Dick’s Sporting Goods Predicts More Trouble In Industry, Will Focus On House Brands

Image courtesy of Mike Mozart

Unlike a number of its competitors who are shuttering stores or shutting down entirely, sales are up slightly at Dick’s Sporting Goods. That may not be enough to please Wall Street, so the retailer has a plan to boost profits: Sell more of its house-brand products.

In the last year, competitors like Sports Authority, Sport Chalet, City Sports, and Golfsmith have closed their doors. Even those retailers that remain have seen their market share fall relative to Dick’s, which took advantage of Sports Authority’s demise to open stores in new areas. Dick’s also took over some former Golfsmith locations after the golf chain filed for bankruptcy.

Another force that may have made investors nervous was CEO Edward Stack’s prediction that the shakiness across the whole sporting goods industry may not be over. While more consolidation will probably be good for Dick’s, it means more liquidation sales and more shoppers opting to stock up at those sales.

The chain does more business in athletic clothing than athletic gear, and going forward will focus on two types of merchandise. There are major brands, like Under Armour and Nike, and also the chain’s own brands, which include a fitness clothing line endorsed by singer Carrie Underwood.

In all, Dick’s plans to cut ties with 20% of the vendors it does business with, replacing that merchandise with its own brands and with the big names. CEO Stack said that the idea is to offer “a more refined offering for our customers.”

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