IBISWorld Industry Report Licensed Sports Apparel Stores in The US 2019

WWW.IBISWORLD.
COM Licensed Sports Apparel Stores in the USJune 2019 1
Playing field: The industry has performed

consistently well due to rising disposable income
This report was provided to
Edeska (2133322036)
by IBISWorld on 26 March 2020 in accordance with their license agreement with IBISWorld
IBISWorld Industry Report OD5326

Licensed Sports Apparel
Stores in the US
June 2019 Claire O’Connor
2 About this Industry 17 International Trade 31 Industry Assistance

2 Industry Definition 18 Business Locations
2 Main Activities 32 Key Statistics
2 Similar Industries 20 Competitive Landscape 32 Industry Data
3 Additional Resources 20 Market Share Concentration 32 Annual Change
20 Key Success Factors 32 Key Ratios
4 Industry at a Glance 21 Cost Structure Benchmarks
22 Basis of Competition 33 Jargon & Glossary
5 Industry Performance 23 Barriers to Entry
5 Executive Summary 24 Industry Globalization
5 Key External Drivers
7 Current Performance 25 Major Companies
9 Industry Outlook 25 Dick’s Sporting Goods Inc.
11 Industry Life Cycle 26 Foot Locker Retail Inc.
13 Products and Markets 28 Operating Conditions

13 Supply Chain 28 Capital Intensity
13 Products and Services 29 Technology and Systems
15 Demand Determinants 29 Revenue Volatility
16 Major Markets 30 Regulation and Policy
www.ibisworld.com | 1-800-330-3772 | info @ibisworld.com

WWW.IBISWORLD.COM Licensed Sports Apparel Stores in the USJune 2019 2
About this Industry
Industry Definition This industry sells licensed sports apparel and accessories. The industry
apparel, accessories and collectibles. does not include online sales of licensed
Retailers must obtain a license from sports apparel or products purchased
professional leagues and sporting through big-box retailers and
associations to sell branded sports department stores.
Main Activities The primary activities of this industry are

Retailing licensed men’s shoes and sports apparel
Retailing licensed women’s shoes and sports apparel
Retailing licensed children’s shoes and sports apparel
The major products and services in this industry are

College athletic apparel
MLB apparel
NBA apparel
NFL apparel
NHL apparel
Other
Similar Industries 33992a Athletic & Sporting Goods Manufacturing in the US

Operators in this industry buy raw materials and convert them into a range of sporting and athletic goods,
except apparel and footwear.
42391 Sporting Goods Wholesaling in the US

Operators in this industry distribute a range of sporting and recreational goods and accessories from the
manufacturer to the retail level.
44811 Men’s Clothing Stores in the US

Operators in this industry retail lines of casual clothing, formal wear, shirts, jeans, coats, blazers, sporting
apparel, sweaters and accessories.
44812 Women’s Clothing Stores in the US

Operators in this industry retail lines of casual clothing, formal wear, shirts, jeans, coats, sporting apparel,
sweaters, dresses, maternity wear and accessories.
45111 Sporting Goods Stores in the US

Operators in this industry retail new sporting goods, including bicycles, camping equipment, exercise and
fitness equipment, apparel, footwear and other goods and accessories.
Provided to: Edeska (2133322036) | 26 March 2020

About this Industry
Additional Resources For additional information on this industry

www.aafaglobal.org
American Apparel and Footwear Association
www.sportmarketingassociation.com
Sport Marketing Association
www.sportsbusinessdaily.com
Sports Business Journal
www.licensing.org
The International Licensing Industry Merchandisers’ Association
www.usfashionindustry.com
United States Fashion Industry Association
IBISWorld writes over 1000 US

industry reports, which are updated
up to four times a year. To see all
reports, go towww.ibisworld.com

WWW.IBISWORLD.COM Licensed Sports Apparel Stores in the US June 2019 4
Industry at a Glance
Licensed Sports Apparel Stores in 2019
Key Statistics Revenue Annual Growth 14–19 Annual Growth 19–24

Snapshot
$7.6bn 0.5% 1.3%
Profit Wages Businesses
$311.8m $918.6m 12,853

Revenue vs. employment growth Participation in sports
Market Share
Dick’s Sporting 9 23
Goods Inc.
6 22
33.4%
3 21
% change
Foot Locker Retail
%
Inc. 0 20
12.3%
-3 19
-6 18
Year 11 13 15 17 19 21 23 25 Year 11 13 15 17 19 21 23 25
Revenue Employment
SOURCE: WWW.IBISWORLD.COM
p. 25
Products and services segmentation (2019)
Key External Drivers 4.8%

Other
Participation in sports 8.8%
29.6%
NBA apparel
Number of broadband
connections MLB apparel
Number of adolescents 9.3%
NHL apparel
aged 10 to 19
Consumer
Confidence Index
Per capita disposable
income
22.1%
NFL apparel
25.4%
p. 5 College athletic apparel
Industry Structure Life Cycle Stage Mature Regulation Level Light

Revenue Volatility Medium Technology Change Low
Capital Intensity Low Barriers to Entry Medium
Industry Assistance Low Industry Globalization Low
Concentration Level Medium Competition Level High
FOR ADDITIONAL STATISTICS AND TIME SERIES SEE THE APPENDIX ON PAGE 32

Industry Performance
Executive Summary | Key External Drivers | Current Performance
Industry Outlook | Life Cycle Stage
Executive Summary The Licensed Sports Apparel Stores The US economy has shown signs of
industry includes brick-and-mortar improvement that has contributed to
establishments that sell apparel that has steady industry growth. The Consumer
been granted specific permission for Confidence Index, which is a proxy that
retail sale. These products comprise illustrates the likelihood of continued
goods from major apparel brands that consumer expenditures, is anticipated to
have received explicit consent from increase an annualized 7.5% over the five
sports leagues, such as National Football years to 2019. Per capita disposable
League, National Basketball Association income is expected to increase at an
and Major League Soccer, and colleges to annualized rate of 2.2% during the same
replicate player names, team logos and period. With an estimated 20.5% of US
league patches onto consumer apparel consumers participating in some form of
products. This industry’s operations also sports in 2019, there remains a very
include major brands that require strong market of consumers with
disposable income from which the
industry can generate additional revenue.
Online
retail and big-box retailers may threaten Despite this increased level of disposable
income, industry profit margins are
the industry’s recent growth expected to marginally decrease over the
five years to 2019.
licenses for their products to be sold in However, the looming threat of
major sporting goods stores, rather than online retail and big-box retailers may
private label items. Industry retail dampen the industry’s recent growth.
locations exist throughout the country in Sports leagues and retailers have
line with population disbursement, Major websites that circumvent consumers’
retail outlets are often located within need for traditional retail locations, and
malls, retail complexes and even sports this may limit the industry’s overall
stadiums to capture demand from team expansion somewhat moving forward.
enthusiasts. The industry has performed Consumers’ use of online retailers due
consistently well over the five years to largely to their convenience is expected
2019, as disposable income levels to continue increasing. As a result,
increased. Industry revenue is expected industry revenue is anticipated to
to grow an annualized 1.3% to $7.6 billion increase slightly at an annualized rate
over the five years to 2019, including an of 0.5% to $7.8 billion over the five
increase of 0.4% in 2019 alone. years to 2024.
Key External Drivers Participation in sports Number of broadband connections

Fluctuations in the level of sports As consumers increasingly shop
participation among individuals in the online for all types of goods and
US influences overall interest in sports services, a greater number of
apparel. As time spent on exercise broadband connections will indicate
increases, consumers are more likely to intensifying competition for industry
purchase apparel that have an athlete’s stores. The number of broadband
name or team’s logo displayed on the connections is expected to increase
fabric. Participation in sports is in 2019, posing a potential threat to
anticipated to increase in 2019. the industry.

