IBD on Ross Stores

Investor’s Business Daily has a nice feature on Ross Stores (ROST). Here’s a sample:

Ross’ appeal is based on its motto, “Dress for Less.” Ross stores offer what the company calls “first-quality, in-season, name-brand and designer” apparel, accessories, footwear and home fashions at prices 20% to 60% below regular prices at department and specialty stores.

With an average price of $10 on clothing purchases, “Ross ends up as the low-price leader in apparel,” said Greenberger. “There are few retailers out there that consistently price below Ross in apparel.”

The average apparel price at TJX’s (NYSE:TJX) T.J. Maxx is $15, and for affiliated chain Marshalls it’s $14, she says, adding: “We love T.J. Maxx, but not everybody can afford to shop there.”

Ross’ low price point is one of the main ingredients of its “secret sauce,” Greenberger says. “Almost anyone” can afford to shop there.

But shoppers who can afford more like to go there, too. Take the tourist in Florida from Manhattan’s Upper West Side, who recently bragged to friends that she bought three designer dresses at a Ross store near West Palm Beach for $36 each.

That kind of “thrill” of finding a bargain on a “fabulous brand” keeps shoppers coming back, Greenberger says.

Posted by on April 16th, 2015 at 3:17 pm


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