Waterloo Region Record

Foot Locker to close 400 stores in malls

CEO says move part of business reset, transformation

JOSHUA CHONG TORONTO STAR

Foot Locker, the American sportswear and footwear retailer, will shutter roughly 400 mall stores within the next three years. The announcement Monday is another blow to the mall retail sector, as other large brands continue to adapt to changing shopping habits and an expected pullback in consumer spending.

The popular retail brand said it plans to close “underperforming” locations across North America as part of a transformation of its retail portfolio.

“We are entering 2023 with a focus on resetting the business — simplifying our operations and investing in our core banners and capabilities to position the company for growth in 2024 and beyond,” said president and CEO Mary Dillon in a press release.

The planned closures represent roughly 10 per cent of Foot Locker’s total sales, said Tony Aversa, senior vice-president of global store development, at an investor day event. He added that the company will now focus on higher performing locations, “new store concepts” and its outlets in Western Europe and Southeast Asia.

“These new concepts allow us to stay focused on our core consumer, while also acquiring new (ones),” he said, adding that the company will have about 400 new concept locations — including play-focused outlets — by 2026, up from approximately 120 this year.

Foot Locker currently operates about 2,700 stores around the world, including 87 outlets in Canada. Despite the addition of the new concept outlets, the brand will still have roughly 300 fewer stores in 2026 compared to this year.

The company did not immediately respond to a Toronto Star email requesting additional information on the expected closures, including the number of Canadian stores and employees impacted.

The announced cuts to the company’s portfolio come amid weaker sales. Foot Locker’s net income fell to $19 million in the fourth quarter of 2022, down from $103 million in the same period last year.

The brand’s total sales also decreased by 0.3 per cent over that time frame.

Foot Locker is just one of several major retailers to announce store closures in recent weeks as the retail sector faces increasing economic headwinds and a changing consumer base. Nordstrom announced this month that it will close its six Canadian department store locations and seven Nordstrom Rack shops, cutting some 2,500 jobs in the process.

In February, Bed Bath & Beyond, another U.S. retail chain, also said it was leaving Canada and axing roughly 1,400 jobs across the country.

BUSINESS

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2023-03-22T07:00:00.0000000Z

2023-03-22T07:00:00.0000000Z

https://waterloorecord.pressreader.com/article/281818583075431

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