Outlet stores Where to shop & how to save big bucks
	Store photos by Lee Meltzer

If your idea of outlet shopping is scrounging through bins of mediocre merchandise, your perception, and perhaps your wardrobe, could use a makeover. And it starts here.

To tell you which outlet stores deliver the best shopping experience, the Consumer Reports National Research Center surveyed more than 6,000 readers about 11,000 outlet outings, rating the value, quality, selection, and service at 33 top stores. We also sent our reporter to hundreds of stores, talked to industry insiders and salespeople, compared outlet- and regular-store prices, and examined $1,500 worth of merchandise to assess its quality. Our major findings:

• The goods are good. Seventy-seven percent of outlet shoppers said the merchandise was of the quality of what they bought at full-price stores. Only 5 percent were disappointed with the quality. And 57 percent said the selection was as good or better than at regular stores.
  
  
• Prices are low, but not always rock-bottom. Only one-third of survey respondents said outlet prices were substantially below sale prices at regular stores. That said, you can still find some real bargains. At an L.L. Bean outlet in Flemington, N.J., our reporter saw a pair of women's $30 stretch slacks for $6 and a coat for $50 less than the catalog price.
  
  
• Chains that sell kitchen goods were among the top-rated overall.
  
  
• VF Outlets (apparel), Coach (handbags and accessories), Lenox and Pfaltzgraff (dinnerware), and Saks Off 5th (clothing) offered exceptional discounts over the prices charged at regular stores for those brands, survey respondents said.
  
  
• Outlets seldom carry the same merchandise as full-price stores, catalogs, and Web sites. Everything at The Gap Outlet, Banana Republic Factory Store, and Old Navy Outlet, which share ownership, is made solely for those stores, a spokeswoman told us. Eddie Bauer, Brooks Brothers, Polo, Tommy Hilfiger, and many others sometimes tweak their regular-store apparel for outlet stores. But outlet-only goods aren't necessarily worse.
  
  
• In general, outlets carry goods appropriate for the season, but they may be a year behind current styles and colors. And they do sell some blemished products, though to a much lesser extent than in the past.
  
  
• Expect salespeople to help. Only about 3 percent of readers said they couldn't find anyone to answer questions. We found salespeople quite forthcoming.
  
  
• Don't expect a perfect shopping experience. Thirty-five percent of respondents encountered at least one problem, such as crowds, long lines, unattractive stores, or a shortage of fitting rooms.

The outlet concept

The first manufacturers' outlets, in the 19th century, were often no-frills shops near the factories where the goods were made. Because there was no middleman, savings were substantial.

Today, manufacturers have various motives for opening outlets. Outlets expose the brand to new customers and make luxury goods more affordable. They also provide a way to dispose of excess inventory. The alternative is to sell leftovers to liquidators such as T.J. Maxx or Marshall's, which could devalue the brand's image.

The malls themselves are put together by real-estate developers who select the site, decide on the mix of stores, and rent the space. They're often conveniently located near interstate highways.

Three developers account for about 40 percent of all malls: Chelsea, which attaches “Premium Outlets” to its 44 U.S. shopping centers; Tanger, with 31 centers; and Prime, with 27. Whatever the mall, you'll find many of the same names.


What you pay

Outlets' main draw is that everything is on sale every day, even brands such as Coach, which never go on sale in regular full-price retail stores. Often, there are sales on top of sales. At Woodbury Common in upstate New York, the world's largest outlet mall with 220 stores, our reporter scored a $675 Gucci handbag, from a previous season, for $470, and winter gloves from Polo for $10--the same pair he had seen at Lord & Taylor a month earlier for $60.

Outlets are able to charge less for any of several reasons: Besides eliminating the middleman, they're selling an outlet-only line that uses excess materials or a manufacturing process that cuts corners slightly; they're selling last season's merchandise; or they're selling products that are slightly flawed. In addition, because of their out-of-the-way location, real estate tends to be less costly.

Survey respondents said a big reason they shopped at the outlets they chose was that they expected to find low prices for good merchandise. Most were indeed satisfied with value--the quality they got for their money. But there was some grumbling over prices. About 16 percent said prices were higher than expected.

