Retailer Sports Authority, which has been in bankruptcy court protection, plans to close for good by holding a huge going-out-of-business sale at its locations across the country.
Charisse Jones of USA Today has the news:
In shutting down, the 463-store chain becomes the latest casualty among rivals for the sporting-good business. It follows the recently announced closure of the Sport Chalet chain, based on the West Coast. While sporting goods and athletic wear sales are growing, traditional retailers like the two chains have been hurt by competition from online.
Sports Authority’s final sales are expected to start by Friday and finish by the end of August, the documents state.
The big-box chain, which filed for bankruptcy protection less than three months ago, had initially planned to try to sell or close about a third of its retail sites in order to strengthen and streamline its operations. But the retailer, based in Englewood, Colo., added that if attempts to restructure its debt failed, it might close all of its stores.
Sarah Berger of Bankrate.com notes that Sports Authority struggled to compete with online retailers:
Sports Authority has struggled to stay afloat as more athletic-minded shoppers head to the internet for convenience, deals and discounts. In March, when the company filed for bankruptcy and initially said it would close 140 of its brick-and-mortar stores, CEO Michael Foss blamed an increase in online shopping.
“We are taking this action so that we can continue to adapt our business to meet the changing dynamics in the retail industry,” Foss said at the time. “We intend to use the Chapter 11 process to streamline and strengthen our business both operationally and financially so that we have the financial flexibility to continue to make necessary investments in our operations.”
Sports Authority is far from the only retailer grappling with fierce competition from online shopping. Earlier this month, department store giants including Macy’s, J.C. Penney’s and Nordstrom reported dismal first quarter earnings, and sporting goods chain City Sports filed for bankruptcy last year.
Sheena Butler-Young of Footwear News reported that Sports Authority’s closing presents an opportunity for Dick’s Sporting Goods:
Dick’s, which had been pegged by market watchers as a beneficiary of Sports Authority’s demise, is feeling short-term pressures from the company’s liquidation activity.
Last week, while announcing its Q1 earnings, Dick’s downward-adjusted its FY16 outlook, citing pressures from the Sports Authority’s storewide sales.
But Dick’s chairman and CEO Edward Stack noted that further down the line its competitors’ challenges will be a boon to business.
“Over the past several months, City Sports in Boston has liquidated, [Sport Chalet] announced the closing of all of their stores [and] the Sports Authority is in the midst of liquidating [and] closing their 400-plus stores [while] others are evaluating strategic alternatives,” Stack said during the company’s conference call. “Although it’s a mess, it’s a great opportunity for Dick’s Sporting Goods … Once this consolidation works its way through the system, we are poised to pick up significant market share.”
