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Evolving Merchandise Mix Key to Foot Locker’s Strategy


Foot Locker, which lowered its financial outlook for the remainder of its fiscal year after reporting poor Q2 results, is continuing to make investments in technology and key vendor partnerships as it works toward shifting its merchandise mix to 40 percent non-Nike products by 2026. That non-Swoosh percentage amounted to 36 percent in the period ended June 30 versus 31 percent a year-ago.

Despite experiencing ongoing consumer softness and a big decline in merchandising margins due to higher promotions, the retailer had success with some brands during the period. Asics, Brooks, Crocs, and Puma outperformed in Q2 for the retailer. Foot Locker is also encouraged by its expanded distribution plans for On and Hoka in performance running with On moving to 350 locations by year-end and Hoka to 150 doors. Another brand that received a special callout during the company’s Q2 results announcement was New Balance. Brand sales grew by more than 100 percent during the period. Foot Locker pointed to New Balance’s innovation, storytelling, and in-store presentation as key drivers for its increased market share.

Foot Locker, which is repositioning its Champs Sports business, is optimistic about numerous market trends in the pipeline for the remainder of 2023 despite its lowered FY23 outlook that forecasts a 9-10 percent drop in comparable sales and more gross margin contraction as it promotionally sells down its $1.8 billion in inventory. On deck: a new signature Anthony Edwards signature basketball shoe from Adidas and Rihanna’s collaboration with Puma.

Meanwhile, new senior executives at Foot Locker include Matthew Wright, VP, and global creative director; Kim Waldmann, chief customer officer; Brian Milburn, chief merchandising officer; and Andrew Rahosh, VP of global ecommerce.