Sporting and Recreational Goods Wholesalers

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 4,600 sporting goods wholesalers in the US distribute merchandise related to sports and recreational activities. Major product categories include small firearms, ammunition, and shooting aids; athletic equipment and accessories; bicycles and bicycle parts and accessories; swimming pools and related supplies; and playground equipment. Other product categories include camping and fishing equipment; marine pleasure craft, equipment and accessories; skiing and snowboarding equipment; and billiards, pool, and bowling equipment and accessories.

Seasonal Demand

Demand for various types of sporting goods varies throughout the year, depending on the sport.

Dependence On Imports

The majority of sporting goods are manufactured in China or Taiwan, and then shipped to the US by sea.

Industry size & Structure

The average sporting goods wholesaler operates out of a single location, employs 12 workers, and generates about $9-10 million annually.

    • The sporting goods wholesale industry consists of about 4,600 companies that employ about 56,900 workers and generate about $45 billion annually.
    • The industry is concentrated at the top and fragmented at the bottom; the top 50 companies account for about 51% of industry revenue.
    • Large companies include Big Rock Sports, BSN Sports, and United Sporting Companies (Ellett Brothers).
                            Industry Forecast
                            Sporting and Recreational Goods Wholesalers Industry Growth
                            Source: Vertical IQ and Inforum

                            Recent Developments

                            Nov 10, 2022 - Lockdowns In China may Reduce Product Availability
                            • Sporting and recreational goods wholesalers may have difficulty maintaining adequate inventory due to China's ongoing struggles to control COVID-19 outbreaks. A third district of Guangzhou, China's southern manufacturing hub, has been locked down as authorities rush to stamp out a widening outbreak and avoid activating the kind of citywide lockdown that devastated Shanghai earlier this year. The latest round of mass testing in Guangzhou comes as China battles a rebound in infections in several economically vital cities, including the capital Beijing, as well as Zhengzhou and Chongqing, which have dampened hopes that the world's second-largest economy could ease curbs and restrictions soon.
                            • Supply chain pain points have moved from water to land as transportation equipment for moving goods on land grows increasingly difficult to find, according to the Wall Street Journal. Shipping containers and the trailers needed to move goods on trucks are being tied up for weeks at a time while companies store goods on the equipment because warehouses are full. The practice is triggering lengthy backups at inland distribution hubs including Chicago and Kansas City, MO, that officials say are as bad now as at any time during the coronavirus pandemic. Congestion is easing in other parts of supply chains. Some Gulf and East Coast ports are still seeing surges in cargo but demand for space on container ships is waning, according to Denmark-based Sea-Intelligence. Backups at the nation’s busiest container port complex at Los Angeles and Long Beach, CA, are at their lowest levels in more than a year.
                            • Warehousing costs may remain elevated due to high demand and facility construction delays, according to real estate services firm JLL. About 74% of logisticians surveyed by JLL predicted 5% annual growth or more in warehouse demand over the next three years. About 28% of those said it would be 20% or more, and 71% expected demand from e-commerce to grow significantly through 2024. A combination of factors, including labor and steel shortages, are forcing delays in getting warehouses up and running. The perfect storm of issues is forcing the delivery time of warehouses to increase dramatically at a time when more space is needed sooner. The time to stand up a facility is typically eight to 12 weeks, according to industrial space construction firm RK Logistics Group. That is now 20 to 24 weeks.
                            • Sporting and recreational goods wholesalers are likely to be affected by changing consumer demand that has resulted in overstocking by retailers of some products. Some Americans, mainly high earners, are reallocating their spending to experiences, says Kayla Bruun, an economic analyst with Morning Consult. Travel demand, for example, has soared as travel restrictions are eased. "There is a shift away from goods and to services, which is more Covid-related," she says. "People were locked down during the pandemic and they were spending more income on things around the home and now they prefer to spend their discretionary spending on goods outside the home."
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