DTLR Might Be Experiencing A Surge In Sales Or May Be Not?

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The DTLR Glen Burnie outlet used to be one of my gold mines in my glory days as a reseller. I would walk in there and find gems after gems, leave with boxes of shoes. My margins were anywhere between 20% and 40% and sometimes close to 90%. But everything changed when StockX came in the picture, there was a significant and rapid decline in my margins, they went down to almost 5%. And that’s because StockX made it easy for everyone to become a reseller, folks no longer had to be knowledgeable about sneakers, all one needed was a style code and a cell phone.  My reselling gig  finally came to a halt when DTLR decided to freeze my account by not allowing me to use their rewards program anymore. The company never really gave me a reason why my account was flagged. When I inquired, one of the employees told me that it was because I was a reseller, nonsense. I only bought multiples of junk sneakers( shoes that no one wanted) so I don’t believe that my reselling background had anything to do with it. Every now and then I still visit this outlet when I do my scouting, and yesterday was one of those days. I was very stunned to see that most of the shelves  were 2/3 empty. I ended up picking up a pair of NMD’s for $29.99 and asked the employee why there were barely any shoes in the store, the response was as I expected, shoulder shrug. During my prayer time, I was contemplating the possible reasons behind this drought and several thoughts came to my mind. DTLR might be experiencing a surge in sales.

I wrote a post a couple of years ago in which I mentioned that DTLR was leaving a lot of money on the table, see link below

DTLR Continues To Leave A Lot Of Money On The Table, Why?

In the post above ,I made the following observation which I’ll illustrate in the image below

The shoe is selling for $35 more on third party marketplaces than it is in regular retail shops ( i.e. DTLR).

For the longest time, I couldn’t understand how a company of this magnitude wasn’t able to properly use its online store to sell its sale items, especially when those same products were selling for 20% to 40% more on third party marketplaces. I’m glad they weren’t capitalizing on it, because it benefited resellers like me, but I think now, there has been a shift and just looking at DTLR’s website is proof that significant changes were made. One of the things  that led to my death as a reseller was the poor margins  I was experiencing since the arrival of StockX. I noticed that the DTLR outlet started pricing their sneakers based on their current resale value on StockX, which left me with literally no profits. Here is my hypothesis, if the outlet location is 2/3 empty , then either the physical stores have picked up in sales( which I highly doubt) or most sneakers are being sold via e-commerce. I believe Covid-19 must’ve been the catalyst, DTLR was still relying heavily on the archaic method of selling via brick and mortar, but with the Corona virus crisis, the company was compelled to shift everything online. So this might’ve been a blessing in disguise. Take this next point that I’m going to make with a grain of salt; DTLR might be sending a substantial amount of its sale items to StockX. Just think about it. I picked up a pair of pink NMD for $29.99, that’s just one pair. That same shoe is reselling on StockX for $45. StockX doesn’t reveal the identity of its sellers ( so they can’t be tracked) unlike eBay, Kixify, Amazon and most feedback based third party marketplaces. So any retailer could create an account under a different name and liquidate all its excess inventory through StockX, and actually earn more revenues since StockX’s traffic is through the roof. Why not?

Maybe the lack of shoes in the outlet location is actually a false positive, it might simply be caused by the fact that DTLR is running out of buying capital. DTLR joined forces with Ruvilla a couple of years ago, and that’s because both companies were struggling to keep their heads above water. They might still be struggling and if that’s the case, then there is no more capital, and if there is no more investment money, then I’m assuming that they are being very selective in what is being purchased. The less shoes purchased, the less shoes left to rot on shelves, which means the outlet location no longer gets the excess junk. No one besides DTLR really knows why the Glen Burnie outlet is experiencing a shoe drought. All I’m hoping is that DTLR has finally found a way to survive the Nike DTC push, only time will tell. If you’re a reseller and live on the East Coast, it might be time to hang up the gloves.

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