Dick's to purchase Golfsmith and....Rebranding is now in progress

[Steve_ Shaffer]

close a lot of stores:

http://www.golfdigest.com/story/reuters-dicks-sporting-goods-buys-up-golfsmith-stores-at-bankruptcy-auction


Dick’s Sporting Goods apparently is bullish on golf again.

According to a Reuters report, the nation’s largest sporting goods retailer just acquired Golfsmith, the nation’s largest golf retailer at auction earlier this week.
According to Reuters, Wednesday’s bankruptcy auction resulted in Dick’s Sporting Goods planning to keep at least 30 Golfsmith stores and wind down the rest of the retailer’s 109 stores through liquidators from Hilco Global and Tiger Capital Group. In announcing its bankruptcy last month, Golfsmith revealed that it owed nearly $200 million in outstanding loans or credit facilities.


An official at Dick’s could not confirm what Golfsmith stores would remain open, but the Reuters report indicates Dick’s plans to retain approximately 500 Golfsmith employees.

[Steve_ Shaffer]

Here are the Golfsmith stores set to close before the end of October:
Minnetonka, Minn.
Plano, Texas
Scottsdale, Ariz.
Duluth, Ga.
Carle Place, N.Y.
Birmingham, Ala.
Tucson, Ariz.
Aurora, Ill.
Palm Desert, Calif.
Sterling, Va.
Woodbridge, Va.
Fairfax, Va.
Bellingham, Mass.
Northborough, Mass.
New York, N.Y. (Fifth Avenue)
Cerritos, Calif.
Houston (Champions)
Chicago (South Loop)
Pembroke Pines, Fla.
North Myrtle Beach, S.C.

[Carl Rogers]

The purchase could be more about the property values than anything else.

[Jim_Kennedy]

I would expect that every square inch Golfsmith had was leased.

Seems to be the case.
http://www.costar.com/News/Article/Golfsmith-Bankruptcy-Follows-Ill-fated-Store-Expansion/184970

[John Foley]

What does this say about the state of the club / apparel / accessories business? Will the small independents gain from this or will be just see Walmartification in this industry?


I used to drop into the Golftown's in Ontario when in Toronto on business. Best golf apparel selection ever. Was there last week and they got a bit of Nike a bit of UA and not much else. This has to be killing the small guys who are trying to make a go at it.

[Will MacEwen]

Golftown has just gone through its own creditor protection process here, and is closing several stores. Less than half.

In Canada, the general perception is that GT was a good business, but buying Golfsmith was a mistake, and controlling distribution and admin through Golfsmith was a giant mistake. 

[Howard Riefs]

I missed yesterday's news that Golfsmith announced plans to close another 59 stores. That will leave it with 30 locations.

http://www.golfdigest.com/story/fallout-from-bankruptcy-auction-continues-as-nearly-60-golfsmith-stores-set-for-closure

http://blog.golfsmith.com/press-releases/golfsmith-stores-remaining-open/#.WB1WhLU8KEc

[Greg Chambers]

I've got a buddy who tried to get his 2 iron re-shafted at golf smith...after they screwed it up the second time they told him "we don't get many of these"......... good riddance.

[Mike_Trenham]

My guess is Dicks is not really bullish on the golf store business but with these two entities they can spin  golf galaxy and golf smith off to a private equity company or another competitor.

[cary lichtenstein]

It's your typical consolidation of an industry...look for more of their suppliers to consolidate too

[jeffwarne]

I've got a buddy who tried to get his 2 iron re-shafted at golf smith...after they screwed it up the second time they told him "we don't get many of these"......... good riddance.

I'm always amused when people are surprised that a $9 hour clerk working at a discount, cut rate big box superstore whose business model is to undercut smaller service oriented and on site green grass vendors---provides sub par service.

[noonan]

I've got a buddy who tried to get his 2 iron re-shafted at golf smith...after they screwed it up the second time they told him "we don't get many of these"......... good riddance.

I'm always amused when people are surprised that a $9 hour clerk working at a discount, cut rate big box superstore whose business model is to undercut smaller service oriented and on site green grass vendors---provides sub par service.

