The news: Skims, the shapewear brand founded by Kim Kardashian, is on an expansion tear as it nears $1 billion in annual sales, per Business of Fashion.

• The company plans to open 16 stores in the US this year, bringing its total domestic footprint to 22.
• Over the next nine months, Skims expects to establish itself in seven new markets—including stores in Mexico, London, and Dubai.

Why it matters: Skims’ growth strategy is a testament to the power of physical retail. Stores are “probably our single biggest growth lever,” CEO Jens Grede told BoF, adding that “the biggest barrier for customers is us simply not being available in physical retail where people live.”

• In the near-term, the company wants to emulate direct-to-consumer (D2C) brands Alo Yoga and Vuori, which have aggressively ramped up their brick-and-mortar presence in recent years and now have around 100 stores each.
• But its broader ambition is to “build the Apple stores of apparel,” according to Grede—which means prioritizing locations on high-end, high-trafficked corridors like New York City’s Fifth Avenue and London’s Regent Street, grade-A malls, and outdoor shopping centers.

That tactical approach could help it avoid the fate of Parachute, which recently closed 19 locations—nearly three-quarters of its entire fleet—that were either too large or located in markets where the brand had limited awareness.

Our take: While stores are hugely important to Skims’ growth, the company has several advantages over the rest of the D2C field.

• Unlike most other D2C companies, Skims doesn’t need to rely on its stores as billboards given its high-profile founder, who is also a fixture of its ad campaigns.
• Its partnership with Nike will give it access to an even larger audience and smooth its entry into the athleisure category—assuming production delays don’t get in the way. The launch will also considerably increase Skims’ retail presence without needing to invest in premium real estate.

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