Off Price Clothing and Apparel Pricing vs Wholesale Pricing
Commonly, when business people want to start a retail operation, they contact several wholesalers to get inventory. By definition, wholesale pricing involves gaining an advantage on pricing due to buying lots of merchandise in bulk. Typically, wholesale pricing is greater than factory pricing, but less than retail.
In contrast, off price merchants gain their merchandise directly from distressed merchandisers, bankrupt businesses, or directly from factory overruns. As a result, pricing from off price merchants is usually lower than wholesale. Also, since the off price merchants acquire their products so inexpensively and at various quantities, the minimum purchase amounts are usually a lot less than what is typically required of buying from wholesalers.
Retailers enjoy shopping at off price merchants because they can mark up their merchandise more and get better sales margins. It's also easier to get started with a new product line or a new business altogether since minimum product purchases are lower. For example, most wholesalers may require a retailer to purchase 100-1000 units at a time, whereas an off price merchant may only require a 20 piece minimum purchase, as DLM Off Price does.