Yeti delivers strong Q3 and moves into DIY space at Lowes
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Yeti has expanded into the do-it-yourself space with the announcement of a new wholesale partnership with US chain, Lowe’s.
The high-end cooler maker, a former award-winner at ICAST, the world’s biggest fishing tackle trade show, has also increased inventory in an effort to avoid the potential impact of tariffs due to be imposed on certain Chinese imports on December 15.
Yeti already has wholesale partnerships with Bass Pro Shops, Cabela’s, Dick’s Sporting Goods, West Marine and Williams-Sonoma.
It will begin rolling out products at Lowe’s during the end of this year and, based on results, continue through early 2021.
“We have targeted Lowe’s Home Improvement as both a strong rounding out within the DIY space and a broader extension with the pro customer for the Yeti brand,” said Yeti CEO, Matt Reintjes.
Yeti also increased inventory levels in Q3 by 33%, to $209.15m compared to $157.67m in the same period last year, to cushion the blow of the planned tariffs.
The increase was mostly seen in drinkware, which made up 56% of net sales in the quarter. Yeti has already increased inventory by 21% in the previous quarter.
Reintjes said the company was not currently planning to move its drinkware supply chain out of China because there were other options to mitigate tariffs before going down that route.
However, Yeti has begun relocating its supply chain for softer items like coolers and bags into other regions, mostly in South East Asia. It hopes to have this supply chain moved out of China completely by the end of this year.
The company revealed the news as it posted strong Q3 results driven by new product and expanding gross margins. Direct-to-consumer net sales for Q3 increased 31% year-on-year to $92.90m. The company raised its full year outlook for net sales to between 14.5% and 15%.