Key External Drivers Number of adolescents aged 10 to 19 individuals can spend greater levels of
continued Adolescents between the ages of 10 and disposable income. The Consumer
19 represent a significant source of Confidence Index is anticipated to
revenue for industry apparel stores and decrease in 2019.
account for one of the most active
demographics in the country. High Per capita disposable income
athletic activity makes this group a major Trends in disposable income significantly
market for industry stores. The number influence consumer demand for the
of adolescents aged 10 to 19 is expected industry’s products. As per capita
to decrease slightly in 2019. disposable income increases, more
consumers are likely to purchase
Consumer Confidence Index nonessential items such as sporting
Fluctuations in consumer confidence will apparel. Per capita disposable income is
have a direct effect on overall retail anticipated to increase in 2019,
spending. An increase in aggregate representing a potential opportunity for
consumer confidence suggests that the industry.
Participation in sports Number of broadband connections
23 600
22
500
21
Million
400
%
20
300
19
18 200
Year 11 13 15 17 19 21 23 25 Year 11 13 15 17 19 21 23 25

Current The Licensed Sports Apparel Stores

industry has grown at a healthy rate over Industry revenue
Performance the five years to 2019 as sports leagues
9
and franchises have increasingly sought to
capitalize on their established brands. 6
Moreover, sports apparel retailers have
increasingly demanded specialized items 3
% change
that can lure customers into stores and
increase sales through higher markups. 0
Industry revenue is expected to increase at

-3
an annualized rate of 1.3% to $7.6 billion
over the five years to 2019. The continual -6
popularity of professional sports has Year 11 13 15 17 19 21 23 25
enabled steady sales through all stages of
the economic cycle, causing industry SOURCE: WWW.IBISWORLD.COM
revenue to increase 0.4% in 2019 alone.
The growing playing The industry consists of brick-and- Despite experiencing continually strong
field mortar retail locations that sell licensed revenue growth, the presence of internet
apparel from popular brands, such as retail has slowed overall brick-and-
Nike Inc, Reebok and Adidas AG. Unlike mortar location expansion. Major retail
standard private label products that can chains have limited location growth due
simply be purchased from the to weakened per-store sales. Moreover,
manufacturer, apparel stores must the internet has resulted in closings for
negotiate and receive licensing contracts many of the industry’s smallest
to sell the industry’s most popular independent locations. The number of
products. Many of these products require industry employees has increased at an
licenses because they display the names annualized rate of 2.1% to 73,683
and likenesses of professional athletes, workers over the five years to 2019,
teams and leagues. Player jerseys, although this growth is occurring far
branded team apparel and items more slowly compared with industry
displaying the logos of teams and leagues revenue growth.
may be manufactured only by brands that External competition from online
receive proper licensing and these brand sports apparel retailers has generally
manufacturers will extend licensing increased over the past five years,
rights to only the industry’s licensed limiting the potential for even stronger
retailers. Additionally, major brands may recovery in sales. Online retailers offer
require licenses for the industry’s the convenience of shopping from home,
retailers to display branded apparel that especially when a customer already
does not contain logos. Training gear, knows the product that they want to buy
shorts, tank tops and shirts that bear the and the size that they need. Consumers
manufacturers logo are also included in have increasingly turned to less costly
this industry. options that are offered online instead of
The number of industry spending in physical retail outlets. While
establishments is expected to increase at many physical licensed sports apparel
an annualized rate of 0.8% to 15,270 stores also operate online retail channels,
locations over the five years to 2019. these sales are not captured within the

The growing playing industry’s revenue figures, which decrease product prices as licenses
field continued include only brick-and-mortar sales. from leagues typically place a high floor
The online market has generally on prices that are not negotiable. As a
increased price competition and limited result, the industry’s profit margin is
the profitability of physical store estimated to be 4.1% in 2019, down
locations. Operators are also unable to slightly from 4.9% in 2014.
The fans The closest measure of sports

involvement is the percentage of Thepresence of internet
Americans who participate in sports, as
published by the Bureau of Labor
retail has slowed overall
Statistics’ American Time Use Survey and brick-and-mortar location
the Centers for Disease Control and expansion
Prevention. The percentage of Americans
participating in sporting activities each
day increased over the past five years, Young adults and entry-level workers are
from 19.1% in 2014 to 20.5% in 2019. also a primary target for the industry,
While much of this increase is due to since they have the ideal balance of
growth in individualized fitness buying power and free time to devote to
activities instead of team sports, growth professional sports teams and athletes.
in the athletic population will likely Consumer sentiment, income and
increase public spending on the spending habits are also a major
industry’s products. influence on industry performance
According to the SportsBusiness because licensed sports apparel is
Journal, demand for industry products generally considered a luxury item. With
has grown particularly strongly for per capita disposable income rising at an
women’s and children’s sports apparel. annualized rate of 2.2% over the five
IBISWorld estimates that consumers years to 2019, this gradual growth has
under the age of 18 represent one of the enabled consumers to continually grow
most influential age groups for the industry revenue. However, the number
industry. While children younger than 18 of broadband connections in the United
do not have the income to purchase States is expected to increase at an
licensed apparel themselves, they are a annualized rate of 6.2% over the five
top target market for sports apparel years to 2019, the result of which could
retailers and tend to become lead to even greater shifts in consumer
indoctrinated in sports culture at a much behavior away from brick-and-mortar
more frequent rate than older audiences. purchasing toward online retail channels.

Industry The continued strengthening of the US

economy will likely have a direct positive
attendance, creating demand for
industry products from fans of the
Outlook influence on the Licensed Sports Apparel teams. Nevertheless, growth will be
Stores industry over the five years to hampered by increased competition
2024. As unemployment falls, incomes from big-box retailers and, in particular,
rise and consumers regain confidence, online retail channels. Overall, revenue
spending on discretionary sports apparel is expected to increase at a slight
is expected to increase. These factors will annualized rate of 0.5% to $7.8 billion
also likely raise sporting event over the five years to 2024.
Demand grows The number of Americans participating

in sports is projected to increase an The
major areas of market
annualized 1.4% over the next five years. growth will likely be among
This growth, coupled with the rising US
population, will likely expand the pool of younger consumers
sports enthusiasts, who make up the
primary market for the industry. Rising target for the industry, as they have the
incomes and spending will further ideal balance of buying power and free
support sales of licensed sports apparel. time to engage professional sports teams
With unemployment expected to remain and athletes. Over the five years to 2024,
low over the five years to 2024 and credit market share for this segment is expected
conditions currently stable, IBISWorld to increase as sports participation rises.
expects that the long-term historical Increased exposure of college men’s
growth rate in consumer spending will football and basketball on TV networks,
reassert itself. Higher employment and a such as ESPN, has catapulted collegiate
brighter economic outlook will likely athletics onto the national stage over the
boost consumer sentiment, making past decade. More exposure has
consumers willing to spend again on the encouraged colleges to increase apparel
industry’s most costly items. Per capita offerings beyond jerseys only. The
disposable income is projected to College Football Playoff and March
increase an annualized 1.5% over the five Madness have further increased hype
years to 2024. among alumni bases, and as a result,
The major areas of market growth for college apparel sales throughout
the industry will likely be among younger basketball, football, baseball, hockey and
consumers and for professional sports- other team sports have continually
and college-branded apparel. Young represented the largest segment of the
adults have historically been the primary industry’s total sales.
Competition Over the next five years, intense increasingly difficult for smaller licensed
intensifies competition from department stores and sports apparel retailers to compete on
mass merchandisers will be the biggest price. While still adversely affected,
threat to the industry. Large chains such sports apparel retailers typically have a
as Walmart Inc. and Target Corporation higher level of customer service and are
can lower prices more readily than more capable of addressing consumers’
smaller independent operators, making it fitting and sizing needs. This trend is

Competition expected to gain momentum over the 0.6% to 15,716 locations over the five
intensifies continued next five years, as the battle for sports years to 2024 in response to the
store supremacy continues. industry’s projected stability. Retailers
The increasing popularity of online will benefit by continuing to differentiate
retailers is perhaps a larger threat to the themselves by stocking quality
industry. Consumers increasingly look merchandise and specializing in specific
for a balance between convenience and sports and leagues. As the industry’s
price, and shopping online enables them competitive nature is expected to gain
to strike that balance. According to a force, mass merchandisers will
2015 Nielsen report on e-commerce, increasingly try to match specialist
consumers have increasingly used price retailers in terms of price and product
comparison strategies when shopping range. The drive for consumer dollars
online, and in many cases, enabling them typically results in numerous
to find more affordable price points for promotional strategies, as retailers aim
products they would otherwise purchase for a larger share of the sports apparel
in brick-and-mortar stores. Additionally, market. The industry will also experience
in 2018, Statista reported that clothing an increase in the number of stores that
made up 57.0% of e-retail, above expand into a superstore format or
footwear and consumer electronics. The contract into niche facilities targeting a
number of broadband connections is particular sporting activity. According to
expected to increase at an annualized rate the SportsBusiness Journal, it will be
of 3.1% over the five years to 2024, increasingly important for retailers to
further spurring online sales and posing a follow fashion trends and provide
threat to industry growth. customers with a targeted selection of
Industry profit is expected to decline merchandise. The number of industry
slightly to 4.0% in 2024. However, the employees is anticipated to increase at an
number of establishments is projected to annualized rate of 0.8% to 76,490 people
increase slightly at an annualized rate of over the five years to 2024.

