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Stewards of the Earth
Carl-E:
So, this fall I started working a seasonal position at Macy's, and continued on after the "season" was over.
I started on the loading dock, unloading trucks. We open the boxes which get compacted and recycled (good). Every article of clothing or handbag or whatever is individually wrapped in plastic inside the boxes (not great). We strip off the plastic before sending the stuff out to the stockrooms and sales floor, and all the plastic goes into a huge (like, 4x4x7 foot) poly bag which is theoretically recycled also. Good? I dunno, most plastic gets recycled as those annoying shopping bags that blow around town whenever the wind picks up...
Everything clothing item comes on or with plastic hangers, unless it's meant to be put out on a table. When sold, the hangers are taken off and reused. Not bad.
However, we sometimes get sent shit where there's one or two tiny things in a big box on the truck. Wasteful, at best.
I also learned how to do what's called fulfillment. Online orders or things people want sent as a gift or something go into a computer system, and get sent from the store. We go out, pick the items from the stockrooms or the floor, pack them up and ship them out. We ship all over the country - the system figures out the closest store that has the stuff ordered. For instance, yesterday I sent a set of three down coats to Sarasota FL thanks to the recent freeze, I guess. We were the closest Macy's with enough down coats leftover...
When we ship something, we wrap it up in plastic again (why did we unwrap it in the first place?), and ship it out in UPS shipping envelopes of various sizes or cardboard boxes, all with the Macy's logo, of course. But we only have so many sizes of boxes, and we pack the excess space with newsprint - rolls and rolls of newsprint. Very wasteful. And when we pull something off a hangar, we trash the hangar, unless it's a wooden suit hangar. No one can explain that one to me. They reuse the ones from the floor, why are we throwing them out in shipping?
Retail is a wasteful business. We have trucks coming and going every day, it's ridiculous.
And don't even get me started on the pricing... there's absolutely no rhyme or reason to it. If you can discount something 80 - 90% and still make a profit, what the hell was your initial markup?
Oh, and if you ever order something from Macy's, and it gets sent from the Logan Valley Macy's in PA, and the shipping card is signed "Carl", that was me. :-D
The Seldom Killer:
Just on the pricing, you can't discount 80-90% and make a profit. However, you'll get to the point where is clearly isn't going to sell and is just going to get in the way of new stock and displays. If you make very dramatic reductions like that, someone will come and take it of your hands. This means that and employee isn't spending their paid for time on getting it off the shop floor, documented as a non-sale/wastage and preparing it for shipping. You're then not spending money on haulage to take it away from the store and not paying for landfill costs where it would likely otherwise end up. Economically and environmentally it's generally a win for the company. If you take a look a the net profit for the whole of the stock of one product, it will likely be profitable overall. That's what big companies look for, not single unit profitability.
explicit:
Sometimes there are huge mark-ups ahead of time as well. Depending on the item they put on a huge pricetag on at first knowing that people think a $300 sweater 50% off is somehow better than that same sweater at $150. JC Penny actually lost a lot of money when they said they'd stop doing these practices, people just like to think they saved money I guess. These are usually for clothes, at least more than anything else, for whatever reason.
Carl-E:
Yeah, it's generally clothes, and the biggest discounts are online, so I actually am picking, packing and shipping a $50 cashmere sweater for $6 plus $4 shipping (according to the receipt I packed with it).
I guess they sell enough of them at $50 that they can afford to do that with one or two of them? Still seems nuts.
Papersatan:
Clothing retail traditionally has a very high initial mark up and a planned reduction cycle for a % of the merchandise; e.g. 10% of the merch sold at full price, 30% at 25% of, 50% at 50%, and the last 10% at 70%. They could just offer it for the equivalent of 40% off all the time, but there is more value in doing it like this:
Clothing is a time sensitive product, you want shorts just before it is warm, and sweaters before it is cold. People are willing to pay more for good that are just released. Clothing customers are also segmented into "trend setting, I want it now, my time is valuable" and "bargain clearance shoppers, hunting for a bargain" A cycle that starts with a high mark up and then drops to 70% off gives you a chance to serve both.
Also, we like to buy goods that are on sale. The initial price is usually only offered for a very short time. I also worked at Macys for a while, and Most goods are 25% off within a week of being on the floor. The brands that get higher discounts faster are ones that are targeting bargain shoppers. A whole group of Karen Scott things might be 50% off the day it hits the floor, but that Ralph Lauren shirt is going to go through a longer cycle, og full price, 15% off, 25% off, 50% off, 65% off...
The cost of producing clothing is very low (artificially low one might argue because it is produced, and sold by underpaid employees) When my mother worked at JCPenny in the 70s their employee discount was "you get it at cost" and she told me that this was usually 80% off of retail. (The current employee discount scheme feels more like a scam to steal employees pay back from them: at Macy's they offer you a credit card when you start (or a pre-paid), and you have to use the card to get your 20% employee discount. Many of my coworkers had a rolling balance on a Macy's card at nearly 25% interest.)
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