In 2004, Foot Locker acquired the Footaction USA brand. Following one of its best years during a difficult five-year period, net sales for Foot Locker increased 10% in fiscal 2013 (ends January) as compared to 2012 due to a 9% increase in same-store sales driven by higher footwear sales. Foot Locker spent $8 million more than in 2012 on marketing and advertising to support its strategic objective of differentiating its formats.
While Foot Locker has met its near-term goal of improving sales and profitability — as outlined in a strategic plan unveiled in 2010 — a longer term, the company is looking to expand its footwear and apparel offerings to attract a more diverse customer base and grow the business internationally. (Foot Locker is heavily dependent on athletic-shoe-giant NIKE, which supplies more than 60% of its merchandise.) Hicks wants Foot Locker to become the leading global retailer of athletic shoes and apparel. Already about 30% of Foot Locker’s revenue is earned outside the US, and that share is growing. Foot Locker is expanding in Europe while continuing to reduce its US store count due to declining footwear sales here. Going forward, the retailer plans to open more stores outside the US. Its strong financial performance in fiscal 2012 led Foot Locker up to date the sales and profit objectives outlined in its 2010 strategic plan. The revised plan aims to grow overall sales to $7.5 billion (up from the previous goal of $6 billion), increase sales per square foot of selling space to $500 from $400, and increase its net income margin to 7% from 5%, all by 2015.
