Footwear Insight

28 • Footwear Insight ~ September/October 2024 footwearinsight.com future is even that much more exciting. Handling hot button issues for retailers such as DTC, shipping costs, product availability & pricing: DTC – We do operate a DTC site, but its primary focus is building and maintaining brand awareness and corporate identity. It has been a useful outlet for clearance items. Current, full price product is always listed at MSRP. Product Availability – As a rapidly growing brand, our biggest challenge with product availability arises when our retailers express frustration over the lack of inventory for replenishment. We are a stock house, but in recent years, in order to grow sustainably, we've become more focused in our collections and planned inventory. Our growth coupled with the fast-paced sellthrough of our shoes makes it difficult to precisely forecast inventory needs... We frequently encounter situations where thousands of pairs sell out almost as soon as they arrive... While this could be considered a "luxury problem," it remains a significant challenge. Retailers must place larger future orders for styles they are confident in to ensure smoother supply and demand management. Pricing – Pricing remains a significant concern as costs continue to rise. Our goal is to consistently price our shoes based on perceived market value, while striving to maintain stable prices for as long as possible. We aim to, as much as we can, absorb the increasing costs of materials and production, minimizing the impact on our wholesale customers and end consumers. — Sam Spears, President, ara Shoes North America ARCOPEDICO What role does the independent retail channel play in the brand's overall strategy? Independent retailers continue to be the backbone of our business. We do not sell large department stores, so independents are truly the bread and butter of what Simco Imported Shoes does. When you think of some of your best retail partners, what words come to mind? Compassionate, Understanding, Attentive, and Ethical. Partnership is an interesting word. We want someone who sees our side as a distributor and takes into account what sacrifices we make. Sometimes people are only concerned with their own bottom line. A true partner wants the brand to be healthy as well as themselves. We are fortunate in this industry to have partners who truly are friends. We can strategize creative solutions for the retailer to be successful while Simco is successful at the same time. In 2024, what are some of the biggest challenges (or strategies) to maintaining a good brand/retail relationship? e biggest struggle is that I only want to sell to independent retailers, but unfortunately the amount of independents has shrunk considerably over the past few years, so we are forced to explore other options. One avenue is our DTC website. I never discount online, and I do not undercut anyone, but it's something that we've had to put in place to make up for the business lost due to Covid. So many of our partners who had stores and were Simco customers for years are gone now, and there's no one opening new shoe stores. We have to explore other revenue sources, even though what we want to do is strictly sell independents. Handling hot button issues for retailers such as DTC, shipping costs, product availability & pricing: We are trying to balance our inventory without being overstocked, but this has led to some situations where we have been backordered on products. ankfully our retailers understand the challenges we face, and I always encourage people to pre-book items to guarantee stock for their stores rather than relying on in-season orders. Our DTC website is completely ethical, and we never discount online. If anything, marketing dollars we put toward the website on social media only help build brand recognition, and we can direct consumers to brick-and- mortar stores through our Store Locator. All of our products sit right around 55 points margin before any special pre-season discounts, and I believe our pricing is fair. Shipping costs are through the roof. I recommend retailers join NSRA's shipping program to get their discount as it's better than I can offer as a small company. Key Initiative: We love to hold contests, and one of my favorites is our "Arco Rewards" Scratcher contest, in which sales associates can scratch off to win $3, $5, $10, or a FREE PAIR. It's a little more exciting than just getting Spiffs, and I love to engage the employees and make it fun. — Sydney Simas, VP, Simco Imported Shoes BROOKS What role does the independent retail channel play in the brand's overall strategy? The specialty run channel continues to be the no. 1 channel of focus for Brooks. It is not only the best curator of product, they are the center of their running community. If your brand doesn't resonate at specialty run, it isn't resonating with runners and walkers When you think of some of your best retail partners, what words come to mind? e best running stores are described with words such as Service, Expertise, Authenticity, and Community. In 2024, what are some of the biggest challenges (or strategies) to maintaining a good brand/retail relationship? With the proliferation of brands at run specialty, we continue to put strategies in place to be the easiest brand to work with for our partners. If they sell a Glycerin on Saturday, we need to get them back in stock before the next weekend. We continue to hold the no. 1 ranking by the Running Industry Dealer Report for on-time delivery of futures and at- once orders, availability of product, internal customer service, and sales reps, which are all the touch points that a brand needs to excel at to compete. If product is equal, Brooks is POWER IN PARTNERSHIP

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