Blog: Foot Locker stumbles
Leonie Barrie | 21 November 2007
Foot Locker has been plagued by sale rumours this year amid a steady decline in its performance, and just four months ago confirmed it had hired Lehman Brothers to evaluate strategic alternatives, including offers from private equity firms. It also said back in July that it planned to close up to 250 stores in an attempt to boost profitability.
Today, though, store closures have been elevated to 300 – suggesting the New York based retailer is having a more difficult time in the US than had previously been thought. The cost of these closures has pushed the athletic footwear firm to a third quarter loss of $33m, compared with a profit of $65m a year earlier.
Foot Locker is also blaming challenging market conditions and a lack of exciting fashion trends in athletic footwear and apparel for its woes. So let’s hope the retailer can learn something from its House of Hoops venture with Nike, which I blogged yesterday. It sees this new venture as a growth opportunity in the premium athletic footwear and apparel sector. And since the stores are specifically aimed at enhancing the consumers’ experience, maybe Foot Locker can learn something to apply to those shops it has decided to keep.
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