Off-price beauty is set to thrive amid tariffs and economic chaos

TJX, parent company to off-price leaders like TJ Maxx and Marshalls, reported 3% sales growth during its third-quarter 2025 earnings call on Wednesday. It saw $14.1 billion in net sales for the quarter, which ended on November 2, reaching $56.42 billion in revenue over the past 12 months, up 7.83% year-over-year. 

As previously reported by Glossy, the off-price beauty and wellness categories continue to be a successful part of TJX’s merchandising strategy, with mass, prestige and luxury brands quietly selling into the channel at 30-70% off MSRP. 

“We’re doing a great job in beauty [because it’s a] consistent flow of freshness,” said TJX CEO and president Ernie Herrman. “We believe [it is a] traffic builder and frequency-of-visit builder, as well as a form of extreme value. … We kind of crush competition on [beauty] value.” 

According to Placer.ai, a location analytics firm, around half of all TJ Maxx, Ross, Marshalls and Burlington shoppers visited a store more than once per month from June to October of this year. The firm also reports year-over-year traffic growth for TJ Maxx, Marshalls and Burlington.

TJX has more than 5,000 stores across nine countries, including TJ Maxx, Marshalls, Home Goods, Sierra, Winners, Homesense and TK Maxx in Europe. 

Meanwhile, for its third quarter of 2025, also ending November 2, Ross Stores reported $5.1 billion in sales, marking a 1% year-over-year sales gain. Ross Stores’ revenue was $20.4 billion in fiscal 2023. The company operates 1,836 locations in 43 states, as well as 356 locations of DD’s Discounts, which appeals to lower-income value shoppers across 22 states. 

With consistent year-over-year growth, the off-price category has proven its stability, even amid economic uncertainty like possible tariffs in a second Trump administration. 

“A lot of brands and market leaders I’m speaking to on a daily basis are very worried about tariffs,” said Liza Amlani, founder of consultancy firm Retail Strategy Group and former off-price buyer. “[But] off-price is one of the retailer channels, maybe the only one, that is optimistic when it comes to the conversation around tariffs.” 

On the campaign trail, President-elect Donald Trump promised elevated tariffs on foreign-made components and finished goods in an effort to drive sales on domestically made goods. 

According to market research firm William Blair, President-elect Donald Trump could implement up to a 60% tariff on goods imported from China — up from the current 7.5-25% — and a 10-20% blanket tariff across all other imported goods. The firm was clear in its predictions, however, that this could change based on various conditions. 

Still, the off-price category is set to benefit. TJX’s Herrman said this has already begun thanks to many brands and retailers already over-ordering to avoid 2025 tariffs.

“We’ve dealt with [tariffs] before, a number of years ago, and I would tell you that this is one of the places where our model is such a benefit,” Harrman said. “The bulk of our inventory is bought from brands [where] we don’t even have visibility into where those goods are from, nor do we actually want to get involved in that. … Vendors could bring in manufactured goods early — this is what happened last time — which could actually create additional availability of goods at advantageous prices for us. … That’s as likely a scenario as anything.”

It’s something that Amlani has also seen. “A lot of brands are buying a lot of components up front right now to avoid some of those tariffs that could come in,” she said. “So we’re seeing a lot of activity which will drive excess inventory.” 

TJX works directly with brands with excess goods and imports only a small percentage of its goods, Herrman said. And, for the brands that are hit with tariffs and hope to pass them along to retailers, off-price is unlikely to oblige. 

That will be true for Ross Stores, said Adam Orvos, evp and CFO. “We will not be a leader in raising prices,” he said. “Our focus, in the case of a [possible] tariff increase, would be to maintain a pricing umbrella versus traditional retailers and offer the best values to the customer.” 

Another learning from the earnings calls was off-price’s changing shopper profile. TJX’s Herrman shared that its shopper demographic has recently become younger, including more consumers ages 18-34. 

“Our objective is to continue to get younger customers, [but] unlike other retailers that narrow in on their customer base from a demographics perspective, we are not doing that,” Herrman said. “We want to continue to trade broadly, so as we get younger [shoppers], I don’t want us to give up on the older customers.” 

TJX’s Herrman also shared plans to expand into Spain with 100 TK Maxx doors scheduled to open in 2026. In other expansion news, TJX completed its 35% minority investment in Brands for Less, a Dubai-based off-price retailer with around 100 stores in the UAE and Saudi Arabia. During the call, Herrman shared TJX’s plans for the new brand will include expansion into Mexico.

