Walmart Inc.WMT unveiled intentions to buy Eloquii Design Inc., a plus-sized fashion retail brand. The buyout is expected to further embellish Walmart's rich online portfolio basket. The deal is expected to close by the end of this quarter.
Venturing Into the Plus-Sized Arena
The plus-sized apparel category is growing at a rapid pace. In fact, a significant portion of women, between ages 18 to 65, wear plus-sized garments. With limited retailer presence, it is usually difficult for shoppers to find plus-sized clothes that ensure fashion and proper fit.
Walmart is renowned for constant endeavors to stay in tune with consumers' preferences and explores ways to attract young shoppers. The latest inclusion of Eloquii will enable Walmart to venture into the fast-expanding category of plus-sized clothing. Eloquii, which predominantly operates as an online retailer, has five retail stores. It manufactures and sells fashion apparel between sizes 14 to 28.
Per sources, the plus-sized apparel category is expected to grow at an average rate of 4% every year through 2020. Well, Walmart is not the only company trying to reap the benefits of this fast-expanding category. In September, Kohl's Corporation KSS revealed intentions to launch the plus-sized brand, EVRI. Stitch Fix SFIX , a popular online retailer, has also been adding more items under the plus-sized line.
Focus on Strengthening Online Offerings
Notably, Walmart focuses on bolstering presence in the ever-evolving online spectrum. Buyouts of ShoeBuy, Bonobos, ModCloth, Jet.com as well as deal with Lord and Taylor underscore the company's aim to build an impressive digital brand portfolio. Moreover, we expect the online portfolio to gain additional competitive advantage through the inclusion of Eloquii.
Apart from augmenting product and brand strength in the e-commerce space, Walmart also strives to improve delivery systems. This big-box retailer recently raised its stake in Dada-JD Daojia to 10% to strengthen last-mile delivery service. Previous instances include the deals with Rakuten, Postmates, DoorDash and Deliv. To make online shopping simpler, the company also focuses on improving payments processes through applications. We believe that such actions aid Walmart to offer multiple choices to online shoppers.
From prudent acquisitions and partnerships to combining shopping with advanced technology, this supermarket giant has been playing several cards to maintain its presence in the online space and stay competitive against Amazon AMZN . Such efforts have aided this Zacks Rank #3 (Hold) company's shares to rise 13.3% in the past three months compared with the industry 's 11.3% increase.
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