Retail: 55
8.67%
Retail: 181
-0.39%
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Monday, August 20, 2018
Volume 2, Issue No. 32
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Mon, Aug 28, 2017
Vol 1, Issue No. 33

NAFTA, China Trade Talks Heat Up

New optimism emerged late last week on news that China and the U.S. will engage in midlevel trade talks this week ahead of two scheduled November meetings on the issue between Pres. Trump and Chinese leader Xi Jinping. Meanwhile, the U.S. and Mexico are reportedly close on a deal that would revise the 24-year old North American Free Trade Agreement (NAFTA), paving the way for Canada to join the discussions in the coming weeks and a new deal by Dec. 1.

With the U.S. Trade Representative’s office set to conduct public hearings this week on plans for $200 billion in additional tariffs on Chinese imports, including some sporting goods products, Wall Street reacted favorably Friday to the thawing relationship between the two countries by sending the Dow up more than 110 points.

According to the Wall Street Journal, Xi does not want a prolonged, broader trade conflict with Washington out of his fear that such a tussle would derail the Chinese government’s strategy to transform the country’s economy. But the USTR reportedly wants to delay serious trade talks on the premise that additional tariffs would provide the U.S. with more negotiating power in the months ahead. The U.S. Treasury Dept. has crafted a new list of demands for China. It includes additional purchases of U.S. goods and services and a strengthening of the Chinese currency, the yuan, which has dipped nearly 10 percent against the U.S. dollar over the last four months, making U.S. products more expensive in China.

Trump and Xi are slated to first meet at the Asia-Pacific Economic Cooperation forum in mid-November, followed by a second head-to-head session at the G20 Summit in Buenos Aires, Argentina on Nov. 30.  

Specialty Retail Holds Key Advantage

With the Back-to-School selling season entering its crucial, final weeks, a new 17-page report from ExpertVoice on “Why Retail Strategies Are Failing” finds that only 32 percent of surveyed consumers find today’s crop of retail associates helpful when they are making a product purchase. But nearly 95 percent of respondents said small or local retailers have sales associates who are helpful or knowledgeable. REI and Cabela’s scored 89 percent and 88 percent, respectively.

“From initial awareness, to the active consideration process, leading through to conversion, consumers need the right balance of assistance and advice—yes, even in the age of online shopping,” suggests the report.

The survey points out that two-thirds of shopping today, excluding groceries, is done in a brick-and-mortar location with 79 percent of respondents purchasing items in those locations every 4-6 trips “because of a helpful sales associate.”

With 68 percent of respondents intending to do the same amount of brick-and-mortar shopping in 2019 and 13 percent vowing to do more next year, the survey finds that 79 percent of consumers head to the store instead of a mobile device “to experience and see products.” Another 49 percent cite “instant gratification of purchasing in real time” as their primary reason for shopping traditional retail and 44 percent do so to avoid the shipping fees that may be tied to an online purchase. Meanwhile, only 20 percent said they rely on retail associates for product advice or recommendations. Perhaps that’s because 56 percent said they are unable to find a helpful retail sales rep when browsing in-store.

Nonetheless, 61 percent of respondents told ExpertVoice that it is important for retail associates to provide them with product recommendations. The most important attributes for a retail associate, according to those surveyed were: customer service (86%), product knowledge (80%), store knowledge (75%), category/activity knowledge (46%), personalized product recommendations (33%) and experience using the products themselves (33%).

“For many considered purchases, tangibly understanding what makes a certain product a better fit for their needs trumps the convenience of ordering it online,” states the report.

FOOTWEAR Insight
Specialty Shoe Retailers Shine at Gold Medal Awards Ceremony

Gold Medal Service Award winners from Kaufman Shoes.
Waldy Award winners from Chandler's Walk Shoppe.

