Steve Madden Shrugs Off Impact of Macy’s Closures
Following a strong 2023, Steve Madden executives addressed concerns regarding how recently announced store closures could impact the company’s wholesale business.
Macy’s Inc. — a major carrier of Steve Madden — said on Tuesday that it would close about 150 “underproductive locations” through 2026, with 50 of these closures set for 2024. The news came a month after Macy’s announced a decision to lay off about 2,300 employees, or 3.5 percent of its total workforce, and close five stores and two furniture galleries.
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When asked during a call with analysts on Wednesday about how the recently announced Macy’s closures could impact Steve Madden’s business, the company’s chairman and chief executive officer Edward Rosenfeld said he did not expect a major negative hit.
“I don’t think we’re looking for any significant impact to 2024 and even beyond ’24,” Rosenfeld said, noting that it remains to be seen what Macy’s stores will be impacted by this decision. “My initial take is that there probably will be pretty minimal impact because the bulk of what we do with Macy’s is in the top 250 doors.”
Rosenfeld gave the example of Madden Women’s, which he said is mainly concentrated to the top 200 stores in the Macy’s fleet. These doors, he anticipates, are less likely to be impacted by closures. On the other hand, Madden Girl footwear, some accessories categories and colder weather categories are more exposed beyond the highest-performing Macy’s doors, and potential closures could mean more of a potential impact.
“But that impact should be relatively modest,” Rosenfeld said.
In its fourth quarter results reported on Wednesday, Steve Madden said wholesale revenues grew 4.9 percent to $354.8 million. Wholesale footwear revenue was down 0.4 percent, offset by wholesale accessories and apparel revenues, which was up 56.5 percent.
Looking ahead, Rosenfeld said the company expects branded and private label footwear to see growth in 2024, with the latter experiencing faster growth as customers recover from inventory slumps and look for more new products.
“We expect to see some pretty nice growth even starting in Q1 in wholesale footwear in the private label segment,” Rosenfeld said.
In the department store channel, specifically, Rosenfeld said Steve Madden is in a strong position to take share, should retailers’ comp sales improve throughout the year.
“We’re confident that we’re very important vendors, and that we’re going to get more than our fair share,” he said. “We’re positioned to take share, frankly, in that channel.”
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