Washington – Several months of stronger-than-expected retail sales provided hope that the industry was poised to bounce back, but March retail sales demonstrate that the industry is continuing to struggle. According to the National Retail Federation, retail industry sales for March (which exclude automobiles, gas stations, and restaurants) decreased 0.6 percent seasonally adjusted from February and dropped 3.7 percent unadjusted over last year.
March retail sales released today by the U.S. Commerce Department show total retail sales (which include non-general merchandise categories such as autos, gasoline stations and restaurants) decreased 1.1 percent seasonally adjusted over February and decreased 10.6 percent unadjusted year-over-year. Retail industry sales for February were revised upward, increasing 0.3% instead of dipping 0.1% as originally reported.
“A chilly start to spring and a late Easter combined for dreary March sales,” said Rosalind Wells, Chief Economist for NRF. “To compensate for the Easter shift, retailers typically look at March and April together to get a better look at how their stores performed. Easter should give a much-needed boost to April sales.”
One of the only bright spots in March came from health and personal care stores, whose sales increased 0.4 percent seasonally adjusted over last month and 3.5 percent unadjusted over last year. Food and beverage stores sales also increased 0.5 percent seasonally adjusted month-to-month but decreased 1.8 percent unadjusted year-over-year.
The shift in Easter sales also played a role in consumer purchases of clothing and clothing accessories. Sales at those stores decreased 1.8 percent seasonally adjusted from February and decreased 8.7 percent unadjusted over March 2008. Electronics and appliance stores sales decreased 5.9 percent seasonally adjusted month-to-month and decreased 10.0 percent unadjusted year-over-year. Sales at sporting goods, hobby, book and music stores also decreased 0.9 percent seasonally adjusted over last month and decreased 3.0 percent unadjusted over last year.
The National Retail Federation is the world's largest retail trade association, with membership that comprises all retail formats and channels of distribution including department, specialty, discount, catalog, Internet, independent stores, chain restaurants, drug stores and grocery stores as well as the industry's key trading partners of retail goods and services. NRF represents an industry with more than 1.6 million U.S. retail establishments, more than 24 million employees - about one in five American workers - and 2008 sales of $4.6 trillion. As the industry umbrella group, NRF also represents more than 100 state, national and international retail associations. www.nrf.com.
Showing posts with label locals blogspot. Show all posts
Showing posts with label locals blogspot. Show all posts
Tuesday, April 21, 2009
Tuesday, April 7, 2009
Sourcing - Eager to Limit Inventory Risk, Brands Push Lead Times Lower
Eager to Limit Inventory Risk,Brands Push Lead Times Lower
Some outdoor brands are pushing back their orders for final orders and greige goods for Fall 2009 and Spring 2010 and pressuring suppliers to shorten lead times and give up margin as a contraction in retail sales works its way up the supply chain, according to textile and contracting sources. “People are trying to trim the lead times,” noted Chris Parkes, national sales manager for Concept III International, which develops sources and produces apparel for a variety of outdoor brands. “No one wants to get stuck with product.”
Parkes cited one example where a client who normally commits to ordering 70% of the prior year’s goods by December had only committed to 40%. Still, he noted that Concept III recently got an unanticipated order for 9,000 square yards of technical fabric. “There still seems to be orders out there for fall/winter,” he said.
Some brands and retailers want to wait until after spring retail sales data comes in to adjust their final orders for Spring 2010, said one textile executive. “Brands are holding on as long as they can,” he said. “There is a trend for greige goods to be forecast later. That makes it more difficult for us to deliver on time.”
This in turn has shortened lead times for textile mills, according to Roger Berrier, EVP for sales, marketing and Asian operations at Unifi, which makes recycled polyester Repreve yarns used by outdoor apparel brands. “Today, mills will not give us a soft order until they have an order themselves,” said Berrier. “Instead of giving us six weeks notice, we are getting an order within two weeks of delivery.”
Unifi is shortening production runs, which raises its machine change over costs. That’s better, though, than being stuck with inventory “because some of these programs just get canceled with no warning.”
Sources also report that brands have pushed back plans to introduce new product figuring that neither retailers nor consumers would gamble on it in Fall 2009 and Spring 2010. Many, however, are pushing for innovations for Fall 2010 on the assumption the economy will improve by then.
Brands are also pushing for price cuts of 3 to 15%. But with Asian mills earning operating margins of 12 to 18 points compared to 40 to 60 once enjoyed by U.S. mills, such concession are hard to come by, said Parkes. The environment has incentivized apparel mills to cut costs. This has lead more intense quality control by U.S. brands, which have rejected fabric they would have accepted a year ago.
For retailers, all this could result in later deliveries on top of already light pre-season orders. That raises the likelihood that they will run out of stock on some items. That’s a risk many retailers favor over being stuck with inventory.
“Everyone is walking on egg shells,” said Parkes. “The Asian mills don't understand what's happening. They've never seen this before.”
Still, Parkes urged brands to push their suppliers to continue innovating and be flexible. “As you are closing down Fall 2010 and things change at retail, don't be afraid to go back to your suppliers and tell them this or that change has to be made,” he said. “Don't accept 10 weeks to develop. You will have to find suppliers who will work with you and turn things in four to six. In the past, brands could say ‘we will do that next season,’ but you can’t do that in this market. If you miss it, the consumer will buy it from someone else.”
Some outdoor brands are pushing back their orders for final orders and greige goods for Fall 2009 and Spring 2010 and pressuring suppliers to shorten lead times and give up margin as a contraction in retail sales works its way up the supply chain, according to textile and contracting sources. “People are trying to trim the lead times,” noted Chris Parkes, national sales manager for Concept III International, which develops sources and produces apparel for a variety of outdoor brands. “No one wants to get stuck with product.”
Parkes cited one example where a client who normally commits to ordering 70% of the prior year’s goods by December had only committed to 40%. Still, he noted that Concept III recently got an unanticipated order for 9,000 square yards of technical fabric. “There still seems to be orders out there for fall/winter,” he said.
Some brands and retailers want to wait until after spring retail sales data comes in to adjust their final orders for Spring 2010, said one textile executive. “Brands are holding on as long as they can,” he said. “There is a trend for greige goods to be forecast later. That makes it more difficult for us to deliver on time.”
