Latest / Omni Talk Retail / Dick's $2.4B Foot Locker Takeover - Bold Move or Strategic Blunder?

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Dick's $2.4B Foot Locker Takeover - Bold Move or Strategic Blunder? · Omni Talk Retail

• 0:00
  Dick's
• 0:00
  Sporting
• 0:00
  Goods
• 0:01
  is
• 0:01
  set
• 0:01
  to
• 0:01
  acquire
• 0:02
  foot
• 0:02
  locker
• 0:02
  for
• 0:03
  $2.4
• 0:04
  billion,
• 0:04
  according
• 0:05
  to
• 0:05
  CNBC.
• 0:05
  Dick's
• 0:06
  Sporting
• 0:06
  Goods
• 0:06
  said
• 0:06
  Thursday
• 0:07
  that
• 0:07
  it
• 0:07
  plans
• 0:07
  to
• 0:08
  acquire
• 0:08
  rival
• 0:09
  Foot
• 0:09
  Locker
• 0:10
  as
• 0:10
  it
• 0:10
  looks
• 0:10
  to
• 0:10
  expand
• 0:11
  its
• 0:11
  international
• 0:11
  presence,
• 0:12
  win
• 0:12
  over
• 0:13
  a
• 0:13
  new
• 0:13
  set
• 0:13
  of
• 0:13
  consumers
• 0:14
  and
• 0:14
  corner
• 0:14
  the
• 0:15
  Nike
• 0:15
  sneaker
• 0:15
  market.
• 0:16
  Under
• 0:16
  the
• 0:16
  terms
• 0:17
  of
• 0:17
  the
• 0:17
  agreement,
• 0:17
  Dick's
• 0:18
  will
• 0:18
  use
• 0:18
  a
• 0:18
  combination
• 0:19
  of
• 0:19
  cash
• 0:19
  on
• 0:19
  hand
• 0:20
  and
• 0:20
  new
• 0:20
  debt
• 0:20
  to
• 0:21
  acquire
• 0:21
  foot
• 0:21
  locker
• 0:22
  for
• 0:22
  $2.4
• 0:23
  billion.
• 0:23
  Footlocker
• 0:24
  shares
• 0:25
  soared
• 0:25
  more
• 0:25
  than
• 0:25
  80%
• 0:26
  after
• 0:26
  the
• 0:26
  deal
• 0:27
  was
• 0:27
  announced
• 0:27
  the
• 0:27
  Thursday.
• 0:28
  However,
• 0:28
  shares
• 0:29
  of
• 0:29
  Dick's
• 0:29
  fell
• 0:30
  slightly,
• 0:31
  or
• 0:32
  roughly
• 0:32
  15%,
• 0:33
  as
• 0:33
  investors
• 0:33
  worried
• 0:34
  about
• 0:34
  the
• 0:34
  impact
• 0:34
  the
• 0:35
  merger
• 0:35
  could
• 0:35
  have
• 0:35
  on
• 0:36
  financial
• 0:36
  results.
• 0:37
  One
• 0:37
  analyst
• 0:38
  from
• 0:38
  TD
• 0:38
  Cowan
• 0:39
  even
• 0:39
  said
• 0:39
  that
• 0:40
  the
• 0:40
  deal
• 0:40
  was
• 0:41
  a,
• 0:41
  quote,
• 0:42
  strategic
• 0:42
  mistake
• 0:43
  as
• 0:43
  it
• 0:44
  downgraded
• 0:44
  shares
• 0:44
  of
• 0:44
  Dick's
• 0:45
  to
• 0:45
  hold
• 0:46
  from
• 0:46
  buy.
• 0:48
  Michael,
• 0:49
  I'm
• 0:49
  going
• 0:49
  to
• 0:49
  go
• 0:49
  to
• 0:49
  you
• 0:50
  first.
• 0:50
  Are
• 0:50
  you
• 0:50
  pro
• 0:51
  or
• 0:51
  con
• 0:51
  on
• 0:52
  Dick's
• 0:52
  acquisition
• 0:52
  of
• 0:53
  Foot
• 0:53
  Locker?
• 0:54
  So
• 0:54
  funny.
• 0:55
  My,
• 0:55
  my
• 0:56
  thoughts
• 0:56
  on
• 0:56
  this
• 0:57
  evolve
• 0:58
  almost
• 0:58
  to
• 0:59
  the
• 0:59
  minute.
• 1:00
  When
• 1:00
  I
• 1:00
  first
• 1:00
  read
• 1:01
  the
• 1:01
  headline,
• 1:02
  I
• 1:02
  was
• 1:02
  actually
• 1:03
  very
• 1:03
  surprised
• 1:04
  and
• 1:04
  I
• 1:04
  hated
• 1:05
  it.
• 1:05
  I.
• 1:05
  I
• 1:05
  really
• 1:06
  thought,
• 1:06
  why?
• 1:07
  Why?
• 1:08
  I
• 1:08
  think
• 1:08
  Foot
• 1:09
  Locker
• 1:09
  has
• 1:09
  issues.
• 1:10
  I
• 1:10
  think
• 1:10
  they're
• 1:10
  very
• 1:11
  fragmented.
• 1:12
  They're
• 1:13
  very
• 1:14
  reliant
• 1:14
  on
• 1:15
  Nike.
• 1:15
  And
• 1:16
  you
• 1:16
  want
• 1:16
  to
• 1:16
  talk
• 1:16
  about
• 1:16
  a
• 1:16
  gorilla
• 1:17
  in
• 1:17
  the
• 1:17
  marketplace.
• 1:18
  I
• 1:18
  mean,
• 1:18
  Nike
• 1:19
  can
• 1:20
  seal
• 1:20
  your
• 1:21
  fate
• 1:21
  within
• 1:23
  minutes,
• 1:23
  either
• 1:24
  positive
• 1:24
  or
• 1:24
  negative.
• 1:25
  And
• 1:26
  I
• 1:26
  also
• 1:27
  think
• 1:27
  that
• 1:28
  the
• 1:28
  sneaker
• 1:28
  game
• 1:29
  is
• 1:29
  a
• 1:29
  very
• 1:30
  fickle
• 1:30
  game
• 1:31
  in
• 1:31
  regards
• 1:31
  to
• 1:32
  the
• 1:33
  consumer
• 1:33
  interaction.
