The retail industry has been under siege the last few years, and 2017 is on pace to see the worst losses yet. At the midpoint of the year, brick-and-mortar stores were closing at the fastest pace ever.

A few retail chains are bucking the trend, though, and steadily opening new locations. What has been the key to their success?

Bargain-bin discounting.

The hunt for riches and glory

Off-price retailers like TJX Companies (NYSE:TJX) — parent company of TJ Maxx, Marshall’s, and Home Goods — and Ross Stores (NASDAQ:ROST) have generally thrived in this challenging environment. In an industry that has become consistently plagued by declining foot traffic and store closures as shoppers migrate online, both chains have been reporting progress in the opposite direction:

Metric

TJX Companies

Ross Stores

Net new stores opened in last year

238

88

Year-to-date comparable-sales growth

2%

4%

Year-to-date revenue growth

5%

7%

Year-to-date earnings per share growth

4%

14%

It’s not just about the deals, either. These companies are tapping into the inner Indiana Jones that resides in many shoppers — the adventure and excitement in finding that special deal, tucked away in an aisle or a bin waiting to be found. Both companies source their product from vendors who have too much stock, thus creating the hidden treasure-style experience.

Not all retailers are able to copy that experience in their stores, but discounting is becoming an increasingly large part of the strategy to combat online stores. But a straight price war could also have its limits, too, as the recently reported quarter shows.

What’s with the stock dip?