This in turn has shortened lead times for textile mills, according to Roger Berrier, EVP for sales, marketing and Asian operations at Unifi, which makes recycled polyester Repreve yarns used by outdoor apparel brands. “Today, mills will not give us a soft order until they have an order themselves,” said Berrier. “Instead of giving us six weeks notice, we are getting an order within two weeks of delivery.”
Unifi is shortening production runs, which raises its machine change over costs. That’s better, though, than being stuck with inventory “because some of these programs just get canceled with no warning.”
Sources also report that brands have pushed back plans to introduce new product figuring that neither retailers nor consumers would gamble on it in Fall 2009 and Spring 2010. Many, however, are pushing for innovations for Fall 2010 on the assumption the economy will improve by then.
Brands are also pushing for price cuts of 3 to 15%. But with Asian mills earning operating margins of 12 to 18 points compared to 40 to 60 once enjoyed by U.S. mills, such concession are hard to come by, said Parkes. The environment has incentivized apparel mills to cut costs. This has lead more intense quality control by U.S. brands, which have rejected fabric they would have accepted a year ago.
For retailers, all this could result in later deliveries on top of already light pre-season orders. That raises the likelihood that they will run out of stock on some items. That’s a risk many retailers favor over being stuck with inventory.
“Everyone is walking on egg shells,” said Parkes. “The Asian mills don't understand what's happening. They've never seen this before.”
Still, Parkes urged brands to push their suppliers to continue innovating and be flexible. “As you are closing down Fall 2010 and things change at retail, don't be afraid to go back to your suppliers and tell them this or that change has to be made,” he said. “Don't accept 10 weeks to develop. You will have to find suppliers who will work with you and turn things in four to six. In the past, brands could say ‘we will do that next season,’ but you can’t do that in this market. If you miss it, the consumer will buy it from someone else.”
Monday, April 6, 2009
Business Plan - Did you hear?...Global retail sales of organic cotton products up 63 percent in '08
Thanks to global brands and retailers, such as Nike and Pottery Barn, retail sales around the world of organic cotton apparel and home textile products shot up 63 percent in 2008, according to a recently released report from Organic Exchange.
That year, sales reached $3.2 billion compared to $1.9 billion a year earlier, as reported in the non-profit’s "Organic Cotton Market Report 2007-2008."
Contributing to that leap are also outdoor industry brands like Patagonia, a pioneer in using organic cotton in the early 1990s, even switching to it exclusively in 1996 for all its cotton apparel. In 2005 and 2006, Patagonia was on the Organic Exchange’s top five list of programs, but has been bumped down the list as larger, more mainstream players have entered the market.
Now, among the top 10 organic cotton-using brands and retailers globally were five U.S. companies: Wal-Mart, Nike, Anvil, Pottery Barn and Greensource. Elsewhere, they included C&A in Belgium, H&M in Sweden, Zara in Spain, Coop Switzerland and Hess Natur in Germany."
The most important news surrounding this figure is the fact that organic is no longer a novelty. With Volcom, Billabong, Nike, Marks and Spencer, H&M and others all selling organic now, the general public is learning the benefits of organic, the perils of traditionally grown cotton, and making the connection between health, the environment and their wallets," Jen Rapp, a spokeswoman for Patagonia, told SNEWS®.
Rapp noted that Patagonia believes 2008's massive sales growth is a result of widely known brands, such as Wal-Mart, selling organic to their large customer bases.
"The beauty is that with brands such as Wal-Mart on the organic cotton bandwagon, and the number of farmers that are switching to organic farming, the cost of organic is going to continue to become more and more affordable, allowing this growth to continue in the current economy," she said.
The Organic Exchange found in its research that most brands and retailers selling organic cotton products remain committed to their sustainability plans and upbeat about market growth. They reported they have plans to expand their product lines 24 percent and 33 percent in 2009 and 2010, respectively. It estimates that the segment will be a $4 billion market in 2009 and a $5.3 billion market in 2010.
Additionally, the organization's "Organic Cotton Farm and Fiber Report 2008" reported that the number of organic cotton farmers grew worldwide by 152 percent in 2007/2008. Organic cotton production hit 145,872 metric tons, which is equivalent to 668,581 bales (a bale is 480 pounds). It was grown on 400,000 acres in 22 countries worldwide.
During 2008, the report noted, certified organic cotton fiber supplies grew by 95 percent, significantly higher than annual growth rates of 45 percent in 2006 and 53 percent in 2007.
"Farmers who planted on speculation or expanded without market partners may have shifted the market into a state of oversupply in 2009," said LaRhea Pepper, Organic Exchange's senior director, in a statement, noting that the non-profit strongly discourages farmers from taking this kind of risk.
"Brands may want to explore opportunities for expanding their organic programs with their business partners, as for the first time in many years, supplies of organic fiber, yarns, and fabrics are more available than in previous years," Pepper added.
Founded in 2002, Organic Exchange (www.organicexchange.org) facilitates expansion of the organic cotton fiber supply by working with the entire chain of supply, from farmers to retailers, to help develop organic cotton programs.--Wendy Geister
That year, sales reached $3.2 billion compared to $1.9 billion a year earlier, as reported in the non-profit’s "Organic Cotton Market Report 2007-2008."
Contributing to that leap are also outdoor industry brands like Patagonia, a pioneer in using organic cotton in the early 1990s, even switching to it exclusively in 1996 for all its cotton apparel. In 2005 and 2006, Patagonia was on the Organic Exchange’s top five list of programs, but has been bumped down the list as larger, more mainstream players have entered the market.
Now, among the top 10 organic cotton-using brands and retailers globally were five U.S. companies: Wal-Mart, Nike, Anvil, Pottery Barn and Greensource. Elsewhere, they included C&A in Belgium, H&M in Sweden, Zara in Spain, Coop Switzerland and Hess Natur in Germany."
The most important news surrounding this figure is the fact that organic is no longer a novelty. With Volcom, Billabong, Nike, Marks and Spencer, H&M and others all selling organic now, the general public is learning the benefits of organic, the perils of traditionally grown cotton, and making the connection between health, the environment and their wallets," Jen Rapp, a spokeswoman for Patagonia, told SNEWS®.