• 1:34
  And
• 1:35
  although
• 1:35
  there's
• 1:35
  a
• 1:35
  lot
• 1:35
  of
• 1:36
  spending
• 1:36
  power
• 1:36
  behind
• 1:37
  it,
• 1:37
  you
• 1:38
  have
• 1:38
  to
• 1:38
  be
• 1:38
  right
• 1:39
  with
• 1:39
  the
• 1:40
  style,
• 1:40
  skews,
• 1:41
  direction
• 1:42
  that
• 1:42
  you've
• 1:42
  chosen.
• 1:43
  And
• 1:43
  I
• 1:43
  think
• 1:44
  Foot
• 1:44
  Locker,
• 1:45
  based
• 1:45
  on
• 1:45
  the
• 1:45
  number
• 1:46
  of
• 1:46
  stores,
• 1:46
  based
• 1:47
  on
• 1:47
  the
• 1:47
  country
• 1:48
  saturation,
• 1:49
  I
• 1:49
  think
• 1:49
  it's
• 1:50
  a
• 1:50
  very,
• 1:50
  very
• 1:50
  difficult
• 1:51
  business
• 1:51
  to
• 1:51
  monitor
• 1:52
  and
• 1:52
  to
• 1:52
  manage
• 1:53
  and
• 1:53
  to
• 1:53
  run
• 1:54
  effectively.
• 1:55
  Now.
• 1:55
  They've
• 1:55
  done
• 1:56
  a
• 1:56
  decent
• 1:56
  job.
• 1:57
  They've
• 1:57
  had
• 1:57
  good
• 1:58
  times,
• 1:58
  they've
• 1:58
  had
• 1:58
  bad
• 1:59
  times.
• 1:59
  But
• 1:59
  it
• 2:00
  is
• 2:00
  a
• 2:00
  very,
• 2:01
  very
• 2:01
  specific
• 2:03
  type
• 2:04
  of
• 2:04
  business
• 2:04
  to
• 2:04
  run,
• 2:05
  which
• 2:06
  you
• 2:06
  have
• 2:07
  these
• 2:07
  third
• 2:07
  parties
• 2:08
  that
• 2:09
  it's
• 2:10
  basically
• 2:10
  out
• 2:10
  of
• 2:10
  your
• 2:10
  control.
• 2:12
  Your
• 2:12
  destiny
• 2:13
  may
• 2:13
  be
• 2:13
  out
• 2:13
  of
• 2:13
  your
• 2:13
  control.
• 2:14
  It's
• 2:15
  been
• 2:15
  highly
• 2:15
  publicized.
• 2:16
  When
• 2:16
  Nike
• 2:17
  wanted
• 2:17
  to
• 2:17
  pull
• 2:17
  out
• 2:18
  of
• 2:18
  the
• 2:18
  market,
• 2:18
  Foot
• 2:18
  Locker's
• 2:19
  business
• 2:20
  had
• 2:20
  a
• 2:20
  precipitous
• 2:21
  drop
• 2:21
  almost
• 2:21
  immediately.
• 2:22
  When
• 2:23
  Nike
• 2:23
  wanted
• 2:23
  to
• 2:24
  expand
• 2:24
  the
• 2:24
  marketplace
• 2:25
  and
• 2:26
  I'll
• 2:26
  call
• 2:26
  it
• 2:27
  use
• 2:27
  Foot
• 2:27
  Locker
• 2:28
  to
• 2:28
  gain
• 2:29
  market
• 2:29
  share,
• 2:29
  it
• 2:30
  was
• 2:30
  great.
• 2:30
  But
• 2:30
  the
• 2:31
  minute
• 2:31
  that
• 2:31
  wasn't
• 2:31
  great,
• 2:32
  it
• 2:32
  was
• 2:33
  a
• 2:33
  problem
• 2:33
  for
• 2:33
  Footlocker.
• 2:34
  So
• 2:34
  I
• 2:34
  think
• 2:34
  there's
• 2:35
  some
• 2:35
  huge
• 2:36
  inherent
• 2:37
  risks
• 2:37
  for
• 2:37
  Dicks.
• 2:38
  So
• 2:38
  that's
• 2:39
  number
• 2:39
  one.
• 2:39
  That's
• 2:39
  why
• 2:39
  I
• 2:39
  hated
• 2:40
  it.
• 2:41
  Then
• 2:41
  I
• 2:41
  started
• 2:42
  doing
• 2:42
  a
• 2:42
  little
• 2:42
  bit
• 2:42
  more
• 2:43
  and
• 2:43
  I
• 2:44
  flipped.
• 2:44
  So
• 2:45
  I
• 2:45
  started
• 2:45
  doing
• 2:45
  A
• 2:45
  little
• 2:46
  bit
• 2:46
  more
• 2:46
  research
• 2:47
  on
• 2:48
  the
• 2:48
  size
• 2:48
  and
• 2:49
  scale
• 2:49
  of
• 2:49
  Dicks,
• 2:50
  and
• 2:50
  I
• 2:51
  was
• 2:51
  a
• 2:51
  little
• 2:51
  mistaken
• 2:52
  in
• 2:52
  understanding
• 2:53
  how
• 2:53
  large
• 2:54
  they
• 2:54
  are.
• 2:54
  Yep,
• 2:55
  a
• 2:55
  pretty
• 2:55
  big
• 2:55
  entity.
• 2:57
  I
• 2:57
  think
• 2:57
  they're
• 2:57
  approaching
• 2:58
  $20
• 2:58
  billion.
• 2:59
  Right.
• 2:59
  So
• 3:00
  at
• 3:00
  that
• 3:00
  size
• 3:02
  growth,
• 3:03
  organic
• 3:04
  growth
• 3:04
  is
• 3:04
  difficult.
• 3:05
  Right.
• 3:06
  One
• 3:06
  up
• 3:06
  1%
• 3:07
  comp,
• 3:07
  down
• 3:08
  1%
• 3:08
  comp,
• 3:09
  you're
• 3:09
  kind
• 3:09
  of
• 3:10
  happy.
