Denim maker Blue increases retail holdings.

When a chain of trendy mail stores in its back pocket, Blue Holdings Inc. has plans to pump up its denim brands' retail presence and spread its store base across the country.

The Commerce-based jeans maker announced last Week that it acquired Washington, D.C.-based Long Rap Inc., operator of 24 Up Against the Wail stores. The deal, expected to close in September, is valued at $32 million in cash and stock.

Now, Blue Holdings is working to put its stamp on Up Against the Wall. The stores already carry some of the company's brands, including Antik and Taverniti, but will add more and increase the selection of the existing labels.

Izzy Ezrailson, president of Long Rap, said it is too soon to be certain about the exact in-store changes. However, he envisions that window displays will feature Blue Holdings' brands in prominent positions and there will be space set aside within the stores to highlight them.

"The idea is actually to build recognition of the brands as they develop attributes that differentiate them," said Ezrailson. One possibility: a range of Blue Holdings products--from accessories to sweaters--will be introduced into the stores if Long Rap detects consumer demand for new items.

Despite the attention paid to Blue Holdings clothing, Ezrailson doesn't expect other companies to be concerned their products will get short shrift. He indicated there are so many brands in the store that no one brand is going to outshine another. In addition to the Blue Holdings brands, Up Against the Wall stores sell True Religion, Citizens of Humanity, Ed Hardy, Primp and Paul Frank, among many more.

Until recently, Ezrailson said Long Rap hadn't been particularly interested in selling. But he had a chance encounter with Paul Guez, chief executive of Blue Holdings, earlier this year at an Integrated Corporate Relations conference in Florida and started to be convinced that marrying his retailing operation with manufacturing would be a good move. And he's looking forward to the performance results: Ezrailson estimated margins on Blue Holdings-branded goods will swell 10 basis points.

At Blue Holdings, Guez has considered building retail operations for some time and began doing it himself with an Antik store on Melrose Avenue that opened last year. "This is exactly what I wanted to do, have a chain of stores where you don't suffer to grow to 25 stores because you are already at 25 stores," he said.

Guez believes the Up Against the Wall chain can reach 100 stores in the near future and maybe even push 300 one day. The expansion is likely to come mostly from organic growth, but Guez said he might pick up small regional chains along the way.

Expansion could be easier for Up Against the Wall than other chains because Ezrailson said the merchandise inside the stores can be tweaked to suit the local demographic. "We can exist in Fox Hills mall as easily as Beverly Center. We can exist anywhere," he said.

Including the retail operations, Guez projected that Blue Holdings can rack up $100 million in revenues next year. The company's fiscal year 2005 revenues totaled $36.3 million. Shares of Blue Holdings, traded on the Nasdaq, landed at $5.15 last Thursday, up 3.4 percent from the previous day's close.

Staff reporter Rachel Brown can be reached at [e-mail] or at [phone], ext. 224.