States have started relaxing or removing their stay-at-home orders, which in some cases allows non-essential stores to reopen for business. But for some decision-makers, opening isn’t as easy as local governments might think.
For instance, Foot Locker president and CEO Dick Johnson told FN that simply having permission to reopen and having stores stocked with the recommended personal protection equipment isn’t enough.
“There are some states where there are no regulations in terms of people in store, so we’re taking it upon ourselves to limit the number of bodies in the store so we can maintain social distancing,” Johnson said. “And we’re following CDC guidelines and WHO guidelines to make sure we are putting our people first. The safety and health of our people as is a top priority.”
And with 3,129 retail stores in 27 countries across North America, Europe, Asia, Australia and New Zealand, the process for Foot Locker’s reopening is far more arduous than businesses with a smaller physical footprint.
Watch on FN
Below, Johnson outlines for FN the retail giant’s plans for restarting brick-and-mortar in the U.S. and the discussions he and his team have before reopening each and every store.
On reopening plans that are in place:
Dick Johnson: “We have our opening offense that we know how we’re going to open stores. But as local government decisions get made, each state, each country that we operate in — sometimes even each county — has a different set of rules. Our framework is set. We know that we’re putting our people first and thinking about what the right thing to do is in terms of our people and making sure they’re safe. We operate with a ‘can we, should we’ framework that says everything’s got to be in accordance with local laws and sentiments but is it safe and right for our team members and our customers, is it possible for us to communicate effectively. All those things have to be in play.”
On decisions that will lead to opening or remaining closed:
DJ: “Local mall developers, local agencies, local government agencies may be ready to open, but it’s absolutely our call. We’ve got to feel like we’ve got it, really in this can we, should we framework. We look at our operational readiness. Can we get the staffing? Can we have time to do the employee training that we need? Do we have all of the supplies, the PPE things that we need? Do we have all of the health and safety protocols? Has everyone been able to check our systems out and make sure that starting them back up works? Is the inventory in the right place? Are we able to communicate with customers? Is the local government direction saying, yes, go ahead. And, you know, all of those things sort of fall in that. If we check all of those boxes and they become green, then we go over there and say, should we? Do we believe, and do our teams on the ground believe, that the the curve is controlled and where it should be in that specific locality? What’s the consumers sentiment? There’s some places the consumers are ready to get out and shop. There’s some places that they aren’t. What’s the other retail around this looking like? Are our competitors and other retailers opening or is it just people rushing out to grocery stores?”
On dialogue with the Foot Locker team:
DJ: “We’ve been talking about reopening since the day we made the decision to close the stores and what would it look like. We knew that we would close the stores in one fell swoop in one day and we knew that we wouldn’t reopen on one day. The discussions have built this can we, should we framework with our people at the center of everything that we’re doing. Our primary focus is to put our people first. We want to get back into retail. Our team has been anxious to get going, they love to service customers but the rules have changed, how you engage with customers has changed. It’s a different environment. We’re taking it very cautiously and the conversations have been cautious around let’s make sure that our employees feel safe, let’s make sure that our customers feel safe and let’s make certain that we can believe we can thrive in this new environment. The dialog is robust, we’ve got all of our functional areas involved, we’ve had a task force that’s been focused on first managing through the crisis and the shutdown and we quickly switched to how do we get ready to reopen, how do we make sure that the inventories flowing, etc. All of those things that we used to take somewhat for granted. We would receive inventory in the warehouse that would make its way through our pick system and we would ship it out to the stores. Well, the way distribution centers operate have changed and we have to make sure that we take all of those things into account.”
On coronavirus task force:
DJ: “We had a corona task force in place before we closed our stores. We saw this coming from our business in Asia, we saw things happening in Italy and finally it hit the U.S. Our team’s been focused on this for a long time. And there’s no daily goals around how fast we get open or what our sales should be. The daily goal is to make sure that we’re taking prudent steps in the right precautions to make sure that we put our people first and that the health and safety of our employees and our customers is paramount. I am as anxious to ring the registers as anybody but at the same time I’m also concerned that if we don’t do this appropriately there could be a rebound. I watch the same news that everybody watches and if we have to go into another lockdown, I think personally, it will be more painful than the first one, so we want to come out of this right. We’ve got multiple work streams out of that task force focused on a lot of different things, there are multiple meetings a day. Our goal is to to open in a prudent way that allows us to make sure that that we’re following health and safety sort of considerations for our employees and for our customers.”
On keeping inventory in check:
DJ: “We’ve had a robust digital business, everybody I think has seen their digital business increase so we’ve been able to certainly move through some inventory but we’ve got a big inventory pipeline that we work with all of our vendor partners on. Each partner is attacking it a little bit differently and we’re working with them to make sure that we’ll be in a good position to flow inventory as stores open up in as seasonality changes. When we closed, we were really still just in the early throws a spring and as we start to open we’re going to be in the early throws a summer, so there’s a lot of work to be done. Our team has done just a tremendous job working with our vendors in all three major geographies in in terms of managing the expectations around inventory flow, how we see the marketplace developing post COVID crisis once things start to open up.”
On learnings that will reshape the business moving forward:
DJ: “I think one thing we certainly learned is the power of our digital business. We always knew that it was a strong tool, but it was sometimes in our network was a little bit overwhelmed by our brick and mortar presence. Now that we’ve had only digital to focus on, I think our team is honed their skills and gotten even better at the digital communication in how we work with our customers to engage with them digitally and ultimately sell them product. I think it’s probably strengthened us as an omnichannel retailer. And I think that’s something that will benefit us for a long time. We’ve certainly learned that we don’t all have to physically be in exactly the same place to make good things happen. I wouldn’t say that we can say that we’ve been running the business because we clearly haven’t, generally speaking, with our 3,200 stores closed we haven’t been running the day-to-day business other than the digital front, but I think it changes the way that we’ll think about work going forward and I think that will benefit a lot of people in a lot of different ways. I think that it also has helped us create a deeper engagement with our consumer. They want to hear from us. We’ve got a lot of stores that are local neighborhood stores, and they want to know what’s going on with the staff, etc.”
On using experiences in other regions to reopen the U.S.:
DJ: “We learned from every opening. What’s the consumption of hand sanitizer? What’s the consumer response if masks aren’t required in the country but we’re requiring them in the stores? All of those things. Every place that we open we learn, we pass that back through our geography heads and back to the task force so that each store that we open so we do a better job with it. We’ve had stores opened in Austria, which is not a huge country for us, but it was one of the first in one of the first European countries we were able to to open stores in. We learned a tremendous amount from that and that’s helping us accelerate openings across Europe. And it certainly helped us as we started to open stores over the last weekend in South Carolina and Texas. It’s not like opening up after Christmas Day, being closed on Christmas Day. This has been a six or seven week period where nobody was in the store so you’ve got all of the checklists that you’ve got to go through to make sure that you’re ready. All of those things we’ve been able to refine as each store that we open, we learn a little bit more from.”
On states that will open last:
DJ: “It’s pure speculation but I have to believe that the tri-state area around New York is going to be a little bit slow. My team tries to stay current as good as anybody can with with the things that are going on. We have tentative dates that look at all the time and just every state is different. There was a big rash of states that had stay in place orders that are expiring as we speak, at the end of April, beginning of May. My gut tells me that it’s going to be the tri-state area around New York and California that we will see open the latest.”