As the summer of last year approached, the North American market for Crocs' signature clogs had already reached a point of saturation. Around the same time, Patrick Regan stepped into the role of Chief Financial Officer at Crocs (NASDAQ: CROX), just weeks after the company's leadership publicly declared it was time to make "bold decisions" to safeguard the health of the business.

This footwear maker, known for its classic clogs and the HeyDude brand, was grappling with bloated inventory levels and decelerating sales growth. However, the company had no intention of clearing out stock through aggressive discounting. Instead, it chose to scale back certain promotional discounts, delist some products, and reduce supply volumes for others.

During his first twelve months on the job, Regan has been executing what he describes as an "aggressive strategy" aimed at stabilizing the company's operations. A key component involved tackling the excess HeyDude inventory sitting in U.S. wholesale channels. Crocs presented retailers with two options: either buy back the stale stock and liquidate it, or provide financial support to retailers to help them mark down and sell the goods.

Simultaneously, with the core Crocs clogs reaching market saturation in North America, the company cut back on shipments to wholesalers in response to weaker demand. Both brands also reduced their promotional activities. Management had previously cautioned that these measures would dent short-term sales, and indeed, by the fall, the company's overall growth, as well as growth for both brands, had declined for the first time in at least two years. The core Crocs brand, which contributes roughly 85% of total revenue, was not immune to this slowdown.

Now, however, the strategy is beginning to bear fruit. By holding firm on selling more products at full price, enforcing stricter inventory controls, and rolling out new product lines, the company is starting to see positive results.