Rapp noted that Patagonia believes 2008's massive sales growth is a result of widely known brands, such as Wal-Mart, selling organic to their large customer bases.
"The beauty is that with brands such as Wal-Mart on the organic cotton bandwagon, and the number of farmers that are switching to organic farming, the cost of organic is going to continue to become more and more affordable, allowing this growth to continue in the current economy," she said.
The Organic Exchange found in its research that most brands and retailers selling organic cotton products remain committed to their sustainability plans and upbeat about market growth. They reported they have plans to expand their product lines 24 percent and 33 percent in 2009 and 2010, respectively. It estimates that the segment will be a $4 billion market in 2009 and a $5.3 billion market in 2010.
Additionally, the organization's "Organic Cotton Farm and Fiber Report 2008" reported that the number of organic cotton farmers grew worldwide by 152 percent in 2007/2008. Organic cotton production hit 145,872 metric tons, which is equivalent to 668,581 bales (a bale is 480 pounds). It was grown on 400,000 acres in 22 countries worldwide.
During 2008, the report noted, certified organic cotton fiber supplies grew by 95 percent, significantly higher than annual growth rates of 45 percent in 2006 and 53 percent in 2007.
"Farmers who planted on speculation or expanded without market partners may have shifted the market into a state of oversupply in 2009," said LaRhea Pepper, Organic Exchange's senior director, in a statement, noting that the non-profit strongly discourages farmers from taking this kind of risk.
"Brands may want to explore opportunities for expanding their organic programs with their business partners, as for the first time in many years, supplies of organic fiber, yarns, and fabrics are more available than in previous years," Pepper added.
Founded in 2002, Organic Exchange (www.organicexchange.org) facilitates expansion of the organic cotton fiber supply by working with the entire chain of supply, from farmers to retailers, to help develop organic cotton programs.--Wendy Geister
Surge in Campground Reservations Creates Opportunities for Outdoor Businesses
More evidence is emerging that Americans are turning to the outdoors for a respite from tough economic times, or perhaps because of them. Advance reservations for nearly 89,000 campgrounds on federal lands were up 26.1% for the period of January 1 to March 22 compared to the same period last year, according to data from the National Recreation Reservation Service. The overwhelming majority of the reservations came in online via reserveamerica.com.
The spike in reservations prompted a report by CNN, entitled “In a Slump, Camping Comes Into Vogue.” The article reports that reservations to state parks in California are also trending up. Of course it’s still too early to say whether media reports will translate into stronger sales of camping gear this spring.
Regardless, marketing gurus are urging outdoor retailers to start promoting close-to-home adventures now to both core outdoor enthusiasts and their more casual shoppers while both groups are planning their summer vacations.
A survey of Leisure Trends Group’s Most Active American Panel conducted between February 15 and March 10 found that 78% plan their summer vacation one or more months ahead of time. More than 50% plan three to five months out, in large part because they are hunting for deals. Among this group, 11 percent said they are considering doing more camping. Skiers, by contrast, often booked their trips this winter only one or two weeks out in hopes of getting the best airline and resort promotions as the economy weakened.
“If I was a specialty retailer, I would institute a program that would show people what they could do within 50 miles,” said Leisure Trend Group’s Julia Day Clark. “People are thinking about this. They are planning and what if retailers could show them something really cool?”
With that in mind, here are some ideas for luring folks into your store:
Blog: If you don’t already have one, you could start by publishing the top 25 local adventures for the spring and summer on your web site. If you have time, post directions, advisories, photos, maps, suggested provisions, GPS coordinates, etc. For an example, check out Dave Baker’s blog for Tucson’s Summit Hut.
Build community: Offer to post customers’ own photos and observations of their experiences on the blog. Contributors can become eligible for a $150 gift card drawing.
Point of sale: Print your top 25 list with a link to your website on fliers for your store. Laminate a few for your sales staff, who can use them on the floor to show customers just how easy it is to hike, climb, cycle, paddle and camp nearby.
Map room: Set up a trip planning area in your store where customers can browse maps, books and maybe even cruise the Internet. Blow up a map of the area and stick push pins into the sites on your list.
Newsletter: E-mail your top 25 list out to your customers as soon as possible with a link to your site. Or break up the list for a series of newsletters.
Events: Feel free to fold your store events into the list. Outside Hilton Head will celebrate “30 Weekends of Adventure” as part of its 30-year anniversary starting this summer. The events will include demo days, speakers and other community events. It’s all part of the outfitter and retailer’s expanded marketing this year despite a double-digit drop in sales. “I think you’ve got to really work harder for customers, but I also think there is a real opportunity for when things get better to get more market share,” said owner Mike Overton
The spike in reservations prompted a report by CNN, entitled “In a Slump, Camping Comes Into Vogue.” The article reports that reservations to state parks in California are also trending up. Of course it’s still too early to say whether media reports will translate into stronger sales of camping gear this spring.
Regardless, marketing gurus are urging outdoor retailers to start promoting close-to-home adventures now to both core outdoor enthusiasts and their more casual shoppers while both groups are planning their summer vacations.
A survey of Leisure Trends Group’s Most Active American Panel conducted between February 15 and March 10 found that 78% plan their summer vacation one or more months ahead of time. More than 50% plan three to five months out, in large part because they are hunting for deals. Among this group, 11 percent said they are considering doing more camping. Skiers, by contrast, often booked their trips this winter only one or two weeks out in hopes of getting the best airline and resort promotions as the economy weakened.
“If I was a specialty retailer, I would institute a program that would show people what they could do within 50 miles,” said Leisure Trend Group’s Julia Day Clark. “People are thinking about this. They are planning and what if retailers could show them something really cool?”
With that in mind, here are some ideas for luring folks into your store:
Blog: If you don’t already have one, you could start by publishing the top 25 local adventures for the spring and summer on your web site. If you have time, post directions, advisories, photos, maps, suggested provisions, GPS coordinates, etc. For an example, check out Dave Baker’s blog for Tucson’s Summit Hut.
Build community: Offer to post customers’ own photos and observations of their experiences on the blog. Contributors can become eligible for a $150 gift card drawing.
