Brands have told Drapers their hands are tied when it comes to discounting, as pressure mounted this week from independent retailers worried about the impact on their bottom lines.
Following Drapers’ story last week (December 13 issue) about heavy and earlier discounting on the high street, several more indies confirmed the situation was reaching breaking point, with many considering dropping brands that fail to police discounting.
Martin Schneider, owner of Leeds premium retailer Accent, told Drapers: “The discounting is the worst I’ve ever seen it. One day I had three customers buy a pair of Grenson shoes, which I have stocked each season for 30 years, at full price, and then go down the road only to be told they could get them from somewhere else for 25% off. They came back and I had to refund all three pairs.”
Like many others, he is calling for brands to control discounting of their stock. He highlighted Moncler and Stone Island as brands that are not often discounted.
“Next season I’ll drop brands stocked in stores that have huge discounts, reduce my forward orders and buy more in-season,” he said.
Karen Hume, co-owner of Drapers Award-winning A Hume Country Clothing of Kelso in the Scottish Borders, agreed, pointing to brands like Barbour and Loake, which have been discounted in other places.
“[With] the brands that really care, some of our bestselling brands like RM Williams, Dubarry and Schoffel, there is no discounting at all because they police it. Other brands need to learn from them,” she said.
Jo Davies, owner of contemporary womenswear retailer Black White Denim in Wilmslow, Cheshire, said she could understand the pressure some of the bigger retailers are under to shift stock, but was riled by brands that discount on their own websites.
“When they are discounting, they are not only damaging the businesses but it’s like sticking two fingers up to the retailer that supported them,” she said.
But brands hit back, with many claiming discounting is out of their control. One brand marketing manager said: “It’s difficult as we’re not allowed to dictate what someone sells our product at. It’s illegal for us to say you have to sell at this price.”
Andrew Loake, managing director of men’s footwear brand Loake, said: “We don’t have a strategy around discounting; we don’t think it is our place to have one. Retailers need to be free to set their own discount levels. It would be anti-competitive and illegal to impose one.”
Another brand managing director told Drapers: “You can’t tell them what price they are allowed to sell at and you can’t threaten to pull stock if they don’t. Brands can be fined up to 10% of their global turnover if found guilty of price fixing.
“The only thing you can do is make a decision at the start of the season to change your distribution policy. If you know a stockist will only sell 20 pairs of shoes at full price for example, you shouldn’t sell them 40, it’s as simple as that.”