Steven Madden elevates chunky heels to new heights. It operates through five business segments: wholesale footwear, wholesale accessories, retail, first cost, and licensing. Its wholesale business boasts seven divisions, such as Madden Girl, Steven, Steve Madden Men's, and Stevies, as well as its Daisy Fuentes, Betsey Johnson, and Olsenboye accessories business through licenses. Its retail operations include about 85 Steve Madden, Steven, and Report stores, along with several websites. Its First Cost segment designs and sources private-label footwear, such as Candie's, for mass merchants. Steven Madden shoes are sold in the US and Canada through its own shops and such stores as Nordstrom and Dillard's.
Despite slogging through an economic downturn that hurt many of its fellow retailers, the company in 2011 logged a third consecutive year of record sales. Sales rose 52% in 2011 on the heels of a 25% increase in 2010. Net income increased to a record $97 million in 2011 from $75 million in 2010. Steven Madden attributes the consistent gains to concentrating on its wholesale business, which generated 84% of 2011 revenue, up from 79% in 2010 and 73% in 2008. Steven Madden looks to department stores, specialty stores, and independent boutiques for the majority of its wholesale revenue.
Looking to increase its private-label footprint, Steven Madden bought Topline Corp. for $55 million in 2011. Topline, which rang up sales of about $189 million in 2010, sells private-label and branded footwear (Report, Report Signature, R2 by Report) primarily to specialty retailers and department stores.
Steven Madden-owned stores are located across the US, with noteworthy penetration in New York, California, and Florida. Its retail business, which brought in 16% of the company's revenue, logged a 13% increase in same-store sales in 2011. To maintain this part of its business, Steven Madden consistently reviews and adjusts its stores portfolio by shuttering underperforming shops.
Steven Madden also has a foothold in areas beyond shoes, and the company continues to invest in its accessories business. (The footwear maker's accessories business has eclipsed its men's business.) In 2011 it acquired the Cejon group of design and marketing companies for about $30 million. The purchase included Cejon Inc., Cejon Accessories, and New East Designs. The companies design scarves, wraps, winter accessories and other items, and expanded Steven Madden's accessories business beyond handbags and belts. Indeed, the company's wholesale accessories segment saw a boost from 15% in 2010 to 18% in 2011, as a result. Prior to its purchase, Cejon was a licensee of Steven Madden for winter weather and other accessories. In mid-2009 the company acquired the SML Brands' Zone 88 and Shakedown Street lines for $1.25 million. The move gave Steven Madden an extended reach into private-label accessories (mostly handbags) that sell to mass merchants and department stores. The company followed up the deal by purchasing handbags and belts maker Big Buddha in early 2010 for $11 million. Later that year Steven Madden made a bold move when it acquired the trademarks and intellectual property of fashion house Betsey Johnson, paying $27 million that had been outstanding on a $49 million loan. Steven Madden, which also received a 10% equity stake, agreed to contribute additional funds to Betsey Johnson, which began restructuring its operations. As part of their agreement, Steven Madden has allowed Betsey Johnson to continue running its eponymous retail stores in the US, Canada, and the UK, as well as manufacture its name-brand apparel collections.
After seven years as head of Steve Madden and amid declining profits, Jamieson Karson resigned in 2008 as the company's chairman and CEO. He was replaced by Ed Rosenfeld, formerly EVP of strategic planning and finance. Founder Steven Madden, individually and through his BOCAP Corp., owns nearly 16% of the company.