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Business

Foot Locker reportedly refuses to sell surplus Yeezys over backlash fears

By
Shannon Thaler
Published Aug. 11, 2023, 12:52 p.m. ET

Foot Locker refused to put surplus Yeezys on shelves over fears of a backlash from stocking the controversial rapper’s discontinued brand, according to a report.

The athletic footwear giant was among the retailers tapped by Adidas to help sell off its remaining Yeezy inventory following its ill-fated partnership with the rapper formerly known as Kanye West, Complex reported.

However, Foot Locker executives had a change of heart over fears it it would cause a public relations nightmare for associating with Ye, who was ousted from the lucrative partnership with Adidas in October following a string of antisemitic and other offensive remarks, an unnamed source told the outlet that.

Adidas has been selling its remaining Yeezy prodcuts and donating a significant portion of the sales to five organizations that combat racism and antisemitism, including the Anti-Defamation League and the Philonise & Keeta Floyd Institute for Social Change, founded by George Floyd’s brother.

The donation could reportedly exceed $9 million, though a final decision hasn’t been made.

Foot Locker wasn’t able to integrate a charity aspect into its sale of Yeezys, sources told Complex.

Foot Locker did not respond to The Post’s request for comment.

Foot Locker reportedly had plans to take on stock of unsold Yeezys as part of Adidas' latest move to rid of the inventory, but had a change of heart over fears of backlash from supporting the rapper formerly known as Kanye West.
Foot Locker was among the retailers tapped by Adidas to help sell off its remaining Yeezy inventory. Getty Images

Adidas grappled with what to do with its unsold Yeezy sneakers, even considering burning as much as $500 million worth of inventory earlier this year.

Experts warned against the move.

While its relatively commonplace for brands to torch its unsold product, it was considered the “worst outcome” because it wouldn’t generate revenue and could spark backlash over waste and environmental costs.

The German sportswear giant ultimately decided to sell the product in batches with a charitable component that shows it doesn’t support Ye’s shock outbursts about Jewish people.

The first batch of 4 million Yeezys went up for sale in June and sold off within 48 hours.

Sources told the Financial Times that there was a surprisingly high demand for the shoes — so much so that Adidas wouldn’t be able to meet all the orders.

The multimillion-dollar selloff means the company likely won’t have to take a big writedown on its remaining stock.

Ye will reportedly receive royalties on the sale, though it’s unclear how much.

Forbes estimated that Ye made $220 million annually from the partnership, which began in 2019.

Proceeds from the sale are also going to be used to pay costs associated with ending the partnership, including legal fees, closure of production capacity and laying off staff.

By 2019, Yeezy eclipsed $1 billion in sales annually, skyrocketing Ye’s net worth.

However, Ye fell out of the billionaire ranks after a string of public meltdowns pushed Adidas to cut ties.

Adidas yanked Yeezy shoes off the market in October following Ye’s string of antisemitic and other offensive remarks.
Adidas yanked Yeezy shoes off the market in October following Ye’s string of antisemitic and other offensive remarks. AP

Though excess Yeezy inventory hurt the company’s profit in the first quarter of this year, the profitable selloff spelled positive results for Q2.

“Adidas second-quarter revenues benefited from the first sale of some of its Yeezy inventory,” the company said in its earnings report earlier this month.

Adidas recorded an operating profit of $193 million in the quarter, which it attributed to around $175 million “related to one-off costs, donations and accruals for future donations,” likely related to the Yeezy selloff.