Point of sale: Print your top 25 list with a link to your website on fliers for your store. Laminate a few for your sales staff, who can use them on the floor to show customers just how easy it is to hike, climb, cycle, paddle and camp nearby.
Map room: Set up a trip planning area in your store where customers can browse maps, books and maybe even cruise the Internet. Blow up a map of the area and stick push pins into the sites on your list.
Newsletter: E-mail your top 25 list out to your customers as soon as possible with a link to your site. Or break up the list for a series of newsletters.
Events: Feel free to fold your store events into the list. Outside Hilton Head will celebrate “30 Weekends of Adventure” as part of its 30-year anniversary starting this summer. The events will include demo days, speakers and other community events. It’s all part of the outfitter and retailer’s expanded marketing this year despite a double-digit drop in sales. “I think you’ve got to really work harder for customers, but I also think there is a real opportunity for when things get better to get more market share,” said owner Mike Overton
Q&A: Retail Consultant Dan Mann Discusses
Retailers say forecasting sales has become much more difficult in today’s uncertain economy, a condition that might not improve for many months. “Our crystal ball is shattered,” said one merchandizing executive. With that in mind, OIA WebNews asked The Mann Group’s Dan Mann to talk about what retailers can do to adjust to the uncertainty. Mann will deliver the last of a Webinar series on Financial Management for retailers this afternoon. Excerpts from the discussion are below:
Q: What is your outlook for specialty outdoor retail sales? A: There are some encouraging signs, but I don't think we in this industry can tell how good or bad it's going to be, because we are not in our season yet. You operate from the best information you have and I would hope the “staycation” trend will come. But right now, frankly, it's too hard to know and hope is not a strategy. If the crystal ball is broken we will have to do a little more work in order to gather the information we need to make buying decisions.
Q: What can retailers do if their forecasts are way off? A: Whether in good times or bad, they need to operate with some discipline. When times are tough like this, discipline is especially important for the retailer, who tends to go on fear or on gut. You have those who say, “We have open-to-buy money, but I don't care what the plan says – which is buy more – I'm not going to buy because of the economy.” Discipline requires a conversation between the open-to-buy team, who is hopefully working from some open-to-buy spreadsheet, and the sales floor. You can't do this from the back room anymore. You need to go to the floor and see where you need to fill in. Are your inventory numbers correct? Look at your displays. See what's moving rapidly and what items are not. Don't just retreat and say, “We are not buying anything now.” Combine your gut and the sales floor versus what your open-to-buy sheet is telling you to buy. The point is we can’t just buy from a spreadsheet anymore. We have to have a more thorough open dialog between the sales floor and the buying office – even if that’s the same person!
Q: What else is required? A: Diligence. Checking and double-checking the spreadsheet versus the shelves. You need to ask what does my display tell me is selling? If it’s rainwear and my spreadsheet tells me I have plenty, but it's raining this week and I have not sold a single one, then I need to go check the sales floor and back room and find out where it is.
Q: What key ratios should they focus on? A: Inventory-to-sale ratio. You have to ask yourself, if I sell at the current rate of turn, when will I be out of product. You will see in this economy some of these numbers will slow down and some will speed up. You may want to look at that daily and against what you have on hand. My concern is that so many people are not operating on clean data. A high percentage of the retailers we work with don't do an annual inventory. Just because my point-of-sale tells me I have it, does not mean that I do.
Q: What is your outlook for specialty outdoor retail sales? A: There are some encouraging signs, but I don't think we in this industry can tell how good or bad it's going to be, because we are not in our season yet. You operate from the best information you have and I would hope the “staycation” trend will come. But right now, frankly, it's too hard to know and hope is not a strategy. If the crystal ball is broken we will have to do a little more work in order to gather the information we need to make buying decisions.
Q: What can retailers do if their forecasts are way off? A: Whether in good times or bad, they need to operate with some discipline. When times are tough like this, discipline is especially important for the retailer, who tends to go on fear or on gut. You have those who say, “We have open-to-buy money, but I don't care what the plan says – which is buy more – I'm not going to buy because of the economy.” Discipline requires a conversation between the open-to-buy team, who is hopefully working from some open-to-buy spreadsheet, and the sales floor. You can't do this from the back room anymore. You need to go to the floor and see where you need to fill in. Are your inventory numbers correct? Look at your displays. See what's moving rapidly and what items are not. Don't just retreat and say, “We are not buying anything now.” Combine your gut and the sales floor versus what your open-to-buy sheet is telling you to buy. The point is we can’t just buy from a spreadsheet anymore. We have to have a more thorough open dialog between the sales floor and the buying office – even if that’s the same person!
Q: What else is required? A: Diligence. Checking and double-checking the spreadsheet versus the shelves. You need to ask what does my display tell me is selling? If it’s rainwear and my spreadsheet tells me I have plenty, but it's raining this week and I have not sold a single one, then I need to go check the sales floor and back room and find out where it is.
Q: What key ratios should they focus on? A: Inventory-to-sale ratio. You have to ask yourself, if I sell at the current rate of turn, when will I be out of product. You will see in this economy some of these numbers will slow down and some will speed up. You may want to look at that daily and against what you have on hand. My concern is that so many people are not operating on clean data. A high percentage of the retailers we work with don't do an annual inventory. Just because my point-of-sale tells me I have it, does not mean that I do.
Monday, March 30, 2009
Retail - SNEWS Mini-Survey provides look at how retailers are adjusting to the new economic climate
The SNEWS® Mini-Survey that ended March 26, 2009 asked, “What are you doing differently to help your retail business survive the current economy?” It was refreshing to read that more than seven of 10 (71 percent) of our respondents indicated they were emphasizing more customer service and follow-up. Not surprisingly, more than two-thirds or 68 percent responded that they were “keeping their inventories leaner” while 53 percent indicated they were carrying fewer SKUs in their stores.
As a bit of a wake-up call to suppliers and manufacturers, nearly half of respondents or 47 percent stated they were cutting out “marginal suppliers.” It was also interesting to note that 44 percent were relying on holding special in-store events with the goal of attracting new customers.
What did surprise us a bit in the results is that only 29 percent of our retail respondents indicated they were seeking to negotiate rent decreases or moving to cheaper space. Several reports in our ongoing economic series, which can be found by clicking here, point out that renegotiating leases is a valuable retail survival tool during this economic downturn, and we do know from conversations with some retailers who have done this that savings have been substantial.
