{"id":77061,"date":"2025-11-30T15:25:28","date_gmt":"2025-11-30T15:25:28","guid":{"rendered":"https:\/\/dralysstore.com\/blog\/?p=77061"},"modified":"2025-11-30T15:25:28","modified_gmt":"2025-11-30T15:25:28","slug":"dicks-turnaround-at-foot-locker-includes-store-closures-inventory-reset","status":"publish","type":"post","link":"https:\/\/dralysstore.com\/blog\/dicks-turnaround-at-foot-locker-includes-store-closures-inventory-reset\/","title":{"rendered":"Dick\u2019s turnaround at Foot Locker includes store closures, inventory reset"},"content":{"rendered":"<div>\n<div class=\"text-to-speech\">\n    <button class=\"text-to-speech__button button\"><br \/>\n        <img decoding=\"async\" class=\"text-to-speech__button__icon\" src=\"https:\/\/www.retaildive.com\/static\/img\/play.svg?500116090725\" alt=\"\"\/><br \/>\n        Listen to the article<br \/>\n        <span class=\"text-to-speech__button__audio-length\">5 min<\/span><br \/>\n    <\/button><\/p>\n<div class=\"text-to-speech__controls\">\n        <audio controls=\"\" class=\"js-text-to-speech\" preload=\"none\"><source src=\"https:\/\/text-to-speech.divecdn.com\/newspost\/806411\/2025-11-25_12.29.16\/dicks-foot-locker-turnaround-store-closures-inventory-clearance.wav\" type=\"audio\/mp3\"><\/source><\/audio><\/p>\n<div class=\"text-to-speech__controls__text\">\n            This audio is auto-generated. Please let us know if you have <a href=\"https:\/\/www.retaildive.com\/contact\/\" target=\"_blank\" rel=\"noopener\">feedback<\/a>.\n        <\/div>\n<\/p><\/div>\n<\/div>\n<h3>Dive Brief:<\/h3>\n<ul>\n<li>In its first quarter reporting as a combined business, Dick\u2019s Sporting Goods Executive Chairman Ed Stack said it was time to \u201cclean out the garage\u201d at Foot Locker in an effort that will span stores, inventory and other assets.<\/li>\n<li>For starters, the company is focused on <a href=\"https:\/\/investors.dicks.com\/news\/news-details\/2025\/DICKS-Sporting-Goods-Inc--Reports-Third-Quarter-Results-Raises-2025-Outlook-for-the-DICKS-Business\/default.aspx\" target=\"_blank\" rel=\"noopener\">clearing out unproductive inventory<\/a> across Foot Locker\u2019s business and will close an unspecified number of stores. The company will also rightsize assets \u201cthat don\u2019t align with our go-forward vision,\u201d per a release.<\/li>\n<li>Already, Dick\u2019s is in the middle of an 11-store pilot at Foot Locker to test changes in merchandising and product. Stack said the effort has produced encouraging results and was \u201cpretty capital light,\u201d including adding fresher products and changing the visual merchandising walls around footwear.<\/li>\n<\/ul>\n<h3>Dive Insight:<\/h3>\n<p>Dick\u2019s has set an aggressive turnaround timeline for Foot Locker, with plans for the <a href=\"https:\/\/www.retaildive.com\/news\/dicks-sporting-goods-names-foot-locker-leadership-team-acquisition-closes\/759491\/\" target=\"_blank\" rel=\"noopener\">newly acquired business<\/a> to reach an inflection point by back-to-school next year and be accretive to the company in 2026.\u00a0<\/p>\n<p>The retailer also named a <a href=\"https:\/\/investors.dicks.com\/news\/news-details\/2025\/DICKS-Sporting-Goods-Names-Matthew-Barnes-President-Foot-Locker-International\/default.aspx\" target=\"_blank\" rel=\"noopener\">head of international for Foot Locker<\/a>, rounding out its leadership team. In addition to Ann Freeman, a 26-year Nike veteran who is president of Foot Locker\u2019s North America business appointed in September, Dick\u2019s has named British executive Matthew Barnes president of Foot Locker International, effective Dec. 3. Barnes has nearly three decades of experience, including at Aldi and Tesco. He also fulfills a requirement Stack was looking for: to have a European running its European business.<\/p>\n<p>There\u2019s a lot of work to do. While Dick\u2019s itself saw net sales rise 5.9% and comps grow 5.7% in Q3, Foot Locker\u2019s proforma comps declined 4.7%.<\/p>\n<p>\u201cLet me be candid: Foot Locker strayed from retail 101 and did not execute the fundamentals,\u201d Stack said on a call with analysts Tuesday, laying some of the blame at the feet of Nike\u2019s DTC transition as well, which left Foot Locker without the right inventory to be successful. However, having worked with the business now for a number of weeks, Stack added that, \u201cour conviction that we can turn this business around has only grown.\u201d<\/p>\n<p>That conviction is based on the idea that Foot Locker\u2019s problems stem from the core elements of retailing, including inventory management and in-store merchandising. At the 11 test stores Dick\u2019s has overhauled, one of the main changes was to the visual merchandising of Foot Locker\u2019s shoe walls. In other stores, \u201cit\u2019s a run-on sentence of shoes,\u201d according to Stack, whereas the refreshed stores make an effort to segment the product and showcase important styles.