CCS Skate Stores Begin Rollout

PARAMUS, N.J. — Foot Locker Inc. is looking to pick up market share in the $8.4 billion skate market with the debut of CCS-branded brick-and-mortar stores.

The company bowed CCS’s first retail shop on the Third Street Promenade in Santa Monica, Calif., on April 30, and the second opened at the Garden State Plaza mall here on June 10. Foot Locker acquired CCS, an online skate retailer, for $102 million from Delia’s Inc. last September.

“We bought CCS because we knew we could grow its business,” Ronald Halls, CEO and president of Foot Locker International, said during a recent tour of CCS’ new 2,100-sq.-ft. Garden State Plaza store. “We thought it would be worthwhile testing retail locations.”

The CCS shops, which mimic the Website, feature skate shoes, apparel, accessories and hardgoods for the 12-to-18 year-old customer. Footwear includes brands such as Supra, DC Shoes, Vans and Emerica. Several labels, including Nike, will be carried in both CCS stores and Foot Locker’s other divisions, but there are few product overlaps. Most of CCS’ shoe business, Halls said, is done with niche skate brands and includes exclusive style makeups and collaborations.

While the skate shoe business accounted for $1.62 billion in sales in 2008, apparel, accessories and hardgoods added up to $6.78 billion last year, according to industry analyst Board-Trac. Thus, CCS devotes plenty of shelf space to apparel, with labels such as Volcom, Fallen, Element and its own CCS brand.The store also sells accessories and hardgoods, and provides a service to assemble and repair skateboards. “Everything in here is authentic for the skate consumer,” said Halls.

Although Foot Locker has experimented with skate-oriented displays in its Champs locations and about 600 Foot Locker stores, CCS marks the company’s first push into full-line dedicated skate stores. But Foot Locker is hardly entering into unfamiliar territory: The company has retained all 32 of CCS’ original merchants since its acquisition, including its managing director, Susan Van Arsdale.

Brad Lyle, director of U.S. sales for Sole Technology, which owns Emerica, Etnies and eS — all sold at CCS — said the company’s business with the retailer remains solid. “As long as CCS continues to bring authentic skate brands to the consumer and continues to support a relevant team within skateboarding, they will be relevant,” he said.

Looking ahead, Halls said CCS could add product around the snowboarding lifestyle, and could ultimately match the size of some of Foot Locker’s other divisions (Champs has 576 stores, while Footaction has 356). Halls said the chain is still on track to achieve revenues of $80 million in 2009 — a target laid out last fall — but he declined to pinpoint the next CCS store openings or estimate a total store count for the year.

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