Repot: Dick's Sporting Goods Wins Golfsmith Bankruptcy Auction, Loves Golf Again!

By winning the Golfsmith auction, Jessica DiNapoli of Reuters says Dick's Sporting Goods will become the leading golf retailer based on number of stores (it may already be now).

Pending bankruptcy judge approval, DiNapoli says:

Dick's plans to keep open at least 30 Golfsmith stores and wind down the rest with liquidators from Hilco Global and Tiger Capital Group, the people said. It plans to keep about 500 of the company's employees.

Golfsmith had 109 stores in the United States at the time of its bankruptcy filing last month, and has been closing stores since then.

With the bid, Dick's, the largest U.S. sporting goods retailer, also won Golfsmith's intellectual property and inventory, the people added, asking not to be identified because the results of the auction are not yet public.

Mike Stachura of GolfDigest.com notes Dick's bullish attitude towards golf continues after the retailer gave indications that it saw golf as in "structural decline" and layed off its professional fitters not long after buying into Mark King and Adidas' Taylor Made vision of three new driver releases in one year.

Now, it looks like Dick's Sporting Goods, whose sporting goods store model is megasized but its Golf Galaxy brand model is a more conservative sized store, will be dictating a big part of golf's retail footprint going forward.

Comments

[Don]

One overextending brick-and-mortar retailer buys the remains of another overextending brick-and-mortar retailer that failed.

Yup, that will work great...

[mark]

Nice, I hope I can get snake eyes stuff at Dicks now.

[BrianS]

Funny how a bargain basement price will make you re-think your strategic plan.

[Don]

Tiger comes back and unclogged the drain. It's morning in American golf.

[Ed]

Dick's has over $6 billion market cap, over $7 billion of sales, and over half a billion dollars of operating income. Dick's are a lot of things but overextended isn't one of them.

This additional investment in the golf space is a curious move by Dick's management team. Might a tournament sponsorship on the big tour be in their future?

[Mort]

Story here is Golfsmith having 109 stores when they went in, and 30 stores worth buying on the way out.

Too many polyester shirts chasing too few buyers.

[Repot]

I'd like to repot a fern.

[Ted B. (Charging Rhino)]

No doubt the retained store locations will eventfully be re-branded as GolfGalaxy, with Golfsmith returning to it's clubmaking and clubfitting roots. And the intellectual property and the private label clubs, components and golf-gear still has some value.

Our local Golfsmith was always echoingly-empty of customers for the sheer amount of retail-space full of shirts, sweaters and old-inventory golfbags. Yet there never was anyone at the clubmaking counter when you needed one. With the small independents gone and most on-course Pro Shops no longer doing clubmaking or repair-work, someone has to do the shaft-replacements and re-gripping.

[Persimmonious]

Ted B., I hear that is increasingly done through online businesses using good 'ol FedEx. Local craftsmen are going the way of the dinosaur.

[The O]

Tying two rocks together to aid flotation is a time-honored business strategy.

[BrianS]

I know kids are not the only customers for Dicks. But my daughter's High School has about 15 kids on the golf team(men and women's) combined. Meanwhile, there are about 150 football players, 6 teams of lacrosse, 5 teams of soccer, 4 teams of baseball/softball, 4 teams of basketball, volleyball. For track and field/cross country there are 2 teams per season, at least 40 kids each season. they have Ice Hockey for girls and boys (4 teams) and field hockey for girls (2 teams). Many parents run, and gym memberships are full. Country club memberships - not so much. (and the money is there). how much space should Dicks dedicate to golf ? Right now it is at least 15% of the floor space. Meanwhile, lacrosse gets about 20% of the space allocated to golf.

[Repot]

I'd like to repot an orchid.