Under Armour hampers Dick’s Sporting Goods sales
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Global apparel brand, Under Armour, bore the brunt of the blame for weak second quarter sales at one of North America’s biggest retailers of its type, Dick’s Sporting Goods.
The giant, which stocks a comprehensive range of fishing tackle from the world’s top brands, saw its same store sales drop 4% during the 13-week period on the previous year, with CEO Ed Stack blaming the performance of the ICAST regular and the group’s decision to exit the hunt and electronics categories.
He said that excluding Under Armour and the hunt and electronics categories, its comparison on the previous year would have been ahead 1% as Dick’s benefited from the booming economy.
The weak performance of Under Armour has been put down to its decision to expand its distribution to Kohl’s and Stack admitted: “Our Under Armour business has been difficult. It was based on the change in distribution, which I understand why it did it. But it had a significant change in our distribution strategy and that impacted our Under Armour business.
“We are in the process of replacing that business and also looking forward to how we can grow the Under Armour business going forward. We are pretty excited about its pipeline beginning in 2019.
“Notwithstanding these challenges, the health of our core business is relatively strong and we are confident sales trends will improve next year as these headwinds are expected to subside. If we weren’t enthusiastic about what’s going on, we wouldn’t have raised our guidance for the second quarter in a row.”
The company also reported a 12% increase in its e-commerce sales – down from the previous quarter. However, this is due to Dick’s bringing its online business in-house a year ago. Overall, e-commerce sales are up 31% over the last two years.