DISCOUNTERS AND OFF-PRICERS SEEN FACING A FLOOD OF CLOSEOUT GOODS
Byline: Catherine Salfino
NEW YORK — Discounters and off-pricers hungry for closeout merchandise should have plenty to choose from this year, according to Arnold Halpern, owner and president of U-Got-It, which specializes in buying and selling closeout goods.
“There’s a helluva lot more closeouts out there than there was last year,” Halpern said. “This includes the whole gamut: better labels and the regular discount labels. And now we’re getting labels from mass merchants as well as a lot of department store and major specialty stores that went out of business.”
U-Got-It deals in women’s, men’s and children’s apparel. The company also manufactures apparel, with the wholesaling side of the business accounting for about 50 percent of total sales.
In 1995, such discounters as Ames Department Stores Inc., Conway and MacFrugals Bargains cited special buys on closeout goods as one of the strengths in their apparel assortments. Halpern said he expects the closeout business to prosper this year because the poor sales environment is making stores hesitant to commit to big orders.
“Retailers will hold back a lot of bucks,” he noted. “That’s where closeouts become very tantalizing.”
Despite a falloff in sales over the last six weeks of 1995, Halpern said he’s optimistic about the first quarter, noting that U-Got-It completed five “major shipments” last week.
The closeout pipeline is filled with a wide assortment of merchandise, including brand and private labels, he said. In the case of private labels, vendors or stores typically cut out the label so the item can’t be returned.
Regardless of the quality, quantity and low price points, Halpern said stores still like to haggle over price.
“It’s the nature of the business,” he said. “Some retailers think closeout firms must make 50 to 60 percent markups, but we only work on 15 to 20 percent markup, and we look to give stores about 50 percent off regular wholesale prices.”