Life Cycle Stage IVA is growing in line with GDP
Industry revenue growth has continued unimpeded
Profit remains stable despite
competition from online sales

Industry Life Cycle The Licensed Sports Apparel Stores these sales represent external
industry is considered to be in the mature competition. External competition has
stage of its life cycle. IBISWorld been mounting in recent years as these
Thisindustry estimates that the industry’s value added, competitor stores increase their offerings
is M
ature which measures an industry contribution of licensed sports apparel. Furthermore,
to the economy, grow at an annualized as consumers increasingly shift
rate of 0.7% over the 10 years to 2024. In purchases online, the industry has lost
comparison, GDP is expected to grow an potential revenue to the leagues
annualized 2.2% during the same period. themselves, all of which retail their own
While IVA growth that is slower than products on their corporate websites.
GDP growth is typically indicative of a To compete, the largest players have
declining industry, the products and focused their efforts on larger and more
services, consumer base and technology convenient locations. Operators also
has stayed the same during the 10-year maintain the advantage that many
period. Additionally, over the past several consumers purchase sports apparel as
decades, the manufacture and sale of impulse items, often at sports venues,
apparel containing the likeness of players which limits competition from more
and teams has become big business. time-consuming retail avenues. Overall,
The industry does not include online these factors enable the industry to
retail sales of licensed sports apparel, maintain its role in supplying licensed
therefore, when coupled with sales from sports apparel and classify it as a
big-box retailers and department stores, mature industry.

Products & Markets

Supply Chain | Products and Services | Demand Determinants
Major Markets | International Trade | Business Locations
Supply Chain KEY BUYING INDUSTRIES

99 Consumers in the US
Consumers purchase licensed sports apparel to support their favorite teams.
KEY SELLING INDUSTRIES

42432 Men’s & Boys’ Apparel Wholesaling in the US
This industry distributes men’s and boys’ licensed sports apparel to the Licensed Sports
Apparel Stores industry.
42433 Women’s & Children’s Apparel Wholesaling in the US
This industry distributes women’s and children’s licensed sports apparel to the Licensed Sports
Apparel Stores industry.
Products and Services Products and services segmentation (2019)
4.8%
8.8% Other
NBA apparel
29.6%
9.3% MLB apparel
NHL apparel
22.1%
NFL apparel
25.4%
College athletic apparel
Total $7.6bn SOURCE: WWW.IBISWORLD.COM
The Licensed Sports Apparel Stores exposure of college men’s football and
industry retails many different products, basketball through TV networks, such as
including jerseys, sweatshirts, bottoms, ESPN, has continued to launch collegiate
t-shirts, hats and many accessories. athletics onto the national stage. More
These products are branded with team exposure has encouraged colleges to
logos from the National Football League increase apparel offerings to more niche
(NFL), National Basketball Association items such as performance apparel, socks,
(NBA), Major League Baseball (MLB) sunglasses and other accessories, in
and National Hockey League (NHL). addition to jerseys, t-shirts and outerwear.
Recently, demand for collegiate athletic The Bowl Championship Series (BCS)
apparel has increased substantially, and March Madness have further
supplanting the NFL as the largest increased hype among alumni bases, and
revenue generator for this industry. as a result, sales of college apparel have
gone up. In 2015 (latest data available),
College athletic apparel Business Insider reported that the
In 2019, sales of college athletic apparel University of Oregon, the University of
are expected to account for 25.4% of Texas, the University of Michigan and the
industry revenue. Increased national University of Alabama were ranked the

Products & Markets
Products and Services top four beneficiaries of royalties and 2019. The majority of revenue comes
continued licensing fees, which includes the sale of from jersey sales, which typically come in
licensed sports apparel. These schools three different styles for men, including
have experienced success in elite, limited and game jerseys. There are
merchandising, partly because of their also style jerseys, which often come in
ability to win games. All four teams are different colors such as white or black.
consistently highly ranked in NCAA Depending on the style, jerseys range
football, especially the University of from $100.00 to nearly $300.00. Other
Alabama, which won two national major product groups include t-shirts,
championships in 2015 and 2017. outerwear, bottoms and hats.
Additionally, two out of the four teams
made an appearance in the 2019 NCAA NBA apparel
Division I Men’s Basketball Tournament In 2019, NBA-licensed apparel is
as well. Over the five years to 2019, expected to account for 8.8% of industry
revenue from this segment is expected to revenue. With multiple TV partners,
continue increasing as college sports including ESPN, ABC, TNT and NBA TV,
remain popular among fans. the league’s exposure and popularity has
risen. The 2015- 2016 season experienced
MLB apparel a major boost in season ticket sales, and
In 2019, sales of MLB apparel are the Finals series between the Golden
expected to account for 29.6% of industry State Warriors and the Cleveland
revenue. The MLB is composed of 30 Cavaliers was the best-rated NBA Finals
teams, but the popularity of big market since 1998, averaging 20.2 million
teams, such the New York Yankees, the viewers. Game seven of the series had
Chicago Cubs and the Boston Red Sox, 31.02 million viewers watching. The
are mainly responsible for driving Cavaliers came from behind and won the
industry apparel sales. Since these teams championship 4-3, after winning the last
play in big cities, they are able to attract three games of the series. Additionally,
larger fan bases, enabling them to spend the past four NBA finals have been
more money on marketing to gain between the Cleveland Cavaliers and the
exposure. Apparel sales for the Yankees Golden State Warriors. As a result, jersey
soared after the announcement of Derek sales remain steady due to the popularity
Jeter’s retirement in 2014 and David of players such as LeBron James and
Ortiz’s retirement in 2016, as fans Stephen Curry.
purchased his jersey and other related
items, making his jersey the best-selling NHL apparel
jersey in baseball history. Similar to other The NHL has 31 franchised club members,
major sports leagues, the MLB licenses with seven located in Canada, which is by
several apparel products, including a far the most of any US professional sports
range of jerseys, such as modern, league. The abundance of teams in Canada
throwback and customizable designs, decreases the amount of licensed NHL
t-shirts and sweatshirts. Typically, apparel sold in US stores and strongly
industry participants carry more products indicates the popularity of the league in the
that pertain to their region’s professional United States. In 2019, NHL-licensed
teams to meet consumer demand. apparel is expected to account for 9.3% of
industry revenue. The 2015 Stanley Cup
NFL apparel Finals was the second-most watched final
NFL-licensed apparel accounts for an since 1995, averaging 5.6 million viewers
estimated 22.1% of industry revenue in on NBC and NBCSN, but the ratings for the

Products & Markets
Products and Services 2017 Finals fell to 4.7 million. However, the Soccer (MLS), NASCAR and the
continued 2018 Stanley Cup Final between the Professional Golfers’ Association (PGA).
Capitals and Golden Knights was the most This segment also comprises all licensed
watched series in three years. Despite the apparel that is not affiliated with any
high ratings, NHL-licensed apparel is still major sports league and accounts.
positioned below other professional sports Together, these segments account for an
leagues. The NHL licenses a wide array of estimated 4.8% of industry revenue in
apparel items, including jerseys, t-shirts, 2019. Items include running shorts, tank
sweatshirts and other accessories. tops, t-shirts and sweats that are owned
by a private label. Demand for these
Other items will remain popular as more
The other segment mainly includes sales consumers purchase clothing for physical
of apparel licensed by Major League activities such as sports or working out.
Demand Demand for products created in the participate in sports, they are
Determinants Licensed Sports Apparel Stores industry subsequently more likely to become
is influenced by several variables, interested in and watch professional
including consumer income, sports sports, which in turn may increase
participation levels, consumer fashion demand for licensed sports apparel.
preferences, sporting trends, population
characteristics and the geographic Popularity of professional
location of stores. Household disposable and college sports teams
income levels determine the quantity and Over the five years 2019, all four major
frequency of purchases from licensed professional sports leagues, which
sports apparel stores. As household include NFL, NBA, MLB and NHL, and
disposable income increases, purchases numerous college athletic programs have
of licensed apparel typically rise, as drastically increased in popularity as a
consumers feel more willing to engage in result of greater TV exposure.
increased discretionary spending. Broadcasting on networks, such as ESPN,
Fluctuations in disposable income levels has driven sports popularity, as people
are inherently linked to the amount of can more closely follow their favorite
taxes payable along with a range of other teams all year long, helping maintain
living expenses, such as utilities. high levels of excitement during the
Conversely, a decline in income levels offseason. The development of online
may lead consumers to choose product media sources combined with
affordability over quality, purchasing technological advancements in mobile
unlicensed items or deferring their phone technology have made it possible
purchases of apparel altogether. to receive instant updates on sporting
events and even watch live sporting
Participation rates events using mobile data. Social media
Fluctuations in the level of sports continues to create a growing global
participation among US consumers have community that can watch, analyze and
a significant influence on demand for discuss major sporting events in real
licensed sports apparel. Over the five time, and this has made even niche
years to 2019, the participation rate for sporting events generate major
sports is expected to increase from 19.1% excitement. These factors have boosted
in 2014 to 20.5% in 2019. As more people the popularity of professional and college

