RIP Crocs

[Z5 FILMS]

washingtonpost.com

Sounds like they suffered the same fait as Krispy Kreme. Expanded too fast, then demand fell to zip. Once hugely profiatable, now drowning in debt.


"The company had expanded to meet demand, but financially pressed customers cut back. Last year the company lost $185.1 million, slashed roughly 2,000 jobs and scrambled to find money to pay down millions in debt. Now it's stuck with a surplus of shoes, and its auditors have wondered if it can stay afloat. It has until the end of September to pay off its debt.

"The company's toast," said Damon Vickers, who manages an investment fund at Nine Points Capital Partners in Seattle."

 

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[hatterasguy]

Good, those shoes are horrible. I don't know what people were thinking when they bought them.

 

[randallg99]

I don't know what people were thinking when they bought them.

drugs, alcohol or chemical imbalances are Crocs target audience. 8)

 

[Sparlin]

When I had a kiosk in the mall (Christmas 07), the one next to me was a CROCs kiosk. From what they told me, they had the 2nd worst sales in the entire country that year. The main problem I saw with them is they had too much diversity, which isn't always bad, until you realize that for each style of shoe, they had 10 different sizes of that style in the store room. Then they might have several of that size as well.

People would swarm the kiosk just to look at the shoes, but the price was a turn off and they would walk away. Another issue, at least at that one, they had 2 employees sometimes 3 for a little 6 x 6 table. There was one time when an employee would clock in, walk away and hang out with friends for 3 hours, then return and let the other one go. Both were paid although only one was working.

The final problem was that shoppers could go to an inline store and see the same crocs for sale as the ones they had at the dedicated kiosk.

I wonder what crocs will do now? I guess they could offer to sale their inventory at cost to a major retailer (Old Navy). Then the retailer could run a promotional such as "Buy an outfit, get a free/ reduced price pair of crocs".

 

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[Jonleehacker]

Good, those shoes are horrible. I don't know what people were thinking when they bought them.

:eusa_clap: Totally agree.

My wife on the other hand owns enough pairs for me to trip on a new color in every room of our house.

 

[czach41]

I remember a while back people were vehemently debating on tv whether or not crocs were a fad or a trend (we may have debated the issue here, too).
I guess a lesson to be learned here is to not get too high when things are going very well, and don't get too low when things aren't going your way: its best to stay even tempered (this goes with business expansion and contraction) My humble opinion of course.

The tribe has spoken!

 

[Bilgefisher]

drugs, alcohol or chemical imbalances are Crocs target audience. 8)

This explains why they were so popular in Boulder.

 

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[LagunaLauren]

I agree. Ugly shoes. Great story about the initial success of the company, though. The creator was on The Big Idea with Donny Deutsch on MSNBC. I think he was in his 40s, just divorced, dead broke, living back with his parents, etc. Came up with the idea for Crocs as a non-slip, non-skid shoe for boats. One of those down-and-out turned millionaire stories. Too bad for him the trend didn't last.

 

[maximus20895]

Wow, who didn't know that this fad would fall of..

 

[hatterasguy]

My godfather has a pair, and I make fun of him every time I see them.

 

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[DiceMan]

I don't know why they got so popular in the first place. Too ugly.

 

[Rakona]

Michael Marks from Flextronics fame was a big shareholder in Crocs:

He cashed out somewhere in the neighborhood of $50mil, over the last few years at $50-$75/share

Good timing!
secform4.com/INSIDERS-trading/1334036.htm

 

[Merkin Man]

Good, those shoes are horrible. I don't know what people were thinking when they bought them.

I've had a pair for almost 4 years and they're the most comfortable things my feet have even worn. Not good looking I agree with. But comfortable as hell.

I just made the rule that I wouldn't wear them beyond the limits of my own property.

 

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[fanocks2003]

I remember a while back people were vehemently debating on tv whether or not crocs were a fad or a trend (we may have debated the issue here, too).
I guess a lesson to be learned here is to not get too high when things are going very well, and don't get too low when things aren't going your way: its best to stay even tempered (this goes with business expansion and contraction) My humble opinion of course.

The tribe has spoken!

Could one big problem be that they didn't evolve into new stuff? A product has a lifespan, then a new fad starts and then a new fad etc. Crocs seemed to stay with the same fad and never bothered to expand with a new fad?

Many times you can renew a failing business with a new line of product or service. Innovate yourself out of revenue problems.

I don't know about Crocs. First time I hear about this business.

 

[^eagle^]

:nonod:I just happened to find a pair at the salvation army last week and they are THE most comfortable things I have ever worn!

What a shame.

 

[Sparlin]

Could one big problem be that they didn't evolve into new stuff? A product has a lifespan, then a new fad starts and then a new fad etc. Crocs seemed to stay with the same fad and never bothered to expand with a new fad?

Many times you can renew a failing business with a new line of product or service. Innovate yourself out of revenue problems.

I don't know about Crocs. First time I hear about this business.

They had several variations of shoes, including "dress" shoes. At one point, they even had a license through Disney to sell small accessories that added to the shoes.

As for the comfort, everyone said they were extremely comfortable.

 

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[CMCarlin]

My wife has also said that they are the most comfortable shoes, but I can't stand to look at them. She bought a pair for my 3 yr son and I complain every time she makes him wear them.

I prefer that he wears sneakers anyway. Tight to the foot, have a better grip and he can run around more 'sure footed'.