Famous Footwear 2007 Annual Report Download - page 4

We planted seeds
for future growth.
In mid-year, we
announced global
expansion initiatives
for Naturalizer and Via
Spiga. Over the next ve
years, through a joint
venture with Hongguo
International Holdings
Limited of China, we
expect that 500 stores
and shop-in-shops
bearing the Naturalizer
or Via Spiga nameplates
will open across China.
A new licensing agreement with our long-term partner Regal
Corporation paved the way for the opening of a total of 40
Naturalizer stores in Japan over the next few years. Our minority
investment in the Sam Edelman brand last August created a new
partnership, combining our sourcing and distribution expertise
with Sam’s creativity and product vision. In addition, new
initiatives such as Natural Soul at Kohl’s and Reba at Dillard’s
are part of our desire to create a continuous pipeline of fresh and
compelling offerings to the marketplace.
We will be taking even Bolder Action in 2008. As 2008 unfolds,
we expect to face an increasingly challenging environment, with
continued consumer softness and lower trafc levels. We also, as
an industry, face cost increases from China that will affect both
our wholesale and retail businesses. Both of these issues will lead
to continued volatility and uncertainty in the footwear market.
Nonetheless, we have the scale to navigate through turbulence
and Brown Shoe has a history of being a reliable business partner,
especially in uncertain times. Our balance sheet is strong and
provides us with the exibility to continue our strategic growth
plans. This is an ideal time for us to move forward more boldly.
Obviously, we intend to adhere to our principles and proceed
with the same thoughtful planning demonstrated by Brown Shoe
throughout our 129-year history. As I have stated often, how we do
business is as important as how much business we do. Moreover,
we intend to create the capability to not simply compete well, but
to win the hearts, minds, and wallets of our customers.
By “boldly,” I mean making an investment of over $1 billion in
Talent, Stores, Systems and Marketing over the next ve years:
1) Signicantly increasing our investment in brand and consumer
marketing, rst by understanding her, second by increasing the
frequency and quality of our communications with her, and
third by connecting with her on an emotional level;
2) Evolving our distribution network, which includes opening
a new distribution center on the west coast to support
Back-to-School in 2009;
3) Implementing enterprise-wide information systems to
support and leverage our sourcing, wholesale, retail, and
corporate operations;
4) Centralizing operating divisions into major “Centers
of Excellence”;
5) Expanding our current portfolio by investing in growth
opportunities, while maximizing the intra-platform synergies
inherent in our business model; and
6) Searching for strategic opportunities that t our growth criteria.
While the lack of nancial success in 2007 has been
disappointing, Brown Shoe has much to be proud of in the last
year and, more importantly, much to be excited about in the
future. During these volatile times, some things are certain,
beginning with our passion to succeed. Our vision is to be THE
leading fashion footwear marketer, winning loyal customers with
compelling global brands. Our commitment to our customers,
employees, partners, and shareholders remains the same.
Our objective is to create sustainable shareholder value, and
achievement of our “Double / Double” goal would take us a long
way there.
Ronald A. Fromm, Chairman of the Board and Chief Executive Ofcer
Brown Shoe 2007 Annual Report 3

President and Chief Operating Ofcer

Chairman of the Board and Chief Executive Ofcer
For the third year in a row, Brown
Shoe participated in the St. Louis
Public Schools’ Back to School
Family Fun Festival, helping children
get off on the right foot for the
school year by donating a thousand
pairs of brand new Buster Brown
shoes and other Brown Shoe
branded footwear.
Brown Shoe employees are no
strangers to giving. In fact, they
traditionally rank among the high-
est per capita givers to the United
Way. Employees participated in
several internal fundraisers to help
benet the 2007 “Give Today. Help
Today.” campaign. We therefore
funnel our human services support
through the United Way in St. Louis
and Madison, which efciently
funds 200 local organizations,
as well as our industry’s Two-Ten
Footwear Foundation, which pro-
vides charitable funds and services
each year to families at home and
abroad associated with the foot-
wear industry.
A major portion of our charitable
funding goes to support higher
education. We believe in provid-
ing the best and the brightest
students with the opportunity
to succeed. For the past three
years, we have partnered with
the Jackie Robinson Foundation,
a not-for-prot organization that
grants four-year scholarships to
talented minority students who
demonstrate academic distinction,
civic engagement and leadership.
Jackie Robinson set an unparalleled
standard for educational success
and empowering students that
continues to this day.
We are proud to support the Jackie
Robinson Foundation through
scholarship funding and profession-
al development for its students.
Through our commitment to great
corporate citizenship, we strive to
make a difference in our communi-
ties, working closely with organiza-
tions that are improving the quality
of life for everyone, everywhere.