• 3:11
  But
• 3:11
  if
• 3:11
  you're
• 3:12
  down
• 3:12
  5%
• 3:13
  comp
• 3:13
  in
• 3:13
  a
• 3:13
  tough
• 3:14
  year,
• 3:14
  that
• 3:14
  is
• 3:15
  a
• 3:15
  massive
• 3:15
  hit
• 3:16
  to
• 3:16
  your
• 3:16
  revenue.
• 3:17
  So
• 3:17
  I
• 3:18
  like
• 3:18
  the
• 3:19
  fact
• 3:19
  that
• 3:19
  they
• 3:19
  actually
• 3:20
  acquired
• 3:21
  an
• 3:21
  adjacent
• 3:21
  business
• 3:22
  that's
• 3:23
  going
• 3:23
  to
• 3:23
  layer
• 3:24
  in
• 3:24
  a
• 3:24
  multibillion
• 3:25
  dollar
• 3:25
  revenue
• 3:26
  stream.
• 3:27
  I
• 3:27
  thought
• 3:27
  that
• 3:27
  was
• 3:28
  a
• 3:28
  very
• 3:28
  easy
• 3:28
  pickup.
• 3:29
  And
• 3:30
  in
• 3:30
  rereading
• 3:31
  the
• 3:31
  releases,
• 3:32
  either
• 3:32
  the
• 3:32
  CFO
• 3:33
  or
• 3:33
  the
• 3:33
  CEO
• 3:33
  said
• 3:34
  we
• 3:34
  are
• 3:34
  going
• 3:35
  to
• 3:35
  add
• 3:35
  in,
• 3:35
  I
• 3:35
  think,
• 3:36
  4.5%
• 3:37
  comp
• 3:37
  sales
• 3:38
  in
• 3:39
  the
• 3:39
  first
• 3:39
  year,
• 3:40
  which
• 3:40
  I
• 3:40
  liked
• 3:41
  a
• 3:41
  lot.
• 3:41
  So
• 3:42
  it's
• 3:43
  so
• 3:43
  number
• 3:44
  three.
• 3:44
  My
• 3:44
  conclusion
• 3:45
  is
• 3:46
  the
• 3:47
  only
• 3:47
  way
• 3:47
  they
• 3:48
  will
• 3:48
  be
• 3:48
  successful
• 3:49
  with
• 3:49
  this
• 3:50
  is
• 3:50
  not
• 3:50
  integrating
• 3:51
  it
• 3:51
  into
• 3:52
  the
• 3:52
  Dick's
• 3:52
  business.
• 3:53
  It's
• 3:53
  sort
• 3:53
  of
• 3:53
  like
• 3:53
  a
• 3:54
  standal
• 3:54
  own,
• 3:55
  let
• 3:55
  Foot
• 3:55
  Locker
• 3:56
  run.
• 3:56
  If
• 3:57
  there's
• 3:57
  some
• 3:57
  back
• 3:57
  of
• 3:57
  the
• 3:58
  house
• 3:58
  IT
• 3:59
  or
• 3:59
  supply
• 3:59
  chain
• 4:00
  efficiencies
• 4:00
  you
• 4:00
  could
• 4:01
  create,
• 4:01
  great.
• 4:02
  If
• 4:02
  you
• 4:03
  start
• 4:03
  to
• 4:03
  sort
• 4:04
  of
• 4:06
  matrix
• 4:07
  it
• 4:07
  into
• 4:07
  the
• 4:08
  Dick's
• 4:09
  organization,
• 4:10
  I
• 4:10
  think
• 4:10
  that's
• 4:10
  a
• 4:10
  massive
• 4:11
  disaster.
• 4:11
  They
• 4:12
  should
• 4:12
  just
• 4:12
  leave
• 4:12
  it
• 4:12
  as
• 4:12
  its
• 4:13
  own
• 4:13
  entity,
• 4:14
  Let
• 4:14
  it
• 4:14
  run
• 4:14
  on
• 4:15
  its
• 4:15
  own,
• 4:15
  treat
• 4:15
  it
• 4:16
  as
• 4:16
  its
• 4:16
  own
• 4:16
  thing.
• 4:17
  Look
• 4:17
  for
• 4:17
  some
• 4:18
  economies
• 4:18
  to
• 4:18
  scale,
• 4:19
  but
• 4:19
  almost
• 4:20
  insulate
• 4:21
  and
• 4:21
  have
• 4:22
  it
• 4:22
  do
• 4:23
  that.
• 4:23
  And
• 4:23
  if
• 4:23
  they
• 4:23
  can
• 4:23
  do
• 4:24
  that,
• 4:24
  it
• 4:24
  may
• 4:25
  be
• 4:25
  very
• 4:25
  successful
• 4:26
  for
• 4:26
  them.
• 4:26
  Yeah,
• 4:27
  that.
• 4:27
  I
• 4:27
  think
• 4:27
  what
• 4:28
  you're
• 4:28
  saying
• 4:28
  makes
• 4:28
  a
• 4:28
  lot
• 4:28
  of
• 4:28
  sense.
• 4:29
  Michael
• 4:29
  and
• 4:29
  Chris
• 4:29
  Walton,
• 4:30
  I
• 4:30
  would
• 4:30
  go
• 4:30
  to
• 4:30
  you
• 4:31
  too
• 4:31
  and
• 4:31
  ask,
• 4:32
  like,
• 4:32
  do
• 4:32
  you
• 4:33
  think
• 4:33
  that
• 4:33
  this
• 4:33
  also
• 4:33
  is
• 4:34
  helping
• 4:34
  Dick's
• 4:35
  kind
• 4:35
  of
• 4:35
  eliminate
• 4:36
  some
• 4:36
  competition
• 4:36
  in
• 4:37
  the
• 4:37
  field?
