The Daily Swarm

Steve and Barry’s, the massive mall retailer that is set to open its nearly 300th store sometime this fall in the former Manhattan Tower Records space on Lower Broadway, is known for its sub-$10 prices for every item of clothing, celebrity designers, and long lines at the checkout counters of its warehouse-sized stores across the country. Steve and Barry, the company’s founders, refer to their business as “the Google of fashion.” And while the New York Times’ Thursday Styles section takes the parallels between the former and future tenants of 692 Broadway to some absurd extremes, one section stand out for the lessons these two Long Island rag merchants could teach the ailing record labels:

Howard Schacter, the company’s chief partnership officer, said Steve & Barry’s monitors its subcontractors carefully and demands ethical business practices. The key to its low prices, he said, is a razor-slim profit margin.

Then, too, Steve & Barry’s doesn’t advertise, but rather relies on word of mouth.

Steve & Barry’s also saves small — for example, by using discount hotels, like Motel 6 and Econo Lodge, for travel, assigning one printer to 50 employees and myriad other ways.

On a tour of their offices, where designers’ cubicles are retrofitted into dreary, sometimes windowless nooks, Mr. Shore and Mr. Prevor pointed out aging furniture that Mr. Prevor found in his parents’ basement and a filing cabinet that bore the logo of a fruit-and-vegetable distributor. (There was a large stack of papers spilling onto the floor next to it.)

It is not a country club, but the offices are lively and full of 20-somethings, many of them recent college graduates — the director of stores was a music major at Harvard — attracted at being able to take on significant responsibilities fairly early in their careers, and also by the likelihood that Steve & Barry’s will eventually go public. TA Associates, a private-equity firm that backs Eastern Mountain Sports and Jenny Craig, bought a minority stake in 2006.

“To be great, you have to have these ridiculous, insane prices, and not sacrifice quality,” Mr. Shore said.