Products & Markets
Demand sports teams, increasing sales of licensed more popular, they pose a major threat to
Determinants sports apparel. sales of licensed sports apparel for
industry participants. Over the five years
continued
Online and e-commerce activities to 2024, online retail activity is expected
The Licensed Sports Apparel Stores to increase as mobile payment platforms
industry does not include online and and low-cost product shipping make
e-commerce sales of industry products. online sales faster and less costly than
Therefore, as e-commerce sites become ever before.
Major Markets Major market segmentation (2019)
4.1%
Other markets
12.1%
Consumers aged 65 and older
46.5%
Consumers aged 18-44
37.3%
Consumers aged 45-64
Total $7.6bn SOURCE: WWW.IBISWORLD.COM
Consumers aged 18 to 44 may incite more families to participate in

In 2019, consumers aged 18 to 44 are high-cost activities, such as hockey.
expected to comprise 46.5% of industry According to a 2016 survey from the
revenue. Over the five years to 2019, this Centers for Disease and Control
market segment has grown due to more Prevention, more than 60.0% of
health-conscious individuals and families consumers aged 18 to 24 met the 2008
stimulating demand for sports and fitness federal physical activity guidelines,
apparel, footwear and other products. meaning they met basic guidelines for
Additionally, fewer schools are requiring aerobic activity (latest data available). This
adolescents to participate in fitness, was by far the highest percentage among
which is causing many families to surveyed demographics, and this group of
prioritize physical activities with their consumers figures to remain as important
children to promote healthy lifestyles. as ever to the future of this industry.
Examples of sporting activities
undertaken by households with children Consumers aged 45 to 64
include camping and fishing, which Other household types, consisting of
suggests that parents become more active consumers aged 45 to 64, are estimated
as their children get older. Fluctuations to account for 37.3% of industry revenue
in disposable income levels also influence in 2019. At this point, parents may be
household participation in sports. For encouraging their children to engage in
instance, high disposable income levels recreational athletic activity, and the

Products & Markets
Major Markets consumers themselves are looking for active and thus have little need for the
continued ways to maintain fitness as they age. products in the sporting goods industry.
Additionally, consumers in this age According to the Centers for Disease
demographic have higher disposable Control and Prevention, in 2016, under
incomes than their younger counterparts 30.0% of people in the 75 and older
and therefore are more willing to demographic specifically were sufficiently
purchase discretionary goods, such as physically active with regard to their own
licensed sports apparel. According to the aerobic fitness.
Centers for Disease Control and
Prevention, a lower percentage of people Other markets
in this demographic are sufficiently The remaining 4.1% can be attributed to
physically active by national standards downstream industry operators, such as
compared with those aged 18 to 24. wholesale establishments and
government entities. Manufacturing
Consumers 65 and older industrial operators sometimes use
Household consumers aged 65 and older sporting goods as an input in their own
are expected to account for 12.1% of production, and some retailers purchase
industry revenue in 2019. The majority of products from this industry with the
these consumers are no longer physically intent to resell.
International Trade Due to the service-oriented nature of trade. The international production and
licensed sports apparel stores, the exchange of sports apparel is reported at
Licensed Sports Apparel Stores industry the manufacturing level and is therefore
does not engage in any international outside the scope of this industry.

Products & Markets
Business Locations 2019
West
AK
0.4 New
England
ME
Great Mid- 0.8
Lakes Atlantic 1 2
NY 3
WA MT ND 5.7
5 4
2.7 0.3 MN
Rocky
0.9 2.4
WI
OR Mountains SD
0.4
Plains 2.3 MI
3.5
PA
3.8
6
7
2.2 ID IA OH 9 8
1.0 WY 3.2
0.4
NE
1.0
IL IN WV VA
3.1 2.0 2.4
West NV
0.7 0.5
KY
UT MO
1.2 NC
0.8
1.5 CO KS 1.7 3.1
3.8 0.8 TN
SC
Southeast
1.8
CA 1.3
10.9
OK AR GA
1.0 0.9 AL 2.4
AZ MS 1.2
2.1 NM
0.7 Southwest 0.6
TX LA
1.1 FL
5.5 7.5
West Establishments (%)
HI Less than 3%
0.6 Additional States (as marked on map) 3% to less than 10%
1 VT 2 NH 3 MA 4 RI 10% to less than 20%
0.6 0.9 2.5 0.4 20% or more
5 CT 6 NJ 7 DE 8 MD 9 DC
1.3 2.5 0.4 1.5 0.1

Products & Markets
Business Locations As with most retail industries, the

Distribution of establishments vs. population
location of establishments in the
Licensed Sports Apparel Stores industry
30
relates to the region’s population and
consumer demand levels. These factors
also affect the employment level and 20
wage costs of each region. In general, an
area with a very high concentration of
%
residents will necessarily yield stronger 10
demand for industry products and will
encourage the establishment of many
industry retail locations. 0
The Licensed Sports Apparel Stores
West
Great Lakes
Mid-Atlantic
New England
Plains
Rocky Mountains
Southeast
Southwest
industry is most heavily concentrated in
the Southeast and West regions, which
account for 23.9% and 17.5% of industry
establishments, respectively, in 2019. Establishments
These two regions also make up the largest Population
share of the US population, at 25.7% and SOURCE: WWW.IBISWORLD.COM
17.3%, respectively. The Southeast and

West regions include heavily populated capable of only supporting a single sports
areas such as Florida, Texas and California, team throughout all of its collective
and these areas are also naturally states. While the Boston Red Sox, New
predisposed to continual outdoor activity England Patriots, Boston Bruins and
due to their warm climates. Boston Celtics are very popular teams
New England, which accounts for 6.4% that have generated significant sales
of establishments, and the Plains region, through sports apparel stores, they
which accounts for 7.2% of occupy a much larger geographical
establishments, additionally account for footprint due to the very scarce
the smallest share of industry population of this region.
establishments. The population portions Conversely, areas such as New York
of these two regions are estimated at and Florida have large markets capable of
4.6% and 6.6%, respectively. Residents supporting more than one team
who are located close to professional throughout not just their respective
sports teams are more likely to purchase states, but even cities. New York City
licensed sports apparel showcasing these holds two baseball teams, two basketball
teams. However, New England and the teams and many football and hockey
Plains regions have states that do not teams throughout the statewide regions
have any teams throughout all four of the of New Jersey and New York. Florida also
major US sports leagues. New England, supports multiple baseball, football,
for example, is considered a region that is basketball and hockey teams.

Competitive Landscape
Market Share Concentration | Key Success Factors | Cost Structure Benchmarks
Basis of Competition | Barriers to Entry | Industry Globalization
Market Share Historically, operators in the Licensed Authority and Golfsmith International
Concentration Sports Apparel Stores industry operate in Inc., in addition to Foot Locker’s
a highly fragmented industry acquisition of Runners Point
characterized by a large number of small Warenhandelsges, a German specialty
Level
players. However, the introduction of athletic store. The consolidation of
Concentration in this mass merchandisers into the retail operators can be attributed to several
industry is M
edium economy altered the trading landscape for factors, including price competitiveness
licensed sports apparel stores, increased between players, the entry of Asian-made
the level of price-based competition and merchandise into the domestic market,
affected the viability of smaller operators. further prompting price competition, and
Increasing external competition from an expansion in the range of licensed
big-box retailers, department stores and sports apparel stocked by department
online outlets placed extra pressure on an stores and mass merchandisers.
already volatile market and effectively While the industry has a medium level
influenced concentration within this of concentration, thousands of small- and
industry. While most industry operators medium-size companies compete for
learned to adapt and survive in this market share in the Licensed Sports
increasingly competitive environment, Apparel Stores industry. Some of the
others were forced to consolidate. industry’s medium-size companies
In 2019, this industry’s top two major include the retail and factory store
players, which include Dick’s Sporting locations of Nike Inc., Adidas AG and
Goods Inc (Dick’s) and Foot Locker Inc. Reebok. All of these stores’ operations
(Foot Locker), are estimated to account include brick-and-mortar stores, but
for 45.8% of available market share, have generated an increasingly high
indicating a medium level of amount of revenue from online
concentration. Over the past decade, this transactions. These major brands prefer
industry has been subject to growing to simply license their products to major
merger and acquisition activity. Recent retailers such as Dick’s, since it already
examples include the Dick’s acquisition has a pre-established network of retail
of former industry player the Sports locations throughout the country.
Key Success Factors Management of seasonal production Product is sold at high profile outlets
Some merchandise is seasonal in nature, In some major urban areas, official
so retailers need to ensure that sports league shops, team shops and flagship
IBISWorld identifies apparel displays are continually rotated stores that boast massive inventories and
250 Key Success to match corresponding sports seasons. displays can often generate high foot
Factors for a traffic and produce significant amounts of
business. The most Prompt delivery to market retail sales.
Major trade announcements or free agent
important for this
signings will result in old player jerseys Attractive product presentation
industry are: losing value almost immediately. Industry Since many of the industry’s products are
stores must acquire and begin selling sold with the latest fashion trends in mind,
updated player jerseys and gear immediately shop displays and attractive presentation
to capitalize on consumer demand. are essential to driving foot traffic.

