DSW goes smaller to improve in-store experience

Probst made the comments, which were webcast, at the Oppenheimer & Co. Consumer Growth Conference in Boston.

The company is moving from large floor plans of about 25,000 square feet to a smaller format of stores of about 17,000 square feet.

The Columbus, Ohio-based company, which operates just under 300 stores, plans to open at least 30 more in 2008 and eventually targets 400 stores.

Also, the company has revamped some locations, improving the lighting and the bathrooms, streamlining the cash registers and installing "ESPN Zones" with TVs and lounge areas targeted at men.

Ultimately, the company wants a 10 percent long-term operating rate, Probst said.

In terms of products, Probst said because its product assortment is "very broad and shallow," it always has fashionable styles, but it needs to make sure it has enough of the right fashionable products in order to continue to grow in a difficult economic environment.

The current popularity of dress shoes is DSW's "sweet spot," he said, adding that, "If the trend goes that direction we can play into that."

Shares rose 47 cents, or 4.3 percent, to $11.49 in afternoon trading.