Payless ShoeSource Continues Global Expansion and Announces Franchise Deals for Stores in New Markets: Korea, Thailand and Vietnam
Stores to Open This Year
TOPEKA, Kan., Feb. 6, 2012 /PRNewswire/ -- Collective Brands' (NYSE: PSS) Payless ShoeSource unit announced today that it has signed two new franchise agreements with partners Emart, a business unit of Shinsegae Group, Seoul, for stores in Korea, and Central Marketing Group, a business unit of Central Group, Bangkok, for stores in Thailand and Vietnam, bringing the total countries which will have franchised Payless stores to 20 countries.
Payless and its partners said that in 2012 they expect six store openings in Korea, as well as five stores each to open in Thailand and Vietnam.
"The franchise model has proven to be a profitable and effective way to quickly reach more international markets with the Payless brand and all it has to offer -- great fashion, well-recognized brands, product quality and leading customer service all at a great price," said LuAnn Via, Chief Executive Officer and President of Payless ShoeSource. "Payless brings the know-how in footwear specialty retailing, a sophisticated sourcing and supply chain system and powerful seasonal product collections. Our franchise partners like Emart and Central Marketing Group bring their strong infrastructure and experience within the local market. Together with these new franchise partners we are truly excited to bring the Payless brand to these three countries and their nearly 200 million consumers."
Emart is well aligned with Payless' value price offering. Since its founding, the firm has reinforced a fundamental retail discounting principle called Every Day Low Price (EDLP) across its markets, and in 2010 declared a new price policy in which the company continuously provides products at low prices throughout the year, rather than short-period discounting such as on a weekly basis.
Central Marketing Group has more than 50 years of experience in distributing and marketing international brands in Thailand and Vietnam. It manages more than 120 brands in six different product categories including fashion and sports apparel, cosmetics, branded watches, electronics and home appliances, IT and stationery and traveling goods.
"We see strong alignment with our retail principles and Payless' model and are thrilled to partner with Payless to bring its store chain to shoppers in Korea," said Joo Hyung Park, Executive Vice President, Corporate Strategy and Operation of Emart. "Payless is known across the globe as an American brand that delivers great shoes and accessories for the entire family at a great price. We see strong synergy with Payless' products when aligned with Emart's number one competitiveness in the Korea retail market."
"We are excited to partner with Payless to bring its store chain to consumers in Thailand and Vietnam. They love fashion, shoe shopping and to get the latest styles at a great price. We know our local shoppers will discover a great specialty shoe retailer in Payless and will be thrilled by what they find in the stores," said Vachiranunt Suphakarn, Senior Vice President, Business Development for Central Marketing Group.
Through the franchise arrangements, Payless will provide both franchise partners with seasonal product assortments, as well as expertise in retail operations, merchandising, marketing and brand strategy. Both Emart and Central will provide retail location strategy, construction, logistics, store training and staffing and local marketing execution.
Payless' knowledge in large-scale supply chain management and expertise in managing the complexities of footwear allow for rapid growth in new geographies. As well, the retailer's sophisticated sourcing and supply chain setup allows it to serve the tastes of consumers of various cultures and climates around the world.
Both firms will utilize Payless' newest store format and will purchase Payless product directly from Payless' seasonal assortment with slight adjustments per the localized footwear needs of the market. Like the Payless stores in the U.S., the international franchise stores are expected to feature a wide assortment of shoes and accessories for the family including products for women, men and children covering a range of wearing occasions.
About Payless International Franchising
Payless, on a mission to democratize the latest fashion in footwear and accessories for all to enjoy, first launched its franchise operation in 2009 with its first-ever franchise store located in Kuwait, which also represented among the first Payless stores in the Eastern Hemisphere. By the end of 2009, eight stores were operating in three countries in the Middle East -- in Kuwait, Saudi Arabia, and the United Arab Emirates.
In 2010 the company continued its rapid franchise expansion with store openings in Bahrain, the Philippines and Russia and also forged multiple new franchise partnerships in new geographies for the continued expansion in 2011 and beyond. In August of 2011, Payless announced the opening of its 100th franchise store. Today, Payless has more than 140 franchised stores in 17 countries including Kuwait, Saudi Arabia, United Arab Emirates, Bahrain, Philippines, Russia, Peru, Turkey, Israel, Indonesia, Lebanon, Malaysia, Singapore, Jordan, Mexico, Morocco, and Egypt.
Payless anticipates the continued rapid expansion of its franchise store program, which represents an opportunity for approximately 700 stores in existing and new countries by 2014.
Payless and its nearly 4,500-store chain has an expanding global presence today in 34 countries and territories including the United States and Canada, where stores are wholly owned, as well as in Central America, the Caribbean, and South America, where the retailer operates stores primarily through joint-venture arrangements.
About Payless & Collective Brands, Inc.