Executive moves:

• Nicola Kilner, CEO and co-founder of Deciem, is set to step down at the end of the year. Deciem is the parent company of affordable skin-care brand The Ordinary, which sells DTC and through Sephora and was acquired by Estée Lauder Companies in 2021. Her successor has not been named.
  
• Chantal Gaemperle, the longtime HR chief at LVMH, is leaving the company. She joined the group in 2007 and most recently served as evp of human resources. Her successor has not been named.
  
• James Conroy is the new CEO of Ross Stores effective February 2, 2025. He will replace current CEO Barbara Rentler, who is retiring. Conroy was formerly the CEO of Boot Barn, a full-price Western wear retailer with more than 420 stores in 46 states.
  
• Monica Arnaudo, Ulta Beauty’s chief merchandising officer, is set to retire in the spring of 2025. Her successor has not been named. She joined Ulta Beauty in 2017. Arnaudo’s CV includes L’Oréal, Estée Lauder Companies, Chanel, Nordstrom and Sephora.

News to know:

• A flurry of investments was announced last week: Menopause-focused women’s health brand Alloy announced a $16 million series A investment from Emmeline Ventures, Amboy Street Ventures and others. Meanwhile, Clean Skin Club, which sells single-use face towels for acne-prone skin DTC and on Amazon, closed a $32 million investment led by Astō Consumer Partners, making it the new CPG fund’s first investment. Finally, hair-care brand Crown Affair closed a $9 million series B funding round led by True Beauty Ventures, an investor in Caliray, Moon Juice, Dieux, and other beauty and wellness leaders.
  
• Olive & June, the nail salon chain turned nail-care brand, is set to be acquired by Helen of Troy Limited for $225 million in cash and a $15 million earnout. Olive & June launched in 2013 and currently sells polish, press-on nails, accessories and various nail-care items DTC and through Target, Walgreens and Walmart. Helen of Troy owns beauty brands like Dry Bar, Revlon and Hot Tools. 

• Turkish Airlines revealed its new amenities kits last week, made in partnership with French fashion house Lanvin and available to all business class passengers. The bags feature limited-edition Lanvin cosmetic products like lip balm and hand cream, as well as branded cosmetic bags. Other essentials, although not branded Lanvin, are also featured, including socks, an eye mask and a toothbrush kit.
  
• Sephora is set to open 20 new stores in the U.K. by the end of 2027. The LVMH-owned retailer currently has six Sephora locations across the U.K. “I know that sometimes we say that retail, and especially retail in the U.K., has been doom and gloom. … My answer to this is always, ‘Boring retail is dead, but exciting retail is alive and really thriving,’” Sephora global president and CEO Guillaume Motte told British newspaper The Times. 

Stat of the week:

Market research company Circana released a report last week with beauty industry sales from January to September as well as the firm’s Q4 shopping predictions. Circana found that, during the first nine months of the year, the U.S. prestige beauty market grew by 7% to reach $22.8 billion, while mass market sales experienced a 2% sales increase, versus the same period last year. Makeup grew by 5% in both sales and units sold, with the lip category overperforming — it saw a 21% increase in sales and a 23% increase in units sold. However, it was prestige fragrance that ranked as the fastest-growing category thus far in 2024, with year-over-year sales soaring by 14% in dollars and 12% in units through September, according to the firm. 

In the headlines:

Olivia Rodrigo becomes Lancôme global brand ambassador. Men are getting filler more than ever. How to get beauty advent calendars right. Rapper Stormzy named Dyson ambassador. Khloé Kardashian brings first solo fragrance to market with Luxe Brands. David Beckham launches longevity-supporting supplement company IM8. Chinese cosmetics label Mao Geping to IPO in Hong Kong. Nathalie Emmanuel’s new role is Giorgio Armani global makeup ambassador. 

Listen in: 

Flamingo Estate founder Richard Christiansen joins the Glossy Beauty Podcast to discuss his brand’s fundraising journey — which included more than 160 investor meetings over the past two years — and his newest book, “The Guide To Becoming Alive,” available this week from Chronicle Books.  

Need a Glossy recap? 

How ‘Wicked’ took over … everything. How Ulta Beauty is serving its 44 million loyalty members. How Puma turned the Las Vegas Grand Prix into a major brand moment. Target’s quarterly sales fall short, as Walmart and TJX Cos. thrive. A surprise Charli XCX concert in Times Square is part of H&M’s loyalty strategy. Mona Kattan’s Kayali is the latest brand to go big on gourmand fragrances.