Outdoor Product Sales Post Healthy Gains in April

 

Outdoor Hardgoods increased 8.6 percent thanks to impressive sales in specialty channels, where technical backpacks, camping and paddlesports grew strongly. Despite unseasonably wet and cold weather across many parts of the United States, Outdoor Apparel sales – much of which is spring-related wear at this time of year – improved a healthy 6.5 percent.

Outdoor Footwear sales rose to $179.6 million largely on the continued strength of the Natural/Minimalist category.

The success of Barefoot and Minimalist product is proving to be a long-term opportunity and still gaining momentum, said Merrell USA VP of Sales Steve Peterson, who credits high-quality construction and consumer education in how to use barefoot footwear with Merrells growth in this product area. More than ever, consumers want to know the fundamental attributes of Barefoot, the key features and technologies in properly engineered Barefoot product, and how Barefoot should be introduced into their outdoor activities. 

By channel, sales of Outdoor Footwear product improved in the mid-single-digits at Independent Outdoor Specialty shops but edged up just less than 2 percent at Sporting Goods Retailers. Outdoor Chain Retailers saw a mid– to high-single improvement in sales of Outdoor Footwear product. Sales of Outdoor Footwear in the combined outdoor specialty channels, which includes both the Independent Outdoor Specialty and Outdoor Chain Specialty channels, grew 13.9 percent for the month to $46.0 million.

After more than a year of meteoric growth, new competitors continue to enter the minimalist fray. An influx of lower-end barefoot product helped to double category sales in the Mall Retailer and Internet/Catalog channels, albeit from a small base. It remains to be seen if – or when – these value offerings start to cannibalize higher-end product sales in the specialty channels.
In Outdoor Hardgoods, growth leaders included Technical Day Packs, Internal Frame Packs, Hydration Systems, Stove Systems, Sleeping Bags, Tents, Kayaks and Oars. Total sales across all Outdoor Hardgoods grew to $379.8 million with most of the growth coming through the Independent Outdoor Specialty channel. The other channels posted flat sales, with Internet/Catalog and Discount/Mass Retailers down slightly and Sporting Goods Retailers up slightly. 

 

By trade channel, the Independent Outdoor Specialty channel saw consolidated growth of more than 20 percent for month while the higher-volume Sporting Goods channel reported a modest 2.2 percent increase.

Sales of Outdoor Hardgoods in the Independent Outdoor Specialty channel were driven by the continued shift by consumers from Lifestyle Day Packs to Technical Day Packs, and by strong growth in Internal Frame Packs, Hydration Systems (both Bike and Multi-Sport), Stove Systems, Sleeping Bags and Tents. Sit-on-Top Kayaks, Recreational Kayaks and Tandem (Sit-in) Kayaks all posted strong growth for the month in the Independent Outdoor Specialty channel. Sporting (Sit-on-top) Boats maintained solid growth, while Whitewater Kayaks and Tandem Boats faltered for the period. Oars saw strong growth as well in the channel.

The Outdoor Apparel business was the most affected by odd weather patterns and the late Easter holiday in April.  Colder, wetter weather – and some lingering snow – continued to stifle sales of spring-related items to the north of a weather line that cut across the country, while spring/summer seasonal product sales kicked in south of the line. Nonetheless, Outdoor Apparel sales increased to $151.5 million for the fiscal month. Rising raw materials costs for commodities like rubber and cotton may have tempered sales growth as apparel manufacturers passed on higher input costs to consumers.

Several sales channels among the nine channels tracked by OIA VantagePoint saw sizable sales gains for outdoor-related product. The Independent Outdoor Specialty channel rang up an increase of 26.3 percent to $134.9 million in outdoor product sales in April.  In that channel, big gains in Hardgoods and Footwear offset sagging Apparel sales. Mall Retailers posted the highest growth percentage for the month, but the gains came off a much smaller base of business. Internet/Catalog retailers posted 17.1 percent growth in outdoor goods sales in April, marking a re-acceleration of sales following a decline in March.  

Likewise, average selling prices were up 3.1 percent for the month in the Independent Outdoor Specialty channel with Outdoor Outerwear representing a higher percentage of overall apparel sales for the month (55.1 percent in April 2011 versus 44.2 percent in April 2010).

Outdoor product sales continued to outpace broader retail market sales, which jumped 8.5 percent in April, according to the International Council of Shopping Centers.  ICSC, which tracks 28 major retail chains excluding Wal-Mart, had forecasted a growth range of 5 to 6 percent for April.

Looking ahead, retailers have repeatedly warned analysts about the impending – and inescapable- impacts that inflation will have on the remainder of 2011. Soaring fuel prices (with gas nearing $4.50 per gallon in some parts of the U.S.) are expected to have a significant effect on summer spending. As noted, rising raw material costs have impacted selling prices while food prices have followed suit due to increasing energy, fertilizer and transportation costs that have resulted in higher prices at supermarkets. All of these factors – along with an eight-month high for jobless benefits in April – mean discretionary income will be at a premium as summer 2011 unfolds.

The silver lining for these somber prognostications may be that the aforementioned factors will lead to opportunity for specialty outdoor retailers – at least in hardgoods – as consumers once again look to save on fuel costs through human-powered pursuits rather than paying up at the pump.