Israel retail fashion chain Fox-Wizel Ltd. (TASE: FOX) has made another move in strengthening its connection with global sport shoe, clothing and accessories giant Nike, by setting up a large, two-floor 3,000 square meter store in Canada, sources inform "Globes." The Niketown store will be in Toronto's Yorkdale shopping mall. Fox will invest $12 million in opening the new store with a substantial amount of this financed by the mall.
The store is scheduled to open in November 2020, with a 10 year lease and an option to extend it by a further five years. Estimates are that the store's annual sales will amount to more than $20 million.
Niketown is a large store concept over several floors with outlets in North America and Europe, which presents both Nike products and the technologies that they contain. This will be Fox's largest store anywhere in the world. Fox already operates seven Nike stores in Canada through its subsidiary Retailers while Fox Canada operates six cosmetics stores.
Yorkdale is owned by the income- producing property company Oxford, which recently opened Hudson Yards mall in New York. Opening Niketown in the Yorkdale mall is a major vote of confidence in Fox because it will be one of Nike's flagship stores while the financing by the mall owners also reflects Fox's rising reputation.
Fox, controlled by Harel Wizel, has a non-exclusive franchise to set up Nike stores in Israel. Over the years, Fox has bought all the Nike brand stores in Israel except for the Outlet stores, which are operated by various franchisees. Fox has also opened new Nike stores in Israel and has a chain of 22 Nike stores with 376 employees.
30 months ago, Fox strengthened its connection with Nike by signinig an agreement with Nike Canada, which gave it a license to set up a chain of stores in Canada over seven years. As of 2018, Nike Canada had 218 employees.
Fox, which has a market cap of NIS 1.5 billion, has over the past two years marked out sports as an area for expansion. In addition to the Nike franchise, Fox has also received the franchise to operate Foot Locker stores in Israel. The stores sell sports shoes of the major brands including Nike as well as Adidas, Fila and others. In the past 30 months, Fox has opened 52 Foot Locker outlets in Israel.
While consumer habits are shifting from 'brick and mortar' stores to online purchases, eroding revenue at fashion and footwear stores in Israel as well as worldwide, sports brands are as yet unaffected by this crisis. It was recently reported that Nike and Foot locker will collaborate to open 50 large stores, which will highlight Nike technology.
Nike has a market cap of $132 billion and is one of the world's strongest sports clothing brands. The company has 392 stores in the US and 790 stores in other countries as well as a small number of flagship stores and online sales.
Published by Globes, Israel business news - en.globes.co.il - on September 2, 2019
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