Founded in 1879, Foot Locker Inc. (NYSE: FL) has been forced to change business operations over time to accommodate the athletics market. Today, it provides goods and apparel to athletes regardless of gender, geographical location, or sport of choice. To do so, Foot Locker now operates numerous subsidiaries and brand names that specialize in a specific product or sport.
Foot Locker reported FY 2019 earnings of $5.8 billion in revenue, compared to $5.7 billion a year earlier. Foot Locker is expected to report its next fiscal year earnings in November of 2020. Here are the primary brands that brought in Foot Locker's income:
- Foot Locker is a retail footwear and sports apparel company, founded in 1879.
- Today, the company owns and operated thousands of Foot Locker stores as well as several other popular and targeted brands.
- Among these are Champs, East Bay, Footaction, and SIX:02.
With stores in the United States, Puerto Rico, and the Virgin Islands, Champs Sports is among the largest mall-based athletic footwear and apparel retailer. It sells numerous athletic brands, carries merchandise for professional sports teams and offers products from a range of professional athlete clothing lines. Champs' unique market position relates to the range of athletic products offered, as it provides apparel across sports and apparel lines. As of year-end 2019, Foot Locker has 547 Champs Sports locations internationally.
East Bay is a subsidiary of Foot Locker and provides athletes with footwear, apparel, equipment and private-label merchandise for numerous sports. Founded in 1980, it has operated as Foot Locker’s direct mail division since 1997. Headquartered in Wausau, Wisconsin, East Bay is among the largest direct marketers in the United States.
The main division of Foot Locker is the Foot Locker line of business. One of the global leaders in athletic apparel and footwear retail sales, Foot Locker operates more than 3,300 stores in 23 countries as of 2019, with more than 1,000 locations operating in the United States alone. Foot Locker offers products relating to a multitude of sports, including basketball, running and general fitness.
Kids Foot Locker
Kids Foot Locker provides children’s athletic apparel in the United States, Puerto Rico, Virgin Island, Europe and Canada.Kids Foot Locker offers the largest selection of brand-name athletic gear, including footwear, apparel, and accessories. Kids Foot Locker outlets operate with approximately 1,500 square feet per store, which is almost less than half of the square footage of the adult Foot Locker stores.
Footaction targets the young male demographic through the offering of athletic footwear and apparel. The merchandise offered by Footaction focuses less on functionality and more on athletic style. As of 2019, Foot Locker operates 272 Footaction stores in the United States.
In 2013, Foot Locker acquired Germany-based Runners Point Warenhandelsges (RPG) for $94 million. The specialty athletic store operated 200 stores in Germany, the Netherlands, Austria, and Switzerland. RPG’s banner stores included Runner’s Point, Sidestep and an online subsidiary called Tredex. The intention of the acquisition was to not only bolster Foot Locker's European sales but also to leverage the digital capabilities of these stores to expand its e-commerce business.
In 2015, Foot Locker announced a strategic decision to wind down operations of Lady Foot Locker stores, although there are still 74 locations internationally. This is not an indication that Foot Locker is giving up on the women’s athletic apparel market, however, as the company intends to expand operations of its standalone store called SIX:02. The intention of this store is to sell yoga and training apparel while providing an intimate customer service experience. The total number of locations has increased from three stores in 2012 to 31 stores in 2019, with the business plan calling for more openings in the future.
Sidestep operates 70 shoe stores around the world, focusing on non-U.S. retail locations. It also operates an internationally-focused online store that generates eCommerce net sales primarily in Germany as well as in Austria and the EU. Sidestep-shoes.com specializes in the “Fashion” category, particularly in the area of “Footwear”. The online store was launched in 2011.
The Bottom Line
Foot Locker’s market capitalization of $4.22 billion is a result of various product lines. By diversifying merchandise offerings to the public through the companies mentioned above, Foot Locker has a stake in multiple facets of the athletics market by offering different items to various customer bases.