At the Sports, Inc. show in Las Vegas last week, the common story on the show floor was retail is difficult, but the actual dealer business itself is doing quite well. As a result, most dealers seemed relatively upbeat and ready to tackle what might be a challenging 2009.
“We operate a retail store, but our true focus is on the dealer business,” commented Gordy Brown of Ken-Tenn Sports in Martin, TN. “Retail has been soft, but the dealer business is definitely offsetting that, leaving us in a pretty good overall position.”
Aaron Patella at Davis Sport Shop in Davis, CA, concurs with Browns general impression of the market, but noted that his business is favorably situated because of nearby UC Davis. “Being in a college town like we are, it seems we are a little insulated from the tougher economic environment. Sales have been good and we are up a little.”
The general theory behind the retail/dealer dichotomy in sales trends was tied directly to school budgets. Since budgets are typically set on an annual basis, most schools already had planned expenditures for the current buying period, which meant the Lehman fiasco and corresponding market insanity had little effect on these dealers.
Now the question now becomes what about 2009?
Representatives from nearly every manufacturer maintained a cautious optimism regarding the outlook following the New Year. Level-headedness was not lost among members, however, and most exhibited some concern when pressed about the long-term ramifications that will stem from the credit crisis.
Speculation is swirling about the effects the credit crunch will have on school budgets and consumer spending in the coming year. Representatives interviewed by Sports Executive Weekly and Sporting Goods Dealers TEAM Business expressed concern that minor sports, such as volleyball and field hockey, would feel the greatest effects if school budget cutting occurs.
Likewise, some vendors noted that many “luxury” products with high price points had already seen a decline, and this may be a haunting pre-cursor for things to come. However, most vendors and dealers maintained that while budget concerns for parents and athletes may cause them to rethink the purchase of unnecessary items, protective equipment like helmets, pads, and braces are still moving off the shelves despite high prices.
While worries over the world at large were definitely present in the aisles, the focus was on the new product and putting in orders. To that end, the vendors serving the team dealer market brought their full skills to bear on the show, coaxing dollars from every dealer they could.
The Soffe/Intensity Athletic booth was filled with lots of smiling faces as the pair of brands continue to utilize parent company Delta Apparels size to sustain strong sales growth despite what the market may throw at them. For the Soffe business, the launch of Soffe Dri is expected to generate major sales at rec leagues and the like with moisture wicking and performance properties offered at a lower price point. At Intensity Athletic, meanwhile, sales are growing steadily, but softball remains its largest segment. However, football is expected to grow quickly to account for approximately 30% of sales in the near future.
The new Tip Off Jersey, which first shipped in September, was called out as selling particularly well and one of Intensitys best selling SKUs ever.
Alleson Athletic had one of the consistently busiest booths at the show as the companys philosophy of orders shipped before days end resonates with dealers who are moving closer to at-once and fill-in ordering just like the rest of the industrys retailers. The companys recently launched sublimation operations (which is based in Mexico) have been well-received by dealers seeking an easier means of adding value and customization than a traditional heavy embroidered logo.
The additional color and detail options offered by sublimation are also resonating with the end consumer. The big news for Alleson is in the year-ahead as it begins to roll out new Under Armour uniforms.
According to management, the launch will coincide with UAs introduction of basketball footwear and the uniform product will match the new shoes.
According to management, the launch will coincide with UAs introduction of basketball footwear and the uniform product will match the new shoes.
Cutter Gloves had three major initiatives on display at the show. First was an expansion of its football product with The Gamer, an all-around glove with protective padding on the back of the hand. In addition to that launch, Cutters is also entering two new product categories for 2009, soccer with a unique and more streamlined take on goalie gloves, and golf, bringing its tacky C-Tack palm to the links in the form of touches and hits on club contact points.
Schutt Sports also entered the glove market through a licensing agreement it signed in August with Krypton, licensee of the TaylorMade name for accessories in golf. The glove line stood out because of its unique, precurved design that more closely resembles the hand in action than a traditional flat glove. The Krypton license also includes softgoods in general with compression and polo shirts both on display.
