Wal-Mart to Launch Simmons Clothing Line…
According to Business Week, Hip-hop entrepreneur Russell Simmons‘ American Classics line of men’s clothing is set to roll out. But with consumers spending less, Wal-Mart keeps mum. As most apparel retailers announce job cuts and store closures because of sluggish sales, it is a precarious time for any of them to launch a new brand. But on Feb. 15 Wal-Mart Stores (WMT) will roll out a new line of men’s clothing designed by hip-hop entrepreneur Russell Simmons in 350 stores, about 10% of its U.S. outlets, and on its Web site. The launch will come less than a week after the world’s largest retailer announced that it will move buyers in the apparel division from its Bentonville (Ark.) headquarters to New York to increase the focus on fashion.
For a company whose financial performance has trounced rivals such as Target (TGT) in recent months by focusing on lower-price essentials rather than more expensive discretionary items, the move seems surprising, especially as Wal-Mart flopped famously in its previous efforts to sell more fashionable, pricier clothing. One such effort was a women’s line designed by Mark Eisen, which alienated the store’s core customers. “Fashion is tricky,” says retail consultant David Lockwood of Mintel Research. “This is not macaroni and cheese or over-the-counter vitamins, which they know really well.” But as Wal-Mart slows its store expansion, it needs to sell higher-profit items to continue generating growth—and apparel is one segment that can still draw new customers.
Priced to Sell…
This time around Wal-Mart is keeping a tighter rein on the price and the trendiness of new clothing items. Simmons’ American Classics line will be priced between $9.99 and $29, with about 80% of the clothes at $15 or less. Simmons, who launched the Phat Farm clothing label in 1992 and another brand in 2008 called Argyle Culture, sold in Macy’s (M), says his new focus is the “urban graduate,” whom he describes as 25-to-50-year-old men such as Will Smith, Adam Sandler, and Barack Obama, who grew up with hip-hop clothes but as professionals can no longer don baggy pants and shirts sporting oversize logos. American Classics’ first season has a heavy focus on purple, navy, and white and includes jeans, sweater vests, casual sports shoes, and woven and knit shirts.
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Source: businessweek.com
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