• 4:37
  And
• 4:37
  then
• 4:38
  maybe
• 4:38
  even
• 4:38
  if
• 4:39
  they're
• 4:39
  a
• 4:39
  separate
• 4:39
  entity
• 4:40
  or
• 4:40
  they're,
• 4:41
  you
• 4:41
  know,
• 4:41
  Dick's
• 4:42
  is
• 4:42
  just
• 4:42
  able
• 4:43
  to
• 4:43
  kind
• 4:44
  of
• 4:44
  keep
• 4:44
  the
• 4:44
  business
• 4:44
  separate,
• 4:45
  but
• 4:45
  maybe
• 4:45
  take
• 4:45
  some
• 4:46
  of
• 4:46
  that
• 4:46
  Nike
• 4:46
  relationship
• 4:47
  into
• 4:47
  Dick's
• 4:48
  Stuff
• 4:48
  stores.
• 4:48
  Like,
• 4:48
  will
• 4:49
  that
• 4:49
  help
• 4:50
  this
• 4:51
  position
• 4:51
  for
• 4:51
  Dick's
• 4:52
  Sporting
• 4:52
  Goods?
• 4:53
  Yeah,
• 4:53
  I
• 4:53
  mean,
• 4:53
  that's,
• 4:54
  That's.
• 4:54
  We
• 4:54
  were
• 4:54
  joking
• 4:55
  before
• 4:55
  we
• 4:55
  started
• 4:55
  this
• 4:55
  podcast
• 4:56
  and
• 4:56
  I
• 4:56
  had
• 4:56
  kind
• 4:56
  of
• 4:56
  a
• 4:57
  potentially
• 4:58
  hot
• 4:58
  take,
• 4:58
  although
• 4:59
  I
• 4:59
  don't
• 4:59
  think
• 4:59
  it's
• 4:59
  that
• 4:59
  hot
• 4:59
  that
• 4:59
  I
• 5:00
  wanted
• 5:00
  to
• 5:00
  get
• 5:00
  Michael
• 5:00
  and
• 5:00
  Chris's
• 5:01
  opinion
• 5:01
  to
• 5:01
  see
• 5:01
  if
• 5:01
  they'd
• 5:01
  laugh
• 5:02
  me
• 5:02
  out
• 5:02
  of
• 5:02
  the
• 5:02
  room
• 5:02
  on
• 5:02
  this.
• 5:02
  But
• 5:03
  I
• 5:03
  mean,
• 5:03
  the
• 5:04
  thing
• 5:04
  I
• 5:04
  like
• 5:04
  about
• 5:04
  this
• 5:05
  deal
• 5:05
  is,
• 5:05
  like,
• 5:05
  if
• 5:06
  I
• 5:06
  just
• 5:06
  go
• 5:06
  with
• 5:06
  the.
• 5:07
  Go
• 5:07
  into
• 5:07
  the
• 5:07
  realm
• 5:07
  of,
• 5:08
  like,
• 5:08
  what
• 5:08
  if
• 5:08
  Dick's
• 5:09
  just
• 5:09
  shut
• 5:09
  these
• 5:10
  stores
• 5:10
  down,
• 5:11
  right.
• 5:11
  And
• 5:12
  the
• 5:12
  $5
• 5:12
  billion
• 5:13
  in
• 5:13
  revenue
• 5:14
  that
• 5:14
  Foot
• 5:14
  Locker
• 5:14
  generates
• 5:15
  a
• 5:15
  portion
• 5:15
  of
• 5:15
  that
• 5:16
  goes
• 5:16
  to
• 5:16
  Dick's
• 5:17
  just
• 5:17
  through
• 5:17
  inertia.
• 5:19
  Then
• 5:19
  when
• 5:19
  I
• 5:19
  think
• 5:20
  of
• 5:20
  the
• 5:20
  annuity
• 5:20
  on
• 5:21
  that
• 5:21
  volume
• 5:21
  year
• 5:22
  over
• 5:22
  year,
• 5:22
  the
• 5:22
  $2.4
• 5:23
  billion
• 5:24
  seems
• 5:24
  like
• 5:24
  they
• 5:24
  got
• 5:25
  a
• 5:25
  steal.
• 5:25
  Yeah.
• 5:26
  So
• 5:26
  I
• 5:26
  think
• 5:26
  minimally
• 5:27
  you
• 5:27
  approach
• 5:27
  it,
• 5:27
  like
• 5:27
  Michael
• 5:28
  said,
• 5:28
  where
• 5:28
  you
• 5:28
  try
• 5:28
  to
• 5:28
  operate
• 5:29
  them.
• 5:29
  If
• 5:29
  it
• 5:29
  doesn't
• 5:30
  work.
• 5:30
  Like,
• 5:30
  I
• 5:31
  feel
• 5:31
  like
• 5:31
  the
• 5:31
  worst
• 5:31
  case
• 5:32
  scenario
• 5:32
  here
• 5:32
  isn't
• 5:33
  actually
• 5:33
  that
• 5:33
  bad
• 5:33
  in
• 5:34
  the
• 5:34
  long
• 5:34
  run.
• 5:34
  So
• 5:35
  for
• 5:35
  that
• 5:35
  reason,
• 5:36
  I
• 5:36
  like
• 5:36
  this
• 5:36
  move
• 5:37
  a
• 5:37
  lot.
• 5:37
  But
• 5:38
  I
• 5:38
  don't
• 5:38
  know,
• 5:38
  I
• 5:38
  might.
• 5:38
  I
• 5:38
  might
• 5:39
  be
• 5:39
  crazy
• 5:39
  in
• 5:39
  my
• 5:40
  math
• 5:40
  on
• 5:40
  that.
• 5:40
  But
• 5:40
  I'm
• 5:41
  curious
• 5:41
  what
• 5:41
  the
• 5:41
  a.
• 5:41
  M.
• 5:42
  Guys
• 5:42
  think.
• 5:43
  It's
• 5:43
  the
• 5:43
  old
• 5:44
  retail
• 5:46
  holy
• 5:46
  grail
• 5:47
  of
• 5:48
  does
• 5:48
  one
• 5:48
  plus
• 5:49
  one
• 5:49
  equal
• 5:49
  two
• 5:50
  or
• 5:50
  three?
• 5:51
  Everybody
• 5:51
  always
• 5:52
  tries
• 5:52
  to
• 5:52
  say
• 5:52
  one
• 5:53
  plus
• 5:53
  one
• 5:53
  equals
• 5:53
  three.