<\/p>\n<p>Prior to the acquisition, <a href=\"https:\/\/www.retaildive.com\/news\/foot-locker-store-concept-investment-fleet-revamp\/741633\/\" target=\"_blank\" rel=\"noopener\">Foot Locker was on its own journey<\/a> to revamp its fleet, including refreshing some stores and <a href=\"https:\/\/www.retaildive.com\/news\/foot-locker-store-of-the-future-concept\/714129\/\" target=\"_blank\" rel=\"noopener\">rolling out new store concepts<\/a> across its namesake and <a href=\"https:\/\/www.retaildive.com\/news\/kids-foot-locker-revamped-store-concept-bronx-new-york-city\/739110\/\" target=\"_blank\" rel=\"noopener\">Kids Foot Locker businesses<\/a>. Some of the elements of the reimagined stores will be kept, but others \u201cneed to be rethought,\u201d according to Stack. In particular, some unproductive areas that were built to foster community will be taken out and replaced with a stronger apparel offering.<\/p>\n<p>Some stores will be closed as well, though Stack wouldn\u2019t go into details on how many, as the company is still evaluating that. CFO Navdeep Gupta also added that Dick\u2019s is not looking at unprofitable stores purely to close them. The retailer is also evaluating if a location could become profitable if it had the right product, innovation and merchandising.<\/p>\n<p>Dick\u2019s, for its part, opened 13 of its experiential House of Sport locations in the quarter, the highest number it\u2019s opened in a single quarter. Dick\u2019s CEO Lauren Hobart also touted its \u201cCollector\u2019s Clubhouse\u201d effort with Fanatics in 20 House of Sport stores, which features trading cards and other collectibles, and said they plan to add this concept to every new House of Sport store. The retailer raised its full-year guidance and expects comps to be up between 3.5% to 4%.<\/p>\n<p>Hobart stressed that the combined company needed to \u201cring-fence\u201d the Dick\u2019s team and that those employees are solely focused on driving Dick\u2019s continued success.\u00a0<\/p>\n<p>\u201cAlthough Dick\u2019s is firmly at the top of the league table, the newest recruit to its team is far from a star player,\u201d GlobalData Managing Director Neil Saunders said in emailed comments. \u201cIndeed, Foot Locker has been one of the laggards of retail for quite some time.\u201d\u00a0<\/p>\n<p>Specifically, Saunders highlighted Foot Locker\u2019s $46 million loss in the quarter, which pulled down Dick\u2019s bottom line, and noted that Dick\u2019s is \u201cinheriting a business that needs a lot of training to get into shape.\u201d<\/p>\n<p>However, Foot Locker now has a date for some of its changes to take fuller effect. Back-to-school next year is the first time Dick\u2019s will have complete control over Foot Locker\u2019s buying process, and the retailer expects to see an inflection at that point. That timing will also give the company time to clear out unproductive inventory at Foot Locker, which it expects to finish by the end of this year.\u00a0<\/p>\n<p>The plan is to start fresh on inventory in the new year, though that means Foot Locker\u2019s gross margin will take a 1,000- to 1,500-basis-point hit in Q4. Stack said he was confident that Foot Locker would see meaningful gross margin improvement next year.<\/p>\n<\/p><\/div>\n<p><\/p>\n<hr>\n<p><strong>Published by Dralys Blog \u2013 Stories | Insights | Innovation<\/strong><\/p>\n<p>Discover more on <a href=\"https:\/\/www.dralysstore.com\" target=\"_blank\">DralysStore.com<\/a><\/p>\n<div class=\"pld-like-dislike-wrap pld-template-2\">\r\n    <div class=\"pld-like-wrap  pld-common-wrap\">\r\n    <a href=\"javascript:void(0)\" class=\"pld-like-trigger pld-like-dislike-trigger  \" title=\"\" data-post-id=\"77061\" data-trigger-type=\"like\" data-restriction=\"no\" data-already-liked=\"0\">\r\n                        <i class=\"fas fa-heart\"><\/i>\r\n                <\/a>\r\n    <span class=\"pld-like-count-wrap pld-count-wrap\">    <\/span>\r\n<\/div><\/div>","protected":false},"excerpt":{"rendered":"<p>Listen to the article 5 min This audio is auto-generated. Please let us know if&hellip;<\/p>\n","protected":false},"author":10,"featured_media":75526,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[36],"tags":[74,34,65,176,45,177,10],"class_list":["post-77061","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-dralys-insights","tag-dralys","tag-e-commerce","tag-entrepreneurship","tag-ecosystem","tag-innovation","tag-smart-shopping","tag-technology"],"acf":[],"jetpack_featured_media_url":"https:\/\/dralysstore.com\/blog\/wp-content\/uploads\/2025\/11\/play.svg.svg+xml","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/posts\/77061","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/comments?post=77061"}],"version-history":[{"count":1,"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/posts\/77061\/revisions"}],"predecessor-version":[{"id":77062,"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/posts\/77061\/revisions\/77062"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/media\/75526"}],"wp:attachment":[{"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/media?parent=77061"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/categories?post=77061"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dralysstore.com\/blog\/wp-json\/wp\/v2\/tags?post=77061"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}