Is DSW Going Out of Business – DSW Closing Stores

By
Start Business Tips
-
Is DSW Going Out of Business
Is DSW Going Out of Business

Is DSW going out of business? In the retail world, like many other industries today, the fate of well-known brands often sparks curiosity and concern among consumers and industry observers.

One such brand that has recently been the subject of speculation is Designer Shoe Warehouse (DSW). The question on many minds is straightforward yet loaded with implications. The brand has been closing many of its stores, which is rather unsettling for its loyal customers. What’s really happening with DSW? Is DSW going out of business?

Well, the simple answer is no. DSW is not going out of business. Despite closing multiple stores lately and struggling with its finances, the brand is not on the brink of closing down.

Now, let’s take a closer look at all of these to help you get answers to some more questions you may have in your mind concerning DSW.

Is DSW Going Out of Business?

Contrary to some rumors and fears, DSW is not going out of business. While it’s true that the parent company of DSW, Designer Brands Inc., planned to close 24 stores in 2023, bringing the total to 85 closures over four years, the company still operates over 500 outlets in the United States.

Looking more closely at the whole thing, the closures look more like a strategic realignment in response to changing market conditions and consumer behaviors rather than a complete shutdown.

A Closer Look at DSW: What It Is and Business Model

Is DSW Going Out of Business
Is DSW Going Out of Business

DSW, under the umbrella of Designer Brands Inc., is a renowned American retailer specializing in designer and name-brand footwear and fashion accessories. The company’s journey began in 1969, launched by Shonac Company, the shoe licensee of Value City.

DSW stands out for its wide range of products, including private-label brands like Audrey Brooke and Kelly & Katie. The company has not only cemented its position in physical retail with over 500 stores but also boasts a robust online presence.

What about DSW business model? Well, recently, there was a change in the brand’s business model in order to adapt to the changing retail landscape. The company is now utilizing its stores as fulfillment centers and platforms for promoting its own and partner brands.

This shift reflects a strategic response to the evolving needs of the modern consumer and the retail environment. So, when the rumor, ‘Is DSW going out of business?’ broke out, it was obviously clear it was nothing but a rumor.

You may also like:

What Happened to DSW?

The COVID-19 pandemic had a profound impact on the retail industry, and DSW was not immune to its effects. The company experienced a significant decline in sales, which CEO Roger Rawlins attributed to the pandemic’s disruption of normal business operations and consumer behavior.

DSW’s sales dropped by 34% in March 2021 as a direct result of decreased foot traffic and the ensuing global health crisis. This led to the decision to close 65 DSW stores over a span of four years, starting with 24 closures in 2021. These closures were part of a broader strategy to mitigate financial losses totaling approximately $489 million.

Why Is DSW Closing Stores?

As we already pointed out, the primary reason for DSW’s store closures was the financial impact of the COVID-19 pandemic. The decline in in-store shopping led to a significant drop in sales, forcing the company to reevaluate its physical footprint.

DSW had to come up with a strategy to streamline operations and focus on the most profitable aspects of the business. This included working with fewer vendors and emphasizing its top 50 footwear brands, aligning with consumer trends towards more casual and athletic wear.

Is DSW Facing Financial Challenges?

Like many retail entities, DSW faced financial challenges, especially during the pandemic. However, the company’s recent financial reports show signs of recovery and resilience.

For instance, in the quarter ending April 30, 2022, Designer Brands’ net income increased significantly, indicating a recovery trajectory. The company is also on track to achieve its goal of $4 billion in revenue by fiscal 2026, suggesting a positive outlook despite the hurdles.

So, despite presently struggling with its finances, there is a great outlook that that the brand is doing everything possible to get out of the struggle.

But does this have anything to do with the question, ‘Is DSW going out of business?’ We don’t think so. It’s just a rumor that seems to have arisen from the company’s declined sales and store closures.

Is DSW Laying Off Employees?

In response to the changing business landscape, DSW did undergo layoffs to make the organization more efficient. This was part of a larger restructuring effort to better align the company with the current market demands and future goals.

In 2021, the company announced a restructuring that resulted in the loss of approximately 1,000 jobs, including both corporate and store positions. The company expressed its commitment to assisting affected employees during this transition.

But has the company been laying off its employees in 2023? We don’t think so. There has not been any official report that DSW is laying off this year. Instead, the news about the brand has been about the restructuring that included the closing of its stores.

Who Are the Competitors of DSW Shoes?

DSW competes with several key players in the shoe retail industry. These competitors offer similar products and target comparable market segments, making the competition fierce in the footwear retail space. Let’s take a look at some of its top competitors.

  • Zappos: Zappos.com is a significant competitor, known for its customer service and a wide range of footwear and clothing options. It differentiates itself with a strong emphasis on customer experience.
  • Famous Footwear: Famousfootwear.com is another competitor, offering a variety of branded footwear at competitive prices. It appeals to customers looking for value and brand variety.
  • Shoe Carnival: Shoecarnival.com competes in the same space by offering a wide selection of shoes for the whole family, often at discounted prices.

Apart from these brands, other noteworthy competitors include large retail chains and e-commerce platforms that have expanded their footwear offerings, directly competing with DSW in terms of variety, pricing, and customer reach.

Is DSW Going Out of Business – Final Thought

To answer the question, “Is DSW going out of business?” – No, DSW is not going out of business. While the company has faced challenges and made significant strategic adjustments, including store closures and a focus on digital and operational efficiency, it remains a key player in the footwear retail industry.

With a clear strategy for growth and adaptation, DSW is working to maintain its position in the market and meet its long-term financial goals.

So, the next time you hear this rumor about DSW, just disregard it because it’s far from the company’s present reality. DSW is not on the brink of closing down – it continues to operate strong in the industry!

FAQs

Who Owns the DSW brand?

DSW, which stands for Designer Shoe Warehouse, is owned by Designer Brands Inc. This American company operates over 500 stores in the United States, managing both the physical outlets and the e-commerce aspects of the DSW brand.

Designer Brands Inc. has been instrumental in shaping DSW’s growth and strategic direction in the competitive footwear retail market.

Why is DSW Not Selling Nike?

DSW stopped selling Nike products because Nike, in 2022, decided to cut ties with DSW and several other wholesale partners. This decision was part of Nike’s strategic shift toward focusing more on direct-to-consumer channels.

This move aligned with Nike’s broader aim to have greater control over its brand and retail experience, a trend increasingly seen among major brands in various sectors.

Is Nike Coming Back to DSW?

Yes, Nike is making a return to DSW. Executives from DSW have indicated in their earnings calls that Nike products will be reintroduced to DSW’s store shelves and website starting in fall 2023.

This reintroduction marks a shift in Nike’s strategy, suggesting a balanced approach between its direct-to-consumer focus and maintaining beneficial wholesale relationships with key retail partners like DSW.

Is Nike Abandoning Foot Locker?

Nike is not abandoning Foot Locker. This was clarified by Nike CEO John Donahoe, who addressed some of the confusion surrounding Nike’s relationship with Foot Locker. Donahoe emphasized that Foot Locker would continue to stock Nike products.

This statement from the CEO directly counters any rumors or concerns that Nike was planning to completely sever its ties with Foot Locker as part of its strategic shift towards direct-to-consumer sales.