Oct 15

Dick’s brings game to Academy’s home turf

Dick’s Sporting Goods recently opened in Katy’s The Shoppes at Parkwest, at Interstate 10 and Katy Fort Bend Road.

Dick’s Sporting Goods joins Houston’s retail scene Friday with six new stores. The Pittsburgh-based newcomer is planning a steady but significant expansion throughout the region, home turf of Katy-based Academy Sports & Outdoors.

“Houston is one of the most important cities in the country today, and to get scale we needed to come in in a big way,” Dick’s CEO Ed Stack said last week.

Dick’s initially will open stores in six area malls: Baybrook, Deerbrook, The Shoppes at Parkwest in Katy, First Colony, Willowbrook and Woodlands. The Baybrook and Katy locations will also include the specialty shops Field & Stream and Golf Galaxy, store-within-a-store concepts that offer an extra emphasis on fishing and golf, respectively.

The company plans to open as many as four more stores locally next year, and Stack said he expects as many as 25 stores here within the next four years. That number could include the company’s specialty shops.

The planned expansion could put it nearly on par with Academy, which opened its 30th Houston-area store earlier this month in Pearland. The Texas company already competes with Dick’s in a number of cities throughout the South, including New Orleans, Memphis and Atlanta, but until now, the two haven’t faced off locally.

“In most markets, we compete head to head,” Academy CEO J.K. Symancyk said. “It’ll be exciting and a little different to play on our home field.”

Though Academy has the largest presence of any sporting goods retailer in the Houston area, the market is rife with competition from Gander Mountain, Hibbett Sports and REI. Bass Pro Shops and Cabela’s, which recently agreed to a merger, also have stores in the area.

The city lost a major player earlier this year when Colorado-based Sports Authority filed for bankruptcy and shuttered 11 Houston-area stores as part of its nationwide closures. Though its selection of merchandise had somewhat overlapped with Academy’s, Symancyk said his company had no trouble holding its own.

“Sports Authority had been struggling to find an audience for some period of time, so they were not as strong of a competitor on a national basis,” he said.

Dick’s, on the other hand, is continuing to grow and now has about 645 stores, more than three times the number Academy has. Jim Duffy, an analyst who covers Dick’s for Stifel, said the company’s methods of managing its finances and inventory have kept its stores competitive.

“Over the years, the landscape has been littered with (failed) sporting goods retailers,” he said. “It’s a notoriously difficult business with seasonal peculiarities, and Dick’s is very good operationally.”

While Academy’s stores are mostly clustered in the South and Midwest, Dick’s are scattered throughout the country. That footprint makes it attractive to brands looking for exposure, Duffy said.

“With their scale as a national player and the buying power they have, they get the attention of the retailers,” he said.

The company has been eyeing the Houston market for years and started planning its entry about a year and a half ago, Stack said.

When asked about the company’s competitive strategy, Stack pointed to its inventory. Dick’s carries products manufactured just for its stores by retailers including Titleist, PING, Mizuno and The North Face, among others.

Still, Academy and Dick’s have a considerable amount of similar merchandise, notably soft goods such as athletic clothing and shoes. Jason Baker, a principal with real estate brokerage firm Baker Katz, said he thinks the hometown team will have a leg up on new competition, at least at first, because of the loyal customer base it has cultivated.

“Having been in our market for 30 or 40 years gives (Academy) a built-in advantage,” he said. “It could be tough to overcome.”

Both Dick’s and Academy match competitors’ prices if customers find better offers elsewhere. But Academy knocks 5 percent off the lower price, something Symancyk said aligns with the company’s commitment to offering the best deal.

Symancyk said that, ultimately, competition pushes companies to play their best game.

“I’m certain that will be the case as we have more competitive choices within Houston,” he said.


Original article can be viewed here