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Indies fume over etailers' 'reckless' discounting

Independent retailers have slammed etailers for offering “crippling” discounts on new season stock, with Matchesfashion.com and My-Wardrobe.com in particular coming under fire.

Julian Blades, co-owner of Northeast designer retailer Jules B, said a recent flash promotion by My-Wardrobe, offering a 25% discount for users with a code, was “reckless” and “devaluing” the industry.

Julia Aitken, owner of womenswear boutique Stanwells, which has a store in Lymington, Hampshire, and one in Westbourne, Dorset, agreed.

“One coat in particular that we stock retails for £900 in our store but is £100 less on My-Wardrobe. The proper industry standard margin is not being adhered to and it has to stop.”

Giulio Cinque, owner of Cambridge designer retailer Giulio, told Drapers he had recently alerted 10 of his suppliers to the fact that Matchesfashion.com was offering 15% off.

“It’s crippling the bricks-and-mortar business,” he said. “The internet isn’t going away; we need to deal with the problem now.”

Matt Horstead, owner of menswear indie Dartagnan in Chichester, West Sussex, described the discounting of in-season stock by pure-play etailers as “farcical”.

“It pushes genuine businesses to the point of pulling their hair out,” he said. “If you launch a Sale at that stage of the season you are cutting your margin straight away. It’s cutting off your nose to spite your face.”

Barry Rapaport, co-owner of Bernard Boutique in Esher, Surrey, said: “We don’t discount out of season, but it’s becoming more difficult to monitor other sites with the increase of secret Sales.”

Many indies have threatened to drop brands if they find them regularly discounted on websites, singling out Paul Smith, Michael Kors and Vivienne Westwood as regularly being in online Sales.

No one from these brands responded to requests for comment.

But one brand owner contacted by Drapers said she had not been made aware of My-Wardrobe’s most recent flash Sale. “They are normally very respectful and ask our permission first but not in this case.”

She added: “If an online stockist was repeatedly discounting I would drop the account immediately.”

Another brand boss said: “We have closed, and we will continue to close, accounts who continually

offer aggressive discounts.”

My-Wardrobe could not be reached for comment. However, a source close to the company highlighted how competitors ran similar activity at the same time and said the flash discount initiative had only been communicated to “top-tier customers”.

No one from Matchesfashion.com responded to requests for comment.

Readers' comments (7)

  • The problem with these two e-tailers is that they are both backed by VC money, both loosing money, and both are geared for growth far in excess of the market growth capable in this product, writing is on the wall with these two, they will go bust or be re-sold in a prepack like Coggles as the VC's will not hang around if everything is pointing in the wrong direction. let face it we have the same problem with HOF last week (20% of everything in store) and price match by JLP, this caused more damage than these 2 after all they are multibillion pound businesses, its just been online is more visible for every one to see - Julian and Giulio, its not always about what's happening online!

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  • You just have to get on with it and stop moaning, I agree with above there is only one way for these guys and Brands will do what they want in terms of controlling there brand equity - Paul Smith and other don't ask them to discount nor do they want them too but realistically what can they do other than limit there exposure as much as possible with out crossing the line of the law (price fixing) I am pretty sure all the brands would have been on the phone to them but unfortunately they don't control these companies the owners do and they will do what they want just like every one else. if everyone keeps complaining about prices been reduced I am sure at some point the OFT will start sniffing around

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  • I am sure I could find a discount code for Jules B or Giulio if I wanted

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  • Martin Ailion

    This is a problem when stocking high profile "name" labels. There's lots of good product out there and a good retailer will always be able to find and identify a source of good non-big-name product. He/She just has to work a little harder at it but, no doubt, will find the rewards better and get back to being what in independent should be - fashion/product oriented and different.

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  • darren hoggett

    If a brands discounting strategy is affecting your store and makes it no longer viable for you to stock the brand, there is only one answer - drop it!

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  • This has been a problem since the dawn of the internet and is magnified by current trading conditions. The brands have their hands tied in terms of price fixing but I hope that the outcome of this is that the independents will give more opportunities to the many great independent labels out there, who are working hard to grow their businesses within the indies and not working with the large scale etailers who are completely 'brand' and discount driven. It's harder work admittedly but it can be an opportunity to give your customers something unique that they can't find on 10+ store online too.

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  • This has been a problem since the dawn of the internet and is magnified by current trading conditions. The brands have their hands tied in terms of price fixing but I hope that the outcome of this is that the independents will give more opportunities to the many great independent labels out there, who are working hard to grow their businesses within the indies and not working with the large scale etailers who are completely 'brand' and discount driven. It's harder work admittedly but it can be an opportunity to give your customers something unique that they can't find on 10+ store online too.

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