The company has significantly reduced the number of traditional retailers it sells to in recent years to improve its profits and strengthen control over how its products are presented. This has hurt some independent sneaker and sports stores, which rely heavily on sales from Nike – the world’s largest shoe maker – to attract customers.
Nike is DSW’s largest sporting goods supplier, accounting for approximately 7% of DSW’s sales in 2020.
Selling products through its own website and physical stores earns Nike more than double the profit it would make from selling through wholesale partners. The company is also gaining much tighter control over customer experience and pricing. This is a big advantage for a high-end brand like Nike that wants to present its products to customers in an attractive and consistent way, and avoid the products being subject to excessive discounts.
Meanwhile, despite the loss of Nike, DSW believes it can increase its revenue by developing other sports brands.
“We are doing very well across our entire sports portfolio,” Designer Brands CEO Roger Rawlins said on Tuesday in a conference call with an analyst.