Cost Structure Cost structure segments are based off of Profit has slightly decreased over the five
Benchmarks the average operator in the Licensed years to 2019, down from an estimated
Sports Apparel Stores industry. 4.9% of industry revenue in 2014, as
Therefore, expenses may vary from intensifying competition among sporting
company to company based on their size goods retailers and department stores’
and scope of operations. expanding their sporting goods product
portfolio is expected to cut into average
Wages industry profit margins. As major retail
Wages are expected to make up 12.1% of centers such as Target Corporation and
industry revenue in 2019. As a proportion of Walmart Inc. increase their inventory of
total revenue, wages have remained licensed products, sports apparel stores will
relatively the same over the past five years. be increasingly squeezed for new sources of
However, employees are still commanding a revenue. This especially becomes
higher average wage overall. Store problematic for retailers that have
employees are expected to undertake a witnessed their retail sales dwindle in
range of moderately strenuous tasks, response to increasing online retail sales.
including stocking shelves, organizing store
displays, operating cash registers and Depreciation
performing customer service. Staff should The industry is very labor-intensive.
also have expertise pertaining to the Depreciation is therefore expected to
operation of sporting equipment and how account for 0.8% of revenue in 2019.
particular footwear and apparel can enhance
an individual’s sports performance. Marketing
However, many employees are part-time Advertising expenditure have remained
workers since a lot of industry products are steady over the five years to 2019, as
seasonal, which brings the average wage many apparel retailers continue to invest
down considerably. in promotional activities to remain
competitive. For example, major players
Purchases have invested considerable resources in
Purchases are the largest expense for the promotional campaigns to drive store
industry, accounting for an estimated traffic and differentiate themselves from
59.3% of industry revenue in 2019. While their competitors. Marketing is
the majority of merchandise is purchased anticipated to account for 2.0% of
from sporting goods and apparel industry revenue in 2019.
wholesalers, some industry operators are
able to purchase goods directly from Rent
manufacturers. Over the past five years, In 2019, rent accounts for 4.9% of
supply contracts between retailers and revenue. This segment has remained
vendors have been exposed to steady over the past five years, driven by
fluctuations in exchange rates, which has the continued demand for well-positioned
caused purchase costs to be relatively and larger stores in convenient areas,
volatile. The seasonal nature of some which typically have higher rental costs.
sporting equipment may also influence
the final price retailers pay for the stock. Utilities
Utilities are anticipated to account for
Profit 0.9% of industry revenue in 2019.
In 2019, profit, measured as earnings Operators must ensure that both their
before interest and taxes, is expected to store fronts and warehouses are kept up to
comprise 4.1% of total industry revenue. code regarding heat, lighting and water.

Cost Structure Other administration. These costs are

Benchmarks Other costs include insurance, anticipated to account for the remaining
advertising and promotions and 15.9% of industry revenue in 2019.
continued
Sector vs. Industry Costs
Average Costs of
all Industries in Industry Costs
sector (2019) (2019)
100 3.3 4.1 n Profit
8.9 12.1
n Wages
n Purchases
80 n Depreciation
n Marketing
n Rent & Utilities
n Other
Percentage of revenue
60
66.9 59.3
40
0.8 2.0
20 0.7 1.5 5.8
4.2
14.5 15.9
0
Basis of Competition Operators in the Licensed Sports Apparel operators. Consumers are inherently price
Stores industry operate within a highly conscious and often look in many places to
competitive retail environment. Over the ensure they purchase goods at the best
Level & Trend five years to 2019, the industry’s level of available price. Licensed sports apparel
ompetition
C in consolidation has increased somewhat, stores also need to offer quality products
this industry is which indicates the recent merger and that are competitively priced. Nevertheless,
Highand the trend acquisition activity that has occurred licensing fees at the production level
among some of its largest stores. maintain a base level for prices.
is I ncreasing Some consumers are enticed into
Internal competition stores based on the type of apparel that
Sports apparel retailers compete with retailers offer. As a result, retailers aim to
other operators on the basis of price, stock apparel that is currently in demand,
product range, league- and team-related based on sports seasons (e.g. college
apparel offered, customer service levels and football season) and fashion trends. The
store locations. Price remains the single position of retail stores influences the
largest basis of competition between level of consumer traffic the store

Basis of Competition receives in addition to increasing the accessories and shoes are the most
continued possibility of impulse purchases. As a appealing category to consumers
result, stores need to be located along shopping online. The category recently
areas of high consumer traffic, such as surpassed books, airline tickets,
within shopping malls or sports venues, electronic equipment and hotel
where they will benefit from a high level reservations in terms of total online sales.
of foot traffic. Additionally, in 2017, Statista reported
that clothing made up 57.2% of e-retail,
External competition falling just behind consumer electronics.
In terms of external competition, Rather than spend in physical retail
department stores and big-box retail outlets, consumers have increasingly
stores have placed significant pressure on turned to inexpensive options that are
the industry over the past five years by offered online. While many of the
effectively expanding the range of sports industry’s companies also operate online
apparel that they offer. These retailers retail channels, these sales are not
are able to leverage their buying power captured within the industry’s revenue
and purchase merchandise in bulk, often figures, which only include brick-and-
at lower prices compared with traditional mortar sales.
retailers. Industry operators have Over the five years to 2024, the drive
suffered as a result of the increasing use for consumer dollars will likely result in
of online retailers, many of which offer numerous promotional strategies, as
free shipping and product discounts. retailers aim for a larger share of the
External competition from online sports apparel market. The industry will
sports apparel retailers has generally hurt likely experience an increase in the
industry performance over the past five number of stores that expand into larger
years. Online retailers offer the formats or contract into niche facilities
convenience of shopping from home, targeting a particular sporting activity.
especially when a customer already According to the SportsBusiness Journal,
knows the product they want to buy and retailers will increasingly need to follow
the size they need. In a 2014 survey, fashion trends and provide customers
Nielsen indicates that clothing, with a targeted selection of merchandise.
Barriers to Entry Prospective entrants to the Licensed

Sports Apparel Stores must contend with Barriers to Entry checklist
Level & Trend several significant barriers, with large Competition High
start-up costs being the most dominant. Concentration Medium
arriers to Entry
B The initial cost of establishing or Life Cycle Stage Mature
in this industry are purchasing a retail outlet and providing Capital Intensity Low
Mediumand S teady sufficient inventory may be prohibitive Technology Change Low
for new entrants. A large share of funding Regulation and Policy Light
may also be directed toward advertising Industry Assistance Low
and marketing to generate market
presence and consumer interest. SOURCE: WWW.IBISWORLD.COM
Furthermore, existing and well-

established distribution networks among new entrants to be successful, they need
operators and suppliers may deter to establish upstream supply
potential operators from entering. For relationships with manufacturers and

Barriers to Entry wholesalers to secure high-quality, to acquisition and consolidation activity.

continued low-priced stock. Furthermore, industry As a result, these national chains are able
operators must ensure that purchased to offer a broad range of products at
apparel is officially licensed by buying competitive prices, which is reflected in
from reputable wholesalers or directly high company revenue. These players
purchasing from licensed manufacturers. have also benefited from their brand
New entrants also need to consider the awareness and strong relationships and
market dominance of players already loyalty among consumers.
operating in this industry. Competition is While not regarded as a formal
fierce, with many operators competing on barrier to entry, intense competition
price. In some cases, official apparel of from external players, such as
major professional sporting leagues department stores, mass merchandisers
experiences virtually no variation in price and internet retailers, may hinder the
throughout industry establishments, success of new industry players. These
since the leagues can often dictate the alternative retail channels for sports
retail price of each unit. Retailers may apparel can compete aggressively on
offer slight discounts on these products price. In fact, the intense promotional
on occasion, but will have to sell them at environment has been cited as the major
a loss to do so. Despite the industry’s reason for the falling or stagnant
moderate market share, concentration average price of sports apparel over the
has risen over the five years to 2019 due past five years.
Industry Globalization levels have remained expanded internationally via the

Globalization constant over the five years to 2019 in the establishment of foreign stores or joint
Licensed Sports Apparel Stores industry. ventures. In terms of international trade,
Level & Trend Historically, this industry has been globalization has been influenced by the
characterized by a large number of small influx of Asian-made goods into the
lobalization
G in this domestically owned operators. While the domestic market. The entry of this
industry is L owand number of independent operators has merchandise, often sold at lower prices
the trend is S teady diminished, this industry remains compared with domestically produced
domestically owned and operated. goods, has increased competition within
Nevertheless, domestic operators have the industry.

