Structure of the Retail – Sporting Goods Industry
The seasonal retail sporting goods industry is heavily tied to sporting trends and relies on large athletic partners to create desirable athletic goods and apparel. Exclusive licenses can help certain firms achieve competitive advantages, and while scale helps, small companies have been able to carve out favorable niches. Online competition continues to grow from non-traditional retailers, causing potential pressures on margin and pricing performance. Potential firearm regulation could negatively impact sales, but most companies are well diversified. We’re neutral on the space, but continued consolidation could ultimately benefit industrywide pricing and margins.
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