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Brown Shoe plans to open 30 outlets in US & Canada
07 Jun '05
5 min read
As a result of these initiatives, Brown Shoe expects to realize an additional $5 million in pretax operating earnings on an annual basis, or $0.15 per share, primarily by improving the performance of its Specialty Retail segment. This reflects the elimination of losses incurred by the stores and reduced overhead cost, partially offset by the loss of upstream profit earned at the Naturalizer Wholesale division.
"With these retail and wholesale moves, we: 1) focus our stores in high- traffic fashion and outlet malls where our Naturalizer customer shops; 2) continue to increase our ability to bring customers 'the perfect balance of style and comfort' in their Naturalizer footwear, and 3) initiate new marketing to communicate the brand's essence and image," Fromm said. "These initiatives now lay the groundwork for the brand's next step forward with consumers."
The closing of the underperforming stores is expected to be completed by April, 2006, resulting in a Specialty Retail division with approximately 300 stores, 275 of which are Naturalizer stores. The 30 outlet stores will add to that total over the next two to three years.
In addition, Brown Shoe said it will test customer reactions to a new store prototype in fiscal 2005. Additional growth and remodeling will hinge on the outcome of these tests.
The Company anticipates the cost to implement this plan will be about $14 to $17 million pretax, or $0.45 to $0.55 per diluted sha The Company anticipates the cost to implement this plan will be about $14 to $17 million pretax, or $0.45 to $0.55 per diluted share, for lease buyouts, severance, and inventory markdowns. Costs are expected to be recognized primarily over the remainder of fiscal 2005, as arrangements are made with landlords and stores are closed.
"With these retail and wholesale moves, we: 1) focus our stores in high- traffic fashion and outlet malls where our Naturalizer customer shops; 2) continue to increase our ability to bring customers 'the perfect balance of style and comfort' in their Naturalizer footwear, and 3) initiate new marketing to communicate the brand's essence and image," Fromm said. "These initiatives now lay the groundwork for the brand's next step forward with consumers."
The closing of the underperforming stores is expected to be completed by April, 2006, resulting in a Specialty Retail division with approximately 300 stores, 275 of which are Naturalizer stores. The 30 outlet stores will add to that total over the next two to three years.
In addition, Brown Shoe said it will test customer reactions to a new store prototype in fiscal 2005. Additional growth and remodeling will hinge on the outcome of these tests.
The Company anticipates the cost to implement this plan will be about $14 to $17 million pretax, or $0.45 to $0.55 per diluted sha The Company anticipates the cost to implement this plan will be about $14 to $17 million pretax, or $0.45 to $0.55 per diluted share, for lease buyouts, severance, and inventory markdowns. Costs are expected to be recognized primarily over the remainder of fiscal 2005, as arrangements are made with landlords and stores are closed.
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