• 5:54
  But
• 5:55
  generally
• 5:55
  when
• 5:56
  you
• 5:56
  do
• 5:56
  that,
• 5:57
  you
• 5:57
  don't
• 5:57
  capture
• 5:58
  even
• 5:58
  1
• 5:59
  of
• 5:59
  the
• 6:00
  sale.
• 6:00
  So
• 6:01
  that
• 6:01
  2,
• 6:01
  2
• 6:02
  and
• 6:02
  change.
• 6:03
  Billion,
• 6:03
  2.4
• 6:04
  billion.
• 6:04
  Whatever
• 6:04
  their
• 6:05
  actual
• 6:05
  revenue
• 6:05
  number
• 6:06
  is,
• 6:06
  if
• 6:07
  Dick's
• 6:07
  did
• 6:07
  close
• 6:08
  all
• 6:08
  their
• 6:08
  stores
• 6:08
  could
• 6:09
  end
• 6:09
  up
• 6:09
  being
• 6:10
  a
• 6:11
  billion
• 6:11
  dollars
• 6:12
  or
• 6:12
  maybe
• 6:12
  a
• 6:12
  little
• 6:13
  bit
• 6:13
  even
• 6:13
  below
• 6:13
  a
• 6:14
  billion
• 6:14
  dollars.
• 6:14
  Now,
• 6:15
  if
• 6:15
  it's
• 6:16
  profit,
• 6:17
  the
• 6:17
  margin
• 6:18
  advantages,
• 6:18
  you
• 6:19
  get
• 6:19
  work
• 6:20
  then,
• 6:21
  sure,
• 6:21
  it's
• 6:22
  awesome,
• 6:22
  but
• 6:23
  I
• 6:23
  think
• 6:23
  it's
• 6:23
  a
• 6:23
  little
• 6:24
  scary.
• 6:24
  And
• 6:25
  the
• 6:25
  other
• 6:26
  key
• 6:26
  piece,
• 6:26
  I
• 6:26
  love
• 6:26
  the
• 6:26
  hot
• 6:27
  take,
• 6:27
  by
• 6:27
  the
• 6:27
  way.
• 6:27
  I
• 6:28
  think
• 6:28
  it's
• 6:28
  a
• 6:28
  very
• 6:28
  interesting
• 6:29
  thing,
• 6:30
  but
• 6:30
  you
• 6:30
  made
• 6:31
  me
• 6:31
  think
• 6:31
  too.
• 6:34
  Dick's
• 6:35
  now
• 6:35
  is
• 6:35
  wildly
• 6:36
  important
• 6:36
  to
• 6:37
  Nike.
• 6:38
  But
• 6:38
  now
• 6:38
  Nike's
• 6:39
  wildly
• 6:40
  or
• 6:40
  Dicks
• 6:40
  is
• 6:40
  now
• 6:41
  wildly
• 6:41
  important.
• 6:42
  It's
• 6:43
  like
• 6:43
  this
• 6:43
  symbiotic
• 6:44
  relationship
• 6:44
  flipped
• 6:45
  a
• 6:45
  little
• 6:46
  bit.
• 6:46
  And
• 6:46
  it's
• 6:46
  sort
• 6:47
  of
• 6:47
  like
• 6:48
  whoever
• 6:48
  is
• 6:48
  the
• 6:49
  strongest
• 6:49
  at
• 6:50
  the
• 6:50
  time
• 6:50
  is
• 6:50
  going
• 6:51
  to
• 6:51
  win.
• 6:51
  And
• 6:52
  if
• 6:52
  you
• 6:52
  read
• 6:52
  the
• 6:52
  tea
• 6:53
  leaves,
• 6:53
  Nike
• 6:53
  seems
• 6:54
  like
• 6:54
  they're
• 6:54
  going
• 6:54
  through
• 6:55
  one
• 6:55
  of
• 6:55
  their
• 6:55
  sort
• 6:56
  of
• 6:56
  macro.
• 6:57
  Not
• 6:57
  as
• 6:57
  strong
• 6:58
  as
• 6:58
  they
• 6:58
  normally
• 6:59
  are.
• 6:59
  So
• 6:59
  Dicks
• 7:00
  could
• 7:00
  be
• 7:00
  sort
• 7:00
  of
• 7:01
  pounding
• 7:01
  their
• 7:01
  chest
• 7:01
  saying,
• 7:02
  we
• 7:02
  won
• 7:02
  here.
• 7:03
  Now
• 7:03
  we're
• 7:03
  going
• 7:03
  to
• 7:03
  turn
• 7:03
  the
• 7:04
  screws
• 7:04
  on
• 7:04
  Nike.
• 7:05
  But
• 7:05
  if
• 7:05
  history
• 7:05
  proves
• 7:06
  anything,
• 7:06
  nobody's
• 7:07
  turning
• 7:07
  any
• 7:07
  screws
• 7:07
  on
• 7:08
  Nike
• 7:08
  over
• 7:08
  the
• 7:08
  long
• 7:09
  term.
• 7:09
  So
• 7:10
  I'd
• 7:10
  be
• 7:10
  a
• 7:10
  little
• 7:10
  bit
• 7:10
  afraid.
• 7:11
  Afraid
• 7:11
  that
• 7:12
  all
• 7:12
  of
• 7:12
  my
• 7:12
  fortunes
• 7:13
  as
• 7:13
  Dicks
• 7:14
  and
• 7:14
  Foot
• 7:14
  Locker
• 7:15
  now
• 7:15
  are
• 7:16
  heavily
• 7:16
  saturated
• 7:17
  in
• 7:17
  Nike.
• 7:18
  And,
• 7:18
  oh,
• 7:19
  by
• 7:19
  the
• 7:19
  way,
• 7:19
  all
• 7:19
  of
• 7:20
  the
• 7:20
  other
• 7:20
  big
• 7:20
  sneaker
• 7:21
  makers
• 7:22
  have
• 7:22
  all
• 7:22
  taken
• 7:22
  a
• 7:23
  page
• 7:23
  out
• 7:23
  of
• 7:23
  Nike's
• 7:23
  book.
