Dick's Sporting Goods Chair & CEO Ed Stack in an earnings call yesterday "outlined how his company will continue grabbing share amid consolidation in the industry," according to Krystina Gustafson of CNBC.com. His strategy includes "opening stores in markets where competitors' bankruptcies left a gap, and targeting new customers in its existing markets where one of those chains has failed." Dick's is cutting 20% of its lower-volume vendors to "focus on its most important suppliers." Stack said, "The consolidation in this industry's not over." At a time when many retailers are "shuttering stores, Dick's this fiscal year will open 43 locations under that nameplate, 19 of which are former Sports Authority stores." Those shops will "primarily target California, Texas and the Pacific Northwest, where Dick's has a small footprint." Stack said that the company "will be 'patient' in site selection for future expansion" (CNBC.com, 3/7). The WALL STREET JOURNAL's Sara Germano noted Dick’s plans to "drop a fifth of the brands it carries and will fill shelves with more of its own private-label apparel and sports gear as it adjusts to a consolidating market." Stack said that the "cuts wouldn’t affect its 10 best-selling vendors, adding that the company will add offerings" from Adidas, Reebok and Nike. The company "didn’t specify which brands it would eliminate." Stack:"It’s difficult to do. It’s difficult to tell people we have done business with for a long time that we are not going to do business going forward." By eliminating some labels, the company "plans to expand in-house brands, such as its women’s athletic line, Calia by Carrie Underwood, and two more that it expects to launch this year" (WSJ.com, 3/7).
ON LIFE SUPPORT: USA TODAY's Nathan Bomey writes sporting goods stores are "down for the count." The "scourge of insolvency is sweeping through the sector as online sellers gain the upper hand over yet another corner of retail just recently dominated by big-box chains, specialty stores and mom-and-pop shops." Online sellers are "undercutting store-based retailers on price and options and some specialty retailers are luring customers away with upscale items." Dick's is "capitalizing on the fallout." The strategy of "expanding as others contract looks like it might work." After the "demise of Sports Authority left Dick's as the only national big-box retail sports chain, several analysts drew comparisons to Best Buy's emergence as the last remaining major national electronics retailer" following the '09 liquidation of Circuit City (USA TODAY, 3/8).
