One of your favorite places to go shopping for sporting equipment growing up is in serious decline.
Sports Authority announced Wednesday that it is filing for Chapter 11 bankruptcy protection. The chain plans to close or sell nearly 140 stores and two distribution centers.
“We are taking this action so that we can continue to adapt our business to meet the changing dynamics in the retail industry,” CEO Michael Foss said in a written statement, via ABC 15.
Dear Sports Authority gift card holders: Spend them now. If Chapter 11 is converted to liquidation, you may be stuck with worthless plastic.
— Nathan Bomey (@NathanBomey) March 2, 2016
According to Bloomberg, the retailer was even with Dick’s Sporting Goods in sales back in 2006. Dick’s has now overtaken them as the sporting goods giant, while Sports Authority has accumulated debt. Dick’s now has 200 more stores than Sports Authority.
A major factor in Dick’s success in overtaking Sports Authority as the sporting goods retail giant has been presentation, per Bloomberg:
One area where it’s lagged is presentation, according to Joe Feldman, an analyst at Telsey Advisory Group. Dick’s excels in layouts and displays and has partnered with manufacturers including Nike Inc. and Under Armour Inc., which operate in-store shops.
Those improvements have helped Dick’s pull in about $10 million a year in sales from the average store, while Sports Authority collects about $5.75 million, according to Steven Ruggiero, a credit analyst at RW Pressprich & Co.
If Sports Authority fails to find a buyer, it will close all of its stores. If this is the case, hopefully you have a Dick’s Sporting Goods by your home.
[Photo: Sports Authority]
