North Face Parent VF Corp Mulls Asset Sales, Sharper Focus as Vans Slumps

Innovation and a better shopping experience are on the agenda for the Vans brand.

These targets are being pursued after the action sports footwear and apparel brand saw a 13% decline in revenue while parent company VF Corp. saw a 3% dip during the quarter ended Dec. 31, the company said in a presentation released Tuesday (Feb. 7).

“We are clear eyed about VF’s performance barriers, which are predominantly operational in nature, and our near-term priority is to put aggressive plans in place to improve our execution,” VF Interim President and CEO Benno Dorer said Tuesday during the company’s quarterly earnings call. “We are not reaching our full potential as a company.”

These quarterly results were released about two months after VF’s previous CEO, Steve Rendle, retired and the company revised its outlook to “reflect the impact of weaker than anticipated consumer demand across its categories, primarily in North America.”

Vans in particular has struggled with supply chain challenges that led to longer lead times, higher inventory costs, more promotions and a greater number of order cancellations, Dorer said during the call.

Moving forward, the brand will boost its investment in product development to deliver new styles and innovations, use data to better understand its customers and meet their needs, and simplify its product offering to improve the shopping experience, Dorer said.

During a test of this approach at one store in California, Vans recorded a 12% gain in revenue while handling 30% fewer stock-keeping units (SKUs). The brand will now expand this initiative to other stores, Dorer said.

“What we need to do is to fuel the brand more consistently and give people more reasons to buy more Vans,” Dorer said. “That is on us, and that is what we will do.”

Among VF’s other brands, Dickies recorded a 16% decline in revenue, Timberland was flat and The North Face grew by 7%, according to the presentation.

VF said in the presentation that it attributed the growth of outdoor brand The North Face to strong consumer engagement, iconic products and robust product line excitement.

“The North Face is a solid and transferable execution blueprint for Vans and, frankly, the entire VF portfolio in the Americas, where we must grow with consumers more consistently,” Dorer said during the call.

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