Establishments in this industry are primarily engaged in the retail sale of men's, women's and children's footwear; these establishments frequently carry accessories, such as gloves, socks and hosiery.
Establishments in this industry are either chain stores or individually owned stores. The National Retail Federation categorizes the vast majority as franchises that belong to large chain operations. Parent company involvement varies in daily franchise operations. This industry further divides itself into family shoe stores, which sell a broad range of sizes and styles, and specialty shoe stores, where a specific selection (such as athletic footwear or women's footwear) is offered exclusively. Athletic shoe stores were the largest specialty category. Other outlets, such as department stores, apparel stores, vendor outlet mall stores, and mail-order catalogs, also generate shoe sales.
Every year U.S. consumers spend over $20 billion in footwear. Products sold in this industry fall into several general categories, including athletic footwear, dress shoes, casual shoes, sandals, work/duty footwear, hiking/hunting/fishing boots, western/casual boots, and "other." In 2003, 1.97 billion pairs of footwear were sold in the United States. Sales in stores devoted only to footwear earned $22.6 million in 2003.
This industry developed from the cobbler stores that date back to medieval times and the mass manufacturers that emerged during the late nineteenth century. Modern stores that exclusively sold shoes began operating at that time. One of the oldest shoe retailers in the United States, Thom McAn, began when McAn opened several stores to sell his footwear.
Like other retailers that benefited from the country's growing population, shoe stores did well from the beginning of the twentieth century through the 1920s. During the early 1930s, however, they were badly hurt by the Great Depression, and sales dropped by an average of 20 percent. The industry expanded rapidly as the economy strengthened and became highly competitive by the 1950s, as fashion trends changed and footwear styles grew more diverse. At that time, the improved post-war financial conditions also allowed new small-business owners to enter this industry by purchasing franchise outlets.
The retail shoe industry experienced another boom during the late 1970s and the 1980s, as athletic footwear sales increased dramatically along with America's infatuation with fitness. Stores specializing in running shoes, tennis shoes, and general sport shoes spread rapidly across the country. Sales of these shoes doubled during the 1980s, and by 1990 athletic footwear became a $5 billion business as some retail price tags topped $100. The industry was impacted even further by this segment when athletic shoe leader Nike, Inc. opened its own giant Niketown retail outlets, led by a 90,000-square-foot flagship store in New York City, as well as others in Japan, Germany, and the United Kingdom. During the late 1990s, the athletic footwear segment experienced a leveling off of sales due to the oversupply of retail selling space and as consumers' fashion taste moved away from athletic shoes to "brown shoes." For the first time since 1992, wholesale figures for athletic footwear declined by 8 percent in 1998 to $8.7 billion (wholesale). The Sporting Goods Manufacturers Association "1999 State of the Industry Report" noted that "many traditional athletic footwear companies expanded into the 'brown shoe' and fashion categories, enabling them to continue to increase sales and expand their market reach."
The shoe store industry, like other retail industries, relied heavily on marketing departments and advertising agencies to generate consumer interest. One key marketing consideration has involved store location because, by the 1980s, the majority of U.S. shoe stores were located in malls. This arrangement allowed chains to operate small stores without high overhead costs, but operations became increasingly competitive as many footwear retailers often competed within the same mall. In 1993, Harlan S. Byrne told Barron's that Famous Footwear owed its considerable success to "its locations in strip centers, where competition is less than in shoe-happy malls." A NSRA survey in 1995 confirmed this conclusion, finding per-store profits were 4.1 percent at strip stores and 0.7 percent at mall stores.
Another important marketing device was store design. Off-price or discount shoes...