MOSS ADAMS CAPITAL: Apparel and foowear market monitor highlights notable deals, stock prices and results.
Details on Industry Insight.
For fiscal 2007, Zumiez posted low single digit footwear comps for most of the year, then struggled in December. The company believes in carrying footwear as a long term strategy so plans to soldier through with the category even in the downturn.
Executives also said they were planning the footwear business cautiously this year because they are not sure of competitor PacSun's liquidation strategy as PacSun exits the footwear business.
As far as trends, Zumiez will be carrying more brightly colored shoes this season, mirroring the color trend going on with apparel.
Other interesting information from the call:
Key strategies going forward: Strategies include hiring and motivating a great staff, continuing to be a destination for the action sports consumer by offering a diverse product mix; and growing its store count, which feeds success and helps keep talented employees by offering them a career path.
Juniors: Juniors recorded double digit comp increases in the fourth quarter. As a result, the company plans to add a little bit of inventory going forward. Juniors is still a small piece of the business at about 15 to 16 percent of the mix.
Young mens: Executives did not think there was any one reason why the mens business hit a bump in February. The category is up against tough comparisons from last year and believes the larger macro economic issues are a factor as well.
Private label: In 2007, private label was 15.4 percent of the business compared to 14.3 percent. Executives believe that number could reach 20 percent, but they don't have a hard target.
CEO Richard Brooks, right, said Zumiez rolls with the cycles and decreases or increases private label accordingly if there is a branded cycle going on or not.
Downturn opportunities: Zumiez believes it can attract top talent and locations in a downturn.
New stores: The company will open 57 news stores in 2008. New markets include Massachusetts, Rhode Island and possibly Virginia. Currently, Zumiez operates 285 stores.
Same-stores sales fiscal 2008: Zumiez expects flat to a low single digit increase.