SIMA Releases Retail Study Results at Sales and Marketing Boot Camp

kailee bradstreet

• July 09 2009
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SIMA presented the results of its 2008 Retail Distribution Study today at its Sales and Marketing Boot Camp in Dana Point, and according to the findings, the organization says that the surf and skate industry appears to be fairing well in a down economy.

The study, which is the third of its kind done by SIMA, looks at a cross section of 400 core retailers (out of a list of 4,910 independent surf/skate shops) throughout the country and provides detailed information about sales on major categories of surf and skate product.  Although core retailers saw a 3.5 percent dip in sales – from $5.51 billion in 2006 to $5.32 billion in 2008 – some categories saw growth, including a 15.6 percent increase in footwear sales from 2006 and a 13.1 percent increase in accessory sales to $561 million. Sunglasses, hats and bags were the most significant contributors to accessory sales, according to the study.

“For 2008, business for the  surf and skate industry was down 3.5 percent overall, but look at that compared to some of the other businesses that are out there competing for discretionary dollars,” says Palladini. “If you’re selling movie tickets, if you’re selling snowboards – God forbid if you’re selling cars right now…We are alright. We are doing fairly well right now compared to our competitive set and I think that’s an important message to share. We are in challenging times right now, but that said, compared to other industries, we are holding on.”

Here’s some highlights from the research that SIMA shared during the presentation:

- Taking into account all channels (military exchanges, department stores, specialty chain company stores), the total lifestyle surf and skate industry generated an estimated $7.22 billion in surf/skate product sales during 2008.

- Stores located in the West region (including mountain states) accounted for more than one-half ($2.7 billion) of total surf/skate sales in 2008. The West Coastal region accounted for 45% of all sales ($2.4 billion).

- Apparel generated the most sales with $1.7 billion (down just 0.8% from 2006). Apparel sales were strongest in surf stores totaling $938 million.

- Hard good sales decreased by 3.7% to $1.1 billion.

-Surf door attrition was 156 or 7.4% fewer doors than in 2006. There were 5,048 retailers were identified. In 2008, only 4,910 were identified.

-Internet/Catalog sales are offered by 24% of retailers and contribute 14% to total sales. In 2004, only 6% of sales could be attributed to sales in this channel.

The morning portion  of SIMA’s presentation kicked off with Michael Wood, Senior Vice President  of TRU, a market research and consultation firm focused on youth. The United States population is made up of 34 million teens, according to the most recent study conducted by TRU, which examined how teens and twenty-somethings act as consumers, including where they are getting their spending money and what motivates them to spend it.

The panel discussion following Wood was also full of useful information for retailers. Tom Holbrook, Quiksilvers executive V.P. of brand development, was joined by Atwater’s GM and President of Sales Greg Osthus, Hurley’s Senior V.P. and GM of Men’s Mark Weber, and Vans V.P. of Sales Jeff Moore, to discuss ways for retailers to manage margins and increase business, and techniques for forecasting revenues. The resounding message from the panel seemed to emphasize staying focused and lean. Holbrook told the audience that the key is to connect with customers through constant communication between the retailer and sales rep, to find out what categories are working best in individual shops, and providing tools such as POP. Osthus pointed out that sales reps shouldn’t be alone on the front lines talking to retailers; instead of monitoring from above, Osthus says management should put themselves out there and travel with their reps’ to visit key accounts. Holbook also emphasized that looking at margins weekly, and even daily, can help project and create plans more accurately. Moore echoed that sentiment: “It all comes down to planning versus reacting,” he says.