UK Market Intelligence: Early Season 17/18

Editor’s Note: This market intelligence report was written mid-late November for Issue 89, released late December. Stay tuned for our annual market intelligence report from each region.

What is going on? At the time of writing this (late November) some of the most respected (!) retailers in winter sports appear to be going on sale. It’s November and they’re going on sale … and not just a little sale it’s 20% off … the season’s not started, some of the stock has not even arrived in store, and they’re going on sale. Is this panic? By Gordon Way.

MarketIntelUK

Market Intel UK

As a distributor it dismays me completely when this happens. We all know only too well, that Retail Price Maintenance is illegal so once again, for the record, I am not (absolutely not) supporting any efforts towards RPM. There’s nothing we can do to protect the Retailer Margin or the reputation of the product in the market place – it’s a free for all. Unlike the USA where MAP policies (Minimum Advertised Price) can help protect both. It does seem to me to be an eminently sensible idea. Sadly in the UK we are at the whims of the ‘on sale’ merchants and the Amazon algorithms. It’s a race to the bottom.

Hopefully by the time you read this it will all be over, the snow will have fallen, the season will have kicked in and other retailers will have ‘held firm’. The business is tough enough without having to drop your trousers this early in the season. Easier said than done!

It is with all this in mind that, with some trepidation, I start to make my calls to retailers. If the rumour mill is right then all of this should not matter to Brian Stark of Boardwise in Edinburgh. After the fire last year that ripped through his store is he coming back? The latest is that Boardwise will not reopen and that the mail order business is to pass to Boardwise Cannock. So I caught up with Brian to find out the state of play: “It’s a bit of a nightmare. Architects, solicitors, insurance companies and the council – fed up with the lot of them. Seven months ago I thought it would be a week and I would know where we are heading. Today I am waiting for a phone call so I can then start to move forward – but I was waiting on that same phone call weeks ago. At the moment all mail order business is going to be run by Boardwise Cannock and all our purchase orders have been taken on by them. But Boardwise is my passion and my life and I just want to get back on the shop floor selling. Unfortunately I have no idea if or when that will be.” For the time being Edinburgh and the industry has lost one of the longest boardsports retailers in the UK. As I mentioned in a previous issue Ultra Sport can trace our own trading history back more than 40 years with Boardwise. Time will tell what the future holds. It’s obviously not easy!

Next I thought I would talk to the closest competitor to Boardwise Edinburgh – Ross from Freeze. Whilst it is always sad when a retailer leaves the playing field, temporarily or not, at the same time there is a potential upside in that another retailer has an opportunity to grow. Ross did not want to talk about the Boardwise situation and was certainly not gloating: “What can I say? At this point in time we have heard nothing official. What I can tell you is that Freeze have moved to a new premises which are about twice the size, we’ve got a new shop which is looking sharp with no expense spared, and a proper fully functioning workshop. Footfall is up and whilst it is early days, so difficult to give you a feel, we are very confident that we’re going to have another bumper year. Early indications are good.” Ross has been at Freeze for almost a third of his life so you can imagine that the business is really close to his heart and, like Brian, he has a real passion for this business “We’re about the only decent store left in Scotland right now and whilst we are going to continue to serve the local community, as we always have done, we’re also looking further afield to grow the business.”

You may recall that Ross did attend ISPO in 2017 despite saying that he thought it was not going to be productive time. So I had to ask. “Yes, yes – I’m going again… the jury is still out but if you are buying me dinner I’ll be back”. This will now be his second visit to Munich – will he become a regular?

So far the issue of the price war has not actually raised its ugly head – was I mistaken that this is a big factor in retailers minds? I guess it’s never far away. “It’s something we simply have to live with,” NicK Warne from Snowtrax had a refreshing approach to the constant discounting: “It’s now part of every day life. As a retailer we don’t like it but there’s nothing we can do about it and moaning to suppliers is going to have little impact.”

Snowtrax, a long established operation in Christchurch, has their own shop, a dryslope and an adventure park. “We do have the advantage that we have different strings to our bow but retail is an important part of the business and, like many other UK specialist winter sports retailers, we pride ourselves on customer service and knowledge of the market. The bottom line is that product pricing will find it’s own level and there’s nothing you can do about it. High demand and low production will keep prices higher – Low demand and over production, we know what happens. And so many brands are over producing – they over forecast, over produce and we end up with huge discounts.”

So how do Snowtrax compete? “We get on with it, try to upsell wherever possible and look for the blended margin.” As a dryslope, Snowtrax is a good barometer for the season – so how are bookings? “Good – the slope is up, lessons are up and actually retail is up – we’re in good shape.”

So far so good – now Jeremy from TSA. What will this call bring? “July, August and September were all massively up on last year,” so far so good, “and then in October it turned to $hit,” Oh dear. So what’s the reason that October is so bad? “I think we just have to accept that the consumer is postponing their buying decisions until they get closer to actually going on holiday. The season for snow has shifted and the season for buying has shifted. I’m not panicking it will come – in fact high end kit is still selling through well and the entry level stuff will follow. As soon as the consumer wakes up to the fact that they ARE going to the mountains they will be in store. Brexit is probably not helping but, as I say, it will come.”

So I had to push it a bit and see how Jeremy felt about Black Friday (we were in the midst of it as we spoke) and discounting in general: “It’s just effing stupid and there is absolutely no reason for it. As for Black Friday it has zero impact on us and no – we don’t participate. I would just say to my colleagues ‘hold your own’ and don’t let your business be run by accountants who make decisions based on spreadsheets.”

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