Dick's Sporting Goods Sets The Bar High
By Sam Lewis
Sporting goods retailer expecting $10 billion in annual sales by 2017
On September 18, Dick’s Sporting Goods announced its long-term plan to boost sales, operating profits, and the value of its shares over the next five years. The company plans to use its namesake stores, its recently developed Field & Stream format stores, and its omni-channel platform to drive this growth.
By 2017’s end, Dick’s expects its store base to expand by about 300, bringing its namesake store total to more than 800. Existing stores will be remodeled so all stores will have a new, fresh appearance. The company also will focus on its key initiatives, like the store-in-store vendor shop model, and shared service footwear decks. Additionally, the sporting goods retailer will grow its newly created Field & Stream outdoor concept store to about 55 locations. Dick’s estimates this growth will translate to $750 million in annual sales by 2017.
As far as omni-channel moves go, Dick’s is planning to grow its e-commerce sales to $1.1 billion by the end of the fiscal year 2017. This would be an $800 million increase in online sales since its 2012 report of $292 million in sales through the web. “We are excited about the profitable long-term growth opportunities across our business in our Dick's Sporting Goods stores — on-line and through our Field & Stream concept,” says Edward Stack, chairman and CEO.” Plans to internally operate its e-commerce platform are also in Dick’s future. In 2014, the company will begin controlling both Golf Galaxy and Field & Stream’s e-commerce platforms, with namesake stores following suit by the end of 2017.
A target of $10 billion in sales by the end of 2017 was set during Dick’s Analyst Day meeting. This indicates 5-year, compounded annual growth of about 11 percent from 2012’s annual sales of $5.8 billion. “To support our long-term goals, we intend to make meaningful investments in our business in the near-term,” Stack says. “We are timing these investments to stay ahead of our needs and to produce sustainable, long-term advantages.”
Dick’s Sporting Goods has not been shy about expanding its brand, and the acquisitions seem to be paying off for the retailer. Golf Galaxy was brought into the Dick’s family in 2006. A runner specialty store, True Runner, was introduced by Dick’s to Pittsburgh in 2012, and 2013 brought the specialty outdoor store, Field & Stream. The success these new expansions of the Dick’s brand have had should make Dick’s Sporting Goods’ lofty expectations an attainable feat.