Payless ShoeSource, Inc., a unit of Collective Brands, Inc., is the largest specialty family footwear retailer in the Western Hemisphere and is dedicated to democratizing fashion and design in footwear and accessories for all to enjoy. Payless offers customers a range of well-recognized brands such as Dexter®, Airwalk®, Champion®, Above the Rim® and Smart Fit®, as well as designer labels by Christian Siriano, Lela Rose, Isabel Toledo and Silvia Tcherassi. As of the end of the third quarter 2011, the company operated 4,455 stores throughout the Americas and an online store (www.Payless.com) and also currently has more than 140 franchised stores located in Asia, Eastern Europe, the Middle East and in Mexico and Peru.
Collective Brands, Inc. (NYSE: PSS) is a leader in bringing compelling lifestyle, fashion and performance brands for footwear and related accessories to consumers worldwide. The company operates three strategic units covering a powerful brand portfolio, as well as multiple price points and selling channels including retail, wholesale, ecommerce and licensing. Collective Brands, Inc. includes Payless ShoeSource; Collective Brands Performance + Lifestyle Group, focused on lifestyle and performance branded footwear and high-quality children's footwear sold primarily through wholesaling, with its brands including Stride Rite®, Keds®, Sperry Top-Sider® Robeez®, and Saucony®, among others; and Collective Licensing International, the brand development, management and global licensing unit, with such youth lifestyle brands as Airwalk®, Above The Rim®, Vision Street Wear®, STRIKEFORCE(TM), Clinch Gear(TM), Sims®, Lamar® and LTD®, World Snowboarding Championships(TM) and Hind®. Information about, and links for shopping on, each of the Collective Brand's units can be found at www.collectivebrands.com.
About Central Group
Founded in 1947, Central Group is one of the largest retail conglomerates in Southeast Asia. Consisting of five core businesses covering Retail, Real Estate, Brand Distribution and Development, Hotels and Resorts and Food Services, Central Group boasts 37 department stores, 15 shopping malls, 362 specialty stores, 67 hypermarkets, 77 supermarkets, 14 hotels, 480 international fast-food outlets and 120 exclusive brands.
Since the first store opened in 1993 as Korea's first hypermarket, Emart Co., Ltd. has achieved strong growth. With the acquisition of Walmart Korea in 2006, the number of Emart locations reached the 100 mark. Today, Emart is truly Korea's no.1 discount store with more than 150 stores across Korea and China. By 2015, the company expects to expand its retail presence in the region to nearly 250 Emart stores in Korea, China, as well as Vietnam. Emart has fundamentally changed the Korean retail industry with the motto of "Every Day Low Price." Currently, Emart Co., Ltd. has various channels including hypermarket (Emart), small scale market (Emart Everyday), category killer warehouse store (Emart TRADERS).
This release contains forward-looking statements. The statements in this release regarding the business outlook and expected performance, as well as other statements that are not historical facts, are forward-looking statements. The word "expects," "anticipates" and similar expressions are intended to identify forward-looking statements. Forward-looking statements are estimates and projections reflecting management's judgment based on currently available information and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. With respect to forward-looking statements, management has made assumptions regarding, among other things, performance of franchisees, the timing of various events and the economic and regulatory environment. A variety of factors could cause actual results and experience to differ materially from the anticipated results or expectations expressed in forward-looking statements. These risks and uncertainties that may affect the operations, performance, and results include, but are not limited to: the impact of competition and pricing; changes in consumer preferences and spending patterns; general economic, business and social conditions in the countries where franchisees operate; changes in weather patterns; the financial condition of franchisees; changes in existing or potential duties, tariffs or quotas, and the application thereof; changes in relationships between the U.S. and foreign countries as well as between foreign countries; economic and political instability in foreign countries, or restrictive actions by the governments of foreign countries in which franchisees, suppliers and manufacturers are located; changes in trade, intellectual property, customs and/or tax laws; fluctuations in currency exchange rates, (e.g. yuan, Canadian dollar, euro); performance of other parties in strategic alliances; the ability to comply with local laws in foreign countries; our ability to maintain and upgrade information systems; threats or acts of terrorism or war; strikes, work stoppages and/or slowdowns by unions that play a significant role in the manufacture, distribution or sale of product; changes in commodity prices such as oil; and other risks referenced from time to time in filings of ours with the Securities and Exchange Commission, including our annual report on Form 10-K for the year ended January 29, 2011 in Part I, Item 1A, "Risk Factors" and in each of our Form 10-Qs. Collective Brands believes these forward-looking statements are reasonable; however, you should not place undue reliance on forward-looking statements, which are based on current expectations and speak only as of the date of this release. Collective Brands is not obligated to publicly release any revisions to forward-looking statements to reflect events after the date of this release.
SOURCE Collective Brands, Inc.
Mardi Larson, +1-612-928-0202, for Collective Brands, Inc.