About the same time the economy across the Euro-zone was sputtering and sports buying groups wondered what '09 would hold, the Haribo Gummi Bear candy company gleefully announced, "We're not feeling a thing from the economic crisis."
"Our 5,000 employees at Haribo don't have to worry about a thing," the 85-year-old CEO Hans Riegel said, noting revenues forecast for 2009 of EUR 2 billion (USD $2.5 billion) for the German company. "We will make it through this year just fine."
For those in the sports industries, the message wasn't as glowing, but it was still sweetly upbeat: 2008 finished with a single-digit uptick in revenues at sports retail after mostly disheartening results for the previous two years. And the forecasts for 2009, depending on who was talking, ranged from stable to as much as 3 percent growth on average.
"The customer is now ready again to go shopping, thank goodness," said Andreas Rudolf, CEO of buying group Sport 2000 reporting full-year revenues up 5.8 percent over 2007 among its members with outdoor as the strongest category and interest climbing in health and fitness.
"Sport is the best investment," he added.
Single-digit increases to rejoice
At the ispo show, exhibitors and retail attendees didn't need to be told that sport was the best investment. They turned out in strong numbers to hear about the industry's status and check out new products (Click here to see our Feb. 4, 2009, story, "Mostly bubbling retailers pack show halls, express caution but are ready to buy.")
"There's snow outside, it's cold, and we're excited about the strong winter," said Roland Scheuermeyer of Intersport, the largest buying group, which reported increased revenues of 7 percent for 2008 over 2007 for its members. A year ago it had forecast growth of less than half that, or 3 percent.
The German association of sport retailers in conjunction with the international association also announced an increase in total revenues of 3 percent in Germany (EUR 7.1 billion or approximately USD $9 billion, up from EUR 6.9 billion or USD $8.7 billion) and 1.5 percent Europe-wide (EUR 37.5 billion or USD $47.5 billion, up from EUR 37 billion or USD $46.9 billion).
As usual monthly revenues fluctuated with the weather, with Intersport's numbers showing the lowest revenues in April 2008 (down 2 percent over prior year), and December showing a shot upward (up 11 percent). What pushed the numbers up in the last quarter of the year was the slamming arrival of winter and snow. Everybody rejoiced and sports shops saw registers ringing: Ice skates sold out, ski and snowsports helmets jumped off the shelves, and sales of outdoor gear flourished.
Outdoor still on the move
"Outdoor is the category that has been growing every single year," said Jost of Intersport. For example, it grew 14 percent in 2008 when overall sports revenues were stable, and grew 16 percent in 2007.
Other categories that remained positive for 2008, per Intersport numbers, were snowsports with growth of 11 percent (compared however to a decline in 2007 of 21 percent), multisport or cross-training up 4 percent (slightly down from the previous year's plus of 6 percent), and fitness with a positive of 3 percent (up from a decline in 2007 of 2 percent).
Top suppliers moving upward on both group's lists of its member's suppliers include Jack Wolfskin, VF Group and Mammut.
"The numbers reveal that we as the German sporting goods industry managed again in 2008 to unhitch ourselves a bit from the continued economic recession," said Werner Haizmann, president of FEDAS, the international sports retail association, and VDS, the German sports retail association.
"Sport is once again a 'mega-trend' all around Europe," he added.
And for 2009?
Ending the year on a high note doesn't mean, however, that 2009 will be easy, sports group and association representatives said in separate presentations, press conferences and statements. All mentioned the importance of service and education at retail to keep the consumer buying.
"Consumers are seeking trust and orientation with personal contact," said Sport 2000's Rudolf.
Intersport's representatives mentioned that in an economic crisis, creativity, cost management and building the customer relationship are all-important.
"In the sports retail industry, selection, service and value," Haizmann said, can be the deciding factors when it comes to continuing to exist or not. Mediocre is 'mega-out.'"
The forecast is still positive, with Intersport at the 2009 winter ispo show revealing its revenues for the just-completed last week of January: An increase of about 5 percent over January 2008, which was down more than 6 percent, putting the group up over a year ago by nearly 12 percent. Sport 2000 also said the just-finished month looked to show double-digit growth.
Still, the groups laid out a more conservative year-over-year forecast for 2009: Intersport is planning for a stable return, while Sport 2000 said the year could be between 1 percent and 3 percent up.
"A growth of 3 percent may be extreme for 2009," said Sport 2000's Rudolf. "Even 1 percent would get people pretty excited."