Traditional department stores have wised up to the popularity of off-price, with Macy's, Lord & Taylor and Kohl's all entering the space this year. As a result, some have expressed concern that these concepts could eat away at TJX or Ross' sales.
As it pertains to Macy's, which plans to open 50 "Backstage" stores over the next two years, Lejuez said he does not think the development of these locations will have a material impact on TJX or Ross. Instead, the retailer could ultimately end up giving share to off-price, not taking it.
"While Macy's plans to open 50 Backstage doors over the next two years, they plan to close 40 of its full-price stores at the end of this year alone," he said. "And while we would estimate a Macy's Backstage door may average $5 million to $10 million, we estimate a full-price Macy's store achieves $25 million to $30 million in sales."
Department stores have been losing share for years. According to Customer Growth Partners, they used to account for 10 to 15 percent of the retail market; now, they account for about 2 or 3 percent.
Meanwhile, off-price retailers have been gaining about a half-point share each year just when it comes to apparel, Customer Growth Partners said.