Indeed, in our reporter's experience, claimed discounts of as much as 65 or 70 percent can be a stretch. Such sales are usually reserved for older goods that merchants want to clear off shelves, not necessarily what consumers want to buy. They're also based on discounts from the full retail price, not the price many people pay. Jack Abelson, a retailing consultant, says sales at all types of stores have become so common that outlets don't always offer the lowest prices. And many full-priced retailers and online retailers, including Lands' End, L.L. Bean, and Nike, have added clearance or overstock sections on their Web sites with prices that rival those of the brick-and-mortar outlets.

So what kind of discount can you expect? Linda Humphers, editor in chief of Value Retail News, the leading outlet-mall trade publication, says that when you factor in sales at regular stores, the typical saving at outlets is about 30 to 50 percent.

Our own small price study showed average savings of 26 percent on an assortment of like items from retail outlet shops. For example, we paid $12 for a three-pack of Jockey Classic T-shirts at the outlets vs. $20 at other stores, and the outlet average for Nike Shox Respond sneakers was $99 vs. $150 elsewhere. (See Outlet prices vs. retail for details of the study, available to .)

For many outlet shoppers, eking out an extra 10 percent might not be the point. “Shopping is entertainment, tactile, and social,” Humphers says. “It's the thrill of the hunt versus staring at a computer.”

Readers' picks for best value: Carter's, L.L. Bean, Lenox, Mikasa, OshKosh B'gosh, and VF Outlet.


What you get

Eighty-one percent of respondents were completely or very satisfied with the quality of the merchandise at the outlet stores they visited. When we asked companies about the quality of their outlet-only merchandise, representatives said they couldn't afford to have the company name associated with shoddy quality. “If you see our label, where you bought it is unimportant,” said Jane Randel, vice president of communications at Liz Claiborne.

We found that differences between outlet-only and regular merchandise were usually barely perceptible. An elastic waistband and an extra button and loop were all that distinguished a $36 pair of Brooks Brothers cotton pajamas purchased at an outlet from a $70 full-price pair. In a head-to-head comparison of similar goods, our experts concluded that outlet versions were sometimes a tad lower in quality than regular retail. The manufacturer might substitute cotton for cashmere and wool, use a lower thread count, or omit an extra row of stitching.

What you won't always find at an outlet is a chain's hottest new designs, such as The Gap's “curvy” jeans, or signature products--Polo Ralph Lauren's Chandler towels, for example.

That said, every outlet-store chain has its own marketing strategy and product mix. Cookware companies such as Le Creuset offer a slew of perfect and imperfect pots and casserole dishes, and sell off cookware in colors that bombed with customers (we saw pistachio and chocolate). Black & Decker stocks new and refurbished goods--floor models, demos, open-box customer returns. They're labeled as such and come with a full factory warranty, so they're a no-risk buy. Lenox sells both first-quality dinnerware and seconds with minor flaws. Coach sells a mix of leather goods, handbags, and accessories made for the outlet; merchandise sold at retail stores in previous seasons; and classics no longer available at retail stores.

The bottom line is that you can feel reasonably confident of getting very good merchandise at a very good price.

Readers picks for best quality: Coach, Harry & David, L.L. Bean, Lenox, Mikasa, and OshKosh B'gosh.


The scoop on selection

Outlets are larger than in the past and sell a wider range of merchandise. Today's 225 malls have 81 stores on average and occupy 250,000 square feet. They've branched out beyond clothing and footwear to include food, tools, and small appliances. In addition, mainstream brands (Wrangler, Bass, The Gap) have been joined by luxury labels (Dolce & Gabbana, Fendi, Versace) and more trendy, youth-oriented nameplates (Quiksilver, Diesel, Ecko).

You're also likely to find much greater variety within a brand than at a department store. At a Harry & David outlet, we found dips, jellies, coffees, and snacks either not available in the catalog or sold only as part of the company's gift baskets.

Readers' picks for best selection: Carter's, Corning, Harry & David, Kitchen Collection, Lenox, Mikasa, and OshKosh B'gosh.


The shopping experience

Outlet malls are edging closer to more shoppers. Although the malls used to stay about 60 miles from cities, to avoid competition with full-price retailers, some have crept to within 30 miles of cities. Las Vegas and Orlando have major malls within their limits.

Still, for most people, a trip to the outlets involve a long drive and surrendering a good chunk of a day. Most CR survey respondents shopped at stores at least 30 miles from home (one-third traveled more than 50 miles each way). Many went to six or more stores and spent at least three hours shopping. Crowds were sometimes a problem, particularly at The Gap and Toy Liquidators.