The nation’s best sit and fit independents were recognized last week at Footwear Insight’s fourth annual Gold Medal Service awards breakfast, held during the FN Platform show in Las Vegas. This year’s award winners — the largest class yet — comprised 77 shops from around the country.

Nominated by vendors and industry insiders, selected stores are mystery shopped and graded on more than 20 customer service elements throughout the store visit, including greeting, the fit process and ease of checkout. Those shops scoring more than 70 points (out of a possible 100) are awarded the Gold Medal Service Award. For 2018, four stores — Chandler’s Walk Shoppe, in Salt Lake City, UT, Tops For Shoes in Asheville, NC, Modern Shoe in Provo, UT, and Walking Comfort, Centerville, UT — all received scores of 100 (or better, thanks to a bonus question) and were named winners of the Waldy Award presented by Waldläufer. Retailer Lamey Wellehan of Auburn, ME, an Auburn staple since its founding in 1914, was awarded the Hoka One-One award for Community Service.

View the complete list of the 2018 Gold Medal Service Awards Winners online at: www.footwearinsight.com/goldmedal

For expanded coverage of the Gold Medal Service Awards, see the next issue of Footwear Insight

The executive director of the Central American and Dominican Council of Apparel and Textiles (CECATEC) talks CAFTA and how the apparel and textile industries are faring across the region.

Viva Las Vegas

Exhibitors at the Agenda and Liberty Fairs, focused on contemporary streetwear, sportswear and footwear, worked hard to push all the right buttons for their steady stream of visitors last week. The adjacent shows are relocating to the downtown Las Vegas Arts District in February 2019, promising numerous upgrades for attendees and exhibitors. FamilyFirst (lower right) is a new fashion-forward line based in Oakland, sourced in Milan and backed by a number of former and present NFL players, including Josh Johnson and Marshawn Lynch. Meanwhile, the 2018 PGA Fashion & Demo Experience (top right) featured nearly 200 participating brands and companies at The Venetian, including Callaway Apparel, Skechers and up-and-coming, bone conduction headphone brand AfterShokz.

OUTDOOR Insight
A Climbing Shoe from TOMS

TOMS Alpargata x So iLL.
TOMS x So iLL Street Climbing Shoe.

Footwear brand TOMS has collaborated with climbing brand So iLL on a new climbing shoe.

The new limited-edition collection of climbing-inspired footwear includes two styles and is available to consumers now on Indiegogo. The collaboration benefits the non-profit 1Climb foundation, which installs climbing walls at Boys & Girls Clubs across the country.

The TOMS x So iLL Street Climbing Shoe is TOMS’ first-ever rock climbing shoe. The collection also includes a rugged version of the classic TOMS Alpargatas featuring a sticky rubber outer sole, the TOMS Alpargata x So iLL.

The Buzz

Ben Hogan Golf Equipment Co. last week, on what would have been founder Hogan’s 106th birthday, reported that its direct-to-consumer business model for custom, hand-crafted irons and wedges has exceeded internal sales projections. The Fort Worth, TX firm is now planning to introduce several new product lines in late 2018 and early 2019, including the Forth Worth Black, PTX and Edge forged iron sets.

Fila Tennis, in time for the U.S. Open, is introducing two traditionally-inspired collections. Both the women’s Heritage and men’s Legends feature a combination of classic FILA themes and colors. One star is Heritage Sparkle Dress inspired by a similar 2003 Fila NYC showstopper that features a shimmery, breathable fabric that shines as it moves. On the men’s side, the Legends Collection will be worn by tennis stars Marin Cilic, John Isner and Sam Querrey among others. All Fila tennis athletes, men and women, will wear the brand’s Axilus Energized Limited Edition Pro 1 shoes, designed to match the respective collections.

The tennis industry will meet for the 11th annual Tennis Industry Association (TIA) Tennis Forum on Aug. 27 at the Grand Hyatt New York. The 90-minute event will feature research of the state of the industry and recognition of the 2018 Tennis Industry Hall of Fame inductees—the late Vic Braden and Jim Fromuth, founder of distributor Fromuth Tennis.

