Purchase intention of deconstructed end of lifecycle fashion products in an online and offline retail environment

Abstract

Obsolete or slow-moving inventory is one of the major influencers for the bottom line of any business today. Surplus stock- be it from overbuys, returns, defects or simply merchandise hitting the end of their lifecycle- need to be accounted, accommodated and dealt with in a manner that can least affect the planned margins. For the fashion newlinebusiness, such merchandise poses greater challenges. The business is ground by seasonal preferences, fast-changing trends, short lead-times and shorter shelf-lives. With rising costs of traditional retail businesses, the associated costs of carrying such inventory are something that the newlineretailer can easily do without. At the retailers end, such merchandise is newlineoften subjected to traditional liquidation methods such as Markdowns, carry forwards, or selling at lowered prices to discount stores or factory outlets. From a manufacturer s perspective, overruns from production newlineare either sold at discounted costs to the retailer or are diverted to other sources of sales. In either case, such decisions do affect the margins of the business, and retailers often account for these necessary evils while planning their pricing strategy. Liquidation methods for such obsolete merchandise also need to meet the additional challenge of maintaining the perceived value of the products, and to not adversely newlineaffect planned margins due to lowered price points. This study seeks to explore fashion consumers acceptance of Deconstructed or up-cycled fashion for such obsolete or EOLC (End-of-lifecycle) merchandise that newlineremain unsold. It also maps the Perceived value of such merchandise and explores the other factors that may affect the Purchase Intention of the merchandise, like the Internal reference price, Perceived monetary newlinesacrifice and Perceived quality. Through an experimental study, a comparative analysis is built across consumers in an E-commerce vs newlineOffline store purchase scenario, to derive if the method of presentation of such products affects the Purchase intention.