The TJX Companies Inc. (TJX.US), the leading U.S. discount retailer, recently released a remarkable financial report. According to its latest earnings, full-year net sales for fiscal 2026 reached $60.4 billion, marking the first time the company has exceeded the $60 billion threshold. Net profit was $5.49 billion, representing an increase of nearly 13% year-over-year. In February of this year, the company also announced a 13% increase in its quarterly dividend and authorized a multi-billion dollar share repurchase program. The giant, which owns discount chains such as T.J. Maxx and Marshalls, is thriving despite overall volatility in the consumer market. Its CEO stated that the flexibility and strong risk resilience of the discount retail model are its core advantages for navigating economic cycles.
TJX's strong performance overseas is just one facet of the global discount wave. This trend, which appears to be about "finding bargains," has been sweeping across China at an astonishing pace in recent years. Data shows that China's hard discount retail market size reached 2.28 trillion yuan in 2025, with a compound annual growth rate of 11%. However, even with this rapid growth, the penetration rate of China's hard discount market is currently only 8%, significantly lower than Germany's 42% and Japan's 31%. This indicates that for a considerable period, this sufficiently wide and high-potential sector will remain a highly competitive arena for major players.
The most visible reflection of this trend offline is the increasing "crowdedness" at outlet malls. In 2025, nationwide outlet sales exceeded 260 billion yuan, and in the first quarter of 2026, sales and foot traffic at key outlets surged by 19% and 22.4%, respectively. From the Bailian project in Shanghai's Qingpu to the Shanshan Outlets in Zhengzhou, once "quiet" luxury discount centers are now bustling with crowds on weekends. Consumers, pulling suitcases, leisurely shop for discounted outdoor gear and classic trench coats. This has replaced the simple act of sharing shopping experiences on social media from a few years ago, becoming a new benchmark for savvy consumption today.
Simultaneously, Vipshop (VIPS.US), often referred to as the "online outlet," is also showing signs of gaining popularity amid this discount wave. The latest quarterly data shows a GMV of 56.9 billion yuan, an 8.6% year-over-year increase, with active SVIP members contributing over 50% of online consumption. In a market caught in a price war, stable brand supply and guaranteed discounts—providing a hassle-free shopping experience—have become Vipshop's strongest moat for retaining loyal customers.
Ultimately, whether it's TJX overseas or the sustained popularity of domestic discount formats, they all point to the same truth: consumption has never downgraded. Instead, it has completed a fundamental shift from "paying for the brand" to "voting for quality and value," driven by a consumer-led trend.
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