A season ago, the “winter that wasn’t” hit outdoor retailers hard.
Sales of wintersports apparel and gear fell a combined 8 percent across specialty, chain and Internet channels for the 2011/12 season (August through March), compared to the previous year, according to SIA RetailTRAK figures provided by Leisure Trends.
Outdoor manufacturers, however, reported relatively stable or improved figures in the midst of last winter. Sales for The North Face brand rose 20 percent in the fourth quarter 2011 and were up 14 percent in first quarter 2012, for example.
Fast forward to about a year later and present day, the results are beginning to flip flop. Retailers are coming off a strong spring and summer, and even early wintersports retail sales are up 1 percent to start the 2012/13 season in August and September, likely due to some pent up demand SIA RetailTRAK officials said.
The positive preseason sales helped specialty retailers whittle away at high leftover wintersports inventories, which stood at a whopping 30 percent higher for apparel and equipment and 14 percent higher for accessories at the end of last season.
But truth be told, retailers aren’t out of the woods yet — “inventories are still fatter with 11 percent more equipment and apparel units and 4 percent more accessories units,” SIA RetailTRAK officials said.
And that’s what’s beginning to change the story for outdoor manufactures this fall. While many brands were able to benefit a year ago by completing most of their wintersports orders before the lack of snow and cold became apparent to consumers and retailers, they’re now facing the negative effects of that overselling.
Flush with wintersports inventory, retailers have cut back their demand. Pre-orders for 2012/13 wintersports equipment is down 13 percent in the early going, according to Amer Sports, parent to Solomon and Atomic.
The North Face saw its third-quarter 2012 sales increase just 5 percent in the third quarter this year, compared to 22 percent last year, and while officials blamed most of that on Europe’s economic troubles, VF Outdoor President Steve Rendle noted that “wholesale order moved closer to need based on last year’s warm winter.”
At Wolverine World Wide, President and CEO Blake Krueger recently told investors that third-quarter 2012 sales fell for its Merrell brand, as “outdoor retailers have struggled to deal with the impact of last year's unusually warm fall and winter.”
Jarden CEO James E. Lillie, parent to Marmot, K2 and Volkl, blamed the 7 percent drop in for the company’s outdoor group in the third quarter 2012 on “year-over-year, weather-related revenue impact.”
The delayed effect from last winter’s woes isn’t a surprise to most manufactures — many have been able to curtail production in anticipation — but just like retailers, some brands tell SNEWS they are beholden to long lead times with their production schedules and facilities overseas, and its tough to stop a charging train. (SNEWS covered the issue of long lead times and earlier ordering at last year’s Winter Market, click here to read the story).
So continue to expect slightly softer results from outdoor manufacturers this winter, even if the snow and cold return. And if it’s a banner year, crossing fingers, we’ll likely see the entire picture flip itself again. Retailers will be rushing to restock next season, but manufacturers might be a little slim on product.
At least by spring 2013, things should improve for season-diversified outdoor manufacturers. Remember that this past spring/summer was particularly long and strong for retailers with many starting the season’s business early and extending it late into the warm Indian summer. For that side of calendar, expect to see retail preseason orders up next year.
-- David Clucas