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 Say goodbye to Patagonia Footwear; Wolverine Worldwide to stop production

Say goodbye to Patagonia Footwear; Wolverine Worldwide to stop production

2014-07-17

Source:mlive

Author:Shandra Martinez

ROCKFORD, MI -- Wolverine Worldwide plans to stop producing Patagonia Footwear.

The company recently decided to end its licensing agreement with Patagonia, the clothing and equipment line started by Yvon Chouinard, a fervent environmentalist who has been the poster boy of green business.

Previously, Wolverine Chief Executive Blake Krueger had credited the partnership for helping the footwear company improve its environmental practices.

Wolverine’s last line of Patagonia Footwear will be the fall 2014 season.

The announcement was made by Chief Financial Officer Don Grimes during a Tuesday, July 15, conference call with analysts to discuss the company's fiscal 2014 second quarter results, which exceeded analysts’ expectations.


An ad for Patagonia Footwear which will no longer be produced by Wolverine Worldwide after fall.


Patagonia wasn’t a money-maker for the company that saw its profits grow by 50 percent in the second quarter.

“Although a wonderful brand, Patagonia currently generates a relatively small amount of revenue and profit for Wolverine,” Grimes said.

He added that the footwear maker didn’t expect dropping the brand to impact fiscal 2014 results, and have a minimal impact on 2015 financial results.

“We look forward to focusing our brand-building efforts on the many more meaningful growth opportunities in our portfolio,” Grimes said.

Patagonia doesn't currently have any plans to produce the shoe line in-house or with another contract, said Adam Fetcher, Patagonia’s global communications director,

"At some point in the future we may revisit footwear but there is nothing in the works now," Fetcher said.

Patagonia's mission statement demands: "Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis."

Wolverine embraced that mission statement for its Patagonia Footwear brand when the publicly-traded company entered into the licensing agreement with Chouinard's private firm in 2006.

Living up to those high expectations meant donating 1 percent of profits -- what Chouinard calls an Earth tax for using the planet's resources -- to environmental causes.

"They rarely let anyone else touch their brand, " Krueger told MLive and The Grand Rapids Press in 2010 for a story about Wolverine Worldwide's environmentally-friendly efforts.

Those included designing more shoes with renewable, biogradable and recycled materials. And shrinking the carbon footprint of its headquarters at 9341 Courtland Drive NE with array of changes, from using energy-efficient lights to biodegradeable utensils in the cafeteria.

The two companies were well-suited for the partnership, Krueger said at the time.

Earlier Tuesday, the company announced it would close 140 stores, mostly Stride Rite locations, in the next 18 months to increase profitability.

The savings will be invested in improving the company’s online shopping platform.

“Consumers have embraced the ease and convenience of online shopping, a trend that has only accelerated for the last several quarters,” Krueger said.

Wolverine Worldwide stock took a beating after the company lowered its forecast for the fiscal year, citing a soft retail environment.

The company’s stock fell 81 cents, or 3.06 percent, to close at $25.64 on the New York Stock Exchange.

Why aren’t people buying more of the company’s shoes?

Part of the blame belongs at the feet of politicians, according to Krueger.

“This consumer mindset is partially attributable to the weak economic recovery in the U.S., but is also the result of a number of other factors, including the continued dysfunction in Washington D.C., the challenging rollout and uncertainty regarding the U.S. healthcare reform,and the lack of the dominant apparel fashion trend,” Krueger told analysts.

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