Yesterday, May 30, 2018, Dick’s Sporting Goods’ stock jumped as much as 28% after the sporting goods retailer held its Q1 2018 Earnings Conference Call. The call excited investors with higher profit guidance. This offset Wallstreet fears over the loss of gun sales after the retailer announced it would no longer sell assault-style rifles in February.
Dick’s has been actively growing its private brand portfolio and the strategy seems to be paying off, as growth there outpaced that of total sales with double-digit comp sales. The retailer expects that business to hit $2 billion in sales in the near future. The strategic importance that private brand plays at the retailer is made clear by the 39 times during the call which private brand, private label, CALIA, Field & Stream and Tommy Armour are mentioned.
Edward Stack, Chairman, and Chief Executive Officer spoke passionately about private brand at the retailer.
“First, our private brand business is a source of strength that continues to accelerate. This business continues to outpace our Company average delivering double-digit growth again this quarter. Driving differentiation and exclusivity within our assortment is the top priority.
We’ve expanded our CALIA collection to new categories and given it premium space in our stores. In the three short years since its launch, CALIA has grown to be our number three private brand in our portfolio and the number two brand in women’s athletic apparel behind only Nike.
This quarter, we also launched Tommy Armour Golf Clubs. These clubs were designed in partnership with the BMW Designworks and have received national recognition. We have significant momentum in our private brand business and believe it can reach $2 billion over a relatively short period of time.”
Calia, its women’s athletic apparel brand that debuted almost three years ago, has already exceeded Under Armour in its categories and is now only second to athletic behemoth Nike. During the call, Dick’s announced that CALIA will get some additional premium space in store as they continue to push for growth. The retailer will also expand the in-store footprint of their Walter Hagen and Slazenger private brands as they continue to grow.
Finally, Dick’s announced the continued expansion of their private brand portfolio with the launch later next year of a new outdoor brand designed to fill white space they have identified in “good” product.