And as for seeking to match prices with competitors, including big box, we were pleasantly surprised to see only 17 percent of our survey respondents indicated this was one of their strategies. Indeed price competition is a course of action that retail experts have also noted is not the way to win the war.
Our new survey question, “Have you found social networking sites to be beneficial to your business?” is now live and awaiting your feedback. We look forward to hearing if you use these sites as a part of your business and, if so, which ones.
To make your vote count, simply go to the SNEWS Reader Poll section in the right navigation bar of every web page in SNEWS or, click here.
--SNEWS® Editors
New digital eFitBiz by SNEWS now out: Don’t miss annual state-of-retail report, ’08 top retailer lists
Always a frontrunner when it comes to delivery of news and information, with this issue of eFitBiz, SNEWS® will start to deliver news to you in a dynamic, interactive fashion like no other industry publication has -- in a virtual magazine format where you live the content.
Debuting in this sixth-annual eFitBiz by SNEWS – our annual look at the state of the previous year’s retail and
While our much-awaited report on the state of retail and our top retailer lists are all still here, they are presented with many enhancements in this virtual magazine: When you “flip” the pages with a click, you’ll find links directly in the stories and charts that will take you to SNEWS stories so you can read up on things you missed or have forgotten – mouse over and around the pages to discover embedded links and features. You’ll experience product videos in ads that demonstrate and show you the equipment, with the video also allowing you to play and replay as needed, stopping where you want to take a closer look.
This is of course only the beginning: The SNEWS fitness magazine, out as usual in mid-summer, will also be virtual and you’ll see all of the above features – and much more as we incorporate more experiences into our mutual adventure into the future of information delivery.
Certainly the virtual content isn’t all there is to talk about, though. The state-of-retail report isn’t unfortunately a rosy picture but when you take a look at the information about past recessions and who’s doing what, you’ll see some optimism still exists. The list of “top retailers” – again using black-and-white store numbers since we know they are factual and not fudged – has changed quite a bit. You may be surprised to realize what did happen between January and December 2008, uttering, “Gosh, that was only a year ago?”
You’ll also be a bit surprised to see how many more changes have taken place since 2009 – businesses are listed where they wouldn’t be now -- since we don’t represent 2009 news on the list. For ongoing information you’ll need to turn to SNEWS online (www.snewsnet.com).
Meanwhile, you won't want to miss this newest release. This 2009 edition of eFitBiz by SNEWS is brought to you by SNEWS (of course!), Afterburner Fitness, BodyCraft, Fitness Master, Health & Fitness Business Expo, Lifecore Fitness and the American College of Sports Medicine.
Our SNEWS subscribers are also first in line to see eFitBiz when it's released. You can also view past editions by clicking here and scrolling down to the eFitBiz editions you choose. Of course, you must be a subscriber to see magazines and magazine archives, but we do offer a Freebie SNEWS subscription that’ll do the trick. Just click here to get one of those if you don’t already have one.
Missed the link to eFitBiz? Click here to get to your copy of the latest edition. Enjoy the new virtual format; pass it around, and please tell us what you think. You can reach us either by emailing snewsbox@snewsnet.com or giving a ring, 530-268-8295.
Note: Retailers, the annual SNEWS® Retailer Survey is kicking into gear soon. Let your vote and voice count. Our 7th-annual survey will open in April. If you have not been surveyed in the past or want to make sure you are included this year, send an email to survey@snewsnet.com with your store name and contact information (including email, phone and fax), as well as the name of the best single person to be in charge of responding to the survey for your business, if it’s not yourself. Don't let you or your suppliers be left out.
Thursday, March 19, 2009
Did you hear?...BIGresearch survey says economic crisis will continue to affect consumer lifestyles for 5 years
According to the March 2009 BIGresearch Consumer Intentions & Actions Survey, just under 91 percent of consumers feel that the current economic crisis will continue to impact lifestyle spending choices over the next five years.
BIGresearch (www.bigresearch.com) asked: "Do you think the current economic crisis will impact your lifestyle over the next five years in any of the following ways?" and more than 8,000 adults, ages 18 and over, responded accordingly:
I will consider each purchase more carefully -- 55.2%
I will be more price-conscious when buying clothing and food -- 50.7%
I will try to stick to a budget -- 48.1%
I will spend less dining out -- 46.3%
I will not incur a large credit card debt -- 43.4%
I will spend less on entertainment (movies, concerts, sporting events, etc.) -- 39.2%
I will save more of what I earn -- 36.3%
I will be more conservative when buying a car -- 30.1%
I will pay off my credit card each month -- 29.0%
I will not run up home equity debt -- 28.1%I will take more practical vacations -- 23.3%
For more details regarding age, gender and income for this survey, click here.
SNEWS® View: The silver lining in what some might perceive as a consumer spending storm cloud is that practical vacations will most certainly include camping and recreational trips with families seeking to stretch dollars while spending more quality time together. Now, more than ever, the outdoor and fitness industries have an opportunity to market the health and well-being of outdoor recreation and vacations for families. It also means for fitness stores, and outdoor stores, it is time to focus on marketing to consumers to show that what products you offer provide quality of life, health, well-being and high value -- needs for any consumer. There is no doubt in our minds that consumers, while interested in saving money and spending less, still want to have fun and stay fit and healthy while doing so. --SNEWS® Editors
BIGresearch (www.bigresearch.com) asked: "Do you think the current economic crisis will impact your lifestyle over the next five years in any of the following ways?" and more than 8,000 adults, ages 18 and over, responded accordingly:
I will consider each purchase more carefully -- 55.2%
I will be more price-conscious when buying clothing and food -- 50.7%
I will try to stick to a budget -- 48.1%
I will spend less dining out -- 46.3%
I will not incur a large credit card debt -- 43.4%
I will spend less on entertainment (movies, concerts, sporting events, etc.) -- 39.2%
I will save more of what I earn -- 36.3%
I will be more conservative when buying a car -- 30.1%
I will pay off my credit card each month -- 29.0%
I will not run up home equity debt -- 28.1%I will take more practical vacations -- 23.3%
For more details regarding age, gender and income for this survey, click here.