Major Companies
Dick’s Sporting Goods Inc. | Foot Locker Retail Inc. | Other Companies
Major Players
(Market Share) Foot Locker Retail Inc. 12.3%
54.3%
Other
Dick’s Sporting Goods Inc. 33.4% SOURCE: WWW.IBISWORLD.COM
Player Performance Dick’s Sporting Goods Inc. (Dick’s) for each specialty store, Dick’s aims to
operates as a full-line sporting goods heighten customer interest and promote
retailer, offering a broad assortment of sales. This industry only includes sales of
Dick’s Sporting brand-name sporting apparel, sporting licensed sports apparel from Dick’s
Goods Inc. equipment, exercise equipment, outdoor brick-and-mortar stores.
Market Share: 33.4% supplies and a range of footwear. There Dick’s has been highly active in
are 729 Dick’s stores throughout 47 states expansion and acquisition activity. For
and the District of Columbia, in addition example, in July 2016, the company
to 94 Golf Galaxy stores in 32 states and completed the acquisition of the
35 Field & Stream stores in 16 states. intellectual property assets of former
Dick’s stores generally contain five industry major player Sports Authority
standalone specialty stores, which Holdings Inc. (Sports Authority), along
include the Golf Pro Shop, a golf store with the right to acquire 31 Sports
with putting green and hitting area; the Authority store leases, for $21.3
Footwear Center, which often includes a million. Additionally, in October 2016,
track for testing athletic shoes; the Dick’s purchased Golfsmith
Fitness Center, which includes the International Inc. (Golfsmith), the
dedicated Cycle Shop designed to sell and largest golf retailer in the United States,
service bikes; the Lodge, which is at a bankruptcy auction for an
designed as a bait and tackle store; and estimated $70.0 million. Since the
Team Sports, a seasonal sports display acquisition, Dick’s has closed a majority
area. By creating a distinct look and feel of Golfsmith’s 109 stores and is in the
Dick’s Sporting Goods Inc. (US industry-specific segment) - financial

performance*
Revenue Net Income
Year** ($ million) (% change) ($ million) (% change)
2014-15 2,232.4 N/A 181.5 N/A
2015-16 2,290.4 2.6 168.6 -7.1
2016-17 2,440.0 6.5 138.6 -17.8
2017-18 2,570.3 5.3 142.9 3.1
2018-19 2,509.9 -2.3 132.3 -7.4
2019-20 2,541.8 1.3 125.5 -5.1
*Estimates, **year-end January

SOURCE: ANNUAL REPORT AND IBISWORLD

Major Companies
Player Performance process of converting 30 former Golfsmith continually popular nature of many
continued stores to the Golf Galaxy Brand. amateur sports, Dick’s has been able to
steadily expand its market share and has
Financial performance experienced no declines in revenue over
Over the five years to fiscal 2020 (year- the past five years.
end January), Dick’s total US revenue is Dick’s revenue from sales of licensed
expected to reach $8.5 billion in total sports apparel is expected to increase at
sales. As the economy expanded and an annualized rate of 2.6% to $2.5 billion
consumers earned additional disposable over the five years to fiscal 2020. Dick’s
income to spend on leisure and sporting has major licensing agreements with
goods, the company generated an nearly all major professional sports
anticipated additional 1.3% in revenue leagues and associations, in addition to
from fiscal 2019 to fiscal 2020. However, licenses with popular sports apparel
much of Dick’s strong five-year brands such as Nike Inc., Adidas AG and
performance has been driven by the Reebok. While the company generates a
company’s expansion strategy rather than slim portion of its revenue from private
changes in consumer spending conditions. label products, licensing is a huge
Dick’s has aggressively expanded in recent business for Dick’s and is expected to
years, increasing its footprint from its 642 generate even greater income for the
operational stores held in 2014. Due to the company over the five years to 2024.
Player Performance Foot Locker Inc. (Foot Locker) is an com and other websites, including
athletic retailer that operates 3,221 Eastbay Inc. Sales from athletic shoes
stores throughout North America, dominate, representing over 80.0% of
Foot Locker Retail Europe, Australia and New Zealand. An the company’s total revenue in fiscal
Inc. estimated 70.0% of its sales come from 2017 (latest data available). The
Market Share: 12.3% operations within the United States. company operates athletic retail stores
Foot Locker sells athletic shoes through under the Foot Locker, Lady Foot
its retail outlets, but it also provides Locker, Kids Foot Locker, Champs
direct-to-consumer sales via Footlocker. Sports, Footaction and SIX:02.
Foot Locker Inc. (US industry-specific segment) - financial performance*

Revenue Net Income
Year** ($ million) (% change) ($ million) (% change)
2014-15 918.6 N/A 104.6 N/A
2015-16 833.3 -9.3 94.5 -9.6
2016-17 869.4 4.3 112.6 19.1
2017-18 853.9 -1.8 63.2 -43.9
2018-19 859.6 0.7 76.2 20.6
2019-20 937.9 9.1 78.9 3.5
*Estimates, ** Year end January

SOURCE: ANNUAL REPORT AND IBISWORLD

Major Companies
Player Performance Foot Locker operates in this industry 0.4% to $937.9 million over the five years
continued mainly through its Champs Sports to fiscal 2020. Stronger growth has been
locations, which carry considerably more mitigated by assortment and foot-traffic
apparel than the traditional Foot Locker challenges, in addition to store closures.
locations that focus on shoe sales. In For example, the number of Champs
fiscal 2019 (latest data available), there Sports stores declined by six between
535 Champs Sports stores were located in fiscal 2018 and fiscal 2019. Additionally,
the United States, compared with 886 Foot Locker’s direct-to-consumer
Foot Locker locations. Champs Sports channel, which comprises sales
predominantly sells licensed apparel in conducted through the company’s
addition to equipment, footwear and catalog, mobile phones and online
accessories. The chain has long been a platforms, is anticipated to increase from
sponsor for National Collegiate Athletic 12.1% of total company sales in fiscal
Association college football bowl games 2015 to 16.0% of total company sales in
and sponsored the Champs Sports Bowl fiscal 2020. As a result, the company’s
between 2004 and 2012. increasing online presence is taking away
from revenue earned through brick-and-
Financial performance mortar stores. Furthermore, while Foot
Foot Locker is anticipated to generate Locker has more locations than Dick’s
$8.7 billion globally in fiscal 2020. Foot Sporting Goods Inc., the store remains
Locker’s revenue from US sales of second in market share because its stores
licensed sports apparel is expected to have placed a far greater emphasis on
slightly increase at an annualized rate of sales of footwear over the past five years.
Other Companies While the Licensed Sports Apparel Stores industry. Smaller stores often struggle to
industry has moderate market share compete on price with major players.
concentration, the industry is comprised Product licensing is a major cost, and
of very small companies that are often independent stores may not wish to
locally operated and consist largely of purchase licensing rights if they are not
nonemploying owners. All of these stores reasonably certain that their products on
are brick-and-mortar locations and very hand will be continually sold. Additionally,
rarely have any sort of online presence, these stores do not have the same per-unit
thus e-commerce does not play a licensing contracts that major players are
significant role in the operations of capable of negotiating, further hurting
virtually all establishments in this their ability to price competitively.

