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The Business Block
Strategic Business Assessment of Dick’s Sporting Goods, Inc.
Spring 2016
Kyle Polman, Kristine Kliphouse, Jordan Hawkins, Stephen Lukridge

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Table of Contents
A. Executive Summary ……………………………………………………………………..3
B. Overview of Dick’s Sporting Goods, Inc. ………………………………………………4
C. Functional Competitive Analysis ……………………………………………………….6
1. Financial History and Status ……………………………………………………….6
2. Strategic Marketing Analysis ……………………………………………………...10
a. Immediate Environment, Segmentation, Targeting and Positioning ……………10
b. Macro-environmental Forces ……………………………………………………25
c. Strategic Marketing Mix ………………………………………………………...27
d. Isolated Sales Forecasting………………………………………………………..30
3. Strategic Assessment of Operations, Supply Chain, Technology, and
Infrastructure ………………………………………………………………………31
a. Key Order Winners and Qualifiers………………………………………………31
b. Supply Chain Integration and Outsourcing………………………………………34
c. Operational Technology and Systems…………………………………………...36
d. Processes, Facilities, and Location…………………………………..…………..40
e. Changes in Infrastructure………………………………………………………...42
f. Sustainability and Corporate Social Responsibility………………………….......44
4. Managerial Accounting Analysis ………………………………………………….47
a. Analysis of Cost Behavior and Process Cost Analysis…….…………………….47
b. Dick’s Sporting Goods Strategy Map……………………………………………49
c. Dick’s Sporting Goods Balanced Scorecard……………………………………..51
D. SWOT Analysis, Summary, and Recommendations ………………………………...54
1. Final Recommendation……………………………………………………………..57
Bibliography……………………………………………………………………………………..58
Sources for Visuals and Diagrams……………………………………………………………….62

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A. ExecutiveSummary
This strategic business assessment of Dick’s Sporting Goods, Inc. evaluates and analyzes the
following components of the organization: Finance, Accounting, Marketing, and Operations &
Supply Chain. After a financial evaluation from years 2012-2014, mixed in with a strategic
marketing analysis, a strategic assessment of operations, supply chain, infrastructure, corporate
social responsibility, and finally with a managerial accounting analysis, it is concluded that
common stock of Dick’s Sporting Goods is a recommended buy for any potential investors.
Some critical findings that this decision is based upon consist of the company’s targeting
strategies, positioning, and strategic marketing mix all within the arena of the sporting goods
industry. Dick’s Sporting Goods strategically focuses on its brand exclusivity and addition of
private label brands. According to Dick’s, these factors offer its customers a wide assortment of
products at an exceptional quality and price that cannot be found among its competitors. These
factors directly correlate to some of Dick’s strengths, consisting of a dominant position in the
marketplace, which includes a deep assortment of products, competitive prices among other
retailers, and the ability to adapt to changing trends in the marketplace.
Other findings suggest many new opportunities for future growth. Some of these areas include
the company’s expansion of its e-commerce platform coupled with its expanding network of
brick-and-mortar stores. The advantages of these developments contribute to its efforts in
downsizing some of its brick-and-mortar stores to reduce costs and specialize the retail
experience. As strengths and opportunities are relevant for Dick’s Sporting Goods, some
weaknesses and threats were also found. Investigating Dick’s corporate culture, further evidence
reveals an inadequate investment in employees, resulting in poor customer service and employee
performance.
After tallying all of Dick’s Sporting Goods’ current strengths, weaknesses, opportunities, and
threats, this strategic assessment of the company leads to a conclusion that potential investors
should buy the stock. With earnings projected to increase 3.28% by 2017, and a steady history of
increasing revenues, the financial position of the firm is better off than reflected in the 2012-
2014 analysis. With investments in e-commerce, new technology, and expansion of stores,
Dick’s is reacting to the changes in the marketplace and planning ahead for long term growth.
All of these signs are significant indicators that Dick’s will maintain its dominant position in the
market and outlast any fading competitors such as Sports Authority. Potential investors should
buy and expect to see a rise in the purchasing of stock from Dick’s Sporting Goods as a direct
result of the firm’s financial position, marketing strategy, operational efficiencies, and cost
behavior.

