U.S. retail census shows the big getting bigger, trend not at peak

Not as if it’s a huge surprise, but the federal government’s Census of Retail data, released every five years, shows that the big sporting goods retailers are getting bigger and claiming a larger portion of the market.
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Not as if it's a huge surprise, but the federal government's Census of Retail data, released every five years, shows that the big sporting goods retailers are getting bigger and claiming a larger portion of the market.

The data, analyzed by the National Sporting Goods Association, found the concentration of sales of sporting goods – including everything from camping and exercise, to fishing and surfing -- in the eight largest sporting goods chains grew to 52.6 percent of all sales during the five-year period from 1997 to 2002 in the recent retail census done by the U.S. Census Bureau, according to ongoing NSGA analysis of the data. In the previous five-year period, the eight largest chains represented 45 percent of sales.

More interesting to note, perhaps is the growth: Specialty sales grew from a total of $2 million per store in 1997 to $6 million per store five years later – a growth of 266 percent, NSGA President of Information Tom Doyle told SNEWS®. Compare that to big-box growth of 33 percent – from $5.2 million in 1997 per store to $6.8 million in 2002 per store.

The gap between the two channels is narrowing, Doyle said, with the birth of so-called “large-format” specialty stores, as well as the adoption of what are akin to specialty shops inside the walls of larger chains.

“That style of retailing is now taking hold at specialty,” Doyle said. “Certainly in specialty stores you have the emergence of what is referred to as a ‘large-format' store. Five years ago, there really weren't any large-format stores to speak of.”

Although the U.S. Census Bureau doesn't name stores, Doyle said specialty for its purposes could include the likes of REI, Cabela's, Bass Pro Shops, and perhaps chains like Performance Bike. Most fitness and outdoor specialty stores aren't large enough to be on that radar screen yet, or at least not among the top group, he said.

The trend of the graying of the line between large-format or even big-box stores and specialty stores also hasn't reached its zenith.

“The trend will continue for several more years,” Doyle said. “It's not maxxed out yet.”

He said what that means for specialty stores is a hard look at what they can do better, and then do it better.

“If there's an elephant coming down your path, you have to dodge him,” Doyle said. “General retail understands that from Wal-Mart. You have to have the Wal-Mart strategy. If the elephant is on the trail you're on, you have to shift your strategy.”

He named looking at different product mixes, specialty brands, upping the level of customer service and expertise, and looking at offering education, as several examples.

“You can develop a certain level of expertise,” he said, “that someone with 20, 30, or 40 stores may not have. It's things like this that can make a difference.

“We've always had the elephant coming down the trail,” Doyle explained, “but do we turn our back on him or do we look for the things that are most appropriate for us to do?”

Despite the growth of large chains, the census showed that the concentration of sales in the eight largest sporting goods chains grew less rapidly between 1997 and 2002 (7.6 percent) than in the previous five-year period (9.8 percent). Concentration of sales also grew in the specialty sports channel, but not to levels seen in the full-line channel. Sporting goods sales of the eight largest specialty retailers grew to 15.9 percent of sales in this channel of distribution during the five-year period 1997-2002. In the previous five-year period, the eight largest specialty retailers represented 10.9 percent of sales. However, concentration of sales in the eight largest special sports retailers grew more rapidly between 1997 and 2002 (5.0 percent) than in the previous five-year period (3.2 percent).

“It's very important to do something. You can't ignore this,” Doyle said. “If I were running a store, I'd be very sensitive to this information.”

Data already released and a schedule of when additional data will be released may be found at www.census.gov/econ/census02/.

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