This issue of Sports News looks at traditional sporting goods stores and chains. Much of the news is negative--stores and chains are either being bought out or going out of business. Competition from discounters, big box stores, and specialty stores is too much for most to handle. "The way the industry has gone is either you are big box or very, very small specialty," noted Andy Bernstein, news editor of the newsletter, "Inside Sporting Goods." (1)
But a few traditional sporting goods stores are hanging in there. Some of their tactics:
Regional Differences
Many independent stores and regional chains believe that they have an advantage when they pay close attention to regional trends and adjust their product lines and marketing accordingly.
"Regional guys as a group are stronger financially than the national big big box chains. They will tell you they can be closer to the customer and react quicker and are more nimble," said Chuck Day, editor of "Sports Trend," an industry trade publication. (2)
Bill Seppala, owner of Harper Sports Shop in St. Clair, Michigan, agrees. ''Those national guys buy general, midrange stuff. They don't touch things like the top-line, $300 hockey skates, which serious high-school players want.
"They are buying for the whole country and don't care that one area is different from another. Like around here, lacrosse and bowling are big, but they don't touch it." (3)
Similarly, Harry McKaig, president of DSG Sports, a two-store operation in North Carolina, said, "We feel one of our biggest strengths is to stay on top of what's popular locally." (4)
Michael Kennedy, CEO of City Sports (an eight store chain with stores in Boston, New York, and Philadelphia) explained his company. ''We don't force city shoppers to sift through skis and golfing stuff they can't use." (5) But his stores do offer more depth than big box chains in certain product lines such as women's aerobic wear and hiking boots. City Sports has one of the highest sales per square foot of anyone in the industry.
The limitations of the big American chains have been most evident in Canada; the companies have yet to dominate there. They haven't been good at reading regional differences--both between the U.S. and Canada and within Canada. "The Canadian consumer is not easy to define. Regional variations are more pronounced in Canada. There's a greater difference between Ontario and Quebec than, say, Michigan and Ohio," noted Roger Blackwell, market analyst and president of Blackwell & Associates, located in Columbus, Ohio. (6)
Location
Many smaller sporting goods stores hope to capitalize either by being in neighborhoods conveniently located near their customers or by developing longstanding relationships with local customers.
Smaller stories are handy for local residents who want to run in and pick up a few supplies. In addition, they can be cost effective in low population areas. Said Mickey Newsome, president of Hibbett Sporting Goods (a 100+ store Southern chain), "In small markets you'll pay less rent. Your advertising costs are much lower, and you get some great first sells in small markets, because many times you're truly needed there in terms of being an employer and in terms in having products somebody else might not have in the market. And you can certainly get great personnel in small markets. You're needed, and you're the hot place to work." (7)
DSG Sports generates sales by supplying local high school and college teams. Said Nancy McKaig, merchandise buyer, "Little, full-line sporting goods stores are really a lost art. What we are trying to do is get the best that each sport we carry has to offer. We really want to become experts in it and specialize.
"Team sales is a drastically increasing part of the business." (8)
Selection
Like specialty shops, smaller full-line sporting goods stores try to offer just the right products for their customers. Michael Modell, president of Modell's Sporting Goods (a 70+ store East Coast chain) said, "For us, the key is having the merchandise the customers want. They don't want 200 basketballs. We just want to carry the one the customer wants." (9)
"We're a home-grown operation, we're very close to our customer base, we spend a lot of time listening to our associates and our customers, and we don't chase every customer." (10)
Kennedy of City Sports explains his selection process, using softball as an example. "Our customers are adults who enjoy softball, but don't want a glove that takes three years to break in. Expensive major league gloves made of high-quality leather are difficult to break in. The less expensive gloves are what our customers want.
"... We're not necessarily the most expensive in every category. Our charter is to be out in front and offer the newest equipment. But, if a product doesn't make sense for our market, we won't carry it just because it's trendy." (11)
"We buy just for one niche of customer - the young urban professional." (12)
Koch Sporting Goods, a Cincinnati company that has been in business since the late 1800s, combines retail sales with lettering services. Noted Edward Koch, president, "We might be a little higher, but we've got the quality items. We're not going to compete with these people who sell basketballs for $ 4.95." (13)
Service
While service is primarily a feature of specialty stores, some smaller sporting goods stores also use it as a competitive edge. According to Seppala of Harper Sports, ''I kill those big chains in service. I talk to guys that train retail staffs, and they say chains turn over their staffs every two months. It takes one year to know something about a category, like shoes or skates or bowling.'' (14)
Similarly, George Lamaine, who owns 3GI Athletics (a small store in Seattle), said, "It all comes down to the service that's offered. Over 52 years we've built a customer base that the new chains can't match." (15)
Kris Larsen, who owns Al's Sporting Goods (a Logan, Utah store), feels he can even compete with specialty stores when it comes to service. "We strive hard to have the best people available at the customer level, whether it's competitive cyclists in the bike shop or experts in tying flies in the fishing department." (16)
Group Buying
Some of the independent stores have formed buying cooperatives so they can have buying power comparable to the big chains. Harper Sports, for example, belongs to a buying group with 350 other independent sports stores, allowing them to purchase at the same price as big box competitors.
Play It Again Sports (a franchise operation of over 700 stores which sell both used and new merchandise) has its own buying group which negotiates prices and also puts on two trade shows a year.
RESOURCE
Here's a resource I recently found. It's a government publication explaining how to set up and run a sporting goods store. It looks like it was written in the late 1980s and therefore does not reflect recent developments in sports retailing. But it does contain enough useful information to warrant adding it to one's library of reference materials.