 

[Steve_ Shaffer]

@Greg, Jeff  & Jerry

I find it incredulous that you knock a chain of stores because of a bad experience in one store. When I " semi-retired" from my law practice, I worked part time in the Willow Grove, PA Golfsmith location- now to be closed. Our repair tech was top notch and did much more than re-gripping. He did excellent work re-shafting and repairing clubs. Some stores are better than others in any chain.  The repair tech in my new local Golfsmith store (where I do not work) in Peoria, AZ- not to be closed-  is excellent.  It depends.

[Richard Hetzel]

@Greg, Jeff  & Jerry

I find it incredulous that you knock a chain of stores because of a bad experience in one store. When I " semi-retired" from my law practice, I worked part time in the Willow Grove, PA Golfsmith location- now to be closed. Our repair tech was top notch and did much more than re-gripping. He did excellent work re-shafting and repairing clubs. Some stores are better than others in any chain.  The repair tech in my new local Golfsmith store (where I do not work) in Peoria, AZ- not to be closed-  is excellent.  It depends.

Totally agree. Every time I have had club work done at Golfsmith the work was great. It all depends on the person who is doing the work and how much (or how little) pride they personally take in that work. These giant big box golf stores were created to destroy the smaller, green grass golf shops, and it seems like the smaller guys are the ones who will survive, especially when they can sell out the back door on eBay, don't report to share holders (why do you think GG is mostly clothing?)  and reverse undercut the big boys. What goes around, comes around Golf Galaxy, Golfsmith, et al....

[Steve_ Shaffer]

 Dick's owns Golf Galaxy. Whether they convert Golfsmith stores to Golf Galaxy remains to be seen.

[Richard Hetzel]

Dick's owns Golf Galaxy. Whether they convert Golfsmith stores to Golf Galaxy remains to be seen.

I bet they do, at some point anyway. I think since Dick's acquired GG they have closed some stores, released all the PGA pros, and made it very apparel heavy to show better profit margins. I wouldn't be surprised if GG is completely absorbed by Dick's at some point.

[Jeff Shelman]

A couple of things:

1. Many of the stores being closed in this second round of closings are locations where there is a Golf Galaxy is nearby. Keeping the Golfsmith and the Golf Galaxy open would be redundant and would overserve the customer. That's certainly the case with the Minnesota closings, the Schaumburg, Ill location and the Indy location. All are very close to GG locations. I'm guessing some of the others are poor performers that get beat by PGA Tour Superstore or others.

2. I would be floored if rebranding doesn't occur. Running two separate brands is costly as there is a lot of duplication of work required (marketing materials, advertising, etc.). The question would be whether Dicks feels that Golf Galaxy is the stronger brand or whether Golfsmith is the stronger brand.

3. I stopped in one of the closing locations here and found a good deal on the new Titleist 917 3 wood. It was a demo that had barely been hit and got it for about 40 percent off. So there should be some deals in the coming weeks.

[Steve Lang]

   The Golfsmith store in The Woodlands (I-45 north Freeway) is surviving, while 4 others in Houston are being closed... it's the oldest legacy location in town.  There's a Golf Galaxy a short distance away off freeway, but perhaps more ominous is a new grand scale PGA Superstore that's just opening just a bit further north, and its club maker/fixer's  shop is right at the front door, not buried in the back corner of the store!


TEXAS
001 Austin Showroom — 11000 Middle Fiskville Rd., Austin, TX 78753
012 Westheimer — 10885 Westheimer Rd., Houston, TX 77042
074 Galleria — 3005 W. Loop South, Ste. 160, Houston, TX 77027
120 Katy — 1210 Fry Rd., Houston, TX 77084
038 Baybrook — 19431 Gulf Fwy., Webster, TX 77598
006 Dallas Midway — 4141 LBJ Fwy., Dallas, TX 75244
071 North Richland Hills — 8701 Airport Fwy., North Richland Hills, TX 76180
051 West Plano — 1701 Preston Rd., Ste. B-2, Plano, TX 75093


