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Old 02-01-2011, 08:38 AM   #1009 (permalink)
Leo
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Kimchi is correct.

The company I work for has a site like this as well called The Daily Steal. This site is loaded up with our close-out items, overstocked items, and sizes that just didn't sell.

Over time, retailers are getting smarter with their ordering. The more we dial in our supply for demand, the less excess we get. Also, the economy affects this as well. As consumers spend less, retailers order less. However, I will say 2010 was a stellar year.

Another reason you see less sales now is because of tighter pricing control by the manufacturers. After what happened with Sierra, the brands finally put the hammer down and tightened up enforcement of these pricing rules.

While these deal sites are awesome for consumers, it's not actually good for retailers in terms of profitability. The discounts are often so deep, that they actually take a loss (big wholesale orders excluded). The reason they keep it running is because it's better to get some of your costs back than none at all with excess inventory. Not even softgoods are profitable on these sites. Hardgoods is by far the worst.
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