Foot Locker joins Fanatics to increase merchandise options

Foot Locker is partnering with Fanatics to dramatically increase its inventory of officially licensed sporting goods such as t-shirts, hats and jerseys.

As part of the multi-year deal, Foot Locker (NYSE:FL) will be able to list tens of thousands of NFL, NBA, MLB, NHL and NCAA products on its website, from of the end of the year. Foot Locker will control pricing, marketing and point of sale, but orders will be fulfilled and shipped by Fanatics, the world’s largest licensed sportswear seller.

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Deals like this are a lesser-known part of the Fanatics business – in addition to its own store and e-commerce sites for major leagues, teams and colleges, Michael Rubin’s company also sells products through a handful of major retailers. The company has similar online partnerships with Nordstrom, Kohl’s, Macy’s and JCPenney. These retailers do not have access to the full line of Fanatics products; each partner has a different mix.

Details of revenue sharing from the Foot Locker deal, which also includes the Kids Foot Locker and Champs Sports websites, were not provided.

“Combining Foot Locker’s leadership in sneaker culture with the sports fan and assortment power of Fanatics is a natural fit,” said Andrew Gray, the company’s executive vice president for Foot Locker Global Stores. and Champs Sports, in a press release. “The coming together of these two dynamic forces will stimulate and serve the culture of sports and sneakers in exciting ways.”

When a product is sent directly from a brand to the buyer, although the point of sale is a different retailer (in this case, Foot Locker), it is known in the industry as “drop shipping”. . Within Fanatics, the agreements are referred to as “connected inventory” partnerships.

Last year, Foot Locker announced a pilot drop-shipping partnership with Nike (NYSE: NKE), one of the store’s largest suppliers. Dick Johnson, CEO of Foot Locker, said at the time that the program would help increase inventory and shorten lead times, all without the burden of keeping actual inventory. The program has since expanded to include more Foot Locker partners and more banners, such as Champs Sports and Eastbay.

“We continue to roll out our direct-to-vendor and regional delivery program to provide our consumers with a seamless extension of choice,” Foot Locker chief operating officer Frank Bracken said in an earnings call. in May. “Drop shipping also allows us to test new products and categories with a view to adding them to the assortment on a larger scale, including in our stores.”

Fanatics recently raised at a $27 billion valuation, 4x its August 2020 valuation. The company is rapidly expanding outside of its core merchandise business, including a new trading card vertical, a platinum -form NFT and, in the near future, a sports betting.

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