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Foot Locker Plans To Open 20 ‘Power Stores’ Amid $150 Million Brick-And-Mortar Reinvestment

Foot Locker is continuing to rethink its brick-and-mortar strategy following a poor holiday showing that saw comparable sales decrease 1.6%, total sales drop 2.2% and net income decrease 10.8% from the prior year to $141 million. The retailer wants to expand on its community-based “Power Store” concept, which features local product assortments, marketing campaigns and events. With six Power Stores already open, Foot Locker plans to open 20 more in 2020.

The retailer expects to open its next Power Store at the new American Dream retail and entertainment complex in New Jersey’s Meadowlands.

“We see a significant potential to take the Power Stores further across the geographies and also to put some of those elements back into stores that we would consider core, because our customer continues to tell us that they value a store experience, they want to be in there talking with our associates and physically experiencing the product,” said Lauren Peters, EVP and CFO of Foot Locker, in an earnings call.

Foot Locker also is planning to ramp up investment in locations for female shoppers, said CEO Dick Johnson during the call. Currently, Foot Locker has 17 “elevated” women’s stores across Europe and 34 in the U.S., with plans to add a combined 40 to 50 new locations globally in 2020.

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Overall, Foot Locker plans to spend approximately $150 million to optimize the store fleet in 2020, as part of a $275 million capital allocation plan to upgrade its stores, online operations and supply chain. The company will open 65 new stores, with further expansion in Asia, and remodel or relocate approximately 125 existing stores.

Despite the openings and the new Power Store format, the retailer still plans to close approximately 150 stores, leaving Foot Locker with a smaller net store footprint.

Foot Locker-Backed Rockets Of Awesome Closes Only Store, While Super Heroic Shutters Operations

Unrelated to the retailer’s store operations and financial results, two Foot Locker-backed brands shared disappointing news.

Rockets of Awesome, a children’s apparel retailer that has raised $49 million (with $12.5 million coming from Foot Locker), is closing its only store in New York City and laying off half of its workforce. As part of Foot Locker’s strategic partnership, Rockets of Awesome has shop-in-shop locations at select Kids Foot Locker stores and sells merchandise on both footlocker.com and kidsfootlocker.com.

The retailer is best known for its subscription service, which allows parents to receive a personalized box of items four times a year. Foot Locker remains the largest retailer of Rockets of Awesome products in the U.S.

Rockets of Awesome CEO Rachel Blumenthal said in an interview with The Wall Street Journal that the company is looking for other locations to open another store, but didn’t want to commit to a specific city or timeline. Rockets of Awesome will continue to sell its apparel through its own web site.

Super Heroic, a DTC children’s apparel startup also backed by Foot Locker, said it is shutting down. Founded in 2016 by two former Nike employees, the company received $3 million in a deal that allowed Foot Locker to sell Super Heroic merchandise in its stores and online. Overall, Super Heroic raised $10 million.

A message posted on Super Heroic’s web site, with the headline “Mission Complete,” said that the company would “honor all sales and exchanges until our closure,” but does not give an exact date.

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