Already Closed
022 Plano — 900 Central Expressway, Plano, TX, 75074
128 Champions — 5319 FM 1960 W, Ste. B, Houston, TX 77069

Remaining Open, one store per big city:

TEXAS
5-The Woodlands — 25415 N IH-45, #B, Spring, TX
15-Arlington — 1001 W IH-20, Arlington, TX
25-Austin Arboretum — 10001 Research Blvd, Austin, TX
109-San Antonio — 1211 N Loop 1604 West, San Antonio, TX

[Howard Riefs]

Any intel/ideas/theories on why Golfsmith shut down its online store?


http://www.golfsmith.com/sitedown.html

[Kevin_Reilly]

Typically in a situation like this, stores are used to liquidate inventory (by the liquidator like Hilco, Gordon Brothers etc) and the online storefront (technical support and fulfillment) is no longer supported at corporate.

[Howard Riefs]

Typically in a situation like this, stores are used to liquidate inventory (by the liquidator like Hilco, Gordon Brothers etc) and the online storefront (technical support and fulfillment) is no longer supported at corporate.

Kevin, thanks for explaining.


And looks like Golfsmith is using those liquidators you mentioned...


https://globenewswire.com/news-release/2016/11/03/886674/10165938/en/STORE-CLOSING-SALES-BEGIN-AT-59-GOLFSMITH-LOCATIONS-NATIONWIDE.html

[David_Tepper]

A little surprised to see the Golfsmith store on Market Street in San Francisco is closing. With all the tourists, especially foreign ones, who visit San Francisco, I would have thought that store is quite profitable.   

[Michael Whitaker]

I missed yesterday's news that Golfsmith announced plans to close another 59 stores. That will leave it with 30 locations.

http://www.golfdigest.com/story/fallout-from-bankruptcy-auction-continues-as-nearly-60-golfsmith-stores-set-for-closure

http://blog.golfsmith.com/press-releases/golfsmith-stores-remaining-open/#.WB1WhLU8KEc

I'm shocked that the store in my hometown of Greenville, SC will remain open. I'm in there often and the place is usually empty.

[JeffTodd]

I worked in Golfsmith management in the Austin office for about 5 years (2010-2014) and was part of the ill-fated acquisition by Omers and operational integration with Golf Town. While I have since moved on, I have a heavy heart as I watch the demise of the company from afar.

Despite the impression that the company’s mission was to destroy green grass, I can tell you our internal mission was anything but. The core DNA of the company was components and clubmaking; categories that were effectively killed off by the highly customizable clubs that emerged in the mid-aughts (R7, etc), and the highly aggressive product launches, short product life cycles, and extreme markdowns that lowered customer pricing expectations. When you can get an OEM club for $149 off the clearance rack, less than a year after it was launched and being played on Tour, building your own club is pointless. 

Nevertheless, the company aspired to be the leader in pure play golf with a focus on the avid publinks player.

Bad leases were definitely part of the equation, but the die was cast during the Omers acquisition 2012. They made some assumptions around economies of scale and vendor leverage that were naïve and bordered on malpractice, and were concurrent to the softening of the golf equipment marketplace. Golf is an inherently slow turn, low margin rate, business, and there were decisions made that forced the company to outkick their coverage; some real head scratchers that came from Toronto, not Austin.

Short term DSG will continue to operate some remaining locations under the Golfsmith banner, although I too can’t imagine that is a long term play for many obvious reasons.

As for golfsmith.com, I’m sure they have flushed any aged/end-of-life inventory to stores to be cleared during Black Friday-Store Closing promotions, and the good/full margin product will get shipped to one of the DSG southern distribution centers in GA and/or AZ.

[hhuffines]

We have a Golfsmith that's still open here in Raleigh but I left there today with some sadness.  They have a great club technician and some very nice people on staff.  Unfortunately it appears to be on life support with inventory and activity at stunning lows.


Fortunately we still have the Bunn brothers running Continental Golf near downtown.  Great guys!