• 7:24
  Like
• 7:24
  Adidas,
• 7:26
  Puma,
• 7:26
  all
• 7:27
  of
• 7:27
  these
• 7:27
  people
• 7:27
  are
• 7:27
  doing
• 7:28
  the
• 7:28
  same
• 7:28
  thing
• 7:28
  that
• 7:28
  Nike
• 7:29
  used
• 7:29
  to
• 7:29
  do.
• 7:29
  And
• 7:30
  it's
• 7:30
  going
• 7:31
  to
• 7:31
  be
• 7:31
  very
• 7:31
  interesting.
• 7:32
  So
• 7:32
  I.
• 7:32
  I
• 7:33
  mean,
• 7:33
  yeah,
• 7:34
  I
• 7:34
  think
• 7:34
  that's
• 7:34
  like
• 7:35
  looking
• 7:35
  at
• 7:35
  the
• 7:35
  edge
• 7:35
  of
• 7:36
  the
• 7:36
  cliff
• 7:36
  saying,
• 7:36
  okay,
• 7:37
  let's
• 7:37
  shut
• 7:37
  Foot
• 7:38
  Locker
• 7:38
  down
• 7:38
  and
• 7:38
  let's
• 7:39
  jump.
• 7:39
  Love
• 7:40
  that.
• 7:41
  It'll
• 7:41
  be
• 7:41
  interesting
• 7:41
  to
• 7:41
  see
• 7:42
  if
• 7:42
  that.
• 7:42
  If
• 7:42
  that
• 7:42
  would
• 7:43
  if
• 7:43
  that
• 7:43
  would
• 7:43
  work.
• 7:44
  Well,
• 7:45
  you
• 7:45
  also
• 7:45
  have
• 7:45
  JD
• 7:46
  Sports
• 7:46
  knocking
• 7:47
  down
• 7:47
  the
• 7:47
  door
• 7:47
  too.
• 7:48
  And
• 7:48
  we
• 7:48
  just,
• 7:49
  yeah,
• 7:49
  the
• 7:50
  CEO
• 7:50
  Regis
• 7:51
  Schultz
• 7:51
  last
• 7:52
  week
• 7:52
  at
• 7:52
  World
• 7:53
  Retail
• 7:53
  Congress
• 7:54
  and
• 7:54
  they're
• 7:54
  taking
• 7:54
  a
• 7:55
  totally
• 7:55
  different
• 7:55
  approach
• 7:56
  with
• 7:56
  Nike.
• 7:56
  Like
• 7:56
  they're
• 7:57
  going
• 7:57
  the
• 7:57
  storytelling
• 7:58
  route.
• 7:58
  They're
• 7:58
  bringing
• 7:59
  brands
• 7:59
  in.
• 8:00
  Dick's
• 8:00
  is
• 8:00
  just
• 8:00
  going
• 8:01
  for
• 8:01
  like
• 8:01
  how
• 8:01
  much
• 8:02
  can
• 8:02
  we,
• 8:02
  how
• 8:02
  much
• 8:03
  Nike
• 8:03
  can
• 8:03
  we
• 8:03
  pound
• 8:03
  in
• 8:04
  and
• 8:04
  out
• 8:04
  of
• 8:04
  this
• 8:04
  store
• 8:04
  right
• 8:05
  now?
• 8:05
  And
• 8:05
  how
• 8:05
  do
• 8:05
  we
• 8:05
  get
• 8:06
  that
• 8:06
  to
• 8:06
  exceed
• 8:06
  expand
• 8:07
  shoppers
• 8:07
  into
• 8:08
  other
• 8:08
  categories
• 8:09
  of
• 8:09
  our
• 8:09
  store?
• 8:10
  And
• 8:10
  I
• 8:10
  think
• 8:10
  JD
• 8:11
  Sports
• 8:11
  on
• 8:11
  the
• 8:11
  other
• 8:11
  side
• 8:12
  here,
• 8:12
  they're,
• 8:12
  they're
• 8:13
  coming
• 8:13
  in,
• 8:13
  they're,
• 8:14
  they
• 8:14
  have
• 8:14
  huge
• 8:15
  US
• 8:15
  expansion
• 8:16
  plans.
• 8:16
  Like
• 8:16
  I
• 8:17
  think
• 8:17
  this,
• 8:18
  this
• 8:18
  hopefully
• 8:18
  will
• 8:19
  help
• 8:19
  solidify
• 8:19
  Dicks
• 8:20
  and
• 8:20
  Nike
• 8:21
  together
• 8:22
  in,
• 8:22
  in
• 8:22
  this
• 8:22
  option
• 8:23
  of
• 8:23
  we're
• 8:23
  ready
• 8:24
  to
• 8:24
  compete
• 8:24
  with
• 8:24
  you
• 8:25
  JD
• 8:25
  Sports.
• 8:25
  But
• 8:26
  Chris
• 8:26
  Walton,
• 8:27
  jump
• 8:27
  in
• 8:27
  here
• 8:27
  quick
• 8:28
  and
• 8:28
  then
• 8:28
  we'll
• 8:28
  go
• 8:28
  to
• 8:28
  Chris
• 8:29
  Disa
• 8:29
  for
• 8:29
  the
• 8:29
  wrap.
• 8:30
  I
• 8:30
  was
• 8:30
  just
• 8:30
  going
• 8:31
  to
• 8:31
  say
• 8:31
  like
• 8:31
  I
• 8:31
  think
• 8:31
  the
• 8:32
  one
• 8:32
  point
• 8:32
  that
• 8:32
  I,
• 8:32
  that
• 8:33
  I've
• 8:33
  been
• 8:33
  thinking
• 8:33
  about
• 8:33
  when
• 8:33
  Michael
• 8:34
  said,
• 8:34
  you
• 8:34
  know,
• 8:34
  does
• 8:34
  one
• 8:34
  plus
• 8:34
  one
• 8:35
  ever
• 8:35
  actually
• 8:35
  equal
• 8:35
  three?
• 8:36
  I
• 8:36
  think
• 8:36
  the
• 8:36
  unique,
• 8:36
  unique
• 8:37
  thing
• 8:37
  about
• 8:37
  this
• 8:37
  is
• 8:37
  the
• 8:38
  shopping
• 8:38
  experience
• 8:38
  experience
• 8:39
  for
• 8:40
  at
• 8:40
  Foot
• 8:40
  Locker
• 8:41
  is
• 8:41
  very
• 8:41
  different
• 8:41
  than
• 8:42
  the
• 8:42
  shopping
• 8:42
  experience
• 8:42
  for
• 8:43
  Dicks.
