Very informative conference call, including questions from a half
dozen analysts, including at least 2 major brokerage houses (Merrill
and AG Edwards). Key points: Marty obviously could not go on record
predicting positive comparisons but he did say comparisons will be
better than the recent ones. Numerous reasons including starting ski
season merchandise in Sept instead of November, absence of NBA
strike, new basketball shoe and cross training lines (these lines are
traditionally not discounted that much), upcoming announcement with
new supplier (probably in shoe area), rather than gradual rollout of
complete store upgrades they will do immediate partial upgrades to
half their stores by holiday season, incentive selling (of shoes I think),
full service selling of shoes in some stores. Model store in Clifton has
increased sales and margins in the very high double digit areas,
addition of value pricing of some product lines (eg cleats) take share
back from discounters, recognizing that cleat sales lead to sales of
other items - shin guards, jerseys, etc. Womens and childrens items
and raquet items are doing well. Shoes not doing well but only 27% of
sales - indications are that shoes should improve. Looking at
improving communication with stores - periodic visits (June and
October) , videos, giving stores freedom to do innovative
merchandising - eg jogging strollers doing well. |
