Why Is Nordstrom Rack So Cheap? (10 Reasons Why)

Nordstrom Rack is a Nordstrom off-price department that features products, including designers, that are up to 70% cheaper than at Nordstrom stores.

It is the port of call for everyone looking for quality and designer products at a hefty discount. But how is Nordstrom Rack able to sell its products so cheap. Read on to see what we found out!

Why Is Nordstrom Rack So Cheap In 2022?

Nordstrom Rack maintains low prices by stocking Nordstrom’s excess inventory at steep discounts. It also stocks low-cost products made especially for the store. Pared-down store organization and quality of customer service also keep prices cheap. Besides, the low prices lure customers into the store, encouraging them to spend more.

Stay on to learn how Nordstrom Rack succeeds in keeping prices so cheap even though it occasionally stocks designer products!

1. Nordstrom’s Excess Inventory

Nordstrom’s full-price store can be pricey, especially for designer items. Also, most of these items are season tied, and the quantity that remains unsold is significant.

This overstock is shipped to Nordstrom Rack, where it is sold for steep discounts ranging from 30% to 80% or even more.

That said, with some patience and astute shopping, it is possible to find designer items at a throw-away price.

These massive discounts make Nordstrom Rack’s prices very cheap and appealing.

2. Low-Cost Items

Other than excess inventory from full-price Nordstrom stores, low-cost products are made specifically for Nordstrom Rack. In several instances, these items form the bulk of its stock.

Further, the brands made exclusively for Nordstrom Rack are made by reputable companies and are of good quality, though priced cheaper.

3. Discounts And Sales Promotions

Nordstrom Rack offers massive discounts on its items, especially those sourced as overstock from mainline Nordstrom.

These discounts go up as much as 70%  in some instances, which is a steep fall in pricing, and allow you to buy a $200 designer item for only $60.

Undoubtedly, Nordstrom Rack’s items are an absolute steal as long as you shop smart.

But even better, Nordstrom Rack offers frequent sales promotions to make space for incoming inventory from mainline Nordstrom.

At these rack clearance sales, prices go down further with a 25% clearance discount tacked on to the other discounts.

For example, a $200 designer item would fall further from $60 to $45; that is how cheap Nordstrom Rack can be!

4. Nordstrom Rack Has A Leaner Store Organization

Mainline Nordstrom bills itself as a first-tier store, and its design and layout reflect that.

That said, the store is organized with lots of space and light, and each item receives a generous amount of prominence.

Some Nordstrom department stores even have eateries to enhance the customer experience.

Also, Nordstrom Rack has plenty of space and light, but the design intends to facilitate faster movement through the store.

For example, the items are displayed closer to each other so that customers can take in visually as much as possible at a glance.

This leaner display costs less in overhead costs and makes it possible for Nordstrom Rack to maintain low prices.

5. Nordstrom Rack Has A Leaner Customer Experience

5. Nordstrom Rack Has A Leaner Customer Experience

Nordstrom Rack’s customer service is every inch as effective as the mainline Nordstrom’s service but is not nearly so personalized and dedicated.

Instead, its greater focus is to help buyers move through the many offerings as quickly and effectively as possible.

Rather than walk you to an item and offer to check it out, they will point you to the product you want.

Consequently, fewer sales associates are required in Nordstrom Rack stores, reducing overhead costs and making the items cheaper.

6. Nordstrom Rack Features Used Redone Products

Some of Nordstrom’s offerings consist of items returned for one reason or another.

So, if they are not too severely damaged, Nordstrom tries to refurbish them to as near a perfect condition as possible.

Then, these are shipped off to Nordstrom Rack, which attracts much lower prices. Luckily, they are not always in a worn-out condition to start with and come out beautifully once redone.

Nordstrom Rack labels the items as refurbished, but that alone should not keep you off, as there are treasures among them if you look carefully.

7. Nordstrom Uses Cheap Prices As Loss Leaders

Besides using low prices to help clear overstock from mainline Nordstrom stores, Nordstrom Rack uses them to attract people into the stores, where they spend more.

It is a common strategy by most retailers.

For instance, they use a few attractive products offered at low prices to lure buyers into the store, where they are also introduced to other products and encouraged to buy.

Money made on purchasing the other products justifies the low prices charged on the loss leaders.

So, though loss leaders are priced unprofitably, Nordstrom Rack’s off-price items are profitable and only play the loss leader role as a bonus.

8. Nordstrom Rack Only Features Mid- And Low-Price Brands

All the items featured at Nordstrom Rack that are not overstocked from mainline Nordstrom are from mid-price and low-price brands yet to establish.

That said, these brands are willing to charge a lower price for their products to help them get a foothold in the market, which helps keep the prices at Nordstrom Rack low.

9. Nordstrom Rack Does Not Provide Customization Services

Unlike its mainline counterpart, Nordstrom Rack does not offer customization services on its premises.

With that, customers take the items as they are, and they must be careful to choose as accurate a fit as possible in all respects.

However, Nordstrom Rack offers repair services at some stores for items bought damaged. Therefore, leaving out customization services helps keep the prices low.

10. Nordstrom Rack Sells Secondhand Items

In 2020, Nordstrom began selling buying back customers used apparel, including clothes, shoes, and accessories.

So, although the store cleans and repairs the items, they can’t cost the same price as brand new ones.

To learn more, you can also read our posts on why is Nordstrom so expensive, what is Nordstrom Rack, and what is Nordstrom Local.

Conclusion

Nordstrom Rack is a counterpart of mainline Nordstrom intended to help dispose of the total price’s overstock affordably but profitably, which it has done successfully.

Besides overstock, it carries items made exclusively for it and sold at a low price.

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Cara Suppa

Cara Suppa has been freelance writing for over a decade and holds a BA in English and an MS in Integrated Marketing Communications. Outside of work, she is an avid cook, gardener, and discount shopper.

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