20 Mar DSW plans expanded service, more stores
Columbus-based DSW plans to spend $10 million on systems that let customers obtain the shoes they want whether online or in stores and to better compete with the likes of Zappos.com.
The footwear and accessories retailer also announced plans to expand the chain by more than 100 stores over the next three years, adding to the 394 stores the company operates.
DSW officials outlined an “omnichannel” strategy yesterday that allows customers access to DSW’s entire inventory — across all stores, warehouses and e-commerce fulfillment centers — whenever they want to buy shoes and whether they buy in person, online or via mobile device.
The initiative is underway.
The first step, said Mike MacDonald, president and CEO, was the introduction in 2011 of a program that allows customers to obtain shoes from the company’s e-commerce fulfillment center when the item isn’t in a store.
Later this year, in-store customers will be able to order from other stores, and online customers can draw from in-store inventories.
“Customer reaction to this new capability has been quite strong,” MacDonald said. “We know we are making many more customers happy.”
By 2015, the company expects that savings and increased sales from the program will exceed costs.
The news came during DSW’s fourth-quarter earnings report, during which the retailer beat Wall Street earnings-per-share estimates for the fourth quarter but said that bad weather hindered sales.
The company also offered a prediction for its 2014 fiscal year that was below expectations.
“Business was stronger in November and December and weaker in January when some of the weather hit,” MacDonald said.
Looking ahead for the full year, the company expects sales to grow by 6 to 7 percent, with comparable store sales to grow in the low-single-digit range.
The company predicts earnings to be between $1.80 and $1.95 per share. Analysts had predicted $2.09 per share.
The sales news sent shares down. They closed at $38.90, down $1.09, or 2.7 percent.