Operating Conditions
Capital Intensity | Technology & Systems | Revenue Volatility
Regulation & Policy | Industry Assistance
Capital Intensity Operators in the Licensed Sports Apparel

Stores industry, similar to most retail- Capital Intensity
Capital units per labor unit
oriented establishments, are mostly labor
Level
intensive due to the human input 0.5
The levelof capital required to perform most of the
intensity is L ow customer-based operations. Retailers 0.4
employ staff to undertake a range of 0.3

labor-related tasks. Key examples include
customer service, restocking shelves and 0.2
maintaining control of inventory levels. It 0.1

is important for sports retailers to
maintain high levels of customer service 0.0
Economy Retail Trade Licensed Sports
to help customers with purchase Apparel Stores
decisions and fittings. In doing so, Dotted line shows a high level of capital intensity
retailers are able to build a loyal SOURCE: WWW.IBISWORLD.COM
customer base, which can be used to

combat increasing competition from time or casual basis, and employment
online retailers. A large portion of labor fluctuates throughout the year in line
in this industry is employed on a part- with peak selling times, such as Father’s

Capital Intensity Day, the back-to-school season and contactless and mobile payment
continued Christmas. As a result, the industry’s technologies. This implementation has
average wage calculations tend to trend helped simplify labor tasks and
lower than retail as a whole. minimize the level of human error in
Capital expenditure for this industry processing purchases. Overall, capital
comes in the form of fixtures and intensity in the Licensed Sports Apparel
fittings such as cash registers and Stores industry is low. On average,
point-of-sale (POS) systems. The industry players are expected to
industry has undergone considerable allocate $0.03 toward capital assets for
change with the implementation of every dollar spent in 2019.
Technology and Operators in the Licensed Sports Apparel cards, EMV chip-based credit cards can
Systems Stores industry have benefited from a be inserted or swiped into compatible
range of technological advances, terminals that provide an added layer of
including the introduction of POS protection against counterfeiting and
Level
systems, bar code scanning and identity theft.
The level
of electronic data interchange (EDI). The Contactless payment systems include
technology implementation of these advances credit cards, key fobs, smart cards and
change is L ow enables retailers to control and record mobile phones that are capable of making
merchandising, distribution, sales and payments without the need to swipe or
stock markdowns via POS systems. While insert a card into a terminal. Using
bar code scanning offers the advantages embedded chips and antennas, retail
of higher labor productivity and increases transactions at participating stores can
the speed at which information is passed, occur faster and may be safer than
it also provides retailers with greater traditional credit cards.
control over the distribution of goods and Technology advances have also altered
the reduction of potential errors along the way consumers shop for sporting
the supply chain. Furthermore, EDI goods and apparel. Key industry players in
systems have enabled operators to this industry have established their own
streamline the previously paper- websites, enabling them to sell sporting
dominated ordering process. goods, apparel and equipment online.
Additionally, improvements to credit However, these advances have created
card technology with the rollout of EMV further competition for this industry by
chips have greatly improved consumer providing another avenue for consumers
safety and ease of use during retail to access and purchase sports apparel
transactions. Unlike traditional swiped rather than visiting sports stores directly.
Revenue Volatility The Licensed Sports Apparel Stores jerseys are especially popular among
industry exhibits a low level of revenue sports fans, but the high cost of these
volatility. Apparel retailers are reliant on items makes these types of purchases a
Level
consumers’ discretionary spending to luxury. However, the industry is very
The level
of volatility drive demand for sporting goods. As stable and generally thrives during all
is M
edium consumers’ per capita disposable income points along the economic cycle. During
rises, more consumers can purchase a periods of low discretionary income,
range of apparel and accessories. Player consumers may forgo purchases of

Revenue Volatility authentic jerseys and instead by player

continued tee shirts or hats. Industry revenue has
increased as little as 1.2% in 2015 and as
much as 6.4% in 2017.
Regulation and Policy The Licensed Sports Apparel Stores products from one team. Over the five
industry has a low level of regulation and years to 2024, regulation from
policy. Although few state and federal professional and college sports leagues is
Level & Trend laws regulate this industry, some of the expected to increase as the value of their
he level of
T legal requirements that exist to sell brands grows.
Regulation is L ight licensed sports apparel have increased Although not specific to the Licensed
and the trend over the five years to 2019. A company Sports Apparel Stores industry, there are
must seek permission from the major legislative changes which occurred
is I ncreasing
professional or amateur league to carry over 2015 that will affect virtually all
licensed apparel in its stores, and a retail industries in the US. By October
company must often meet multiple 2015, all major credit card companies
benchmarks to get permission. For were to have begun issuing new chip-
example, the NFL requires that industry and-PIN credit cards to replace swipe-
participants purchase a minimum and-sign credit cards. Credit cards in the
number of products to carry in their United States have long operated by
stores, often in excess of half a million having the customer swipe their card
dollars in merchandise a year, in addition through a cashier terminal and then sign
to a minimum royalty guarantee. a receipt to authorize their retail
Additionally, many leagues require transaction. In recent years, countries
prospective stores to prove they are throughout the world have noticed that
located in a strong market by having swiped credit cards are prone to several
them sign a limited product line contract types of fraud and identity theft. These
and giving them a probationary period. cards have since been replaced with new
Under these contracts, a store might only chip-and-PIN cards containing EMV
have one year to prove it can sell payment technology built into the card.

Regulation and Policy Using this new technology, credit cards merchant that sold products to a credit
continued are instead inserted into compatible card thief will be forced to bear the cost
terminals and a PIN will automatically of the identity theft if they did not have
authenticate any retail transaction. the proper EMV chip terminal
As the United States transitions to technology installed by October 2015.
this new credit card system, the federal Conversely, if a credit card company has
government has established liability not issued their customer a new EMV
standards to ensure that merchants and chip and outdated card is stolen, the
credit card companies adopt the bank will be liable for the charges. This
technology as quickly as possible. legislation will ultimately encourage
Starting in 2015, whichever party does both industry retailers, credit card
not have EMV chip-based technology companies and banks to provide
available will bear the financial cost of consumers with the newest and safest
any credit card fraud. For example, a credit card technology.
Industry Assistance While tariffs are applicable to goods that trade association representing apparel
are imported and supplied to the Licensed producers, wholesalers and retailers.
Sports Apparel Stores industry, they do The association aims to increase
Level & Trend not exist at the retail level. As a result, this product safety, expand the
he level of
T industry does not receive any formal trade international trade opportunities of
Industry Assistance assistance; however, several organizations domestic manufacturers and has fought
is L owand the provide guidance and support to retailers. to increase the government’s spending
The National Retail Federation, for on military uniforms and combat
trend is S teady
example, represents the country’s largest footwear. Furthermore, the Licensing
advocacy group that serves the interests of Industry Merchandisers’ Association
the retail sector. The association’s current (LIMA) is a global organization
initiatives include lobbying Congress to dedicated to the licensing industry.
enact fair patent laws to protect LIMA, founded in 1985 and
consumers against patent trolls, require headquartered in the US, serves
online sellers to collect sales taxes that are members in 40 different countries and
equal to that of local retail stores and is focused on the growth and expansion
encourage the enactment of new of the licensing industry. Members are
cybersecurity platforms. eligible for exclusive benefits such as
Additionally, the American Apparel education programs, research tools and
and Footwear Association is a national networking events.

Key Statistics
Industry Data Industry Participation
Revenue Value Added Establish- Wages Domestic in sports
($m) ($m) ments Enterprises Employment Exports Imports ($m) Demand (%)
2010 5,816.6 1,036.4 13,770 11,705 56,448 -- -- 649.8 N/A 18.5
2011 6,028.6 1,105.9 14,242 12,105 58,485 -- -- 677.1 N/A 18.6
2012 6,489.2 1,139.5 14,780 12,564 60,261 -- -- 702.8 N/A 19.3
2013 7,055.9 1,300.3 14,400 12,158 62,378 -- -- 792.7 N/A 18.6
2014 7,131.4 1,236.9 14,706 12,385 66,340 -- -- 821.0 N/A 19.1
2015 7,477.2 1,285.9 14,858 12,498 70,061 -- -- 886.7 N/A 20.4
2016 7,719.7 1,308.4 15,012 12,614 72,547 -- -- 882.8 N/A 20.9
2017 7,402.0 1,251.7 14,919 12,564 71,221 -- -- 889.2 N/A 19.0
2018 7,577.0 1,282.7 15,165 12,763 72,951 -- -- 910.6 N/A 20.3
2019 7,604.2 1,289.5 15,270 12,853 73,683 -- -- 918.6 N/A 20.5
2020 7,668.1 1,303.3 15,365 12,929 74,580 -- -- 929.1 N/A 21.0
2021 7,613.9 1,298.5 15,408 12,973 74,696 -- -- 928.9 N/A 20.7
2022 7,668.4 1,307.9 15,514 13,062 75,378 -- -- 937.1 N/A 21.2
2023 7,746.7 1,321.2 15,635 13,162 76,118 -- -- 946.3 N/A 21.8
2024 7,778.4 1,327.1 15,716 13,231 76,490 -- -- 950.8 N/A 22.0
Annual Change Industry Establish- Domestic Participation

