Dick's Sporting Goods: It’s 'a perfect storm' in retail right now

Dick's Sporting Goods grand opening in Houston, Texas in October 2016. (Photo: Dick's Sporting Goods/Facebook)

Dick’s Sporting Goods grand opening in Houston, Texas in October 2016. (Photo: Dick’s Sporting Goods/Facebook)

Dick’s Sporting Goods’ top executive described the current retail market as “a perfect storm” in a phone call with investors last week.

Chairman and CEO Ed Stack said Saturday the company’s hunting category faces slow growth as politically-driven fear around impending gun regulation drags sales and causes inventory backlog, inciting a “panic” industry-wide.

“It’s a perfect storm right now,” he said. “We’re not particularly happy that we’re in it, but we think we are one of the few that are very well positioned to come up the other side very strong and continue to be the leaders in this industry and we think it’s there and we think it’ll be great on the back side, but it’s going to be painful for a while.”

Dick’s reported second quarter net income of $112.4 million, 23 percent higher than 2016. Net sales increased 9.6 percent to exceed $2.2 billion.

“In this very competitive and dynamic marketplace, we were able to deliver a significant increase in our bottom line from last year,” Stack said. “We continued to capture market share and generated strong results in eCommerce, footwear and golf, although sales were pressured by weakness in hunting, licensed and athletic apparel. By design, we will be more promotional and increase our marketing efforts for the remainder of the year, as we will aggressively protect our market share.”

Stack told investors the company’s extensive consumer research in markets where competition is “more fierce” revealed some uncomfortable truths.

“The customers have told us they feel our prices are not competitive in today’s environment,” he said. “Consequently, we have become more promotional and competitive, and have launched our best price guarantee where we promised the customer if they find a lower price than ours, we will match it.”

Stack echoed the woes of other sporting goods’ chains and firearms manufacturers whom blame sluggish sales on stockpiled inventory hanging around since last year’s election. He called the promotional pricing in the hunting category “almost irrational.”

“The gun and ammunition business is difficult,” he said. “That is right now … continuing to be promotional. And I think it’s going to become more promotional as we get into the meat of the season, which is toward the end of the third quarter and to the beginning of the fourth quarter.”

Read More On:

Latest Reviews

  • Tuck & Carry: CCW in a Skirt

    Aimed at women who want the comfort and convenience of a skirt but with the protection of a holstered gun, the Tuck & Carry occupies what I term apparel holsters -- that is clothing/holster duos.

    Read More
  • The Marlin Dark in .45-70 is Stealthy and Modern

    Flash forward the lever gun of Western lore to the 2020s, where Marlin has taken that classic design and given it a modern upgrade. Meet the Marlin Dark.

    Read More
  • Gear Review: Sig Sauer Tango 6T 1-6

    Sig Sauer has long been a big name in the firearms industry, so it came as no surprise several years ago when Sig filled out its repertoire with its own optics line. Today, we’re looking at the Tango 6T, a 1-6 low power variable optic.

    Read More
  • First Look: Hornady 6mm ARC

    Hornady brought another impressive project to the shooting public in 2020 with the introduction of the 6mm Advanced Rifle Cartridge.

    Read More