Fila's Axilus Energized Limited Edition Pro.

Tubes of the Week

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Numbers In Play
The Sports Insight Index is our opinion of what we think are the 30 most important public companies in the industry, 15 vendors and 15 retailers. Space considerations prevent us from tracking more, but we will make changes over time.
Index base of 100 is key to the closing prices of 12/31/14
Retail
Despite a solid gain from Walmart, whose shares went up more than 9 percent after it reported Q2 results, the segment falls back further than last week’s 1.4 percent gain with four stocks down and 11 up. Meanwhile, the National Retail Federation raised its retail sales forecast for 2018 to a 4.5 percent increase, up from prior guidance of 3.8-4.4 percent improvement, with the caveat that a “tariff cloud” hangs over the segment. Macy’s, whose shares have risen 82 percent over the last year, apparently took a hit from profit-taking as its shares dipped 16 percent following its release of Q2 results. Sports Direct, which was started by Founder Mike Ashley in 1982, was the period’s other big decliner. SPD’s owned and higher-margin brands in Karrimore, Lonsdale, Everlast and Dunlop are being sold in Bob’s Stores this Back-to-School Season. Dick’s, slated to report Q2 results before month’s end, is closing an 84,000-sq. ft., two-story former Galyan’s Trading Post location in Norfolk, VA. Kohl’s, which reports Q2 results Aug. 21, has expanded its Amazon returns program to 21 more doors covering the Milwaukee market. Gordon Haskett Research found that 13 Chicago KSS stores that accept Amazon returns have realized an 8.5 percent increase in traffic. Nordstrom, which is not listed in the Index, has hiked its FY sales outlook on strong online revenues and traffic at its Rack locations. In Q2, the retailer’s comps rose 4.1 percent and ecommerce business was up 23 percent year-over-year.
Brands
The segment’s weekly gain is approaching 1 percent, exceeding the Dow’s 0.62 percent increase for the period as eight stocks rose and seven fell. Acushnet and Callaway apparently get a lift from the latest golf sales trends, summer PGA Show and Tiger’s second-place finish at the recent PGA Championship. Columbia sees Zacks cite its ongoing Project CONNECT as helping drive further sales and profit growth. Amer continues to generate double-digit footwear sales growth in the U.S., something the Finnish company hopes will help re-ignite its footwear business globally in FY19. Adidas is re-releasing Derrick Rose signature basketball shoes in China, including the 2010-11 NBA MVP model, due to market demand there. The DRose 10 will drop during the upcoming NBA Season, according to the Bleacher Report. Also, The Three Stripes sees a federal judge dismiss Rick Pitino’s breach of contract lawsuit, which was filed in Oct. 2017. Nike is using a Swoosh text service at its new Nike by Melrose concept store in Los Angeles for quick interaction between customers and store associates, who get purchases ready for curbside pick-up for Nike+ members. Puma snags Barcelona striker Luis Suarez from Adidas in a £1 million endorsement deal. VF Corp. is reportedly closing Williamson-Dickie’s Uvalde, TX plant on Oct. 9 and relocating operations to Mexico and Honduras. Nautilus lands a favorable profile in the Portland Business Journal detailing the fitness company’s turnaround under CEO Bruce Cazenave and COO Bill McMahon.  


