This is the case of the Best Brands shop, which uses the off-price model, which has reported a growth of 10% in 2014, compared to the previous year.
With respect to the outlet format, Mario Martinez, CEO of Simo, told Elfinancierocr.com that “… The company set up an outlet store to transfer leftover goods which have spent two seasons in stores which offer the latest trends. The prices are dropped only because of the season, but the products are new, of the same quality, original, and have the same guarantees. Discounts go up to 30%. ”
Meanwhile, William Fondevila, manager of Best Brands, added “… The off-price system allows us to set prices which are between 25% and 75% cheaper compared to other stores. The products are totally new, fashionable and trending products which sometimes have not yet reached other countries; of original recognized brands and top quality. The chain has specific purchasing offices to seize opportunities when importing products. ”
Also cashing on the discounted pricing models are big retailers like Walmart with the Maxi Palí, a rebranding of the low-end supermarket Palí, with bigger stores and a greater variety of products. The Maxi Palí combine the Palí and a mini version of a Walmart.
Others include Simo, with its Penny Lane, Nike, PLX, New Balance and DC brand stores; Outlet Open Box started operations several months ago.
Importadora Monge, for example, has rebranded its “Play” stores to “Monge”. Play, focusing more on electronics, and carrying the same products and prices of the well known for low pricing and easy financing of the “Importadora Monge” brand, was seen as a high-end shop by consumers.
Although numbers aren’t available, a visit to Pricesmart on weekends and in particularly around “pay days” (15th and 30th of each month), it is visible the low pricing concept has caught on with Costa Rican consumers.
Although the retail formats are different, their common denominator is low prices on brand names to attract consumers and remain competitive.