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Survival of the Fittest: Poor Economy Has Wounded Some Weak Outlet Malls but Strengthened Others
Sunday, September 07, 2008 10:55 AM

"The strong centers now tend to be closer in to population centers -- and larger."

James Rudnick, whose Rudnick Development based in Tallahassee, Fla., controls the second Jeffersonville development, re-branded as HomeWorks to focus on home goods, did not return calls.

A representative of the Boyle Group of Reading, Pa., said it sold its interest in the mall to Rudnick about two years ago. Rudnick Development's Web site says the 300,000-square-foot center is 45 percent occupied and touts space for lease with "ample parking available for customers."

The economy has left value-oriented retailers such as warehouse stores, Wal-Mart and Big Lots among the few chains that are thriving. A common criticism of outlet malls is that their prices often aren't lower than sale prices at regular retail stores, and that many stores feature "made for outlet" merchandise that's not as high-quality as the mall-store goods at merchants such as the Gap.

Outlet strategies vary widely among retailers, with the majority of stores having moved away from the original concept of factory-direct seconds or overruns. Limited Brands' Victoria's Secret and Bath & Body Works primarily use their outlet stores as clearance centers for discontinued or past-season merchandise, said company spokeswoman Tammy Roberts Myers.

Fluharty said stores in Prime Retail centers commit to everyday discounts of at least 25 percent off regular retail prices; however, many retail stores such as Gymboree and Limited Too frequently offer discounts of 25 percent or more at their regular retail stores, making their outlet-mall discounts look less impressive.

"The outlet industry got away from its roots when retailers started producing merchandise specifically for outlet stores," said Chris Boring, a retail consultant in Columbus who leads Boulevard Strategies. "Meanwhile, Target, Kohl's and other discounters have increased their fashion offerings, and department stores have become more promotional. So it's much more competitive now."

Despite these complaints, Humphers said, outlets are holding their own. Overall, they're attracting slightly fewer shoppers but a steady amount of sales as gas prices have soared and consumers have come to recognize that "outlet" doesn't necessarily mean rock-bottom prices.

"The shopper that's looking for bargain-basement prices and isn't that brand-conscious will shop at Wal-Mart," Humphers said. "There's been somewhat of a fall-off in traffic, but not in sales," indicating that there are fewer looky-loos and just as many serious buyers, Humphers said.

A number of the shoppers in Jeffersonville on a recent afternoon were from the Columbus area.

"I always leave with something," said Dania Daniel, 26, a resident of the Northwest Side who was shopping at the Puma outlet. "To me, it's worth it to drive down here four or five times a year, even with the gas prices.



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