At one time, Wal-Mart (NYSE: WMT) wanted to be a trendy place to buy clothes. It thought that would fatten margins and bring in higher end customers. It never worked. The middle class did not appear to warm to the idea of buying fashion at a warehouse.
The largest retailer has seen the error of its ways and a number of people in the apparel unit will pay for the company's mistakes. According to The New York Times, "in a major revamping of its sluggish clothing business, Wal-Mart Stores will shut two divisions at its headquarters in Arkansas, eliminate dozens of positions and move dozens more to New York City."
Selling clothes is a $30 billion business for Wal-Mart, so it will not do anything to exit that part of its operation. But, it clearly has no interest in trying to be the "trend setter" by locating the latest fashions and hoping it can present them with appeal down the aisle from the guns and ammo section.
Now, it will just sell clothes, the kinds of shirts, pants, and dresses that most people who don't care about designer labels wear.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
1-30-2008 @ 12:10PM
roudy11z said...
If I remember right WMT was going to try to keep up with Target in the clothing arena. This was also the time that analyst said Target was catering to the $50k customer. WMT is finally seeing that their main business lies with us common middle to low income people. This was the premise "Mr. Sam" started WMT on and it will still work today and tomorrow. I still have WMT as my core holding for this reason regardless of what the "smart" analyst say. RoudMan
1-31-2008 @ 11:57AM
msshiver said...
I will be very happy to the "George line of clothing gone from walmart Faded Glory and I would like to see more of them in plus sizes. Womens Petite
2-07-2008 @ 2:13AM
Fran Pipkin said...
Won't go to the trendier stuff? Then explain to me how Hanna Montana clothing found its way to the front of the womans clothing racks, and a big chunk of it I might add, and it sits there as before just as hideous as the ugly clothing that it replaced.