In its second-largest acquisition, Amazon buys the company for $970 million.
Parent company Brown Shoe looks to cut annual costs by $200 million.
Shoes.com, an e-commerce unit of Brown Shoe Co., posted weaker e-commerce sales in the third quarter. In the wake of tough sales across a number of divisions, Brown Shoe will implement a cost-cutting plan designed to save the company $200 million annually.
For the third quarter ended Oct. 29, Brown Shoe reported:
- Sales from Shoes.com decreased 2.1% to about $19.1 million from $19.5 million in the third quarter of 2010.
- Total sales decreased year over year 0.3% to $713.8 million from $716.1 million.
- Specialty retail sales decreased 5.0% to $64 million from $67.4 million in the third quarter of 2010.
- Same-store sales for the company’s Famous Footwear chain decreased 0.4%.
- Net earnings were $17.6 million, down 4.9% from net earnings of $18.5 million in the third quarter of 2010.
Internet Retailer calculates Shoes.com, No. 137 in the Internet Retailer Top 500 Guide, accounted for 2.7% of total sales, the same as in the prior year.
For the first three quarters:
- Sales from Shoes.com decreased 0.8% to about $50.9 million from $51.3 million in the first three quarters of 2010.
- Total sales increased year over year 2.6% to $1.95 billion from $1.90 billion.
- Net earnings were $18.7 million, down 51.4% from net earnings of $38.5 million.
Internet Retailer calculates Shoes.com accounted for 2.6% of total sales, compared with 2.7% in the prior year.
In order to cut costs, Brown is exiting children’s wholesale and other women’s specialty and private-label businesses, closing between 70 Famous Footwear stores in fiscal 2011 and and 75 more in 2012 for a total of approximately 145 stores, and closing all Brown Shoe Closet and F.X. LaSalle stores and a retail distribution center in Wisconsin.
“While our efforts to date have been focused on eliminating underperforming or poorly aligned assets, this is not our sole focus,” says CEO Diane Sullivan. “We are determined to expand our portfolio over the long term and to deliver enhanced growth through our focus on the strategic consumer platforms of family, healthy living and contemporary fashion.”