Snipes USA is betting big on brick-and-mortar. This week, the retailer announced the opening of a new store in Brooklyn, which is its second door on Flatbush Avenue. Snipes has 17 stores in New York and more than 100 throughout the country.
The retailer entered the U.S. market in May 2019 with the acquisition of KicksUSA, and since then has earned headlines for other major moves, including the acquisition of Mr. Alan’s in July 2019 and the stateside introduction of its elevated Snipes 2.0 concept in July 2020.
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Snipes’ footprint, according to president Jim Bojko, is only going to grow larger.
But its expansion is happening at a time when much of the attention in sportswear retail is on Foot Locker and JD Sports, who have bolstered their portfolios through a series of high-profile acquisitions of their own.
Below, Bojko sounds off on how JD Sports and Foot Locker’s moves have impacted the Snipes USA business, reveals insights into its expansion strategy and talks about some of the challenges ahead.
With the rise of digital, what makes expanding your brick-and-mortar footprint attractive?
Jim Bojko: “We did see digital go through the roof last year, but our brick and mortar sales kept pace. We’ve actually seen a lot of interest in our physical locations, and the traffic there has been really strong. Our mission is to push street culture forward to the community, we have an inherently local outlook with everything that we do. That requires a local presence in our communities so we can participate there, we can support, we can empower, we can celebrate, and we have to have a physical presence to be able to do that. From a more commercial perspective, our customer tends to prefer trying on items in person. There’s an instant gratification element that that plays a large role in the business that we do. For example, often times they’re planning to go out at night and don’t have the time to wait to buy digitally and have it arrive in the mail. And there are some of our customers who just prefer to pay in cash, so that’s why it’s important to shop locally. And finally, others find delivery services unreliable in our neighborhoods so it’s a bit of a challenge where our customer just wants to make sure they actually get their hands on it. All of that really lends itself and/or emphasizes why we continue to see a lot of opportunity in the in the physical space.”
Where will digital versus physical retail settle out?
JB: “I think we’ve gained a couple of years of digital acceptance with the customer and comfort with shopping digitally. For us specifically, I think that translates into more of an omnichannel play where our customer has got more comfortable with our digital channels and interacting with us in a digital world. We invested in our app, we invested in our website, so there’s a lot of investment there to make sure the digital world reflects that same experience we want to offer in store. This leads to more cross-channel shopping. You see the product online and you want to secure it right now so you buy it online, but you also want that instant gratification and you don’t want to rely on a delivery service so you pick it up in store later that day. I think we’ll see more of that, but I think we were going there anyway. This was more of an acceleration to get there.”
What regions are most desirable for expansion?
JB: “For our culture, New York City is really the No. 1 market in the world, and we’ll continue to invest there as best we can. It’s a very competitive market so we have to be very deliberate around where we go. Flatbush, for example, is a market where the customer that we cater to is very well represented, but there’s not a lot of other retail available to them. With our model of participating in the community and then providing a product that isn’t otherwise available, that’s the kind of market that we’re currently looking for and we definitely see plenty of opportunity. Chicago is a very interesting market, and certainly along the I-95 corridor there are interesting markets. But we have to work very closely together with our brand partners. Not just our ownership, we don’t just have to look at our cash position and whether we can afford it, but it also has to align with what our brand partners are looking to do. But certainly, we see a lot of potential even in the markets that were already in.”
What are your expansion plans for the rest of 2021 and 2022?
JB: “For 2021, there’s going to be a little bit more infill in areas like Flatbush. There will be a couple more doors this year, and next year. We’re bullish on continuing to expand, but with the supply chain issues right now, we want to be sure we can provide the product and the experience our customers are used to, and if we can’t get the product right, it doesn’t make sense to open new doors. That’s something we’re currently working on together with our brand partners. You only make a first impression once, so rather than enter with half empty shelves, we’d rather wait a little longer to go into those markets and do it the right way.”
How have the supply chain issues and congestion at the ports impacted the Snipes business?
JB: “They are impacting business heavily. Right now, it’s certainly looking like there will be more delays. Before the pandemic, sneaker releases would be well coordinated across the brands and retail partners. Now, it’s a bit more scattered, and there’s confusion on our customer side that we’re looking to manage. For next year, we think there will be further delays and also more cancellations. That means we need to make sure that we adjust our product mix accordingly and continue to invest in categories that are available and try to get as much of those categories that are that are going to be scarce as we can.”
Sportswear retail giants Foot Locker and JD Sports have gone on recent acquisition sprees. How will these affect Snipes?
JB: “We’re an inherently local or regional space, so from a customer facing side, I’m not sure that this will impact what we’re doing. The reality, though, is our brands are looking to work with fewer and fewer partners — the “fewer, bigger, better” mantra that’s been put out there. As our competition scales up, it certainly puts pressure on us to continue to grow as well and continue to be a relevant partner for our brands.”
Snipes isn’t foreign to acquisitions. Would the company consider snapping up other retailers?
JB: “We’ve had great success with our acquisitions to date. We have a lot of support from our ownership to continue to grow, so we’re always open to look at organic and inorganic growth. That’s part of our toolbox.”
What are your predictions for the holiday shopping season?
JB: “It’s going to be tight. I think product scarcity is going to be the name of the game. We think we’ll end up in a in a better position product-wise than we were in last year, but it will be challenging and well below where we used to be and what the customer is used to across the board. We’re doing our best right now to accelerate orders and making sure we’re equipped to deal with the supply chain issues that we’re already seeing. We think it’s only going to get worse. It will be OK, but it’ll be tight.”
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