RETAIL: 65

35.14%

BRANDS: 180

80.27%

Weekly Review

Retail Name (Ticker Symbol)
Close on 08/09/18
Close on 08/16/18
% change over week
Big 5 Sporting Goods (BGFV)
BGFV
$5.65
$5.70
+0.88%
Sports Direct (LON: SPD)
SPD
$521.63
$493.70
-5.35%
Camping World (CWH)
CWH
$20.91
$21.85
+4.50%
Dick's Sporting Goods (DKS)
DKS
$34.65
$36.39
+5.02%
JD Fashion (JD)
JD
$624.62
$607.77
-2.70%
Foot Locker (FL)
FL
$47.61
$49.75
-4.49%
Genesco (GCO)
GCO
$41.50
$41.90
+0.96%
Hibbett Sports (HIBB)
HIBB
$23.75
$25.80
+8.63%
Kohl’s (KSS)
KSS
$75.11
$74.75
-0.48%
Macy’s (M)
M
$40.56
$35.81
-11.71%
Sportsman’s Warehouse (SPWH)
SPWH
$4.86
$5.21
-7.20%
Shoe Carnival (SCVL)
SCVL
$32.02
$32.78
+2.37%
Tilly’s (TLYS)
TLYS
$16.08
$17.35
+7.90%
Walmart (WMT)
WMT
$89.01
$98.64
+10.82%
Zumiez (ZUMZ)
ZUMZ
$27.10
$28.70
+5.90%
TOTAL
TOTAL
$1,605.06
$1576.10
-1.80%
Brand Name (Ticker Symbol)
Close on 08/09/18
Close on 08/16/18
% change over week
Acushnet Holdings (GOLF)
GOLF
$26.58
$27.12
+2.03%
adidas (ADDYY)
ADDYY
$119.89
$118.90
-0.83%
Amer Sports (AGPDY)
AGPDY
$33.26
$31.98
-3.85%
Callaway (ELY)
ELY
$22.26
$22.52
+1.17%
Columbia Sportwear (COLM)
COLM
$90.67
$89.54
-1.25%
Deckers Brands (DECK)
DECK
$121.28
$118.60
-2.21%
GoPro (GPRO)
GPRO
$6.17
$5.46
-11.51%
lululemon (LULU)
LULU
$128.16
$129.47
+1.02%
Nautilus (NLS)
NLS
$13.90
$14.20
+2.16%
Nike (NKE)
NKE
$81.26
$80.05
-1.49%
Puma (PUMA)
PUMA
$493.21
$515.00
+4.42%
Skechers (SKX)
SKX
$29.44
$29.35
-0.31%
Under Armour (UA)
UA
$19.15
$19.22
+0.37%
VF Corp. (VFC)
VFC
$95.55
$91.13
-4.63%
Wolverine Worldwide (WWW)
WWW
$37.68
$37.76
+0.21%
TOTAL
TOTAL
$1,318.46
$1,330.30
+0.90%

Sports Insight Extra Podcast Series

Nikki Barua

The old way of retail is dead, and there is a massive opportunity to re-invent, proclaims the CEO of Beyond Curious in Los Angeles.

Matt O’Toole

President of Reebok dishes on the brand’s mission and objectives from its headquarters in Boston.

Gabriella Santaniello

Retail expert dishes on what’s going right and wrong in industry today and weighs in on the Walmart vs. Amazon tussle.

Guy Yehiav

The CEO of Profitect addresses the right medicine for changing the paradigm of accountability—prescriptive analytics.

Pat Ryan

Batter Up! The global product director for baseball/softball at Wilson Sports details the new USA Baseball standard that took effect January 1 and what it means when you hit the store this spring looking for a new stick for junior.

Patrick Clark

President of Nextwave, a Buford, GA system integrator, discusses benefits of an on-demand apparel microfactory, a bridge to Just In Time manufacturing, from Sourcing at MAGIC in Las Vegas.

Shawn McBride

Ketchum Sports & Entertainment EVP talks Olympics—impact of three consecutive Games in Asia, social media, corporate guerilla marketing and drawing in younger consumers.

Tyson McGuffin

Tennis pro Tyson McGuffin, 28, talks about the rising popularity of pickleball and how he became a champion in the sport.

Bob Mullaney

The 20-year shoe and retail industry veteran, recently named president and CEO of RG Brands, dishes on the comfort footwear business and Barry’s iconic Dearfoams brand.