A shoe is provided in which an external wrapper (18) covers an outer surface of a midsole (12) along at least a portion of a perimeter of the shoe. An upper assembly (26) forms an external upper surface of the shoe. A wrapper locator (34) abuts an inner surface of the external wrapper (18) and includes an upper edge region (40) extending above a top edge of the external wrapper (18). A lower edge region (38) of the upper material (28) overlaps the upper edge region (40) of the wrapper locator (34). A lower edge (46) of the upper material (28) abuts an upper edge (44) of the external wrapper (18). In this manner, the shoe construction is provided having a midsole wrapper that does not result in large ridges or bulky wrinkles.