NEW YORK — Despite the massive retail slump, footwear merchants are approaching spring with a fresh — albeit cautious — sense of hope.
Retailers interviewed during the recent FFANY show, held Dec. 3-5, said they had learned important lessons from a diffi cult fall, and as a result, they’re more confi dent about their spring strategies. Many store owners expect tighter inventory management to benefi t their bottom lines.
“With each new season comes the opportunity to start fresh,” said Burt Tansky, CEO of Neiman Marcus, in a conference call last Thursday. “We are and have been working with our vendor partners to adjust our inventories to the current expected level of demand.”
There’s no question that many retailers are stocking less product for spring, after suffering through excess inventory last fall, when sales at many stores ground to a halt.
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“Buying for fall, we didn’t expect this,” said New York-based Shoegasm owner Eddie Cuevas. “[Now], if a shoe comes in three colors, we will buy the best one. [We’re] buying closer to season because trends are changing so fast.”
Cuevas added that he wouldn’t bring in unknown labels for spring, preferring to work with established vendors. “We are not going after new brands,” he said. “[Instead] we are trying to build relationships with brands we already carry.”
Lisa Polansky, owner of her namesake store in Brooklyn, N.Y., said that much of her planning would take place after the holidays, when she can reevaluate the mood and spending power of her customers.
Polansky said even though she anticipates a challenging season, there will be opportunities in the new year. “Spring will be tough, but the kids’ business will be OK because sandals won’t fi t [come spring],” she said. “[In the] women’s business, I want to be optimistic, and early spring might be good because you want to get out of the doldrums of winter.”
Galen Hardy, senior director of casual lifestyle and performance at Zappos.com, said even in the current economic climate, he is more upbeat about spring after a solid performance in the past few months.
“We had increases in the third and fourth quarter of 2008,” he said. “The biggest day in the history of Zappos was Cyber Monday, at full price.”
Looking to spring, Hardy said he had not seen a clear style trend, though he noted that the e-tailer was emphasizing shoes with patent leather, piping detail, color blocking, embellishments and large buckles. For Pittsburgh-based Littles, owner Joel Sigal said the weather — not the economy — will be the dominant factor driving business next spring. “If it breaks in March, spring could be OK,” he said.
Even if the economy doesn’t pick up by spring, Sigal said consumers will still respond to the right product. “Shoes make women happy,” he said, though he worried that vendors may be playing it too safe to lure in cautious consumers. “I hope the industry doesn’t get too conservative. They need to show color. Give her a reason to go, ‘Wow.’”
Sigal added that he’s banking on bright colors to coax consumers into his stores, even if they don’t buy the more vibrant colorways. “Even if the color doesn’t sell that well, [we need] to show it,” he said.
Rob Shiff, president of Spyler & Co., said his company and other discounters are fi nding opportunity in the misfortunes of larger competitors. As big chain discounters, such as Mervyns and Shoe Pavilion, go out of business, the wholesale business for discount goods has become a buyer’s market. “[The closure of] Mervyns creates an infl ux of goods,” he said. “There are opportunities out there [for the closeout business].”
But much of spring’s sales will depend on the mood of consumers and their willingness to spend. Many retailers told Footwear News that President-elect Barack Obama’s inauguration could dramatically lift spirits — and shopping habits — across the country.
“The new presidency should change things,” said Polansky. “It should open people up. I want to be positive because I think we are going to go through this [period] and come out of it.”
Lorrie Krady, shoe buyer for New York-based A&E Stores, which operates the Strawberry chain, agreed that new leadership could alter the country’s mood. “The change in the presidency will give the consumer hope, and gas prices are going down, and lower interest rates on mortgages [will help].”
Still, Krady said she’s not sure the consumer will pay full prices even after the economy starts to improve. “When you see Saks Fifth Avenue at 70 percent off, that’s scary,” she said. “[The question is], will [the customer] go back and pay full price?”
Krady said with promotions dominating retail, consumers would likely continue to search for post-holiday bargains. “My customer is someone who wants trendy stuff at great prices,” she said.
However, April Lonigro, footwear buyer for Las Vegas-based Marshall Retail Group, expects less promotional activity in 2009 because retailers cannot sustain operations with such drastic markdowns. “People can’t stay in business if they keep doing that,” she said. “People didn’t really see this coming [for fall and holiday] and are trying to get their product sold, but now they’re scaling back.”
For their part, vendors were mixed about the promotional environment and their overall prospects for spring.
“Retailers can’t survive on sale at 50 percent off,” said Rick Cytrynbaum, CEO of Montreal-based Modern Vintage. “Conceptually, it can’t work. [But] retailers will need to keep a close eye on product. It will need to have value, and this relates to [everyone], from Neiman Marcus to DSW.”
Cytrynbaum said if current spending trends hold, sales would decline. “There was a decrease in spending over the past few months, so I believe it will be the same for spring,” he said. “The consumer will buy less and be more specifi c. They will want the trend, comfort and fi t all rolled into one.” Maral Kalinian, director of design for Yellow Box Footwear, was more optimistic. “I expect our business to go up,” she said. “We have great price points and stellar styles, so we’re actually in a sweet spot.” Similarly, Jim Barnier, VP of sales for Gee WaWa, said manufacturers need to produce the best products they can and hope consumers respond. “We are planning to weather the storm with customers who see the value in quality leather and those who see what makes us special,” he said.
Other brands said they would have to wait and see. Benjamin Duensing of London Underground, owned by Dynasty Footwear, said, “I have my fi ngers crossed and hope something miraculous will happen and people will start buying again.”