Mitch Kummetz: So if there’s comp growth in ’24, do you anticipate some of that coming from just like now that you slowed the growth or shut down the growth of stores in Europe, is there an opportunity for comp growth in Europe, just kind of from the standpoint of like a mature ramp? Or do you see that as an opportunity?
Chris Work: Yes. I think I would look at this — I’m going to take your question a little bit higher level, and then I’ll come into Europe. I think when we’re looking at this business, we think we have opportunity for comp growth really across the business. Specifically because what we know this business has been able to do and where we have landed here these last couple of years, which is pretty disappointing to us, to be quite frank. But we’re looking at many of these locations, knowing we’ve got good locations. We’ve got buyers that are really homed in on finding the right product for what’s next. We’ve got good sales teams that are out there to serve the customers. And so as we tie this together and we think about 2024, we think we have a good opportunity.
Now earlier in this call, we talked about men’s as being an opportunity. And I think that’s a really good place for our business to start. I think each of our other categories have had some challenges as well. So as we look at those and we look at some of these new brands that Rick spoke to and the fact that we’ve continued to bring a lot of newness into the business, we think we have opportunity in our other categories as well. Geographically, we know that North America has been challenged. It has been just as much, if not more, than Europe. So we know that in the U.S., we’ve got opportunity. We believe we have opportunity in Canada. And as it comes to Europe, I think you’re absolutely right. We’ve got a lot of new units. We’ve been very focused on new markets and growth.
And as Rick said, we’re sort of pausing that with the idea that we need to grow comp and we need to focus on the customer and get back to basics to drive the profitability and cash flow, right, within that region. And then I think once we get to that level, we have the opportunity to rethink about growth because there still is a lot of growth in Europe. I don’t want to give the impression that the growth is not there. We just have to be able to do it in a profitable way with cash flow. And as we think about Europe individually, I mean despite the pullback we saw in overall sales, I mean, Europe did comp in 2023. It just did not comp to a level that we needed it to, especially in light of what you’ve seen with wage inflation and some of the other costs that have gone up in Europe.
So I believe there’s comp opportunity across the business, and I think that’s why you’re hearing us be pretty confident about the ability to grow sales despite the fact that we’ve got the 53rd week in closures that we’ve got to overcome.
Mitch Kummetz: Okay. And then maybe two last ones are a bit more strategic. One on the new brands. It sounds like the benefit that you’re seeing there is mostly on the men’s side. Is there also, I think, Rick, you mentioned the opportunity to do more women’s with private label, but there is also an opportunity to add brands to help the women’s business? So that would be my first question. And secondly, one month doesn’t make a trend, but footwear, it looks like it was positive in February. I’m just wondering, is that really a function of that you’re just starting to lap easier compares? Or have you also kind of worked on sort of pivoting with footwear assortment to try to drive better results there?
Rick Brooks: All right. Thanks for the question, Mitch. First, I guess just for clarity purposes around new brands. We have some brands that are new brands we’ve launched that are working well in women’s. So I’ll be clear about that. And where it’s really made a difference in the business, just not enough to tip it to the positive at this stage of the game. In the private label, we have a lot of good stuff there, too. And then other brands that we’re launching that are predominantly have benefited the men’s. We know there’s also a unisex aspect to how our customer buys products. So it becomes a little harder for me to quantify that for you to how it’s impacting women. We see that throughout our business with women buying boy shoes as an example, would be another example where we know it’s happening based upon the seismic we see playing out there, or we see it in T-shirts, where we’re selling small size of the men’s disproportionately to our typical business.
So it’s a little bit hard to answer that question, Mitch, just because we know there’s a unisex aspect to our business particularly with women in the business. But yes, we do have some brands that are specifically new in the women’s business, and we’re seeing some success just not enough to tip it to the positive at this point. So we’re always looking for brands across wide ranges that we think will really be relevant for all of our customers. I would guess would be the message you have for you there. On footwear, in February, yes, it was positive. But it was a promotionally driven positive number. So what I will tell you about footwear, Mitch is, we have just been clearing footwear aggressively and we’ve had a lot of footwear. We’ve had some good help from our brand partners here in doing this.
But as you know, it’s been an issue in a challenged department for a while now. And so what you’re seeing us do is get inventory in position so they can really go after newness in footwear. So I think, Chris, inventory in footwear was down.
Chris Work: 30%.
