MERCHANDISING

ANDY MEYER

Off Broadway Shoe Warehouse

WHERE ARE WE GOING?

EOY Average Store Inventory (Footwear)

34,744

31,33730,636

28,034

20,000

22,000

24,000

26,000

28,000

30,000

32,000

34,000

36,000

DEC

2013 2014 2015 2016

$194,000,000

$196,000,000

$198,000,000

$200,000,000

$202,000,000

$204,000,000

$206,000,000

$208,000,000

$210,000,000

$212,000,000

Retail

2013 2014 2015 2016

Total Company Comp Store Retail Sales

$80,000,000

$85,000,000

$90,000,000

$95,000,000

$100,000,000

$105,000,000

Margin $

2013 2014 2015 2016

$40.50

$41.00

$41.50

$42.00

$42.50

$43.00

$43.50

$44.00

$44.50

$45.00

AUR

2013 2014 2015 2016

Footwear Margin $ Footwear AUR

MILLIONS OF SHOES

WHEN DO WEPURCHASE FOR YOUR STORES?

SPRING 2016Merchandise and Product Creation Calendar

FEBRUARY 2016

FEBRUARY 2015

NOVEMBER2015

OCTOBER2015

JULY2015

MAY2015

APRIL2015

Product Creation CalendarSPRING 2016

PLANNING - TIMELINE SPRING 2016FASHION GROUP ATHLETICS MARKETING

MILESTONE TASK DETAIL ASSIGNED TO START DUE START DUE STARTSize Optimization Profiles Review and setup Size Optimization Profiles Assistant Buyers 1-May-15 30-Jun-15 1-May-15 5-May-15

Post Mortem Q1 2015 Review Sales Results - Pre Q1 2015 Planning Planners & Buyers 12-May-15 12-May-15

Top Level (Dept) Sales Plan Sales Plan: SS 2016 (Expansion, IMU, AUR and Turn Goals) Andy, Mike & Planners 15-May-15 15-May-15

June FFANY Buyers & Assistants 2-Jun-15 4-Jun-15 2-Jun-15

Post FFANY Market Review & P Type Level Sales Planning

Initial "Big Ideas" Outline; Review Sales Plan Planners & Buyers 9-Jun-15 26-May-15

SS 2016 OTB Plan Enter Sales and Receipts Plan I Planners 9-Jun-15 19-Jun-15 12-May-15 26-May-15

Assortment Planning Setup Season Assortment Sheet Parameters Planners 1-Jun-15 5-Jun-15 1-Jun-15 5-Jun-15

DAP Creation Update store groups, create DAP ID Codes Planners & Assistant Buyers 16-Jun-15 20-Jun-15 1-Jun-15 5-Jun-15

Order Entry Buying Teams 23-Jun-15 30-Sep-15 1-May-15 25-Jul-15

Pre-Market Assortment Review Review SS 2016 Sls/Rec/EOS Plan; Refine "Big Ideas" Outline

Andy, Mike, Planners & Buyers 30-Jul-15

Lock in FW 2015 OTB Plan Final Sls/Rec changes to OTB Plan I Planners 31-Jul-15 31-Jul-15

August FFANY Buyers & Assistants 4-Aug-15 6-Aug-15 4-Aug-15

Post Mortem Q2 2015 Review Sales Results - Pre Q2 2016 Planning Planners & Buyers 11-Aug-15 4-Aug-15

Style Out Buyers - schedule individual time with Andy Andy & Buying Team 11-Aug-15 13-Aug-15 23-Jun-15

Post FFANY Market Review Finalize "Big Ideas" Outline; Last Review Sales & Receipt Plan Planners & Buyers 13-Aug-15

Platform/Magic Buyers & Assistants 17-Aug-15 19-Aug-15 17-Aug-15

Assortment Plan Deadline for Preliminary Line Review

All Sku detail entered into Assort Plan - no changes until after Pre Line Review Buying Teams 31-Aug-15 19-Jun-15

Preliminary Line Review w/Andy Andy, Mike, Planners & Buyers 3-Sep-15 23-Jun-15

Assortment Plan Deadline for Official Line Review All Sku detail entered into Assort Plan - no changes until after Line Review Buying Teams 7-Sep-15 7-Jul-15

SIZE OPPORTUNITIES

Julie Brigham

Don’t you just hate it when a customer comes in and loves a shoe,

but they can’t find their size?

Our Definition of Size Optimization

Athletics analyzes brands by category. Key programs are analyzed at the sku level. We are able to build prepacks

Determining a size curve by store by using historical sales data

Results enable us to identify left, center and right stores, ultimately creating a higher sell through by size

Level of detail used in analysis varies by department

Store Department Product Type Category 6.5 7 7.5 8 8.5 9 9 10

A Athletic Women’s Running Premium 3% 10% 22% 23% 21% 17% 3% 1%

Mid Price 2% 15% 18% 25% 18% 15% 5% 2%

Base Price 5% 18% 18% 22% 20% 14% 2% 1%

B Athletic Women’s Running Premium 2% 5% 18% 22% 21% 17% 10% 5%

Mid Price 1% 8% 17% 21% 18% 18% 11% 6%

Base Price 3% 9% 16% 17% 18% 20% 12% 5%

Size Optimization

0.00%

2.00%

4.00%

6.00%

8.00%

10.00%

12.00%

14.00%

16.00%

18.00%

5 5.5 6 6.5 7 7.5 8 8.5 9 9.5 10 11

Sale

s by

Size

% to

Tot

al

Size Scale

Nike Running - Seasonal Comparison

Q2 2016 Holiday 2016

Sample Size Op Results

What We Have LearnedSales by size can vary by brand, product type and

category in a store

Example – store 5066 is a center store for Asics, but a

right store for Skechers

A store’s sell through by size can vary seasonally

Just because a store sells to the left or right of the size

curve doesn’t always mean that they need size 5’s or 11’s in every sku. We are working to identify those stores that

