Germany is suddenly dealing with an invasion of sports discounters that are introducing an entirely new shopping concept to the German market -- a concept that has local retailers just a tad shook up.
In mid-October, Austria-based discount superstore Sports Experts opened a store in Munich -- its second in Germany. Not only is Sports Experts Munich massive at some 48,440 square feet (4,500 square meters), but it also shockingly guarantees it will have the lowest price: If a customer finds the same item in a different store for a lower price than the same item offered at Sports Experts, the customer will get the difference back. In cash. And the chain, already 23 strong in Austria, also offers a full satisfaction guarantee. Or your money back.
Shocking for German retailers, but a pleasure it seems for consumers. Germans have flocked to the first Sports Experts store in Regensburg, where sales in running, outdoor, and "sun and water" are already ringing in 40 percent higher than expected since its opening in the spring. And despite some losses in the European sports arena this year, Sports Experts has still seen overall record 23-percent growth in 2001. Individual segments that lead were: running, 138 percent; leisure and casual wear, 47 percent; fitness, 31 percent; and sun and water, 29 percent.
For German retailers, however, it's not so much the store itself, but who is guiding it -- the Austrian arm of the international buying group called Intersport (www.intersport.com), to which they also belong. Despite also being Intersport members, the Austrians could march into Germany under the European Union's open borders and open the chain without stopping to ask permission from their German colleagues. The Austrian business only must obey any Germany laws.
Rainer Angstl of Sport-Scheck in downtown Munich, whose store is also some 49,000 square feet but seems cozy because of its several floors in a narrow building where it has been for nearly 56 years, says only, "We will see," about how the new concept could affect his business. He told SNEWS he will be watching closely to see how he should respond.
"Of course no German sport retailer is glad to see additional competition," Peter Thuerl, spokesman for Intersport Germany, told SNEWS. But he adds that fair competition is what the group is all about, and competition can even bring new customers to all stores and to the market in general.
From Helmut Weiss, spokesman for Intersport Austria, came a statement to SNEWS that his group had conversations with German colleagues to try to help them understand the concept and convince them of its merit, "which is why we believe the right time is now, to expand into Germany."
Sports Experts already has 23 stores in Austria that range in size from 6,800 square feet to more than 64,000 square feet, with 10 so-called superstores at more than 32,000 square feet. Its motto: "International brands, the best prices." The superstores of the chain offer more than 100,000 items from more than 400 different companies, as well as its own in-house brands. Already Intersport Austria has plans to open about two new Sports Experts each year, with one scheduled for in northern Germany for Spring '02.
SNEWS View: Perhaps a big box sports and fitness discounter isn't big news in the United States. But to Germans, where government controls over growth and prices have been abundant until recently, it's a bit of a shocker. Combine the expansion of Sports Experts with Wal-Mart's recent announcement that it is planning to take on discount fitness and sports in Germany with a vengeance, and one can see why traditional retailers are concerned. The retail market, as Germans know it, is going to change drastically in the next few years. And although some small shops may not be able to succeed, the movement could actually create more customers, as the Intersport Germany spokesman pointed out. More customers doesn't of course help a retailer who isn't getting enough of them.