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Thursday, Mar 28, 2024

Sport Chalet’s Future Includes New Store, Revamps

Sport Chalet Inc. is preparing to roll out a new business plan, which includes a new store in downtown Los Angeles and revamps of existing ones. The La Canada-based sporting goods retailer announced this month a new store opening in Los Angeles at the Fig at 7th shopping center, which currently is undergoing a $40 million renovation. Slated to open next year, the new store will serve as one of the anchor tenants for the center as well as the prototype for future Sport Chalet locations. “This will be the next generation of Sport Chalet stores,” said CEO Craig Levra. “We’re extremely excited about it.” While considerably smaller than the typical 45,000-square-foot model, the new 27,000-square-foot location will offer “the best of the best” in terms of merchandise and offerings, Levra said. The initiative comes on the heels of a difficult year for the sporting goods retailer, which experienced a 17 percent drop in revenue in its fourth quarter. In the sporting goods industry, retail sales are often at the mercy of nature and weather, a reality that Sport Chalet experienced last year. Declining sales were largely due to an unseasonably warm winter, Levra said. Typically, about 30 percent of a store’s square footage is dedicated to seasonal merchandise. The new store will sport a new merchandise concept which will be flexible to the ebbs and flows of category growth as well as seasonal switch-outs, the company said. Julie McMaster, assistant buyer for Sport Chalet’s active sports segment, said the new store will not include every category found in a typical location, but the company is still working on a specific merchandising plan. The National Sporting Goods Association’s Sports Participation report recently found that kayaking and skiing saw the largest increases in participation last year, each increasing 27 percent and 11 percent respectively. Wrestling, aerobic exercise and running closely followed the two categories, each nearly increasing 10 percent. The new store will feature high-end equipment and merchandise for hot-selling categories. Based upon the success of the new model, Sport Chalet will move forward in duplicating the prototype in new and existing stores. “Once we open we will learn a lot,” Levra said. “If it’s working, we’ll do more; if it’s not, we’ll stop it.” Meanwhile, Sport Chalet already has planned the renovation of two stores this year. Next year, the Porter Ranch location will get a face-lift. The sporting goods retail sector has been fairly stable amid the challenging economy, and each retailer has adopted its own business model, latching on to hot-selling categories said Bruce Hammond, spokesperson for the National Sporting Goods Association. This month, Sport Chalet competitor, Dick’s Sporting Goods, announced the opening of a specialty store to serve the running category. The new concept, True Runner, will include footwear, apparel accessories and expertise that cater to running enthusiasts. Last year, the industry saw sales of some $55 billion, a 4 percent increase over the year prior. This single-digit increase has been typical over the years, Hammond said. While the weather has been a constant impact on sporting goods retailers, a recent challenge to brick-and-mortar stores has been the increasing use of technology, he added. “Consumers are now utilizing smart phones to find prices elsewhere,” Hammond said. “They’ll come into a store to try something on and then buy it online.” Levra said the online business has been a segment of success for Sport Chalet. In the fiscal 2012 year, online sales jumped 22 percent. Levra said the company’s recent investment in expanding its business may be scrutinized due to the company’s financial struggles, but he remains committed to the future plan. “That’s how confident we are that our business model is correct.”

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