Brown Shoe Co. will continue to invest heavily in the turnaround at Famous Footwear. While traffic and sales were sluggish at the company’s family footwear unit, operating profits jumped more than 88% for second quarter as gross margin improved 200 basis points and operating margins increased to 4.4% in H1 from 3.3% in H1 2002.

The operating improvement is now being coupled with stronger relationships with the athletic vendors that now account for more 60% of total Famous Footwear sales. The shift is not surprising after the company brought in Joe Wood, the former head merchant at The Finish Line, as president of the Famous division.

“The recent good news is we have seen a marked change in the performance of the athletic category…”,  said Wood. He said the trend, coupled with continued gains in the women's, kid's  and men's categories should enable FF to report “modest” comp gains through back-to-school and “hopefully” the year. 

Famous Footwear's back-to-school business has been “a little more robust” than the company had expected at the beginning of the year, Wood said. “The performance of a K-Swiss, the performance of a Converse has been absolutely stunning,” he said, and added that New Balance and Nike were also doing well.

Famous is now doing more make-up product with key vendors “such  as  Nike,  Converse,  K-Swiss, New Balance, Asics, Avia and adidas”, with Wood intimating that some of the vendors now have dedicated design and sales staff for FF.

The company has remodeled about 400 FF stores in the last 18 months and will have 500 remodeled by the end of 2003 and 700 by the end of fiscal 2004.The remodels will be coupled with increased efforts on the marketing side to build consumer awareness of the new Famous format and brand strength.


>>> The key will be generating traffic, and when that happens, hold on…