SBJ/February 18 - 24, 2002/Salt Lake 2002

Maker of U.S. team uniforms boosts sales estimate 400%

Figure skater Michelle Kwan
and President George W.
Bush sported the Roots names
on U.S. team items.
Canadian apparel maker Roots expects to sell at least $25 million worth of U.S. Olympic Team licensed merchandise and as much as $50 million if the frenzy continues well after the Games, said CEO Marshall Myles.

Myles said Roots originally projected $5 million in sales. But the Salt Lake City Winter Games are drawing better-than-expected television ratings fueled in part by a surge in patriotism following last year's terrorist attacks, and the apparel's style has caught the imagination of the public.

"It caught us by surprise," said Myles, who would not disclose the company's overall sales. "Our goal was to really get our name out there."

Roots, which opened its first store in Canada in 1973, now has 140 stores in Canada and 80 in the Far East. Myles said the company wants to use its newfound fame to expand in the United States, where it hopes to open stores in San Francisco and Seattle and get distribution through top department store chains.

"We're looking to capitalize on it, but not just as a fad," he said.

Roots, which goes by Roots Canada in its native country, was something of a last resort for the U.S. Olympic Committee. The outfits the company designed for the Canadian Olympic team in Sydney were the envy of the athletes there, but USOC still offered the right to supply the U.S. team to major U.S. companies first.

Nike Inc., Reebok International and Adidas America, which had the U.S. team outfitting rights in Sydney, all passed. Roots eventually landed the deal for a cash commitment of well under $1 million, USOC sources said.

The contract called for only a small upfront fee plus an easily attainable minimum royalty requirement. Roots also agreed to supply parade outfits, warm-ups and casual wear to Olympic team members and "podium jackets" to medal winners, free of charge.

The U.S. team beret is the hottest apparel item in America. Television shopping network QVC sold 10,000 in just three minutes last Wednesday. The same morning, the Olympic "Superstore" in Salt Lake City went through 2,000 of the $19.95 lids in five minutes. Some have been resold on Internet sites for more than $200.

By last Tuesday, five days into the Games, the Superstore and concession stands had sold about $7.5 million worth of merchandise, seemingly well on their way to hitting the budgeted goal of $12 million.

The original run of 50,000 units sold out quickly, and production has been upped to 250,000, with Canadian factories churning them out "24 hours a day," Myles said.

Even without the swell of interest, the Roots product line and brand name were guaranteed massive television exposure during the Games. Yet only a handful of U.S. retailers were willing to carry the product.

Department store Nordstrom's and sporting goods chain Gart Sports were the only traditional "brick and mortar" retailers to carry the line, along with the seven company-owned Roots stores across the U.S.

U.S. Olympic "Team Spirit" stores carried Roots' products, which were available on the Roots and U.S. Olympic team Web sites. House of Blues music clubs also sell them.

"We spoke with a number of retailers, but they hadn't had good history with Olympic products," Myles said.

Now, no one can keep Roots products in stock. Last week, people were waiting for more than two hours to get into the Roots shops in Salt Lake City and Park City, Utah.

Myles credited USOC for helping develop the distinctive look of all the U.S. team products. The dark and light blues, the all-lower-case font and snowflake that define the look of the U.S. team came not from Roots' designers but from an internal rebranding effort that USOC began more than a year ago.

"We were really trying to focus the brand on our athletes," said Matt Biespiel, the USOC's managing director of brand development. He said the average U.S. team member is about 25 years old, and light blues and retro looks are in fashion with young adults.

When the Games close Sunday, Roots and the U.S. team's new look will live on. Roots has the U.S. team rights through the 2004 Games in Athens.

"I would be lying if I said I expected this," Myles said.

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Related Topics:

Adidas, Olympics, Reebok, Salt Lake 2002

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