For Schutts more traditional hardgoods business, the company completely re-launched its pads line for 2009. Schutt management reported that its XP and Ion 4D helmets, which launched early this year, have been major growth drivers for the business, both exceeding sales plans by a healthy margin. The company reported that 40% of NFL players are wearing Schutt technology on the field and that because of Riddells agreement with the league, all of those players are paying to wear the Schutt product.
Rawlings Fall 2009 line will include shoulder pads that incorporate the companys new Advanced Impact Management System (AIMS). Each of the AIMS shoulder pads utilizes insert pads that feature Rawlings Zoombang technology, which the company said is a visco-elastic polymer that is extremely soft at rest and can conform to any shape.
Rawlings claims Zoombang technology is the “most advanced padding material on the planet” and dissipates up to 60% more energy than foams and gels. The AIMS shoulder pads have a suggested retail price of $571.40. Rawlings will also bolster its lineup with the Spartan shoulderpad series, which features a low profile flat pad construction for improved field vision and mobility. The adult-sized Spartan shoulder pads will retail for $242.90.
Representatives for ChamPro Sport, a value-oriented team sports vendor, said they looked at the general economic situation as an opportunity to move more products off the shelves as consumers become more fiscally conscious.
ChamPro football helmets, for example, retail for around $100, a price point that can be more the quadrupled by products from higher-end helmet manufacturers. The “odd man out,” it would seem, are products with price points that straddle the median.
Shock Doctor expanded its mouthguard line with a pair of new offerings that it hopes will help to grow its already dominant market share. Addressing new rules in high school wrestling, the company introduced the Double Braces Mouthguard that offers full coverage of both the upper and lower teeth brace brackets. Shock Doctor also unveiled the Gel Max Lip Guard, which hopes to capitalize on the popularity of full lip protection in addition to mouth protection among football players in particular.
McDavid looked to its iconic HexPad product for an easy way to help boost sales. The solution: make ordering easier on coaches and dealers. To that end, McDavid has streamlined its offering, giving dealers a choice between tank and cap-sleeve options with shoulder or rib padding available together or individually. The idea is that a team will be able to outfit everyone in McDavid compression with each player individually receiving whatever padding they need.
Interestingly, McDavid is rethinking the way it approaches its advertising plans. While it reported strong successes with its advertisements featuring athletes in the product, the company found that connection only established the brand name, but failed to create a strong call-to-action. Going forward, McDavid will focus on educating the consumers about what products the athlete wears and why those products are important for any athlete to wear.
New Faces and New Companies See Good Sales at Show
New on the show floor was Trigon Sports International, but manning the booth were a couple of old faces. Cary and Chris Bawcum, formerly of Vantage Products International, left the Collegiate Pacific subsidiary that they founded to start this current venture which will find itself in direct competition with VPI. TSI has started its business focusing on large ticket field items like bleachers and batting cages for baseball and softball, but will launch football shortly. TSI hopes to capitalize on dealers who are hesitant to order from a Collegiate Pacific subsidiary when often they are competing against a member of BOOs own road sales force.
At Select Sport, SEW and SGD TEAM Business sat down with recently appointed president, Kyle Mertel. Since starting in June, Mertel reports that all systems are go and the company is ready for growth in 2009. Because the company owns its own factory in Pakistan (through its European parent company based in Denmark), Select was able to offer product for 2009 without a single price increase over 2008. According to Mertel, the company has established itself at the high-end of the market with strong dealer support and strong sales to high schools. The next step for Select will be to begin growing its retail business, starting with soccer specialty before moving beyond.
Finally, Acacia will continue efforts to secure the growing broomball market, which is flourishing in some northern states. Noteworthy products from Acacias broomball selection were the Spider Gel Pro shoe and the Titan broomball gloves, which will retail for $89.99 and $34.99, respectively.