• 8:43
  Dicks
• 8:43
  is
• 8:43
  almost
• 8:44
  a
• 8:44
  standalone
• 8:44
  experience
• 8:44
  where,
• 8:45
  whereas
• 8:45
  Foot
• 8:46
  Locker
• 8:46
  is
• 8:46
  that
• 8:46
  mall
• 8:47
  based
• 8:47
  experience
• 8:47
  and
• 8:48
  so
• 8:48
  in
• 8:48
  theory
• 8:49
  where
• 8:49
  does
• 8:49
  the
• 8:49
  volume
• 8:50
  go
• 8:50
  over
• 8:51
  time?
• 8:51
  Is,
• 8:51
  is
• 8:52
  I've
• 8:53
  been
• 8:53
  wrapped,
• 8:53
  trying
• 8:53
  to
• 8:53
  wrap
• 8:53
  my
• 8:54
  head
• 8:54
  around
• 8:54
  that.
• 8:54
  Yeah.
• 8:55
  And
• 8:55
  I
• 8:55
  think
• 8:55
  it,
• 8:56
  it
• 8:56
  presents
• 8:56
  different
• 8:57
  dynamics
• 8:57
  than
• 8:57
  a,
• 8:58
  than
• 8:58
  say
• 8:58
  if
• 8:59
  the
• 8:59
  acquirer
• 8:59
  was
• 9:00
  basically
• 9:00
  competing
• 9:01
  in
• 9:01
  the
• 9:01
  same
• 9:02
  trip
• 9:02
  and
• 9:02
  they're
• 9:03
  not
• 9:03
  in
• 9:03
  this
• 9:03
  case.
• 9:03
  But
• 9:03
  yeah,
• 9:04
  I
• 9:04
  don't
• 9:04
  know.
• 9:04
  Yeah.
• 9:05
  Okay.
• 9:05
  Christ,
• 9:05
  Issa.
• 9:06
  The
• 9:07
  floor
• 9:07
  is
• 9:07
  yours,
• 9:07
  friend.
• 9:08
  All
• 9:08
  all
• 9:09
  very
• 9:09
  interesting
• 9:09
  points.
• 9:10
  I
• 9:10
  guess
• 9:10
  a
• 9:10
  few
• 9:10
  things
• 9:10
  to
• 9:11
  add.
• 9:11
  One
• 9:11
  is,
• 9:12
  I
• 9:12
  do,
• 9:12
  I
• 9:12
  do
• 9:13
  agree
• 9:13
  with
• 9:13
  Michael
• 9:14
  that
• 9:14
  the
• 9:15
  businesses
• 9:15
  should
• 9:15
  be
• 9:16
  treated
• 9:16
  separately.
• 9:17
  But
• 9:18
  I
• 9:18
  think,
• 9:18
  you
• 9:18
  know
• 9:19
  what
• 9:19
  is
• 9:19
  interesting
• 9:20
  is
• 9:20
  that
• 9:20
  while
• 9:20
  there
• 9:20
  are
• 9:21
  some
• 9:21
  kind
• 9:21
  of
• 9:21
  back
• 9:21
  of
• 9:22
  the
• 9:22
  house
• 9:22
  synergies,
• 9:23
  I
• 9:23
  also
• 9:23
  think
• 9:23
  because
• 9:24
  Dick's
• 9:24
  and
• 9:25
  Footlocker
• 9:25
  have
• 9:25
  two
• 9:26
  very
• 9:27
  different
• 9:27
  customers,
• 9:28
  there's
• 9:28
  opportunity
• 9:29
  to
• 9:29
  learn
• 9:29
  from
• 9:29
  each
• 9:30
  other
• 9:30
  and
• 9:30
  leverage
• 9:31
  your
• 9:31
  customer
• 9:31
  data
• 9:31
  and
• 9:32
  customer
• 9:32
  insights.
• 9:33
  Also
• 9:33
  what's
• 9:34
  really
• 9:34
  interesting
• 9:34
  is
• 9:34
  Foot
• 9:35
  Locker
• 9:35
  has
• 9:35
  an
• 9:35
  international
• 9:36
  presence
• 9:36
  which
• 9:37
  Dick's
• 9:38
  does
• 9:38
  not.
• 9:39
  So
• 9:39
  that
• 9:39
  could
• 9:39
  be
• 9:39
  an
• 9:40
  opportunity
• 9:40
  for
• 9:40
  growth.
• 9:41
  But
• 9:41
  I
• 9:41
  think
• 9:42
  underpinning
• 9:42
  all
• 9:43
  of
• 9:43
  this
• 9:43
  is
• 9:43
  Foot
• 9:43
  Locker
• 9:44
  saw
• 9:44
  some
• 9:44
  major
• 9:44
  challenges.
• 9:45
  If
• 9:45
  you
• 9:45
  recall,
• 9:46
  they
• 9:47
  set
• 9:47
  up,
• 9:47
  set
• 9:48
  up
• 9:48
  a,
• 9:49
  or
• 9:50
  set
• 9:50
  upon
• 9:50
  a
• 9:50
  path
• 9:51
  for
• 9:51
  a
• 9:51
  new
• 9:51
  strategy
• 9:52
  that
• 9:52
  kicked
• 9:52
  off
• 9:53
  in
• 9:53
  2023
• 9:53
  called
• 9:54
  Laces
• 9:54
  Up.
• 9:55
  And
• 9:55
  two
• 9:55
  big
• 9:55
  pillars
• 9:56
  of
• 9:56
  that
• 9:56
  strategy
• 9:57
  were
• 9:58
  around
• 9:59
  supply
• 10:00
  chain
• 10:00
  improvement
• 10:00
  and
• 10:00
  inventory
• 10:01
  accuracy
• 10:02
  as
• 10:03
  well
• 10:03
  as
• 10:03
  the
• 10:03
  omnichannel
• 10:04
  experience
• 10:04
  for
• 10:04
  the
• 10:05
  customer.
