Eli5: what happens to clothing in stores like Macy that goes on huge clearances and never get bought?
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Ever been to Ross?
Just kidding, I have no idea.
There are few ways it proceeds
1. It gets handed off to places like Winners or Tjmaxx to recoup loss by selling it at cheaper price
2. It stays on the shelf until it’s sold
3. It gets boxed into warehouse until next season
4. It gets distributed to online vendors or warehouse where they sell them for cheaper price nationally and internationally
5. As last and final resort they are donated or sent to dumps to be trashed.
If the clothes does not sell even on clearance sales that means the shop is going to take a loss getting it out of the store. There is a market for unwanted clothes in cheaper countries where people prefer low price clothes over prettier clothes. But even repacking the clothes for export is going to cost money. There are some clothes shops that offer to donate the clothes to the thriftstore. This might be the cheapest as they can offer the thriftstore employees to come get the clothes off the racks themselves so there is no work involved. However it is possible that the customer who buy the clothes from the thriftstore might have bought something else from you so there might be a small loss of opportunity.
Most of the clothes is just thrown in a trash dumpster though as this is the easiest. If it is thrown into a textile dumpster then it will be shredded and can be recycled as textile scraps. Some garages and workshops buy this for rags and then burn them afterwards. They can also be used in various materials such as insulation. They might be rewoven into new textiles. It is also possible to use it as a raw material for various cellulose based chemical processes. Or they are bought as fuel for furnaces that can handle it. But a lot of it also end up as landfill or in garbage incinerators. Either because it was missorted or because nobody wanted recycled textures at that time.
Either they’re bought by a secondary outlet in bulk like Ross or Gabe’s, they’re donated to charities for tax write-offs, or they’re shredded/incinerated.
If you wonder how the clothes at Gabe’s or Ross are so cheap, this is why.
Might get further reduced until it sells, perhaps moved to an outlet store or discount version (eg. Nordstrom Rack, Off Fifth). Might get sold off to a chain specializing in designer discount/liquidation like TJ Maxx or Marshall’s. Might get donated and the wholesale cost written off against profits.
One thing to think about is that the company wants to make a profit on the whole batch of how every man thousands of items were produced. They know they won’t make a profit on each individual item. They have to keep product moving to make way for the next thing – season, fashion, whatever. So they need to get the old stuff off the shelves and out of the warehouse. Holding onto stuff costs money.
They are often first sold in bulk to discount stores – Ross, Marshalls, TJ Maxx, Burlington and others. Someone I know at TJ Maxx said anything they can’t sell is the sold to another kind of store, let’s say “lower” on the rungs.
Eventually though, some things will get sent to like Goodwill or simply put in the trash.
Remember, holding onto stuff costs money, and the company just wants to be done with the actual inventory at some point.
They get sold to cheap outlet stores first. Then they often get sold to foreign traders who dump them onto 3rd countries like Ghana -where they stimulate local dollar economies, before the final rejects are discarded in giant trash heaps, burned, or washed into oceans.
Here is a shocking 30 min documentary on it,
These days, items are purchased for TJMaxx, they aren’t just buying lots of old junk anymore. You may think you’re receiving an item that was once in Macy’s or wherever, but a deal was made prior. Check the quality on a lot of items, it may have a brand name but it isn’t the same in many cases.
There is a chain of distributors that clothing “falls” down:
New clothing gets put in high end stores and sold for high prices.
Clothes that don’t sell get put on sale after a while.
Clothes that don’t sell on sale get sent to “budget” stores like TJ Maxx, Marshalls, or others.
Clothes that don’t sell then get donated or sold to charities, who may offer it for sale in stores like Goodwill or Salvation Army.
Clothes that don’t sell there are sold (not donated) to third world countries. This is why you will see little kids in Africa wearing clothing with american designer labels.
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