As Doug McIntyre reported earlier today on BloggingStocks, Wal-Mart (NYSE: WMT) is taking another shot at the fashion industry that dealt it a crushing blow a few years back.
Norma Kamali will be creating a line of Wal-Mart exclusive, and Op and l.e.i. lines will also be found in the stores. Perhaps most interestingly, Wal-Mart has shifted a large part of its fashion operation away from Bentonville -- and into New York City.
Let's face it: the notion of Wal-Mart entering the fashion business is about as awkward as Karl Rove rapping. Doug doesn't think the fashion foray will work, but I think it might for the same reason that Wal-Mart has succeeded: it can offer a compelling value proposition.
If it wants to find success, Wal-Mart should look at Steve and Barry's -- a college-town discount clothing retailer that has found tremendous success selling clothing at incredibly cheap prices like basketball shoes worn by an NBA star for $8.88. Everything in the entire store is $8.88 or less --- sweatshirts, winter jackets, etc.
And Steve & Barry's is a relatively small company -- Wal-Mart's scale and legendary efficiency should enable it to offer products of similar quality for even less. Another key to Steve & Barry's success has been the buzz its generated with athlete and b-list celebrity endorsement deals: Amanda Bynes, Venus Williams, Bubba Watson, Stephon Marbury, and a Sex and the City line coming soon.
Wal-Mart should look hard at the formula that has made Steve & Barry's successful. Maybe they should even buy the company.
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