Wolverine World Wide to shed Keds brand
Wolverine World Wide is making some changes to its portfolio.
The parent company of Stride Rite, Sweaty Betty, Sperry, Merrell, and other footwear brands has started a formal process to divest or license its Keds brand and Wolverine Leathers business, both of which it described as “low-profit contributors.” The move is in line with Wolverine’s strategy to reduce complexity and prioritize growth brands as it looks to increase long-term shareholder value.
In connection with the Keds and Wolverine Leathers brands and organizational changes, the company said it reduced part of its workforce earlier this week. It expects the initiative to result in approximately $30 million in savings in 2023.
“We believe the recent changes to our group reporting structure and the announcement of strategic alternatives for Keds and Wolverine Leathers, as part of our regular assessment of the portfolio, will put the business on an accelerated path to improved profitability and restore Wolverine as a best-in-class brand house,” said Brendan Hoffman, president and CEO Wolverine. “In this rapidly evolving retail environment, agility is more important than ever. As such, I firmly believe that portfolio simplification and prioritization are essential to achieving our goals.”
Including the impact from the workforce reduction, Wolverine expects to realize total savings of approximately $45 million in 2023 from organizational synergies and other indirect cost areas.
In addition, the company plans to build on the supply chain cost initiatives started earlier this year and expects to realize approximately $20 million of savings in 2023.
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Wolverine’s revenue rose 8.6% in the third quarter, to $691.4 million, fueled by strong performances from its Merrell brand and international business. Direct-to-consumer revenue rose 4.5% to $160 million.
Wolverine World Wide is a leading marketer and licensor of branded casual, active lifestyle, work, outdoor sport, athletic, children's and uniform footwear and apparel. The company’s portfolio includes Merrell, Sperry, Hush Puppies, Saucony, Sweaty Betty, Stride Ride, Wolverine, Bates and Chaco. It is also the global footwear licensee of the Cat and Harley-Davidson brands.