Revenue Value Added ments Enterprises Employment Exports Imports Wages Demand in sports
(%) (%) (%) (%) (%) (%) (%) (%) (%) (%)
2011 3.6 6.7 3.4 3.4 3.6 N/A N/A 4.2 N/A 0.5
2012 7.6 3.0 3.8 3.8 3.0 N/A N/A 3.8 N/A 3.8
2013 8.7 14.1 -2.6 -3.2 3.5 N/A N/A 12.8 N/A -3.6
2014 1.1 -4.9 2.1 1.9 6.4 N/A N/A 3.6 N/A 2.7
2015 4.8 4.0 1.0 0.9 5.6 N/A N/A 8.0 N/A 6.8
2016 3.2 1.7 1.0 0.9 3.5 N/A N/A -0.4 N/A 2.5
2017 -4.1 -4.3 -0.6 -0.4 -1.8 N/A N/A 0.7 N/A -9.1
2018 2.4 2.5 1.6 1.6 2.4 N/A N/A 2.4 N/A 6.8
2019 0.4 0.5 0.7 0.7 1.0 N/A N/A 0.9 N/A 1.0
2020 0.8 1.1 0.6 0.6 1.2 N/A N/A 1.1 N/A 2.4
2021 -0.7 -0.4 0.3 0.3 0.2 N/A N/A 0.0 N/A -1.4
2022 0.7 0.7 0.7 0.7 0.9 N/A N/A 0.9 N/A 2.4
2023 1.0 1.0 0.8 0.8 1.0 N/A N/A 1.0 N/A 2.8
2024 0.4 0.4 0.5 0.5 0.5 N/A N/A 0.5 N/A 0.9
Key Ratios Imports/ Exports/ Revenue per Share of the

IVA/Revenue Demand Revenue Employee Wages/Revenue Employees Average Wage Economy
(%) (%) (%) ($’000) (%) per Est. ($) (%)
2010 17.82 N/A N/A 103.04 11.17 4.10 11,511.48 0.01
2011 18.34 N/A N/A 103.08 11.23 4.11 11,577.33 0.01
2012 17.56 N/A N/A 107.68 10.83 4.08 11,662.60 0.01
2013 18.43 N/A N/A 113.12 11.23 4.33 12,708.01 0.01
2014 17.34 N/A N/A 107.50 11.51 4.51 12,375.64 0.01
2015 17.20 N/A N/A 106.72 11.86 4.72 12,656.11 0.01
2016 16.95 N/A N/A 106.41 11.44 4.83 12,168.66 0.01
2017 16.91 N/A N/A 103.93 12.01 4.77 12,485.08 0.01
2018 16.93 N/A N/A 103.86 12.02 4.81 12,482.35 0.01
2019 16.96 N/A N/A 103.20 12.08 4.83 12,466.92 0.01
2020 17.00 N/A N/A 102.82 12.12 4.85 12,457.76 0.01
2021 17.05 N/A N/A 101.93 12.20 4.85 12,435.74 0.01
2022 17.06 N/A N/A 101.73 12.22 4.86 12,432.01 0.01
2023 17.06 N/A N/A 101.77 12.22 4.87 12,432.01 0.01
2024 17.06 N/A N/A 101.69 12.22 4.87 12,430.38 0.01
Figures are in inflation-adjusted 2019 dollars. SOURCE: WWW.IBISWORLD.COM

Jargon & Glossary
Industry Jargon BIG-BOX RETAILERA retail store that is differentiated by SPORTS PARTICIPATION RATEThe number of
its sheer size and large range of products, including consumers participating in regular physical activity as a
electronics, household goods and other consumer products. share of the total population.
BRICK-AND-MORTARA store that has a physical
presence and location, as opposed to an online retailer.
IBISWorld Glossary BARRIERS TO ENTRYHigh barriers to entry mean that INDUSTRY REVENUEThe total sales of industry goods
new companies struggle to enter an industry, while low and services (exclusive of excise and sales tax); subsidies
barriers mean it is easy for new companies to enter an on production; all other operating income from outside
industry. the firm (such as commission income, repair and service
CAPITAL INTENSITYCompares the amount of money income, and rent, leasing and hiring income); and
spent on capital (plant, machinery and equipment) with capital work done by rental or lease. Receipts from
that spent on labor. IBISWorld uses the ratio of interest royalties, dividends and the sale of fixed
depreciation to wages as a proxy for capital intensity. tangible assets are excluded.
High capital intensity is more than $0.333 of capital to INDUSTRY VALUE ADDED (IVA)The market value of
$1 of labor; medium is $0.125 to $0.333 of capital to $1 goods and services produced by the industry minus the
of labor; low is less than $0.125 of capital for every $1 of cost of goods and services used in production. IVA is
labor. also described as the industry’s contribution to GDP, or
CONSTANT PRICESThe dollar figures in the Key profit plus wages and depreciation.
Statistics table, including forecasts, are adjusted for INTERNATIONAL TRADEThe level of international
inflation using the current year (i.e. year published) as trade is determined by ratios of exports to revenue and
the base year. This removes the impact of changes in imports to domestic demand. For exports/revenue: low is
the purchasing power of the dollar, leaving only the less than 5%, medium is 5% to 20%, and high is more
“real” growth or decline in industry metrics. The inflation than 20%. Imports/domestic demand: low is less than
adjustments in IBISWorld’s reports are made using the 5%, medium is 5% to 35%, and high is more than
US Bureau of Economic Analysis’ implicit GDP price 35%.
deflator. LIFE CYCLEAll industries go through periods of growth,
DOMESTIC DEMANDSpending on industry goods and maturity and decline. IBISWorld determines an
services within the United States, regardless of their industry’s life cycle by considering its growth rate
country of origin. It is derived by adding imports to (measured by IVA) compared with GDP; the growth rate
industry revenue, and then subtracting exports. of the number of establishments; the amount of change
EMPLOYMENTThe number of permanent, part-time, the industry’s products are undergoing; the rate of
temporary and seasonal employees, working proprietors, technological change; and the level of customer
partners, managers and executives within the industry. acceptance of industry products and services.
ENTERPRISEA division that is separately managed and NONEMPLOYING ESTABLISHMENTBusinesses with
keeps management accounts. Each enterprise consists no paid employment or payroll, also known as
of one or more establishments that are under common nonemployers. These are mostly set up by self-employed
ownership or control. individuals.
ESTABLISHMENTThe smallest type of accounting unit PROFITIBISWorld uses earnings before interest and tax
within an enterprise, an establishment is a single (EBIT) as an indicator of a company’s profitability. It is
physical location where business is conducted or where calculated as revenue minus expenses, excluding
services or industrial operations are performed. Multiple interest and tax.
establishments under common control make up an VOLATILITYThe level of volatility is determined by
enterprise. averaging the absolute change in revenue in each of the
EXPORTSTotal value of industry goods and services sold past five years. Volatility levels: very high is more than
by US companies to customers abroad. ±20%; high volatility is ±10% to ±20%; moderate
volatility is ±3% to ±10%; and low volatility is less than
IMPORTSTotal value of industry goods and services
±3%.
brought in from foreign countries to be sold in the
United States. WAGESThe gross total wages and salaries of all
employees in the industry. The cost of benefits is also
INDUSTRY CONCENTRATIONAn indicator of the
included in this figure.
dominance of the top four players in an industry.
Concentration is considered high if the top players
account for more than 70% of industry revenue.
Medium is 40% to 70% of industry revenue. Low is less
than 40%.

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COM Licensed Sports Apparel Stores in the USJune 2019 1

Playing field: The industry has performed

IBISWorld Industry Report OD5326

2 About this Industry 17 International Trade 31 Industry Assistance

13 Products and Markets 28 Operating Conditions

www.ibisworld.com | 1-800-330-3772 | info @ibisworld.com

About this Industry

Main Activities The primary activities of this industry are

The major products and services in this industry are

Similar Industries 33992a Athletic & Sporting Goods Manufacturing in the US

42391 Sporting Goods Wholesaling in the US

44811 Men’s Clothing Stores in the US

44812 Women’s Clothing Stores in the US

45111 Sporting Goods Stores in the US

Provided to: Edeska (2133322036) | 26 March 2020

About this Industry

Additional Resources For additional information on this industry

IBISWorld writes over 1000 US

Provided to: Edeska (2133322036) | 26 March 2020

Key Statistics Revenue Annual Growth 14–19 Annual Growth 19–24

$311.8m $918.6m 12,853

Foot Locker Retail

Key External Drivers 4.8%

Industry Structure Life Cycle Stage Mature Regulation Level Light

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Key External Drivers Participation in sports Number of broadband connections

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Participation in sports Number of broadband connections

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Current The Licensed Sports Apparel Stores

Industry revenue is expected to increase at

revenue to increase 0.4% in 2019 alone.

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The fans The closest measure of sports

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Industry The continued strengthening of the US

Demand grows The number of Americans participating

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Products & Markets

Supply Chain KEY BUYING INDUSTRIES

KEY SELLING INDUSTRIES

Products and Services Products and services segmentation (2019)

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Products & Markets

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Products & Markets

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Products & Markets

Major Markets Major market segmentation (2019)

Total $7.6bn SOURCE: WWW.IBISWORLD.COM

Consumers aged 18 to 44 may incite more families to participate in

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Products & Markets

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Products & Markets

Business Locations 2019

West Establishments (%)

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Products & Markets

COM Licensed Sports Apparel Stores in the USJune 2019 1