US-based footwear retailer Designer Shoe Warehouse (DSW) is set to close its 38 stores of its Town Shoes brand in Canada by the end of the fiscal year.
According to DSW spokesperson Margaret Standing, the retailer has made this decision following a 90-day review of the brand’s performance, competitive positioning and future requirements, reported Cbc.ca.
Margaret was quoted by Cbc.ca as saying: “The decision to exit the Town banner was a difficult decision to make, given its heritage.
“Unfortunately, as the competitive landscape for mid-luxury, mall-based footwear has dramatically changed, comparable sales have deteriorated consistently and generated significant operating losses.”
The footwear retailer will also focus on its Shoe Company, Shoe Warehouse, and DSW Designer Shoe Warehouse banners after closing its Town Shoes banner.
The closure of Town Shoes stores is estimated to affect 400 jobs across the country. The retailer is planning to offer alternative employment at its other three footwear retail brands.
DSW chief executive officer Roger Rawlins said: “After completing our strategic assessment of the Canadian marketplace, we have decided to close its smallest retail banner and focus on the three largest family footwear banners, which we believe have the most potential for future growth and profitability.”
In May 2014, DSW acquired a 49.2% stake in the Town Shoes brand from Alberta Investment Management and other minority shareholders. It also acquired the remaining stake in May for $44.7m.
The company reported a total revenue of $795m in the second quarter ending 4 August, a 16.4% increase compared to the same period of the previous year.