As state governments lift their stay-at-home orders and restrictions on nonessential businesses, Designer Brands Inc. is gearing up to get back to business.
The DSW parent has announced plans to reopen nearly 200 of its stores in the United States and Canada by the end of the week and double that by this month’s Memorial Day holiday. But its locations won’t look the same as they did pre-pandemic.
Shoppers who pay a visit to their local chains will see hand-sanitizing stations at entryways, associates donning masks and signage that implores them to observe social distancing guidelines. They’ll get to browse products in one-way aisles and try on shoes at designated areas in stores. At checkout lanes, they’ll notice plexiglass shields at the registers, and they won’t be able to pay with cash — only credit cards, gift cards or other contactless payment options will be accepted.
Here, FN chats with Designer Brands CEO Roger Rawlins about the changes customers will see in stores, how the company plans to keep employees safe and the unique partnerships its tapped to do its own coronavirus research.
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What is your strategy for reopening stores? How are you adhering to state and local guidelines?
“Having these protocols in place gives me comfort that we’re doing the right thing. We have a team of people who are focused full time on monitoring what’s happening within each of these jurisdictions. We have the best practices in place, and we have been operating these ‘warehouses’ — which is what we call our stores — full time. We never shut them down; they just weren’t open to the customer, but they were acting as our primary point of fulfillment to our customer for all of that digital demand, which has allowed us to sell through a lot of inventory. If we hadn’t made these investments in this omnichannel era, to be honest, I’d be frightened as to how much inventory we would’ve been able to liquidate.”
How are you managing inventory?
“The benefit of being a brand of brands is the relationship that you have with these partners that we’ve had for years. We’ve been able to successfully get out of that inventory and cancel those goods as needed. Frankly, it’s been very targeted to the seasonal category because, as I would describe it, sandals in the spring and boots in the fall or winter are like bananas on the shelf. They turn brown pretty quickly, and you got to get them out of your inventory. We’ve also been very aggressive in pricing during this time. We jumped on that early, and I think we’ve been effective in getting out some of the product that we had to as we now go through a spring and summer season.”
You’ve continued to expand “buy online, pick-up in store” this year — most notably curbside pickup, which is now available at a couple hundred DSW stores. How have you ramped up your omnichannel services in light of the ongoing health crisis?
“We’ve tried some of these things and wanted to do them for years — and within weeks we got things up and running because we were able to get focused. We were able to leverage a very small team on a few very important initiatives and turn things around in an [accelerated] time period [so] that what used to take months got done in days. A great example would be self-checkout: We’ve been talking about that for years, and within weeks we were able to get something in test mode that I’m hoping in the next couple of weeks we’ll be able to roll it out to consumers. I think, in this time of crisis, organizations — and I’m proud to say I really do believe we’re one of them — can be nimble and respond and have an ability to differentiate themselves as we come out of this.”
What steps is the company taking to keep its workers and customers safe?
“This one, I think, is unique and different from any one that I’ve heard: We partnered with American Eagle, Aerie, American Signature Furniture and Albertsons, because our chairman, Jay Schottenstein, has a role in all of those organizations. In that partnership, we actually engaged with Johns Hopkins [University researchers], and we ran tests on the virus to better understand exactly how this thing lives … We are lucky enough to [be able to partner with] all of these organizations [and] have the financial wherewithal to be able to do some testing ourselves and be able to validate information we were hearing from people. We’re asking people to go back to work and be in front of the consumer. Before we could make a decision like that again, we had to think about how to protect the health and safety of our associates. That was the lens we’ve been using that led us down this path. I’m just so proud that we approached it that way and that I’ve got a boss that challenged me to think differently about this. I’m really proud of our board and our team.”
DSW recently launched a “Giving Tuesday” charitable initiative for COVID-19 relief. Can you tell us about that?
“We have an obligation to protect our associates and our customers. But it’s also more than that: It’s about those folks that are putting up this fight every day and all those families that we think are desperately in need of some kind of assistance. We talked a lot about what it is that we could do, and this is really our first major endeavor [related to COVID-19 relief]. We got to combine forces with Reebok and our long-term partner, Soles for Souls; the combination of the three of us were able to provide a 100,000 pairs of new shoes to frontline workers and families in need. In addition to that, we are collecting gently worn shoes from our customers, and we’re gonna reward them with a $10 DSW certificate when they donate two or more pairs.”
What have you learned from this pandemic that can help you reshape the business moving forward?
“Innovation. Innovation. Innovation. You have to find ways to be nimble as an organization. The fact that we’ve had that in our culture and that we’ve been thinking that way for a long time really demonstrated itself when this [pandemic] hit. We had game plans in place, we had this small team in place, and the culture of change was already there. It’s not something we would have planned for, but to see how our organization reacted reinforced for me the importance of constantly challenging the way you operate and the way you have to innovate. We had the right kind of resources in our organization and the right kind of capital to weather these kinds of storms. There’s a quote that goes: In times like these, companies that fail can be defined in two words: Too late. What I’m really proud of is, because of this nimbleness and innovative culture, we were not too late to react, whether it be taking action on inventory or partnering with other retail companies to understand how this virus behaves on our materials. I think the consumer’s behavior has changed forever in a bigger way as a result of this, and I think it will put more challenges on the conventional retail model of brick and mortar. Going forward, digital experience is the number one priority, and getting our teams to rally around that is the direction we’re heading.”