• 10:05
  Two
• 10:06
  critical
• 10:06
  pieces
• 10:07
  into,
• 10:08
  you
• 10:09
  know,
• 10:09
  kind
• 10:09
  of
• 10:10
  create
• 10:10
  long
• 10:10
  term
• 10:11
  value.
• 10:11
  So
• 10:12
  the
• 10:12
  punchline
• 10:12
  here
• 10:12
  is
• 10:13
  that
• 10:13
  just
• 10:14
  because
• 10:14
  they're
• 10:14
  acquired,
• 10:15
  there
• 10:15
  can
• 10:16
  be
• 10:16
  a
• 10:16
  lot
• 10:16
  of
• 10:16
  great
• 10:16
  opportunity
• 10:17
  for
• 10:17
  both
• 10:18
  organizations.
• 10:19
  However,
• 10:20
  they
• 10:20
  still
• 10:20
  have
• 10:21
  to,
• 10:21
  the
• 10:21
  leadership
• 10:21
  team
• 10:22
  still
• 10:22
  has
• 10:22
  to
• 10:22
  fix
• 10:23
  or
• 10:24
  improve
• 10:24
  upon
• 10:25
  bootlocker's
• 10:26
  core
• 10:27
  business.
• 10:28
  Right.
• 10:28
  Right.
• 10:28
  Michael,
• 10:29
  you
• 10:29
  want
• 10:29
  to
• 10:29
  say
• 10:29
  something
• 10:29
  else?
• 10:30
  One
• 10:30
  last
• 10:30
  quick
• 10:31
  thing
• 10:31
  that
• 10:31
  Chris
• 10:31
  just
• 10:32
  made
• 10:32
  me
• 10:32
  think
• 10:32
  of.
• 10:33
  The
• 10:33
  question
• 10:33
  is,
• 10:34
  are
• 10:35
  they
• 10:35
  going
• 10:35
  to
• 10:35
  be
• 10:35
  on
• 10:35
  the
• 10:35
  right
• 10:36
  side
• 10:36
  of
• 10:36
  history?
• 10:37
  When
• 10:37
  you
• 10:37
  look
• 10:38
  back
• 10:38
  with
• 10:38
  the
• 10:38
  massive
• 10:40
  change
• 10:40
  of
• 10:41
  the
• 10:41
  US
• 10:41
  Department
• 10:42
  store
• 10:42
  and
• 10:43
  mall
• 10:43
  model,
• 10:44
  the
• 10:44
  answer
• 10:45
  might
• 10:45
  be
• 10:45
  yes.
• 10:46
  Right.
• 10:46
  Because
• 10:47
  department
• 10:47
  stores
• 10:47
  are
• 10:48
  clear,
• 10:48
  clearly
• 10:49
  failing.
• 10:50
  This
• 10:50
  could
• 10:50
  be
• 10:51
  the
• 10:52
  future
• 10:52
  where
• 10:53
  you
• 10:53
  have
• 10:53
  a
• 10:53
  huge
• 10:53
  base,
• 10:54
  you
• 10:55
  start
• 10:55
  to
• 10:55
  bring
• 10:55
  in
• 10:55
  complementary
• 10:56
  plugins,
• 10:57
  you
• 10:58
  let
• 10:58
  them
• 10:58
  do
• 10:58
  their
• 10:59
  own
• 10:59
  thing,
• 11:00
  you
• 11:00
  have
• 11:00
  them
• 11:01
  all
• 11:01
  have
• 11:02
  unique
• 11:02
  innovation
• 11:03
  as
• 11:03
  well
• 11:04
  as
• 11:04
  setting
• 11:04
  up
• 11:05
  multiple
• 11:05
  opportunities
• 11:06
  to
• 11:06
  shop
• 11:07
  for
• 11:07
  the
• 11:07
  customer.
• 11:08
  It'll
• 11:08
  be
• 11:08
  very
• 11:08
  interesting
• 11:09
  to
• 11:09
  see
• 11:09
  how
• 11:09
  this
• 11:09
  one
• 11:10
  really
• 11:10
  works
• 11:10
  out.
• 11:11
  Yeah,
• 11:11
  and
• 11:11
  that's
• 11:11
  why
• 11:12
  I
• 11:12
  made
• 11:12
  the
• 11:12
  point
• 11:12
  of
• 11:12
  Dicks
• 11:13
  could
• 11:13
  be
• 11:13
  very
• 11:13
  surgical
• 11:14
  about
• 11:14
  which
• 11:14
  stores
• 11:14
  they
• 11:14
  decide
• 11:15
  to
• 11:15
  keep
• 11:15
  open,
• 11:15
  given
• 11:16
  that
• 11:16
  phenomenon,
• 11:17
  so
• 11:17
  that
• 11:17
  the
• 11:18
  draft
• 11:18
  from
• 11:18
  the
• 11:18
  sales
• 11:19
  volume
• 11:19
  goes
• 11:19
  from
• 11:19
  one
• 11:19
  place
• 11:20
  to
• 11:20
  another.
• 11:20
  Wow.
• 11:20
  And
• 11:21
  Chris,
• 11:21
  you
• 11:21
  brought
• 11:21
  up
• 11:21
  good
• 11:21
  points
• 11:21
  too.
• 11:22
  Like
• 11:22
  the
• 11:22
  retail
• 11:22
  media
• 11:23
  angle
• 11:23
  here.
• 11:23
  They
• 11:24
  can.
• 11:24
  That
• 11:24
  expands,
• 11:25
  you
• 11:25
  know,
• 11:25
  greatly
• 11:25
  across
• 11:26
  these
• 11:26
  two
• 11:26
  entities.
• 11:27
  Dicks
• 11:27
  is
• 11:27
  a
• 11:27
  great
• 11:27
  omnichannel
• 11:28
  retailer,
• 11:29
  so
• 11:29
  they
• 11:29
  can
• 11:29
  probably
• 11:29
  bring
• 11:29
  that
• 11:29
  operational
• 11:30
  knowledge
• 11:30
  to
• 11:30
  Foot
• 11:31
  Locker
• 11:31
  as
• 11:31
  well.
• 11:31
  So.