Footwear retailer Schuh will ramp up its openings and almost double its store portfolio after it was sold to US retail group Genesco for £125m last week.
Schuh managing director Colin Temple, who along with finance director Mark Crutchley has been locked into staying at the retailer for a further four years in an earn-out deal which will net them up to £25m each, said Genesco’s financial muscle meant the retailer could “up the ante” with regard to its UK growth. It will open four stores in the UK this year, taking its total store count to 63, but plans to open eight stores in 2012.
“The cost of capital under this new scenario is a little bit cheaper for us than borrowing through the banks,” said Temple. “We think the UK has the capacity for another 40 to 50 Schuh stores and this deal enables us to accelerate that.”
Meanwhile, Schuh could stand to benefit from a boost to margins if it opts to amalgamate some of its buying with Genesco’s US chain Journey, which has a similar brand and customer profile.
Genesco, which also wholesales Dockers footwear under licence, sells footwear from more than 2,285 outlets in the US and Canada.
However, Temple stressed: “We didn’t build this deal thinking we would get better margins, though they would be nice to have.”
He added that Schuh would look to expand into European markets in around two years’ time.
Separately, Schuh delayed the start of its summer Sale, pushing it back to yesterday, a week later than when it started last year. Temple said he had shifted the Sale date because he was confident he could clear the majority of its summer stock at full price.
“It is difficult to compare because this time last year we were already on Sale, but business has been quite kind to us,” he said.
Schuh was crowned Multiple Footwear Retailer of the Year at the Drapers Footwear Awards 2011 in May.