SNEWS® View: The silver lining in what some might perceive as a consumer spending storm cloud is that practical vacations will most certainly include camping and recreational trips with families seeking to stretch dollars while spending more quality time together. Now, more than ever, the outdoor and fitness industries have an opportunity to market the health and well-being of outdoor recreation and vacations for families. It also means for fitness stores, and outdoor stores, it is time to focus on marketing to consumers to show that what products you offer provide quality of life, health, well-being and high value -- needs for any consumer. There is no doubt in our minds that consumers, while interested in saving money and spending less, still want to have fun and stay fit and healthy while doing so. --SNEWS® Editors
Wednesday, March 18, 2009
Retail - Recession a Good Time for Retailers
If ever there was a time for guerilla marketing this is it. As the focus has shifted to conserving cash, retailers and brands alike have cut their marketing budgets. One survey taken late last year showed 33% of national advertisers, including some of the nation’s biggest brands, were planning on cutting their advertising spend in 2009. Dick’s Sporting Goods told analysts last week it would reduce its advertising spend as a percentage of sales in Q3.
Marketing professionals argue that’s why a recession is the best time to boost your marketing activity. As other brands and retailers dial down their messaging there is that much less clutter to break through.
Even if you don’t have more money to spend on advertising, this is a good time to focus your messaging on whatever marketing you can afford. In a survey conducted for the OIA Specialty Retail Operational Report 2007, more retailers (53%) attributed increased sales to improved advertising than to eight other reasons, including more advertising and a strong economy. Brands, retailers and marketing gurus consulted last week by OIA WebNews indicated they are getting the best return on investment by focusing on existing customers, building up their online communities with user generated content and generating public relations.
“I would wrap all the marketing dollars I had left around those ideas that live in PR,” said Gregg Bagni, a marketing consultant whose firm Alien Truth Communications works with brands in the active outdoor lifestyle market. “I think PR is elevated to another level because PR has a lot more extension and legs on the web from a viral standpoint.”
Below are some marketing tactics that appear to be working in today’s environment.
A constant flow of promotions. Use your close-out buys to fuel a steady stream of sale promotions expected by today’s consumer. Dick’s Sporting Goods has been emphasizing $29 and $39 running shoes in its Sunday circulars for months and is working closely with suppliers to identify other close-out deals to drive traffic. Offer first-come, first-serve daily or weekly deals on your Website to those willing to sign up for an e-mail alert.
Expand rental/outfitter business. Gear rental and outfitting enjoy the highest gross margin of anything outdoor retailers do and will drive motivated buyers into your store.
Focus on existing customers. Existing customers tend to be twice as profitable as new ones, so start rewarding them. Reinvigorate your ties with local outdoor clubs, schools, parks and recreation departments and other NGOs. Partner with them to bring in speakers or hold events that will elevate your brand. If creativity is not your forte, hire a local enthusiast for 10 hours a week to work on promotions and community relations. Give all employees 20% off coupons or $10 gift certificates for distribution to enthusiasts, friends and family outside the store.
Mock “Liquidation Sale.” Bagni offers this free guerilla marketing tip. Buy a gigantic block of ice, carve your logo in it, put it in your parking lot and announce you are having a “Winter Liquidation Sale” until it melts. Hook up a live web cam to your web site to show how much ice is left and send photos to local TV stations every day. “In March, if you’re above Mason-Dixon Line, you can probably get a week out of it,” said Bagni. “The down side is if it melts quickly you’d have to put a tent out there, but then you could have fun with that. It’s totally guerilla.”
Marketing professionals argue that’s why a recession is the best time to boost your marketing activity. As other brands and retailers dial down their messaging there is that much less clutter to break through.
Even if you don’t have more money to spend on advertising, this is a good time to focus your messaging on whatever marketing you can afford. In a survey conducted for the OIA Specialty Retail Operational Report 2007, more retailers (53%) attributed increased sales to improved advertising than to eight other reasons, including more advertising and a strong economy. Brands, retailers and marketing gurus consulted last week by OIA WebNews indicated they are getting the best return on investment by focusing on existing customers, building up their online communities with user generated content and generating public relations.
“I would wrap all the marketing dollars I had left around those ideas that live in PR,” said Gregg Bagni, a marketing consultant whose firm Alien Truth Communications works with brands in the active outdoor lifestyle market. “I think PR is elevated to another level because PR has a lot more extension and legs on the web from a viral standpoint.”
Below are some marketing tactics that appear to be working in today’s environment.
A constant flow of promotions. Use your close-out buys to fuel a steady stream of sale promotions expected by today’s consumer. Dick’s Sporting Goods has been emphasizing $29 and $39 running shoes in its Sunday circulars for months and is working closely with suppliers to identify other close-out deals to drive traffic. Offer first-come, first-serve daily or weekly deals on your Website to those willing to sign up for an e-mail alert.
Expand rental/outfitter business. Gear rental and outfitting enjoy the highest gross margin of anything outdoor retailers do and will drive motivated buyers into your store.
Focus on existing customers. Existing customers tend to be twice as profitable as new ones, so start rewarding them. Reinvigorate your ties with local outdoor clubs, schools, parks and recreation departments and other NGOs. Partner with them to bring in speakers or hold events that will elevate your brand. If creativity is not your forte, hire a local enthusiast for 10 hours a week to work on promotions and community relations. Give all employees 20% off coupons or $10 gift certificates for distribution to enthusiasts, friends and family outside the store.
Mock “Liquidation Sale.” Bagni offers this free guerilla marketing tip. Buy a gigantic block of ice, carve your logo in it, put it in your parking lot and announce you are having a “Winter Liquidation Sale” until it melts. Hook up a live web cam to your web site to show how much ice is left and send photos to local TV stations every day. “In March, if you’re above Mason-Dixon Line, you can probably get a week out of it,” said Bagni. “The down side is if it melts quickly you’d have to put a tent out there, but then you could have fun with that. It’s totally guerilla.”