Many outlet centers are designed to resemble a village, with a layout that has no clear beginning or end. That arrangement lengthens shoppers' trips and increases impulse buying. Seating, even in restaurants, tends to be functional rather than comfortable. The point, experts say, is to provide an adequate level of amenities without allowing customers to relax and stop shopping for too long.

When shopping, respondents found the sales help at Harry & David to be exceptional. Our nosy reporter agreed. When he questioned a sales clerk about the differences between goods sold via the company's catalog and those sold in the outlets, she gave him an explanation in the form of a 20-minute store tour.

Readers' picks for best service: Coach, Harry & David, Jockey, L.L. Bean, Lands' End, Lenox, Mikasa, and Pfaltzgraff.


how to shop

Our survey, hours of shopping, and examination of dozens of labels and garments reveal that great bargains, high-quality merchandise, a wide selection, and a pleasant experience are yours if you shop right. Here's how:

Time your visit. Crowds can be brutal on weekends. Midweek (Tuesday through Thursday) is usually quietest. Arrive as soon as the mall opens, when the merchandise is neatly arranged and sales clerks are perky, said one outlet center company executive. Dinnertime is another good time to beat the mobs. Avoid shopping between noon and 3 p.m. Save time by consulting a mall map first.

Catch the biggest sales. Outlets follow the same calendar as regular stores, offering especially sweet deals around Presidents' Day, Memorial Day, Labor Day, Thanksgiving (and the Friday after), and Christmas. Great deals can also be seasonal. In January, for instance, merchants need to clear out their inventories to make room for spring arrivals.

Use coupons. The major outlet developers have Web sites full of downloadable coupons for bonus discounts from selected stores for a limited time. You might also be able to sign up for e-mail alerts about sales at your favorite center. The sites for the three biggest developers are Premiumoutlets.com, Primeretail.com, and Tangeroutlet.com. For other outlet centers, try doing a Web search using the location--Reading, Pa., for example--and the word “outlets.” At many stores, you can sign up for discounts on your favorite brands.

Join a frequent-shopper program. By joining Prime's 1Club or Chelsea Premium Outlet's VIP Shopper Club, at their Web sites, you'll have access to exclusive sales, promotions, and special events. Members also can pick up coupon books at the mall's customer-service office. Clubs and coupons are usually free. Tanger imposes a one-time $10 membership fee and charges about $3 to $5 for a coupon book for nonmembers. Others might charge for a booklet if you show up at the office without a voucher. Be sure to make a printout from the Web site before you go.

Seek other discounts. AAA members, for instance, might qualify for another discount at participating stores. (They'll need to present their card to get the bonus.) Some centers also extend a 10 percent discount to shoppers older than 50 on a weekday, when crowds are smaller. At Chelsea Premium Outlets, Tuesday is “senior” discount day.

Look first at merchandise that came from regular stores, if possible. As we found, some goods made specifically for the outlets might be a notch inferior to regular-store products. Unfortunately, it's usually impossible to identify outlet-only merchandise by the label. The Gap, for instance, used to label its outlet line “Gap Factory Store”; now the labels say simply “Gap” (but you'll find three small squares under the logo on the sewn-in label on outlet exclusives).

The only easily identified for-outlet merchandise we saw came from L.L. Bean, marked “Factory Store,” and from Brooks Brothers, where such products carry the company's “346” label. Merchandise that migrated from the Brooks Brothers retailers bear a label with “Brooks Brothers” in script. Fortunately, sales clerks we queried were quite knowledgeable and open about their products' lineage. If you're unsure of the origin of the item you want, ask.

Consider irregulars. They are among the most deeply discounted goods. Many flaws are practically unnoticeable and have little bearing on longevity. Bring a magnifying glass to help you identify flaws. If you're not sure about a defect, ask a sales clerk to point it out.

Shop for out-of-season items. The back of the store is where merchants exile rock-bottom-priced items such as summer goods in the fall.

Understand return policies. Some outlets accept returns with no questions asked, with or without a receipt, regardless of when you bought the item. Others give store credit and adhere to a strict time limit. Without a receipt, you'll typically get a refund or credit for the lowest price the item sold for, not necessarily the amount you paid. Generally, you cannot return outlet merchandise to a full-priced store, and vice versa.