Starting in 2022, Nike fans will not be able to buy Nike sneakers, apparel and accessories at one of America’s largest shoe store chains.
As a result Nikes may be harder to find at stores. The company has significantly slashed the total number of traditional companies it sells to in an effort to improve profits and an effort to tighten control over how their products are showcased. As the largest shoemaker in the world, this move will drastically impact independent tennis shoe and athletic shops, which rely on attracting customers who are specifically shopping for Nike products.
On Tuesday, Designer Brands, the parent company of DSW, announced in an earnings call that Nike shipped the last of the products the stores will receive in September. Once DSW sells that allotment in stores and online, all Nike branded items will be gone from their inventory. DSW reports that Nike is largest athletic goods’ supplier and accounted for approximately 7% of DSW’s sales in 2020. Despite the partnership loss, DSW will work to make up the missed revenue by growing other athletic brands.
Nike reportedly has exited about 50%” of its retail partners and plans to focus its resources, marketing and products with just 40 retail partners, which include Foot Locker and Dick’s Sporting Goods.
Selling their products on their own website and physical stores allows Nike to net more than double the profit it would receive from selling to wholesale partners. Nike also believes the move is also an effort to prevent products from being discounted too heavily.
This seems to be a trend in the sneaker world as close competitors such as Under Armour and Adidas are following the same path by pulling back on retail partners and working to build a more direct-to-consumer experience.