COVID-19 has revealed a key weakness in discount retailers’ playbook: almost no e-commerce.
(Bloomberg)—For years, discount retailers like T.J. Maxx and Ross have been eating their rivals’ lunch as consumers warmed to the thrill of shopping as a treasure hunt experience.
But Covid-19 has revealed a key weakness in the discount playbook: almost no e-commerce.
Now, these off-price retailers, which were among the few outlets to add locations in recent years, are finding that a pandemic means a full halt to operations. The beleaguered department stores, meanwhile, can still rely on their websites for at least some revenue.
TJX Cos., owner of T.J. Maxx and Marshalls, and Burlington Stores Inc. closed not only stores, but also distribution centers and online operations. Ross Stores Inc. never had an e-commerce option. The thinking is that the web was never that big a factor in their combined $65 billion in annual sales, so by cutting costs to a minimum they’ll have cash to scoop up excess inventory that will turn into tasty bargains once they’re able to reopen their doors.