Business Plan - Outdoor Foundation Report Finds Participation
Initial data from the 2009 Outdoor Recreation Participation Topline Report, published by The Outdoor Foundation, shows that an increasing number of Americans participated in nature-based, outdoor activities last year. The study finds sizeable participation increases in many nature-based activities including double-digit increases in backpacking, mountain biking and trail running and close to a ten percent increase in hiking and camping. Overall participation trends in recreation, sports and fitness remained largely unchanged from last year.
“Americans are finding solace and security, adventure and excitement in the great outdoors,” said Christine Fanning, executive director of The Outdoor Foundation. “During these challenging economic times, a return to affordable, nature-based recreation allows individuals, friends and families to reconnect – with one another, with the natural world and with natural values.”
The Outdoor Foundation 2009 Outdoor Recreation Participation Topline Report also shows increases in many active outdoor activities among youth, showing a positive trend from 2008 in some key areas. Biking, backpacking and hiking are just a few of the activities that show increases in participation among young people. Overall, outdoor participation for youth ages 6 – 12 is down 7.6% from last year, showing a continued need to focus on connecting kids and nature.
“It is certainly encouraging to see an increase of youth participation in some important recreation categories, but more must be done,” continued Fanning. “Public and private partnerships, effective outreach programs and creative campaigns must be top priorities for every sector of society if we are to truly inspire and grow the next generation of outdoor enthusiasts.”
Retail sales information from Outdoor Industry Association supports the assumption that more Americans are participating in nature-based outdoor activities. The Outdoor Industry outperformed many other industries in 2008, with a 5% gain over 2007.
The Outdoor Foundations 2009 Outdoor Recreation Participation Topline Report details Americans' participation in outdoor activities from 2007 to 2008. The Report is a high level overview of The Foundation's full Participation Report, which will be released later this year with expanded data and full analysis.
A copy of the 2009 Outdoor Recreation Participation Topline Report along with the 2008 Outdoor Recreation Participation Report can be downloaded from The Outdoor Foundation website at outdoorfoundation.org/research.
“Americans are finding solace and security, adventure and excitement in the great outdoors,” said Christine Fanning, executive director of The Outdoor Foundation. “During these challenging economic times, a return to affordable, nature-based recreation allows individuals, friends and families to reconnect – with one another, with the natural world and with natural values.”
The Outdoor Foundation 2009 Outdoor Recreation Participation Topline Report also shows increases in many active outdoor activities among youth, showing a positive trend from 2008 in some key areas. Biking, backpacking and hiking are just a few of the activities that show increases in participation among young people. Overall, outdoor participation for youth ages 6 – 12 is down 7.6% from last year, showing a continued need to focus on connecting kids and nature.
“It is certainly encouraging to see an increase of youth participation in some important recreation categories, but more must be done,” continued Fanning. “Public and private partnerships, effective outreach programs and creative campaigns must be top priorities for every sector of society if we are to truly inspire and grow the next generation of outdoor enthusiasts.”
Retail sales information from Outdoor Industry Association supports the assumption that more Americans are participating in nature-based outdoor activities. The Outdoor Industry outperformed many other industries in 2008, with a 5% gain over 2007.
The Outdoor Foundations 2009 Outdoor Recreation Participation Topline Report details Americans' participation in outdoor activities from 2007 to 2008. The Report is a high level overview of The Foundation's full Participation Report, which will be released later this year with expanded data and full analysis.
A copy of the 2009 Outdoor Recreation Participation Topline Report along with the 2008 Outdoor Recreation Participation Report can be downloaded from The Outdoor Foundation website at outdoorfoundation.org/research.
Thursday, March 5, 2009
Industry Watch: Keeping an eye on layoffs, bankruptcies and closings… Who’s next?
2/9/09
Precor
Amer confirms in its 4Q financial report that Precor had two rounds of layoffs in Q4 resulting in 41 positions being terminated. Click here to read SNEWS coverage.
2/11/09
Nike
Nike announces reorganization plans that could result in up to 1,400 employees losing jobs by end of year. Click here to read SNEWS coverage. And click here to read blog posting on news.
2/11/09
REI
Based on a significant business slowdown in the final months of 2008 and continued projected weakness in 2009, REI announced the elimination of 61 full-time jobs, which represents less than 2 percent of its full-time workforce. Click here to read SNEWS coverage.
2/20/09
Gymcor.com
Kelley Acevedo and his staff at GymCor.com stopped returning calls and emails, and, it appears, have emptied their offices and slipped away. Click here to read SNEWS coverage.
2/24/09
Horny Toad / Nau
As part of restructuring following the Nau acquisition, Horny Toad confirmed that five employees lost positions at Horny Toad, and then in February two more, including Ian Yolles at Nau were let go in Portland.
2/24/09
Champion / Duofold
Hanesbrands has about 45,000 workers in more than 25 countries. Last month the company said 310 jobs will be cut when it closes its Barnwell, S.C., sock-knitting plant and moves production to El Salvador by the end of April. Hanesbrands has been cutting jobs and closing plants in an effort to streamline operations and move production to other countries since it spun off from Sara Lee Corp. in 2006.
2/25/09
FHI, Omni, Busy Body
On Feb. 23, the remaining 24 stores, i.e. the eastern branch of Fitness Holdings International's formerly dominating 120-store national chain, were going to start close-out sales, signaling the eventual demise of the stores. Although once at a peak of 120 stores, FHI at the time of the October filing said it ran 111 stores -- 67 Busy Body and 44 Omni. In late October, the court approved closing 20 stores, and then added four stores to the list in November and another 30 in December. Add those 54 to the current 32 and that leaves 25 stores, which are now only in California and Colorado. Presence in Arizona, Nevada and Washington has already been eliminated. Click here to read SNEWS coverage.
2/27/09
Body Masters
After three decades of manufacturing high-end commercial fitness equipment, Body Masters has shut down operations. Knight Companies, a firm that specializes in oilfield and fishing tools, has acquired Body Masters' bank note and is foreclosing on the manufacturing facility including most of the manufacturing equipment. Click here to read SNEWS coverage.
3/2/09
Marmot / ExOfficio
Four employees at Marmot, including industry veteran John Cooley, as well as four employees at ExOfficio were laid off. Click here to read SNEWS coverage.
