Bloomberg Businessweek - USA (2021-03-01)

(Antfer) #1
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needed to get out of the house during quarantine,” Taliaferro
said when I spoke with him months later.
With a map of Nike outlets to guide them, the 19-year-olds
headed east from Portland, traveling through Idaho, Utah,
and Colorado, focusing on hot spots such as Salt Lake City and
Denver, where Nike factory stores are more densely packed
than in other metropolitan areas. “We know that Nikes have
the most variety in styles and the best discounts on their more
select shoes,” Taliaferro said. Along the way, they dropped in
on every Foot Locker, DTLR Villa, and Champs Sports outlet
they passed, stopping occasionally at Adidas outlets as well.
Some of the best scores, according to Hebert, came from
mom and pop stores, which didn’t have the restrictive pur-
chase limits that outlet stores for larger brands sometimes
place on certain shoes. “There’s kind of a stigma against
resellers,” he said. “They even went at us harder now,
because these Nike outlets weren’t getting any new inven-
tory.” The mom and pops were more than happy to make
dozens of sales at a time.
For the first two weeks, the pair saved money by stopping
overnight at truck stops and Walmart parking lots, crashing in
their vehicle’s cargo box on two thin sleeping pads and some
pillows and blankets. When they reached Louisiana, the bugs
and heat forced them to seek out cheap motels. By the time
they escaped the U.S. humidity belt, they barely had enough
room in the truck for shoes, let alone sleeping pads. Back home
in Portland, they lifted the steel door and a wall of orange Nike
boxes spilled onto the pavement. Hebert had spent more than
$200,000 on about 2,000 pairs of shoes, which he hoped would
return a profit of around $50,000. “I’m not dealing with 100%,
double-my-money margins usually,” he told me. “It’s just a
pretty calm 10 to 20 and then moving product as fast as I can.”
After the trip, as supply chains grew less strained, Hebert
started diversifying his approach, wholesaling some of his
summer brick stock, along with some Jordans and Yeezys,
to smaller retailers. He said he thought the West Coast
Streetwear brand might be getting big enough to launch its
own direct-to-consumer offensive, starting with its own web
store. Bypassing StockX would mean fewer fees and fewer
returns. “If I ship them a shoe and the box has a damaged
corner or something, they’ll go ahead and charge me 15%
of the sale, and then they’ll charge me $14 to ship it back,
which is like a double whammy,” Hebert said. “When I’m
not working on a high margin it really hurts me, but they
don’t do it for every sale, which is kinda weird. I still don’t
know the formula, and I’ve been asking for it for a while.” (A
spokes person for StockX says that if it receives a damaged
or defective product, it charges only the shipping fee. “In


certain cases— typically when a product is determined to be
inauthentic,” she adds, “we do then charge the seller a mini-
mum of $15 or up to 15% of the transaction amount.”)
He was also taking steps to go beyond selling shoes—which
I’d learned, quite by accident, ran in his blood. At one point
in late June, after his trip, he’d phoned me, and the number
was identified as belonging to Ann Hebert. I looked the name
up and discovered there was an Ann Hebert who’d worked at
Nike for 25 years and had recently been made its vice pres-
ident and general manager for North America. The press
release announcing her promotion noted that she would be
“instrumental in accelerating our Consumer Direct Offense”—
the Nike initiative that had helped fuel the sneaker-resale
boom. Hebert later sent me a statement for an American
Express corporate card for WCS LLC, to demonstrate West
Coast Streetwear’s revenue, and it was in Ann’s name.
When I asked Hebert about the connection later that year,
he acknowledged that Ann was his mother and said that,
while she’d inspired him as a businessperson, she was so
high up at Nike as to be removed from what he does, and
that he’d never received inside information such as discount
codes from her. He insisted, though, that she not be men-
tioned in the article and cut off contact not long after our
conversation. (Ann Hebert didn’t reply to emailed questions;
Carreon-John, the Nike spokesperson, says Ann disclosed rel-
evant information about WCS LLC to Nike in 2018. “There
was no violation of company policy, privileged information
or conflicts of interest, nor is there any commercial affiliation
between WCS LLC and Nike, including the direct buying or
selling of Nike products,” she writes.)
Nike’s marketing and corporate culture are strong enough
in Portland that most anyone there can steep in it; the children
of company executives, no doubt even more so. But whatever
the advantages to growing up with a silver swoosh in one’s
mouth, Hebert’s hustle couldn’t be denied. Not to mention, as
he pointed out during our last phone call, that he’d started out
selling Supreme T-shirts. He also moved plenty of Adidas stock.
In the fall, he’d struck out for even less familiar terrain.
When Sony launched its PlayStation 5 console in November,
Hebert sensed a looming shortage of stock. “We botted
Walmart and Target pretty hard,” he told me. “I ended up with
24 of them and made between $300 and $500 on each one.”
There’d been growing pains outside the family business,
though. His bots had initially gobbled up hundreds of PS5
systems, but because he was working in unfamiliar territory
he’d made mistakes that resulted in most of his orders get-
ting canceled, leaving him with just the two dozen consoles.
“Wish I had prepared more,” he said. <BW>

“I’m not dealing with 100%, double-my-


money margins usually,” Hebert said.


“It’s just a pretty calm 10 to 20 and then


moving product as fast as I can”

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