SBJ/20100517/This Week's News

Apparel, equipment sales slip for second year

Sports apparel and equipment sales in the U.S. dipped 4.3 percent last year, marking the first time the sporting goods industry has experienced consecutive years of declining sales since the Sporting Goods Manufacturers Association began tracking those numbers in 1988.

Lacrosse was named the hottest growth sport
in the sporting goods group’s report for 2009.

“2009 may be remembered as the most difficult year the sporting goods industry has experienced,” noted the SGMA’s annual State of the Industry Report, issued last week.

Wholesale domestic sales of sporting goods equipment, fitness equipment, sports apparel, athletic footwear and licensed merchandise totaled $71.8 billion in 2009 — a 4.3 percent decrease compared with a weak 2008, when wholesale sales were $75 billion, a 3.2 percent decrease from the previous year and, at that time, the first drop in five years.

The report, however, an amalgam of industry data and research along with consumer and business-to-business surveys, noted that the sports and fitness industry slowed at less than half the rate of general economic decline in 2009. Additionally, the report projected that industry sales will rebound in 2010 between 2 percent and 4.5 percent, outpacing the 2 percent growth projected for the overall U.S. economy. More than 63 percent of industry executives surveyed for the report said they expected sales to increase this year; only 8 percent predicted sales declines.

Activities most likely to generate sales growth or decline
HOT
Lacrosse 50%
Football 25%
Fitness walking 21%
Aerobic training 18%
Fitness cycling 18%
NOT
Golf 42%
Roller/Street hockey 21%
Paintball 21%
Baseball 21%
Billiards 17%
To read: 50 percent of those surveyed picked lacrosse as the sport most likely to generate sales growth; 42 percent cited golf as the sport most likely to generate sales decline.
Survey base: A panel of 60 industry experts, primarily retailers and manufacturers.
Source: SGMA State of the Industry Report 2010

“We’ve gone from a year of doubt, where big retailers and manufacturers responded early with personnel cuts, to some cautious optimism,” said SGMA President and CEO Tom Cove. “We’ve learned that we’re not as discretionary a spend as luxury goods, but we’re still tied to the economy. The key factors to the rebound will be how much consumers’ definition of value has changed and, on the industry side, what the ‘new normal’ is, as far as how much inventory it’s appropriate to have on hand.”

Among leading categories, sports apparel sales dropped 5 percent, from $29.6 billion to $28.1 billion; the overall sports equipment sector dropped 2.4 percent, from $20.8 billion to $20.2 billion; athletic footwear declined 0.8 percent, to $12.268 billion; licensed product sales plummeted 13.8 percent; exercise equipment declined marginally, from $4.2 billion to $4.1 billion.

Among the few sports seeing increases in equipment sales were camping, football, soccer and martial arts.

Lacrosse was named the “hottest growth sport,” followed by football and fitness walking. Running, named last year’s third-hottest sport, fell to ninth.

Sales of golf clubs and accessories fell 11.4 percent to $2.48 billion, somewhat more than a 5.1 percent decline in golf participation would bring about. Sales of tennis equipment dipped 6.2 percent, while the sport’s participation numbers were flat.

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