Wal-Mart
Not only is Wal-Mart paring back its Metro 7 line, it's also rethinking how it's distributing its line called George -- designed by Mark Eisen (formerly of AnnTaylor
That said, the change in strategy for Metro 7 has been pretty serious, with Wal-Mart admitting it had tried to launch fashionable apparel too quickly, in too many stores. Metro 7 is now in fewer than 1,000 stores, as compared with 1,500 stores previously. And a lot of the buzz surrounding Wal-Mart's most recent quarter has had to do with sluggish customer response to the apparel offered, resulting in a buildup in inventory.
These events have ramifications that should have been clear from the get-go. Everybody who gets panic-stricken over their stocks when Wal-Mart pushes into some new product line is forgetting that just because Wal-Mart is a large and historically successful company doesn't mean it can do anything and everything.
Wal-Mart's decision to try to sell more fashionable clothing to its customers was obviously a reaction, at least in part, to Target's
This also makes me think of another development that caused panic -- when Wal-Mart started pushing into organic merchandise, freaking out investors who held shares in companies like Whole Foods Market
Wal-Mart's dying to drum up more growth and lure more customers from all walks of life, but when it comes to appealing beyond its core, it's got some real challenges. (Another thing -- for at least some of the types of customers who gravitate toward cheap chic or organic goods, the Wal-Mart way of doing business hasn't been held in high esteem.) Taking focus away from what Wal-Mart does best -- and who its best customers are -- may turn out to be a risky strategy for it. But what choice does it have?
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Alyce Lomax owns shares of Whole Foods Market. The Fool has a disclosure policy, and it's very fashionable.