The big family-owned German-based shoe retailer, which also owns Ochsner Sport in Switzerland, has continued its expansion in the U.S. with the takeover of KicksUSA. Founded in 2002, the American retail chain, which specialized in the area of sneakers, athletic shoes and clothing, operates 64 stores on the East Coast, primarily in Philadelphia, New York and New Jersey, as well as a web store.
The shops of KicksUSA will be renamed Snipes, after the sneaker retailer chain that has belonged to the Deichmann group since 2011, operating more than 230 stores in nine European countries. Both chains address a similar type of customer.
Without revealing the price paid for Kicks, Dechmann said it was the biggest takeover in the company's history. The group had made its first acquisition in the U.S. in 1984 by acquiring Lerner Shoes, which resulted in the launch of the Rack Room Shoes chain. Deichmann replicated the shop fitting concept of Lerner Shoes, a mix of self-service and service to customers, in Germany and later in other parts of Europe. At the end of 2018, Deichmann operated more than 520 stores in the U.S., including also the Off Broadway chain acquired in 2001.
The group will continue the expansion abroad in 2019, notably in Dubai, China, Poland, Latvia and Estonia (more on this in Shoe Intelligence).
Blaming excessively warm weather in Europe and strong competition from pure e-tailers and fashion retailers, Deichmann reported relatively stable figures on a comparable basis for the past year. Its gross sales, adjusted for currency exchange effects, rose by 2 percent in 2018, reaching gross sales of €5.8 billion and net sales of €5 billion in 25 European countries and in the U.S under several banners. The growth on a same-store basis was limited to 0.1 percent.
Sales outside Germany represented 60 percent of the group's total sales. Deichmann sold 178 million pairs of shoes in its stores worldwide and on its web shops, an increase of 1 percent as compared to the previous year. The addition of new stores contributed to the sales increases in volume and value. At the end of 2018, Deichmann operated 4,053 physical stores and 40 web shops in 26 countries, employing a total of 40,698 people. This compares with 3,989 brick-and-mortar stores and 36 web shops at the end of 2017.
Deichmann is also selling its products through 40 web shops in 26 countries, plus four online marketplaces. The e-commerce division is enjoying a double-digit growth rate. As part of the development of its activities in this area, the group will launch a new homepage, called Deichmann Digital.
For 2019, Deichmann plans to invest a record of €285 million on various programs including the modernization of its store network, the opening of new shops, internationalization and digitalization. Deichmann plans to open 229 new stores worldwide and to renovate 256 existing stores in its 25 European markets and the U.S. in 2019.
More in Shoe Intelligence.
