Entries Tagged as 'Retail'

Carolina Custom

I went to Carolina Custom Golf’s Cary Store at lunch today. They are closing their 6 stores, including the Cary store and two Raleigh stores (see the article for details) and having a closeout sale to beat all closeouts. The store was pretty picked over but I managed to find some nice shoes at over 50% off for my son and some great Adidas golf caps for me.

I have mixed feelings about this. I’ve been a customer at CCG since we moved to the area. It used to be the only golf retail store near our house. In fact, it was really the only retail store in the area, until Golf Galaxy moved in across Buck Jones from it. I never really enjoyed the store much. Unlike how I like to wander around Golfsmith’s monster store in North Raleigh, I never liked the atmosphere. Customer service was tepid at best, and semi-antagonistic at worst. Prices weren’t great and selection wasn’t real good either.

But, as a former small business owner whose business struggled and eventually succumbed to cash un-flow death, I sympathize. It was pretty sad to see so much empty floor space, with club and clothes racks pushed off to the side. Looking at the inventory, I just kept thinking about how much each item, now on huge markdowns, must have cost the owners originally. I wondered how they’re doing with this whole process. How are they taking care of their families? What about the employees? The ones in the Cary store today were pretty down, that’s for sure.

I better stop – I’m starting to sound like an Obama speech about the economy.

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The Golf Business and the Economy

As I ran into Golf Galaxy to reload on some pellets yesterday, I saw a lot of clearance items, and it got me thinking. The golf business (big B on business) is supposedly tanking, according to the media. The current economic problems are hitting an already struggling industry is the story one hears often in the lay press. So how are some big parts of the mainstream golf industry doing at closer inspection?

  • Golfsmith
    • Stock price has fallen by about 60% over the last year
    • 9.3% decrease in online revenue reported for last quarter
    • The company expects earnings growth to be driven by “reduced operating expenses and marketing costs” – that doesn’t sound particularly encouraging to me
  • Callaway
    • Stock price dropped from $16 to $11 from one year ago to July but has rebounded lately to just over 14
    • Declared a dividend of $.07 per share – may not seem good, but usually a good sign from an investor standpoint
    • Announced record sales for first half 2008 globally
    • Halle Barry joined the Callaway Golf Foundation as ambassador – ’nuff said
  • Dick’s Sporting Goods and Golf Galaxy
    • Dick’s reported 5% loss of net revenue in 2nd quarter 2008
    • Same store sales decreased by 3.7% at Dick’s; 4.5% at Golf Galaxy
    • Dick’s CEO, Ed Stack, stated, “We anticipate the golf business is going to be a little bit difficult through 2009.”
      • Ed. note: Hey Ed, when wasn’t the golf business “a little bit difficult”?
  • Ashworth is considering a sale or merger to “enhance shareholder value”
  • The USGA couldn’t get any of the Big 3 automakers to bite on being it’s “Official Car”, so chose Lexus instead. Buick and Cadillac have long been synonymous with the PGA and Senior Tour respectively, so that is a big moment in the relationship of Detroit and big time golf.
    • Ford has even cut it’s relationship with Lefty Mickelson (gasp!)
  • In a not-so-official survey by Golf Digest, 41 of 60 private golf clubs contacted felt they were in a membership “crisis” and were offering incentives of various types.

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On the other hand, a recent study has shown that golf’s economic impact in the US has increased by $14 billion in the last five years (up to $76 billion from $62 bill.) This is a larger segment than the motion pictures and video industries. Now, how that’s measured can be construed in many ways, but it is obvious that golf remains a major force in the economy.

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I hope you weren’t looking for some grand conclusion, were you? ‘Cause I just present the numbers, ma’am.

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