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Forget “cheap chic.” Wal-Mart just wants to be cheap.
After years of trying to mimic Target’s trendy fashions and house wares with mixed results, Wal-Mart is shifting its cross-hairs and taking aim at dollar stores’ rock-bottom prices.
According to several sources close to the company, the world’s biggest retailer in recent weeks has begun aggressively hitting up its suppliers for “opening price point” goods — that is, the cheapest items in any given product category.
That means opening its shelves to new manufacturers who can deliver ever-lower prices for cosmetics, party favors, appliances and greeting cards.
Likewise, it means pressing big partners like Procter & Gamble and Kraft Foods to produce smaller, more affordable packages for everything from diapers to laundry soap to instant soup.
“The message is, ‘Anybody who can deliver opening price point [goods] for us will become a vendor — anybody who can’t, can leave,’ ” according to one longtime supplier to the mega-discounter.
“Not since the 1990s have we seen Wal-Mart signal this level of competition on price.”
With gasoline prices soaring and unemployment still hovering near double digits, Wal-Mart executives sniff an opportunity to return decisively to the company’s low-price roots.
Sources close to the company speculate the move will further Wal-Mart’s plan to enter urban areas, including the Big Apple, with smaller stores this year.
This month, Wal-Mart merchants took the unusual step of actively contacting vendors to get out the message on lower prices, according to several sources close to the company.
“It’s pretty unusual to have them calling you instead of the other way around,” one manufacturing executive said. “They told us, ‘The dollar chains are eating our lunch, and we’re not going to let them do that anymore.'”
Wal-Mart is preaching to the choir, according to Cameron Smith of Cameron Smith & Associates, a dominant executive-search firm for Wal-Mart suppliers. Dollar stores led by Dollar General and Family Dollar pose the greatest threat to Wal-Mart over the next five years, according to a survey of Wal-Mart’s vendors released last month.
“To be honest, I didn’t really expect that,” Smith told The Post, noting that most chatter typically surrounds Wal-Mart’s rivalry with Target.
A Wal-Mart spokesman declined to comment.
Wal-Mart began to refocus on low prices last summer as CEO Mike Duke ousted chief merchant John Fleming, an ex-Target exec, and tapped Wal-Mart veteran Bill Simon to head the company’s US division.
Simon, who has since pressed for stricter adherence to the company’s “Everyday Low Price” mantra, said last October, “I don’t really find it acceptable” when asked by an analyst about dollar stores that were stealing Wal-Mart’s lowest-income shoppers.
Dollar stores have siphoned away Wal-Mart’s lower-income shoppers with more convenient locations and smaller package sizes, according to Jefferies analyst Daniel Binder. james.covert@nypost.com