Foot Locker Inc. (FL) is a sports shoes and sportswear retailer with more than 3,100 outlets in the United States and approximately 20 other countries.Although the first Foot Locker retail store opened in California in 1974, the company has a much longer history.Foot Locker is the only remaining operating entity of the once famous FW Woolworth Company, which was founded in 1879 as a fifty cents national retailer.In the mid-20th century, Woolworth expanded its business by opening a series of specialty stores. In the process, the company acquired GR Kinney, a shoemaker who owns the Foot Locker brand. Over time, following the decline of the Woolworth flagship store, the company changed its name, eventually changing its name to Foot Locker Inc. in 2001.
Today, Foot Locker sells sports shoes, clothing and various other sports products worldwide. For this reason, Foot Locker now operates many subsidiaries and brands specializing in various products or sports.These brands include Lady Foot Locker, Kids Foot Locker and Champs Sports. In 2019, the company had sales of 8 billion U.S. dollars, and its current market capitalization was 3 billion U.S. dollars.
Throughout its history, Foot Locker has taken a number of measures to stay competitive in the rapidly changing retail environment. These include several major acquisitions aimed at expanding beyond the traditional physical form of retail. This strategy is in sharp contrast to its former parent company Woolworth, who failed to survive the hypermarket and later e-commerce era. Below, let’s take a look at the 4 most important acquisitions made by Foot Locker. Please note that Foot Locker does not provide annual revenue and profit data for its subsidiaries.
- Business Type: Sports Goods Direct Sales
- Purchase price: US$146 million
- Date of purchase: December 3, 1996 (announced)
Eastbay is a mail-order company for sporting goods that sells sneakers, clothing, equipment, and private label merchandise for many sports. The company was founded in 1980, went public in 1995, and has been operating as Foot Locker’s direct mail department since 1996.Eastbay is headquartered in Wausau, Wisconsin, and is one of the largest direct sellers in the United States. The acquisition was carried out before Woolworth’s name change. It is the key to Foot Locker’s success, providing an alternative network for selling its products during the decline of department stores and shopping centers.
- Business type: retail footwear and clothing
- Purchase price: $225 million
- Purchase Date: April 21, 2004 (announced)
Footaction targets the young male population by providing sneakers and clothing. The products provided by Footaction pay less attention to functions and more attention to sports style. In 2004, Foot Locker purchased approximately 350 Footaction stores from Footstar Inc., which was reorganized in Chapter 11. Although the initial agreement to purchase the Footaction retail store was US$160 million, according to reports, in response to competition, Foot Locker increased its offer to US$225 million. bid.This transaction marks Foot Locker’s commitment to the development and growth of retail footwear and sportswear. As of 2019, Foot Locker operates 250 Footaction stores, mainly in the United States and Puerto Rico.
Runner point group
- Business type: retail sports shoes and clothing
- Purchase price: US$94 million
- Purchase Date: July 10, 2013
One of Foot Locker’s recent acquisitions is the Runners Point Group based in Germany. At the time of purchase, the sports store operated 200 stores in Germany, the Netherlands, Austria and Switzerland. In 2012, the year before the acquisition, its revenue was $250 million.The acquired company’s stores include Runners Point, Sidestep, and an online subsidiary called Tredex. The acquisition strengthened Foot Locker’s European sales and used its digital capabilities to expand Foot Locker’s e-commerce business. As of 2019, there are 107 Runners Point and 80 Sidestep stores in Europe. The former caters to running shoes and the community, while the latter is a brand that focuses on sports fashion footwear.
- Business Type: Secondary Sports Shoes Market
- Purchase price: $100 million in minority equity investment
- Purchase date: February 7, 2019 (announced)
The most recent Foot Locker acquisition on our list is GOAT Group. GOAT is the secondary market for sports shoes management under the GOAT and Flight Club brands. Unlike other acquisitions, Foot Locker made a “strategic minority investment” in GOAT instead of directly acquiring the company. The percentage of GOAT owned by Foot Locker through its $100 million investment is not disclosed. Due to the nature of GOAT’s business, this investment is also different from the company’s early acquisitions. As a secondary sports shoe market, GOAT allows Foot Locker to enter a new niche market in e-commerce. Now, Foot Locker can enhance the value of its sneaker brand as a resale product, not just an initial purchase. The partners stated that the goal is to use Foot Locker’s global footprint and GOAT’s digital capabilities to expand the sales of the two companies.
Foot Locker Diversity and Inclusive Transparency
As part of our efforts to raise awareness of the importance of company diversity, we emphasized the transparency of Foot Locker’s commitment to diversity, inclusion, and social responsibility. The figure below illustrates how Foot Locker reports on the diversity of its management and workforce. This indicates whether Foot Locker disclosed data on the diversity of its board of directors, top management, general management and all employees in various indicators. We have used ✔ for transparency.
|Foot Locker Diversity and Inclusion Report|
|Race||gender||ability||Veteran status||Sexual orientation|
|Board of Directors||✔||✔|
|employee||✔ (U.S. only)||✔|