3/2/09
Accell Fitness
Accell said production was cut back in Estonia and purchasing is now fully concentrated in Asia. Also, R&D and purchasing activities in Finland were terminated, and were centralized at the head office in the Netherlands. The sales offices and warehouses in Germany, Switzerland and Austria were closed and stock management was transferred to the local distributors. These markets are now managed centrally from the Netherlands. Because of redundancy, 25 jobs were cut. Apart from the head office in the Netherlands, Accell said the fitness division still has sales outlets, including warehouses, in Finland, the United Kingdom and North America.
3/2/09
Big 5
Big 5 said it reduced its employee headcount by 9 percent last year through attrition.
3/2/09
Hardbody Fitness
After 7 years running Hardbody Fitness specialty shop and All Sports sporting goods, owners David and Brenda Hayes announce they are shutting when December 2008 sales plummet. Click here to see a SNEWS report.
Precor
Amer confirms in its 4Q financial report that Precor had two rounds of layoffs in Q4 resulting in 41 positions being terminated. Click here to read SNEWS coverage.
2/11/09
Nike
Nike announces reorganization plans that could result in up to 1,400 employees losing jobs by end of year. Click here to read SNEWS coverage. And click here to read blog posting on news.
2/11/09
REI
Based on a significant business slowdown in the final months of 2008 and continued projected weakness in 2009, REI announced the elimination of 61 full-time jobs, which represents less than 2 percent of its full-time workforce. Click here to read SNEWS coverage.
2/20/09
Gymcor.com
Kelley Acevedo and his staff at GymCor.com stopped returning calls and emails, and, it appears, have emptied their offices and slipped away. Click here to read SNEWS coverage.
2/24/09
Horny Toad / Nau
As part of restructuring following the Nau acquisition, Horny Toad confirmed that five employees lost positions at Horny Toad, and then in February two more, including Ian Yolles at Nau were let go in Portland.
2/24/09
Champion / Duofold
Hanesbrands has about 45,000 workers in more than 25 countries. Last month the company said 310 jobs will be cut when it closes its Barnwell, S.C., sock-knitting plant and moves production to El Salvador by the end of April. Hanesbrands has been cutting jobs and closing plants in an effort to streamline operations and move production to other countries since it spun off from Sara Lee Corp. in 2006.
2/25/09
FHI, Omni, Busy Body
On Feb. 23, the remaining 24 stores, i.e. the eastern branch of Fitness Holdings International's formerly dominating 120-store national chain, were going to start close-out sales, signaling the eventual demise of the stores. Although once at a peak of 120 stores, FHI at the time of the October filing said it ran 111 stores -- 67 Busy Body and 44 Omni. In late October, the court approved closing 20 stores, and then added four stores to the list in November and another 30 in December. Add those 54 to the current 32 and that leaves 25 stores, which are now only in California and Colorado. Presence in Arizona, Nevada and Washington has already been eliminated. Click here to read SNEWS coverage.
2/27/09
Body Masters
After three decades of manufacturing high-end commercial fitness equipment, Body Masters has shut down operations. Knight Companies, a firm that specializes in oilfield and fishing tools, has acquired Body Masters' bank note and is foreclosing on the manufacturing facility including most of the manufacturing equipment. Click here to read SNEWS coverage.
3/2/09
Marmot / ExOfficio
Four employees at Marmot, including industry veteran John Cooley, as well as four employees at ExOfficio were laid off. Click here to read SNEWS coverage.
3/2/09
Accell Fitness
Accell said production was cut back in Estonia and purchasing is now fully concentrated in Asia. Also, R&D and purchasing activities in Finland were terminated, and were centralized at the head office in the Netherlands. The sales offices and warehouses in Germany, Switzerland and Austria were closed and stock management was transferred to the local distributors. These markets are now managed centrally from the Netherlands. Because of redundancy, 25 jobs were cut. Apart from the head office in the Netherlands, Accell said the fitness division still has sales outlets, including warehouses, in Finland, the United Kingdom and North America.
3/2/09
Big 5
Big 5 said it reduced its employee headcount by 9 percent last year through attrition.
3/2/09
Hardbody Fitness
After 7 years running Hardbody Fitness specialty shop and All Sports sporting goods, owners David and Brenda Hayes announce they are shutting when December 2008 sales plummet. Click here to see a SNEWS report.
Thursday, February 12, 2009
Tuesday, January 13, 2009
Did you hear?...Welcome 2009: Number of obese Americans now surpasses number of "just" overweight
A study from the National Center for Health Statistics revealed that the number of obese American adults is now higher than the number of those who are overweight. While the prevalence of obesity has more than doubled since 1980, the number of those who are overweight has remained stable over the same time period.
Both are terms used to describe levels of bodyweight that are generally considered higher than what is healthy, with obese higher. Overweight is defined as those with a BMI (body mass index) between 25 and 29.9, which per the U.S. Centers for Disease Control and Prevention corresponds to approximately 169 to 202 pounds for somebody who is 5-foot-9. Obese is a BMI higher than 30 or, for the same 5-9 person weighing more than 203 pounds.
The National Center for Health Statistics’ numbers show that more than 34 percent of Americans are now obese, compared to 32.7 percent who are overweight. It said about 6 percent are "extremely" obese.
More than a third of adults, or over 72 million people, were obese in 2005-2006, according to the NCHS report. The figures come from the 2005-2006 survey and are the most current available.
The current numbers are based on a survey of 4,356 adults over the age of 20 who take part in a regular government survey of health, said the NCHS, which is part of the CDC.
Both are terms used to describe levels of bodyweight that are generally considered higher than what is healthy, with obese higher. Overweight is defined as those with a BMI (body mass index) between 25 and 29.9, which per the U.S. Centers for Disease Control and Prevention corresponds to approximately 169 to 202 pounds for somebody who is 5-foot-9. Obese is a BMI higher than 30 or, for the same 5-9 person weighing more than 203 pounds.
The National Center for Health Statistics’ numbers show that more than 34 percent of Americans are now obese, compared to 32.7 percent who are overweight. It said about 6 percent are "extremely" obese.
More than a third of adults, or over 72 million people, were obese in 2005-2006, according to the NCHS report. The figures come from the 2005-2006 survey and are the most current available.
The current numbers are based on a survey of 4,356 adults over the age of 20 who take part in a regular government survey of health, said the NCHS, which is part of the CDC.
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