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Tiffany Montgomery
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Designer labels fight back against department store discounts

By Tiffany Montgomery
April 20, 2009 6:00 AM

I saw in interesting story about designer labels fighting back about deep department store discounts that took place last fall and holiday.

A lot of the same discounting issues bubbled up in the action sports industry as stores looked to move inventory after consumer spending came to a halt.

The Wall Street Journal story said some designers, including Eileen Fisher, are even pushing to rent space in department stores to have better control of pricing. At a minimum, Fisher wants stores to mark down only poor sellers quickly, leaving strong sellers at full price even when new inventory arrives. To lessen her company's dependence on department stores, it is opening more of its own boutiques.

Many brands are also demanding to be left out of department store sales all together. "All of our brands are taking great care to ensure that what happened in November will not happen again," Paola Milani, a spokeswoman for the Gucci Group, told the WSJ.

Some brands have been successful controlling their presentation and prices in department stores. Louis Vuitton goods sold at Saks Fifth Avenue or Neiman Marcus are sold by salesmen employed by Vuitton in space that is leased by the company, the WSJ said.

It will be interesting to see if any similar ideas develop in the action sports industry as the recession changes the playing field.

 


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