An outlet store, factory outlet or factory shop is a

brick and mortar Brick and mortar (also bricks and mortar or B&M) refers to a physical presence of an organization or business in a building or other structure. The term ''brick-and-mortar business'' is often used to refer to a company that possesses or leases ...

online store Online shopping is a form of electronic commerce which allows consumers to directly buy goods or services from a seller over the Internet using a web browser or a mobile app. Consumers find a product of interest by visiting the website of the ...

in which

manufacturer Manufacturing is the creation or production of goods with the help of equipment, labor, machines, tools, and chemical or biological processing or formulation. It is the essence of secondary sector of the economy. The term may refer to a ...

s sell their stock directly to the public. Traditionally, a factory outlet was a store attached to a

factory A factory, manufacturing plant or a production plant is an industrial facility, often a complex consisting of several buildings filled with machinery, where workers manufacture Manufacturing is the creation or production of goods with t ...

warehouse A warehouse is a building for storing goods. Warehouses are used by manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc. They are usually large plain buildings in industrial parks on the outskirts of cities, ...

, sometimes allowing customers to watch the production process, such as in the original L.L. Bean store. In modern usage, outlet stores are typically manufacturer-branded stores such as Gap or Bon Worth grouped together in outlet malls. The invention of the factory outlet store is often credited to

Harold Alfond Harold Alfond (March 6, 1914 – November 16, 2007) was an American businessman who founded the Dexter Shoe Company and established the first factory outlet store. Early life Alfond was born in Swampscott, Massachusetts, on March 6, 1914, ...

, founder of the Dexter Shoe Company.

History

Outlets first appeared in the eastern United States in the 1930s. Factory stores started to offer damaged or excess goods to employees at a low price. After some time, the audience expanded to include non-employees. In 1936, Anderson-Little (a men's clothing brand) opened an outlet store independent of its existing factories. Until the 1970s, the primary purpose of outlet stores was to dispose of excess or damaged goods. In 1974, Vanity Fair opened up the first multi-store outlet center in

Reading, Pennsylvania Reading ( ; Pennsylvania Dutch: ''Reddin'') is a city in and the county seat of Berks County, Pennsylvania, United States. The city had a population of 95,112 as of the 2020 census and is the fourth-largest city in Pennsylvania after Phila ...

. Throughout the 1980s and 1990s, outlet malls grew rapidly in the United States. A typical outlet mall in the U.S. is opened with between 100,000 to 200,000 square feet (about 1 to 2 hectares) of retail space. This can gradually increase to 500,000 to 600,000 feet (around 5 hectares). The average outlet mall has an area of 216,000 square feet. In 2003, outlet malls in the U.S. generated $15 billion in revenue from 260 stores. The number of U.S. malls increased from 113 in 1988 to 276 in 1991 and to 325 in 1997 and 472 in 2013. Outlet malls are not an exclusively American phenomenon. In Canada, the Dixie Outlet Mall dates from the late 1980s, and was followed by

Vaughan Mills Vaughan Mills is a regional outlet mall located at the southeast quadrant of the Highway 400 and Rutherford Road interchange in Vaughan, Ontario, just south of Canada's Wonderland. It is one of the largest enclosed shopping centres in Canad ...

in 1999, and Toronto Premium Outlets in 2013. In Europe, retailer BAA McArthurGlen has opened 13 malls with over 1,200 stores and 3 million square feet (about 30 hectares) of retail space; describing itself as an "outlet village", Bicester Village, on the edge of the town of Bicester in Oxfordshire in England, is a regular stop for bus-tours of foreign tourists, especially from China. Stores have also been emerging in Japan since the mid to late 1990s.

Difference between factory outlet and outlet store

At factory outlets, the products sold are from one brand only. Manufacturers who sell only their own products at a reduced price run factory outlets. On the other hand, retailers run outlet stores, and various brands are sold there. Factory outlets have been around longer than outlet stores and were typically built next to the factories where the products were manufactured.

References

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