Nordstrom signage outside one of the company’s department stores.

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Allbirds will begin selling its shoes in select Nordstrom department stores next month, the companies announced on Tuesday, as the sneaker brand seeks to partner with other retailers to expand its reach and earn profits.

Starting June 1, a selection of Allbirds footwear, including the company’s signature wool trainers, will be available for sale at 14 Nordstrom stores. The assortment will expand to Nordstrom’s website and other stores later this year, the companies said.

For Allbirds, the move is a chance to win new customers and become profitable. It’s also emblematic of a broader trend among retailers such as Allbirds and Warby Parker that began selling products exclusively online direct to consumers.

Increasingly, these direct-to-consumer businesses — including Casper mattresses, Harry shavers, and sportswear makers Vuori and Outdoor Voices — have expanded to sell through third parties. Others have pushed to open dozens of physical stores to connect with shoppers in person. Thanks to these changes, the new companies are more like long-established retailers such as Nike or Ralph Lauren.

The deal helps Nordstrom build its reputation as the partner of choice for new retailers looking to test the wholesale waters. It also helps give the department store company an edge over rivals such as Macy’s and Kohl’s with items likely to attract shoppers.

Earlier this month, Allbirds announced its first two retail partners: Public Lands, a Dick’s Sporting Goods banner, in the US, and Zalandao in Europe. He teased at the time that other deals were in the works.

Selling through other retailers should help Allbirds reach consumers who might not have known about the brand otherwise, Joey Zwillinger, co-founder and co-CEO of Allbirds, said in a post conference call. -profit in mid-May.

In particular, the company hopes to attract environmentally conscious buyers. In 2020, Allbirds pledged to halve its carbon footprint by 2025. In addition to labeling all of its products with a carbon footprint score, the company said it sources natural materials found in trees and sugar cane fields and strives to reduce waste. .

Allbirds brand awareness in the United States is still in the double digits out of 100%, according to Zwillinger. Third-party retail can be “a very effective way to build brand awareness and build credibility,” he said on the call.

Allbirds shoes are made of wool and the laces are made of recycled plastic bottles.

Source: Allbirds

Allbirds hopes the move will help boost investor confidence. Shares of the company fell from an IPO price of $15, closing Monday at $4.68. Allbirds listed on the Nasdaq stock exchange last November, before the public debut window was frozen due to soaring inflation and Russia’s war on Ukraine.

In the three months ended March 31, Allbirds’ net loss widened to $21.9 million from a loss of $13.5 million a year earlier. It was even then that its sales increased by 26% to 62.8 million dollars, against 49.6 billion dollars.

Allbirds also revised its outlook for the year, citing continued disruptions to its overseas business due to ongoing Covid-related lockdowns in China and the war in Ukraine.

This isn’t the first time the Allbirds and Nordstrom have teamed up. In 2018, Allbirds opened in Nordstrom’s rotating pop-up exhibit, marking the sneaker company’s first try with another retail partner. Nordstrom has worked with other brands online, including Kim Kardashian’s Skims line and On Running.

Zwillinger said on the conference call that Allbirds plans to be selective about how it grows its third-party business. The company doesn’t expect to see a significant impact on its finances in 2022, but the partnerships should become a catalyst for new business by next year, he said.

BMO Capital Markets analyst Simeon Siegel has been a proponent of retailers using wholesale to build a profitable business with strong gross margins, citing Ralph Lauren and Calvin Klein owner PVH as companies that have successfully used this approach.

“Companies are building very healthy, very large businesses by embracing wholesaling,” Siegel said in an interview. “You shouldn’t totally avoid wholesaling and just think of wholesaling as bad.”

It’s when companies get too wholesale and use excessive discounts and unclear messaging that they can ruin their reputation, he said.

Nordstrom is expected to release its fiscal first quarter results after the market closes on Tuesday.