Ross Stores on Monday announced that, with the opening of 30 Ross Dress for Less and 10 dd's Discounts stores in 19 states in September and October, the company has completed its store expansion plans for fiscal 2018.
In all, the retailer has added 99 new locations this fiscal year, according to a company press release. Ross now operates almost 1,500 Ross and over 230 dd's Discounts stores, Jim Fassio, Ross president and chief development officer said in a statement.
In August, Ross raised its long-term store potential to 3,000 locations, up from its previous 2,500 target, with plans for new stores in both existing and new markets. Fassio on Monday reiterated that its flagship Ross Dress for Less could eventually have some 2,400 locations nationwide, (up from previous plans for 2,000), and dd's Discounts could reach some 600 stores, (up from previous plans for 500).
Ross is operating in one of the most protected segments of retail. Off-price businesses like Ross and rivals from TJX companies have consistently attracted shoppers whether the economy is weak or strong.
Those retailers may also be shielded from the worst effects of one of retail’s current worries — tariffs — because their vendor base is more diverse and includes many suppliers from countries outside of China, according to Brett Rose, founder and CEO of United National Consumer Suppliers.
As a result, off-price retailers continue to post strong growth, and are among those opening rather than shuttering stores. In the process, they have challenged department stores, and that includes those retailers' own banners in the space. Growth at Nordstrom Rack, for example, has outpaced flagship sales increases. And some observers worry that Macy's new Backstage effort will grab sales away from mainline stores.
But off-price retailers do face some challenges, including how to replicate their treasure hunt atmosphere online, where a lot of apparel sales are increasingly rung up. Furthermore, they're depending more on private label merchandise as they face a dearth of first-run items of in-demand items.
Department stores have faltered not just because shoppers are going elsewhere but because more upscale brands are too. Coach, Michael Kors and Ralph Lauren have all scaled back wholesale through the segment, and that means fewer name brand items are filtering to the off-price buyers that have traditionally eagerly taken them up for their bargain-hunting customers.
That's leaving the off-pricers less of an ability to post "compare to" prices on tags because much of the goods they sell were never on offer anywhere else. In fact, Ross has reportedly agreed to a $4.9 million settlement over class action claims by customers who sued the company for what they said were "deceptive" and "misleading" pricing practices.