The typical fishing tackle store specializes in selling rods, reels, lures, terminal tackle with a smattering of other accessories, rainwear and apparel, usually limited to t-shirts and hats.
I talk to a lot of owners and managers and ask them why they don’t carry more apparel and related accessories. Typically, their answers are…
- “We specialize in just fishing gear.”
- “Our customers expect fishing products not a clothing store.”
- “We don’t know anything about buying apparel.”
- “None of our buyers have any expertise in apparel purchasing.”
- “Apparel is just not our thing.”
All sales are not created equal
Let’s pause for a minute here and put some logic into the consideration of product mix. The typical motivation for being in business is to generate supple profits consistent with one’s investment, time and risk. Also consider that a dollar of sales in fishing tackle is worth exactly the same as a dollar of sales in apparel.
On the other hand, a $1,000 in tackle sales might generate $350 ($1,000 X 35% gross profit percent) in gross profit. While a $1,000 in apparel sales will likely produce $500 in gross profit at the typical 50% markup. Thus, a dollar of apparel sales will generate 43% more (500-350=150 / 350 = .43) gross profit than a dollar of tackle sales.
The point is that apparel sales are more margin productive than fishing tackle sales. Additionally, apparel turns at a much higher rate than hard goods and apparel vendors are far more likely to provide markdown money for any slow moving items.
Also consider the fact that a dollar of gross margin from tackle is exact equal to a dollar of gross margin from apparel sales. The name of the game is gross margin dollars and not necessarily the source of those gross margin dollars.
A more diverse customer base
The concept of product mix comes into play here. I’m guessing that fishing tackle is primarily purchased by male customers. Since the fishing customer base is predominately male purchasers, the retailers have relatively little to attract women accompanying their husbands.
One of the attractive aspects of apparel is its universal appeal to both men and women, all of whom need and want functional clothing. If a garment is functional, eye-catching and priced competitively, it will move. Trust me, the bank doesn’t care about the source of the cash; it all goes into the cash account.
Other benefits of stocking apparel are that the turn rate is usually much higher than hard goods because of the seasonality of apparel. Additionally, apparel usually responds to a markdown thus freeing up cash, open to buys and space.
The importance of apparel, accessories and footwear is so clearly illustrated by such tackle behemoths as Bass Pro Shops, Cabela’s and other large outdoor retailers. As you walk into these stores, the first 150 feet of lineal space is devoted to all forms of apparel, apparel related accessories and footwear.
Why? Because such products are replete with potential sales dollars and generous margins. Often when purchasing apparel for the stores, company buyers can simultaneous place their orders for a certain percentage of off-price goods. Also, markdown money is usually available to “juice up” slower moving inventory.
I am not suggesting that tackle/sporting goods retailers get out of the tackle business. I am suggesting, however, that they add copious amounts of footwear, apparel and accessories to sell in combination with their hard goods inventory.
If you don’t know anything about apparel buying, then learn it or hire an apparel buyer. If you don’t have the space, either move into a larger store or consider dumping some of your less productive inventory so as to provide the necessary space. Remember that historically 20% of your items will generate 80% of your sales.
Selling apparel et al is great. Just hang it up and the consumers will do the rest. So do your homework, make a plan and get started. Chances are, your men, women and youth customers will love it!