Crocs in Parma by Ze Eduardo at Flick.com

Listeners to the classic BBC radio series, Hitchhiker's Guide to the Galaxy, know the utility of shoes as an economic indicator.  The Shoe Event Horizon theory holds, in part,  that when people are depressed, they look at their shoes.  Prompting them to think, "Hey.  New shoes will make me feel better."  They then buy new shoes. Of course shoe makers have no incentive to make quality shoes at that point--the quicker shoes wear out, the more people see that they need new shoes.  That may provide one explanation for the problems the makers of Crocs are now facing: their shoes are too durable and in a recession people stick with the pair they have.  As Ylan Mui writes in the Washington Post, Who needs a second pair of Crocs in a recession, particularly when the first pair is holding up just fine?"  Another possible explanation: the company overextended:

The company used money from its public stock offering to diversify and acquire new businesses, such as Jibbitz, which makes charms designed to fit Crocs' ventilating holes, and Fury Hockey, which used Croslite to make sports gear. It built manufacturing plants in Mexico and China, operated distribution centers in the Netherlands and Japan, and forged into the global marketplace. More than half of Crocs were sold outside the United States. 

Whatever the explanation, the company went from profits of $168.2 million in 2007 to losses of $185.1 million last year.  So put on one of your five pairs of microbial foam shoes and read Once-Trendy Crocs Could be on their Last Legs  here.