Dive Brief:

• Payless on Tuesday relaunched online, with plans to open a flagship store in Miami in November that is also home to its new headquarters. The retailer features brands like AirWalk, American Eagle (not affiliated with American Eagle Outfitters), K-Swiss, Kendall + Kylie and Aerosoles, according to a press release. 

• The shoe retailer, which has dropped "Shoesource" from its name, will also open 30 to 45 stores in Texas and other border states by 2021, with the goal of running 300 to 500 in North America over the next five years, a spokesperson said in an email. 

• The retailer liquidated in early 2019 during its second bankruptcy within two years, shutting all its roughly 2,500 store locations in the U.S. and Puerto Rico and winding down its e-commerce business.

Dive Insight:

In a statement, Payless CEO Jared Margolis acknowledged that the discount shoe retailer is picking an unprecedented time for a relaunch.

"[I]t's undeniable that this year's back-to-school season will be unlike any other," Margolis said. "We are fully aware that we're relaunching in a time when many have lost their jobs, finances are tight, and parents nationwide are adjusting to working from home, facilitating at-home schooling for their children, all while serving the most important role as parent."

The company is doing its part by partnering "with deserving schools," (in districts with families at or below the poverty line, per a company spokesperson) to provide students, teachers and families with "online connectivity technology, complimentary lunches, and shoes to power the body and mind for this new and different school year ahead," according to the release. Without giving specifics, the 60-plus-year-old retailer also said it's "rolling out a variety of diverse community partnerships throughout the year."

The new chief executive, previously president of licensing group CAA-GBG, touted the retailer's value proposition and sounded an upbeat and inclusive tone. While that value orientation couldn't save the retailer from a chapter 22 in recent years, it could be its greatest strength, as consumers continue to be drawn to lower-priced apparel. The financial difficulties introduced by the COVID-19 pandemic could solidify that further, especially if the federal government remains unwilling to renew additional unemployment relief at the levels that expired in early July.

Last year as Margolis took over, the company acknowledged that it emerged from its first bankruptcy reorganization "ill-equipped to survive in today's retail environment, with too much remaining debt, too large a store footprint and a yet-to-be realized systems and corporate overhead structure consolidation."

But 500 stores, while perhaps far fewer than the 2,500 it once ran, is still too large of a footprint, according to Lee Peterson, executive vice president of thought leadership and marketing at WD Partners. The 300 to 500 planned locations will be in addition to 700 existing international stores, (298 franchise and 412 Latin and Central America locations), according to the press release.

"I guess some people don't read or watch the news!! Unless you're a massive discounter, Walmart, Target, Dollar, etc, there is NO reason to have more than 100 stores. None," Peterson said in an email, when asked about Payless's new plans, adding that the pandemic has only accelerated that reality. "The whole notion is so ridiculous, someone should send them a text that says, '1990 was 30 years ago.'"