need fringe sizes

By reducing sku count, we will be able to buy deeper in

the key sizes that drive profitable sales

NOW THAT YOU KNOW A LITTLE MORE ABOUT THE

MERCHANDISING PROCESS…LET’S ANSWER SOME OF

YOUR QUESTIONS

Manager’s QuestionsWhy have we shifted deliveries and inventory build up to the point of hurting what was or traditional busy months of season change to holiday and BTS only? All of our loss over the past 5 years can be linked to March and October. When are we going to eliminate heavy carry over of sandals and boots each season and taking dot rolls off season instead of discounting in season? ________________________

Why can't we get the brands our customers want?

Sizes and widths have been brought up on may meetings and calls and still nothing has seemed to change. What is the chances that it will or can be? ________________________

Look books on flow to help with visual guide for staff? More often than the twice a year?

How can we get inventory more consistent year around and not have major dips which impact sales? _________________________

Can we get hush huppies? Can we get black slip-ons for Vans? _________________________

Is it possible to have the DC do all the shipping to the store thus having more control and avoid vendor drops?

My store sells more work and non slip shoes then any of the other OBSW stores. Could we expand our selection with a bigger verity of styles and colors? I have had requests for tall non slip shoes and even rain boots that are non slip. We have had request for additional colors including brown and white. _______________________

How do you outline/process to purchase shoes?

I would like to hear about any new incoming brands. (Keen, Chaco, etc.) Upcoming trends. What is the next 'go to' shoe for this season? ________________________

Will we ever has a system to evenly spread out the shipment for the weeks. Instead of 100 cases one day and 25 the next?_________________________

Do we have women's work boots available to us?

Why don't we get more children’s all white or all black tennis shoes for BTS?

Men's comfort product is starting to hit the store again. Are we going to see more casual lace ups? ________________________

We are very slip on heavy in casuals. Athletics; will we diversify any from the Nike/Skechers? Is Adidas dead; and Saucony almost dead? Hats, so many hats. Are the baseball cap styles selling across the board? Women's Wedge sandals? Will we see a reduction in this stuff since we have so much carry over? Chunk heel and flats seem to be what's going to be big this year.

Is it possible to get the DC to put like items in the same boxes to alleviate some of the mixed cases? ________________________

Can we get rid of the single pairs more often so they are not just sitting in our back rooms?________________________

Will we ever get men’s western in

Canton, GA?

Manager’s Questions

Any new high end brands coming soon? How can we request more of our top sizes that are selling? A lot of customers asked for Men's Bearpaw this winter; any chance we can look into getting them next year? Customers always complain about not finding enough wide/narrow widths; how can we request more?________________________

Why can't we get more 5's and 11's in women's sizes and 7's in men's ? I think if we had more of these sizes available we would make more sales.

Why do we get wool items in south Florida?

_________________________

When should be expect an accurate measure of capacity to be applied to product flow?

_________________________

Why are we not being assisted with meaningful dot markdowns corresponding to significant product receipts in relatable departments?

Can we get more access to product knowledge prior to receiving the product it relates to? Also; could we have a notation made on athletic shelf labels informing customers of the type of shoe (runner; cross trainer; walker) and sub categories of neutral runner; over/under pronator? This would also be beneficial to list on boots if they are leather or wide calf etc. (on the shelf label)

________________________

Will we be getting any version of slim calf boots or styles that we can promote as adjustable?

Why don't we ever get handbags that tell a story? It seems like all we get are bits and pieces of random merchandise._______________________

Why don’t the buyers come to the store and talk with managers and staff to see what the customers are asking for?_________________________

Is it possible to submit a request to get more of something that is selling well or get rid of something that is selling poorly?

Manager’s Questions

The $29.99 and up boot sale did very well for me not only for Black Friday weekend but for the entire winter because I had a section set up for it the front of my store where I could isolate the sale products and draw customer's attention to it as they entered the store. It was like I was running a promotional event all season long. Can we have more sales with a theme whether it be price point; category; etc.?

There is an overflow of men’s and not enough clearance for men’s and kids._________________________

Why do we continue to purchase the same style in multiple brands?_________________________

Can you keep us posted on who is covering what departments and which vendors currently?

Will we ever carry Coach Handbags?______________

Will we ever carry Men's Coach Shoes?

_____________

If we carry toddler shoe's why not carry toddler socks?

Why do we have so many clearance shoes?

________________________

Is there any way that SMs can provide feedback on what is needed or can help sales for our locations?

Manager’s Questions

VP & GMMAndy Meyer

Women’s Better/Contemporary Nichole Duck – BuyerAmani Dooley-Wilkes – Assistant Buyer

Women’s ClassicBrittany Moeller – BuyerJill Grace – Assistant Buyer

Women’s Junior & ChildrenAlbena Ivanova – BuyerLori Maroldo – Assistant Buyer

Merchant Buying TeamsAthletic

Matt Wong – BuyerJulie Brigham – Assistant Buyer (Women’s)Brandon Russell – Assistant Buyer (Men’s)

Men’sJoel Pollack – BuyerKatherine Lastufka – Assistant Buyer

Accessories Lourdes Muller – BuyerLaDonna Bacon – Assistant Buyer

Director of Planning and ProcessMike Young

Director of Merchandise Special ProjectsRandall Austin