Do Outlets Really Save Money?

Reported by: John Matarese

You'd never know we were in a recession... if you check out the weekend crowds at the outlet malls. Shoppers have been packing their lots, despite the poor economy.

But do outlets really save you money...Or is it just an illusion?

Shoppers Love Outlets

Despite the recession .... new outlet stores continue to stage ribbon cuttings and grand openings.  And today's budget strapped shoppers are flocking to them.

Sally Williams told us "we just saved $80 on our purchases!"

Outlet malls claim huge savings compared with retail stores. Michele Rothstein of Premium Outlets says "on average, our shoppers can expect savings of 25 to 60%"

But are the Deals Real?

But are the deals really that great? Bargain shopper Stephanie Dolch isn't so sure....she says she finds much better deals at discounters like TJ Maxx, consignment shops, and thrift stores like Goodwill.

Stephanie told me "Everywhere I go to shop, I pay 75 to 85 percent off. I won't shop full price."

Stephanie says if you take the time to hunt, you can find almost-new brand names like Ralph Lauren, Ann Taylor, and Talbots at secondhand stores for 10 bucks or less.  And she's not joking. She showed me a brand new $29 Gap sweater, with tags still attached, for $3.50 that she bought at Goodwill."

Of course many of us dont have time to sort though the Goodwill racks.

Hidden Camera Comparison

So we took a hidden camera to some popular outlet stores -- including Ralph Lauren, Levis, and Columbia.
 
We then compared prices with discount retailer TJ Maxx.... and some department stores.

• The Ralph Lauren outlet featured button down polo shirts for $39 dollars....about $20 less than retail. But at TJ Maxx, we found racks of what appeared to be the identical Ralph Lauren dress shirt for just $29...10 bucks less!
• The Levis outlet featured Levis 505 jeans marked down on the tag from $44 to $34. But we found Levis 505 on sale at Macy's Veteran's day Sale for just $29.
• The Columbia outlet had adult parkas with zip out linings for 99 dollars.. TJ Maxx had similar Columbias for $79.  However, TJ Maxx's selection was hit or miss:  the outlet store had hundreds of jackets for sale.

Department Stores Fight Back

Meantime, department stores like Macy's and Nordstrom are fighting back with their own store brands....that look just like the big names for less than half.

John Bailey of Nordstrom showed me two almost identical leopard print ballet flats. He said "this flat retails for $395 for a Jimmy Choo...but we also have a BP (Nordstrom House Brand) flat also in the same print, that retails for $59.95." Yes, outlet prices...at Nordstrom.

Next: The Bottom Line...Plus How to Save More at Outlets