The Athlete’s Foot

Athletes Foot

The Athlete’s Foot aims to grow as a source of urban footwear and apparel.

By Alan Dorich

Not many brands can emerge from bankruptcy to successfully reinvent themselves in their market, but The Athlete’s Foot has accomplished that in recent years. “We are very much a fighter within the marketplace,” Adam Chait, CEO of The Athlete’s Foot USA declares.

The retailer, which has its global headquarters in Amsterdam and its U.S. headquarters in Atlanta, sells athletic footwear and apparel in 29 countries. Chait explains that when the company started operations in Pittsburgh in 1971, “We were one of the first multi-brand retailers in the athletic space.

“In the mid-‘90s, The Athlete’s Foot reached its peak,” he continues, explaining that the company was the dominant player in the athletic specialty space. But it hit a rough patch in the mid-2000s with bankruptcy and was repeatedly bought and sold by a series of owners.

Being Better

INTERSPORT, the world’s largest sporting goods retailer, bought The Athlete’s Foot in 2012 and organized a turnaround. After performing research, The Athlete’s Foot executive team determined that consumers were increasingly wearing athletic footwear and apparel for uses other than performance.

“What we realized was the market was moving toward end users who were using sneakers as fashion statements,” Chait says, noting that Athletes Foot info boxthese consumers often dress themselves from the sneakers up. “They look in their closet and first decide which pair of sneakers they want to wear.”

The Athlete’s Foot’s executive team repositioned the brand, which included changing the store’s colors and designs with upgraded lighting, fixtures, mannequins and music. “[We added] all the things that deliver a premium, cool, in-store experience,” he says. “We’re focused on growing our apparel business and having different fixtures that tell those key stories.”

The Athlete’s Foot also added TVs that feature music videos or custom content. “It’s a much more interesting environment,” Chait says.

Additionally, the company consolidated its relationships with vendors. Each store previously had its own relationships with suppliers, but “we agreed to consolidate all of those accounts into a single one,” he recalls.

“That’s allowed us to be more strategic and thoughtful,” he continues. “We can do things that benefit our consumers and franchisees, and benefit our vendors in how they want their stories told.”

Today, The Athlete’s Foot has approximately 525 locations worldwide. “We’re on a path to hit 1,000 in the next few years,” Chait says. “With each new store we put out in the marketplace, we want it to be better than the one before. We’re always adding enhancements as we go along.”

Fashion Forward

The Athlete’s Foot serves a customer base of 18- to 24-year-olds who are “urban fashion forward,” Chait says. “They are social, they are engaging and they are very digital in nature.

“They are into hip-hop and they put a lot of focus on fashion,” he continues, noting that its customers tend to be early adopters of trends. “They also may be into sports, yoga or healthy living, but at their core, they’re really fashion-forward.”

The Athlete’s Foot locations, Chait adds, strive to wardrobe its customers from head-to-toe. “We want our consumers to say, ‘Here is the hot pair of shoes, but here’s the sweatshirt, the sweatpants, the hat and the backpack that complete the look,’” he says.Athletes Foot 2

It is a good time for The Athlete’s Foot to be in business, he adds. “We’re fortunate that the whole athleisure trend is not only big and vibrant, but it feels permanent,” Chait says. “It’s nice to participate in a market that’s healthy and growing.”

Its primary brands, he notes, do an excellent job of managing the amount of supply in the marketplace relative to demand. “It creates a really healthy environment for everybody,” he says.

Locally Focused

The Athlete’s Foot’s model of being locally owned and operated has set it apart, Chait says. Many of its competitors, he notes, make their buying decisions out of their corporate headquarters.

But The Athlete’s Foot’s franchisees get to determine much of what they stock. “They’re on the floor and they know their consumers,” he says. “They know what colors, what styles and what silhouettes are working for them.”

The company’s store employees also have more experience. Its competitors often experience frequent turnover, but “our franchisees are folks who have been with the business 12 to 25 years,” Chait says.

“In some cases, there are multiple generations that are part of our business,” he adds, noting that several franchisees joined The Athlete’s Foot over 20 years ago and are now passing on their business on to the next generation.

This experience gives a sense of permanency to its locations. “There’s many stores where we know our franchisee is serving his second generation [of customers],” he says. “Those kids have gone on to get married and they’re bringing their own kids in the stores.”

The Athlete’s Foot’s stores also form connections in their regions. “We’re really focused on how we can give back to the community and strengthen our ties with them,” Chait says.

These include sponsorships with local high schools as well as free turkeys during Thanksgiving. “We have franchisees who do these things to weave their fabric into the local area,” he says.

Perfect Partners

A longtime veteran of the retail and consumer goods spaces, Chait joined The Athlete’s Foot in 2015. “One of the guys I previously worked with is Ingmar Kraak, our global CEO,” he explains, adding that the company approached him to do consulting work, which led to a permanent role.

He praises The Athlete’s Foot’s stakeholders who have contributed to its turnaround, including INTERSPORT. “They’ve given us the vision, the strategy, the resources and the support required to reposition our brand, and invested in us to sustain us for long-term success, as opposed to a short-sighted view,” he explains.

The company’s franchisees also have been key, since they invested their own money in remodeling the stores. “That was not an inexpensive proposition,” he admits. “We were able to remodel 100 percent of the stores in two years.”

But this was only possible, he notes, because the franchisees were willing to give up a little control. “They’ve trusted us as the office to represent their interest and advocate on their behalf,” Chait says.

He also highlights the company’s vendors, which include Nike Inc., Adidas and Puma. “As we’ve changed our business, they’ve been tremendous partners in supporting our growth,” he says.

Going South

Chait is optimistic about the future of The Athlete’s Foot, which plans to grow by adding some neighborhood locations in the Southeast. However, “We’re not looking at malls,” Chait notes.

The company has found that malls are too saturated. “We see studies that say 25 percent of malls are going to close in the next five years,” he explains. “We don’t want to have exposure to underperforming malls as their traffic is sinking.”

The Athlete’s Foot USA plans to open 15 to 20 stores in the next year. The company also will be launching e-commerce in 2018 and rollout omni-channel capabilities in 2019 so it can serve customers whenever and wherever they want.  “We have some very big goals, but I think they’re reasonable and achievable given the way we’ve been able to work so well as a team,” Chait says.

“We have great operators and a great team here in the office,” he says. “We know what to do and have the right team to do it.”

 

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