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 4,500 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 14 workers, and generates about $10 million annually.

    • The sporting goods wholesale industry consists of about 4,500 companies that employ about 62,000 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 and BSN Sports.
                            Industry Forecast
                            Sporting and Recreational Goods Wholesalers Industry Growth
                            Source: Vertical IQ and Inforum

                            Recent Developments

                            Jan 2, 2024 - Higher Minimum Wages Ahead in 2024
                            • Sporting and recreational goods wholesalers will have to monitor minimum wage changes, as 22 states increased their minimum wages in January 2024, according to Chain Store Age. About half of the increases are automatic adjustments linked to inflation. States that raised their minimum wages in January 2024 include Hawaii ($14), Maryland ($15), Nebraska ($12), and Washington ($16.28). Several states are set to boost their minimum wage levels later this year, including Florida (up to $13 in September) and Nevada (up to $12 in July). According to the Economic Policy Institute, nearly 40 US cities and counties will increase their minimum wage rates above state levels at the start of the new year. The federal minimum wage is $7.25 an hour, and more than 20 states, primarily located in the South and the Midwest, use the federal minimum as their wage floor.
                            • Consumer confidence levels rose in December 2023 for the second month in a row, following three consecutive months of declines, according to data from The Conference Board. The Conference Board’s consumer confidence index increased to 110.7 in December 2023 from 101 in November 2023. According to Dana Peterson, Chief Economist at The Conference Board, “December’s write-in responses revealed the top issue affecting consumers remains rising prices in general, while politics, interest rates, and global conflicts all saw downticks as top concerns.” Peterson added that the gains in consumer confidence were largest in householders aged 35-54 and households with income levels of $125,000 and above. Plans to purchase homes, autos, and large appliances rose moderately on a month-to-month basis as interest rates moderated.
                            • Lower consumer spending, volatile inventory levels, lingering supply chain problems, and inflation are expected to limit growth in the US sporting goods wholesalers industry, which is projected to grow at a less than 1% CAGR from 2022 to 2027, according to a recent Inforum forecast. This rate is slower than the projected growth of the overall economy. Employment levels in the industry have been relatively flat year to date, and employment costs have increased as wages have risen.
                            • US manufacturing activity contracted in November 2023, falling below the baseline for growth for the thirteenth consecutive month, according to the Institute for Supply Management’s Manufacturing ISM Report on Business. The Manufacturing PMI registered 46.7% in November, unchanged from the 46.7% recorded in October. A reading above 50% indicates manufacturing expansion. November’s New Orders Index remained in the contraction zone at 48.3%. The November Production Index was 48.5%, a decrease from October’s 50.4%. Two manufacturing industries tracked by the ISM reported growth in November: Transportation Equipment and Food, Beverage & Tobacco Products. The industries reporting contraction in November were Paper Products; Printing & Related Support Activities; Electrical Equipment, Appliances & Components; Computer & Electronic Products; Apparel, Leather & Allied Products; Textile Mills; Machinery; Primary Metals; Furniture & Related Products; Miscellaneous Manufacturing; Chemical Products; Fabricated Metal Products; Wood Products; and Plastics & Rubber Products.
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