Sporting and Athletic Goods Manufacturers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 1,600 sporting and athletic goods manufacturers in the US design, engineer, and manufacture a wide range of sporting, athletic and fitness related goods and equipment. Products include sports equipment (excluding sports apparel and footwear) used to play team sports, like baseball, basketball, football, and hockey; individual sports, including golf, tennis, bowling, and swimming; fitness equipment; and products used in outdoor recreational activities, such as fishing, camping, hiking and rock climbing.

International Sourcing And Sales Risks

An increasing percentage of finished sporting and athletic goods and raw materials are being sourced from foreign countries, particularly China and other developing countries in Asia.

Protecting Brands And Distribution Rights

The marketing success of many sports and athletic goods manufacturers often depends on maintaining strong brand names, trademarks, and proprietary technologies or product designs.

Industry size & Structure

The average sporting goods manufacturer employs 26 workers and generates $6-7 million in annual revenue.

    • The US sporting and athletic goods manufacturing industry consists of about 1,600 companies that employ 41,000 workers and generate $10.7 billion in annual revenue.
    • The industry is dominated by a small number of large manufacturers having several different products and brands, but is also characterized by a large number of very small manufacturers who market specialized products in niche markets.
    • The 50 largest manufacturers generate 70% of the industry's revenue, yet 51% of manufacturers have less than 5 employees.
    • In 2020, participation rates were 67% of the population for fitness sports, followed by 53% for outdoor sports, 43% for individual sports, 22% for team sports, 13.7% for water sports, 14% for racquet sports and 8.3% for winter sports, according to the Physical Activity Council.
    • Millions of Americans participate in team and individual sports including basketball (25 million) baseball (15.8 million), soccer (17 million), swimming (31 million), volleyball (14 million), softball (9.2 million), cheerleading (3-4 million), racquetball (3.5 million), lacrosse (2.1 million), rugby (1.4 million), fishing (42.5 million), and surfing (2-3 million).
                                  Industry Forecast
                                  Sporting and Athletic Goods Manufacturers Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  Mar 15, 2023 - Sales Up for Sporting Goods Stores
                                  • Sales for sporting goods stores increased by 3.4% unadjusted year over year but declined 0.5% month over month seasonally adjusted in February 2023, according to data released by the National Retail Federation. Overall retail sales were up 5.4% in February 2023 over a year ago and down 0.4% from January 2023, according to the US Census Bureau. NRF’s retail sales calculation, which excludes car dealers, gas stations, and restaurants, showed an increase of 6.5% unadjusted year over year and 0.5% month over month in February 2023. According to NRF Chief Economist Jack Kleinhenz, “Sales growth has slowed in recent months, but consumers’ economic health still looks good. February is typically the slowest month of the year, so monthly fluctuations are expected. Sales are higher than last year and that’s due in large part to the strong labor market, which means more income and spending.”
                                  • Outdoor retailer REI has implemented new inclusive sizing standards for its 1,300 brands, according to Glossy. The new regulations require brands to offer extended sizing at price parity to continue being sold at REI’s nearly 170 stores and online website. In addition, brands must ensure inclusive marketing practices and eliminate cultural appropriation. For headwear makers, brands must accommodate different hair types, such as higher volume curly hair. Brands must present their procedures to REI for approval. The standards on inclusive sizing will not go into effect until spring 2024, and headwear requirements will go into effect in 2025. The company will offer its brand partners access to panels and workshops with experts who can help them make any needed changes. According to Nicole Browning, senior manager of local and inclusion marketing at REI, “A punitive, shame-and-blame approach is not the most effective long-term solution. A lot of the brands we work with may have never considered some of these things before, and having a strict approach isn’t the right way to go. These things take time.”
                                  • Three-quarters of sporting goods company executives said they plan to expand nearshoring by 2025, according to an annual report by McKinsey & Company and The World Federation of Sporting Goods Industry in FashionUnited UK. The report, titled “Sporting Goods 2023 – The need for resilience in a world in disarray,” cited supply chain disruptions, geopolitical considerations, trade tensions, and rising labor costs in Asia as reasons to move to nearshoring. Companies should consider several variables when researching nearshoring: lead times, risk exposure in the supply chain, labor costs and skill requirements, and sustainability. The report also said sporting goods companies could achieve 5 to 10 percent savings by building supply chain resilience through reviewing sourcing and supply chain options and applying next-generation solutions.
                                  • Team sports participation in the US continues to make strides toward pre-pandemic levels, growing nearly 2% in 2021 to over 68 million, according to the Sports & Fitness Industry Association (SFIA) US Trends in Team Sports Report for 2022, as reported in SGB Media. While 2021's participation was greater than the 67 million participants in 2020, it has yet to return to 2019's level of 70.8 million participants. On a positive note, the number of 6-to-12 year-olds playing sports reached 17.6 million in 2021, the highest level in the past five years and an encouraging sign for the future of team sports. Core participation in this age group increased in flag football, basketball, court volleyball, grass volleyball, and fast-pitch softball over a five-year average. Many spring season team sports were not at full strength in 2021 because of the Omicron COVID variant, and SFIA officials expect stronger numbers in 2022.
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