IRONDEQUOIT, N.Y. — In the summer of 1979, 15-year-old buddies Steve Shore and Barry Prevor started out in business with a megaphone and piles of excess-inventory T-shirts they sold for $1 each at flea markets across Long Island.

In college, they opened their first Steve & Barry's University Sportswear store at the University of Pennsylvania, charging fire-sale prices for T-shirts and sweat shirts emblazoned with college names.

Their low cost, casual clothing chain moved off campus for the first time in 1998 to a mall in Auburn Hills, Mich., and underwent a rapid expansion. Their 100th store opened in this Rochester suburb in November, and they expect to swell to 200 stores inside a year — and top 5,000 someday.

"In many ways we're changing the world," Prevor said in the midst of a rapid-fire patter. "McDonald's changed hamburgers, Home Depot changed hardware. Basically we're saying it's the same thing with clothes. There's no reason people have to pay five times the price for the items we're selling."

Almost everything at Steve & Barry's — jeans, jackets, hats, athletic pants, cargo shorts, hooded sweat shirts — costs $10 or less, an obvious delight for shoppers. But retailers across the realm, from mass-merchant discounters to higher-end clothiers, are also starting to take notice, retail experts say.

In the garment industry, Steve & Barry's fits into an emerging category of "extreme-value retailers who go to off-the-beaten-track marketplaces like Madagascar where they can really get tremendous deals," said Lois Huff of Retail Forward, a consulting firm in Columbus, Ohio.

They cater to tightfisted customers "looking for something that's 'good enough' — decent quality at a great price," Huff said. "There's a huge shift in many consumers toward that kind of a mind-set."

"When somebody discovers a Steve & Barry's, they feel like they've found a store that understands and embraces their needs," echoed Marshal Cohen, chief analyst at market research firm NPD Group Inc. "So what if the color is a slightly different shade of blue! At this price I can buy five of them!"

Shore and Prevor's privately held mini-empire, which employs some 10,000 people, is built on bulk-buying in every corner of the globe, from Nepal and Swaziland to China and the United States.

Ron Blackwell, chief economist for the AFL-CIO in Washington, said apparel purchasers have such "enormous buying power today" that prices are "constantly under pressure to be dropped," leading to international bidding wars whereby "even good governments of poor countries, in order to give their people jobs, will sacrifice the rights and wages of those workers. It's often characterized as a global race to the bottom."

Prevor maintains that their factories in developing countries don't use child labor.

"We make sure our standards are far above normal industry standards — we take this completely to heart," he said.

Their penny-pinching strategy also relies on word-of-mouth advertising and low overhead. Stores usually set down in second-tier malls in either big-city suburbs or small towns like Vienna, W.Va., Hadley, Mass., and Middlesboro, Ky.

A big draw is their licensed apparel from 350 colleges. While the University of Michigan is probably their best seller nationally, all stores carry an abundance of regionally popular college colors and logos. But it was the $10 price ceiling that drew a crowd at the Medley Centre in Irondequoit on a recent weekday afternoon.

"I was surprised at the quality, especially the jackets," said Barbara Fox, 55, who bought a sweat shirt with a Navy emblem for her father, Lee Behnke, a World War II veteran. "But, really, I couldn't believe the cost. I said, 'Well, that's just the grand opening.' They said, 'Oh no, that's all the time.'

"I stay away from the big-name brands," Fox added. "I don't even walk into Abercrombie & Fitch or Eddie Bauer because you're paying for the designer name."

Steve & Barry's markups, analysts estimate, float between just 2 percent and 20 percent, far below the apparel industry's 54 percent average.

"We don't have to hit a home run on every item," Prevor said. "If we can make a few pennies and have satisfied customers and have them tell their friends and that allows us to continue to grow, then that's good enough for us."

After averaging 70 percent annual growth over the last decade, sales appear to be close to $1 billion a year, Cohen guessed, adding that "they certainly make enough money to keep them going forward."

"While they don't right now compete with the mass merchants — the Kmarts, Targets, Wal-Marts — at some point they will," Cohen said. "As the mass merchants have been demonstrating, they're willing to go out and knock out the competition even if it means losing money on it."

While declining to detail the company's finances, Prevor isn't shy about predicting ballooning growth.

"Certainly within the next couple of years, we're going to get into the realm of sales that some of the other retail giants have," he said. "We could easily see that there could be more than 5,000 Steve & Barry's in the United States. We really see no practical limit."