July Pro Shop: Your 2020 Apparel Strategy
July is the second biggest month of the year for golf retailers in the UK and usually the largest month for ball sales. It’s also the key month for planning next year’s stock, and even though we’re little over half way through 2019, it’s already time to plan for 2020 Apparel.
In July Pro Shop: Retail Tips, Crossover Chairman, Phil Barnard, has the Apparel numbers you need, and great advice for your ordering strategy.
In the UK, the Apparel category is responsible for over 22% of golf retail sales: accounting for over 50% for some retailers. Sixty-five percent of Apparel sales comes via the on-course channel, second only to the Clubs category, which claims, on average, over 40% of retail sales. However, while the Clubs category has shifted focus to custom-fit, Apparel still requires planning and forward ordering.
“..get it right, and this is a category that can offer great profitability.”
Many clothing brands only produce their pre-order quantities, plus about 25% on top: so, if you don’t order in advance you could struggle for inventory. This presents a number of challenges but, get it right, and this is a category that can offer great profitability. Retailers, especially those at branded destinations, often make much more margin from Apparel, than Clubs.
Picture your Customer
The first challenge with this category is to define who’s going to buy the Apparel. Is it the members, or visitors? A number of questions could arise from this insight, not least whether, or not, you brand the clothing with the Club crest. However, the key issues are basic: size mix and sub category break down. If it’s clothing for members, you have a better opportunity to get the size profile right, as you should know who they are. If you see a slant towards visitors, you may need to stock a slightly wider size range to capture the sale.
Branded visitor locations are likely to sell many more shirts as mementos. Member clubs sell a more even spread, and potentially, sell more Outerwear for those members keen to play in competitions, whatever the weather. You also need to factor in what proportion of the customers are women, which adds a whole new dimension.
Having decided the basic categories, with a good idea of sizing requirements, you now need to work out which ranges to choose.
On the Range
Colours and designs can be very transient, making it difficult to buy in, and sell out, before the season ends: A problem exacerbated by many of the leading brands now offering, not only summer and winter ranges, but also Spring and Autumn, too.
It’s never easy to sell last year’s fancy styles when the colour pallets have changed! One of the key strategies is to work out when to hold a basic core range, (simple colours and sizes that can be replenished), and when to include a fashion range (current on-trend designs, and very seasonal).
“One of the biggest mistakes I see during the season, is when a fashion range has sold well and the retailer then tries to repeat the success with another reorder”.
One of the biggest mistakes I see during the season, is when a fashion range has sold well and the retailer then tries to repeat the success with another reorder. This often fails. Customers that wanted the fashion items have already bought them earlier in the season. The net result is that the retailer has to chop the clothing out at a discount – which doesn’t always work. It’d be better to sell the fashion range at the start of the period, take the margin, and then switch to the core range for the rest of the season.
Your Brand Strategy
Once you understand your customer, and the type of products they’ll buy, retailers should establish which brands to work with. This is often defined by the price points the customers are willing to spend. It’s no good trying to sell £79 Hugo Boss shirts at a private club where the members want a £39 pullover.
Brand selection is critical, and it should give you with the opportunity to present some of the ranges with a tried and tested selling strategy: with Good, Better and Best price points.
“As you have to book your Apparel so far in advance, it’s always a challenge for retailers to know what to order.”
Make sure that you are realistic on what you can sell. Often the temptation is to get in too many brands an offer too much range. This is done without proper planning and understanding of what customers want. It’s better to work with fewer brands that might be able to offer a couple of price points. Not only does it reduce admin, but you should also be able to negotiate better deals with concentrated buying, without trying to chase everyone’s minimum order levels.
Take the Numbers
Once you’ve ticked these boxes, it’s time to put some numbers together. As you have to book your Apparel so far in advance, it’s always a challenge for retailers to know what to order, especially when you don’t know how the current year has gone. Therefore, make sure you have as much data as possible to manage your projections. This year, numbers have been tricky. Overall, Apparel is down -1.7% compared to the same period in 2018, and -8.7% to 2017. However, taking away Outerwear, the category stands at +2.7% compared to 2018 and -5.3% to 2017. Outerwear has had an appalling start to the year, owing to the unseasonably warm and dry weather.
If you look at the sub category units, things are even trickier. This year, units for men’s shirts are down over 7%, compared to 2018, and down 9% on 2017. I can guarantee that most brands will be looking for you to increase your orders, however, based on these numbers, you’d be hard pushed to forecast any increase. The only way to do that may be to cancel another brand.
“The chances are, that if there’s no drastic change in the weather, you’re likely to have quite enough Outerwear to cover you for next year.”
Even worse are Outerwear and Bottoms, which are down 34% and 10% respectively, on 2018. The chances are, that if there’s no drastic change in the weather, you’re likely to have quite enough Outerwear to cover you for next year. To offer some glimmer of hope, May was up 14% in Outerwear.
The key take-away here, is that you need to know your numbers. Account for what you already have, and make some educated guesses on what’s going to happen next year.
Don’t assume everything will be the same, as you can see that didn’t work last year!