You might at first think it’s because of the ongoing global supply chain issues caused by COVID-19, but that’s not the case.
The popular apparel and sneaker company has, over the past few years, shifted sales from outlets to own stores, both online and physical. Nike previously pulled its products from retailers including DSW, Macy’s, Urban Outfitters and Zappos.
Now it looks like Foot Locker will also be added to this list. The shoe retail chain, which has a business services office in Camp Hill, announced last week that no supplier is expected to account for more than 60% of its business this year, according to a story from Yahoo Finance. For comparison, Nike accounted for 70% of sales in 2021 and 75% in 2020.
“This change reflects Nike’s accelerated strategic shift towards direct-to-consumer and Foot Locker’s ongoing brand and category diversification efforts,” said Andrew Page, chief financial officer of Foot Locker, on a call with results, Yahoo reported.
As a result, shares of Foot Locker tumbled nearly 35% on Friday, a loss of about $950 million in market value. Shares are down about 40% for the year, according to CNN.
According to CNBC, the company plans to implement a cost reduction program to reduce approximately $200 million in expenses each year. It will also build on its existing relationships with brands such as New Balance, Puma and Crocs.
Foot Locker currently has stores in Harrisburg Mall, Capital City Mall in Camp Hill, Park City Mall in Lancaster and York Galleria Mall.
- READ MORE: Katy Perry quits ‘American Idol’ for Aretha Franklin’s granddaughter
- Jason Momoa and Lisa Bonet reconcile their marriage