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B. Overviewof Dick’s Sporting Goods, Inc.
Every season starts at Dick’s, just like every story starts with a vision.
What began in 1948 as nothing more than a small vision has now become a leading omni-
channel sporting goods retailer offering an extensive assortment of authentic sports equipment,
apparel, footwear, and accessories. Dick’s Sporting Goods, Inc (NYSE: DKS) was founded in
1948 when an 18 year-old Dick Stack was approached by a store owner of an Army surplus store
in Binghamton, New York. The store owner requested that young Dick invent a list of products
necessary for expanding the store into a fishing tackle business. Once Dick presented his
suggestions, the owner belittled him and caused him to quit. Dick then went to his grandmother,
who in return presented him with her life savings of $300 and told him “do it yourself.” Dick
would go on to open up his own bait-and-tackle shop, and by late 1970’s, expanded his product
line to include most of what Dick’s Sporting Goods appears like today.
Dick’s Sporting Goods is today run by Dick’s son, Edward W. Stack. Ed and his brothers bought
the bait-and-tackle shop from their father, and have expanded the business to nearly 644 Dick's
Sporting Goods stores in 47 states, 73 Golf Galaxy stores in 29 states, and 19 Field & Stream
stores in 9 states. The sporting goods company went public on the New York Stock Exchange on
October 15, 2002 under the ticker DKS.
Headquartered in Coraopolis, PA, Dick’s Sporting Goods seeks to build leading brands that
serve and inspire athletes and outdoor enthusiasts around the world to achieve their personal best
through a blend of dedicated associates, in-store services and unique specialty shop-in-shops
dedicated to Team Sports, Athletic Apparel, Golf, Lodge/Outdoor, Fitness and Footwear. It
creates value for shareholders through the relentless improvements of everything it, along with
the individuals who make it up, does.
Dick’s Sporting Goods also owns and operates Golf Galaxy, Field & Stream, True Runner and
Chelsea Collective specialty stores. Dick’s offers a large lineup of products through a content-
rich e-commerce platform that is integrated with its store network and provides customers with
the convenience and expertise of a 24-hour storefront.
Within a highly competitive market, Dick’s Sporting Goods must not just be a team player, but
be an individual leader. It focuses on what differentiates itself from top competitors within the
sporting goods industry. The company competes with other sporting goods retailers on all fronts,
including large, traditional, specialty, online, and catalog-based sporting goods retailers. It
focuses its intentions on enhancing customers' performance and enjoyment of athletic and
leisurely pursuits, rather than solely concentrating its merchandise on the latest fashion trend or
style.
From a financial standpoint, Dick’s currently holds a 10% market share of the current $67 billion
U.S. sporting goods industry (Dick’s Investor Relations), outweighing other top sporting goods
retailers, mass merchants, and the entire rest of the market. The company’s 2015 total sales
consisted of $7.3 billion, a leading quantity among the industry.
The ultimate logistical goal for a large retailer such as Dick’s is for minimal amounts of products
to rollover into store-bound inventory, whereas the right amount of goods will be available to the
customers purchasing disposal at the right place at the right time. This poses a logistical

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challenge for Dick’s, due to the company’s heavy reliance on nearly 50 suppliers, 1,600 vendors,
outreach of nearly 650 store locations, and an expanding e-tailing platform. To cover this breadth
of locations, Dick’s Sporting Goods must rely on all of its suppliers, distributors, and
manufacturers to provide it with sufficient quantities of inventory in a timely fashion. It extends
its reach to nearly 50 suppliers including distinguished name brands such as Nike, Under
Armour, North Face, Adidas, Columbia Sportswear, Asics, Callaway, Puma, and Fitbit, to name
a few.
As Dick’s Sporting Goods remains one of the leading omni-channel sporting goods retailers in
America, the utilization of various technologies and systems presents a new challenge for its
remaining at the top, primarily since the company is seeking to expand its e-commerce
magnitude in the industry. E-commerce is one technology growth area that a company like
Dick’s Sporting Goods cannot afford to ignore. The surge in e-shopping is arguably the most
influential ingredient that can drive Dick’s sales up and its technology systems forward.
Through sustainability and corporate social responsibility efforts, Dick’s Sporting Goods yearns
to make a lasting impact in its communities through sport. The company believes in the value of
every single athlete no matter what age, gender, or skill level. Through matched donations and
sponsorships, Dick’s Sporting Goods is able to fund numerous underprivileged or under
budgeted teams, leagues, or associations with the resources and equipment they need in order to
not only make an impact in the community, but become better leaders and lesson-learners to
impact the world.

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C. Functional CompetitiveAnalysis
1. Financial History and Status
The global sporting goods industry has witnessed changes in the evolution of physical activity
trends, and is struggling to gain the attention of the younger millennial generation adapting to the
digital age. The rise in technology, electronics, online media, and internet accessibility continues
to thrive and modernize every day, which poses a large challenge for all retailers within the
sporting goods industry. While some of the industry’s major drivers such as disposable income,
government campaigns, and health-conscious trends have grown over the last decade, younger
customers are straying away from sporting goods and spending more on electronics, fashion, and
entertainment (Yahoo Finance). Additionally, with recent safety concerns in contact sports such
as football, there has been a slight decline in participation. According to an industry overview on
Yahoo Finance, sporting goods makers and distributors are uniting to increase sports
participation by launching promotional campaigns and forming lobbying groups in hopes of
reaching out to a broader customer base. For Dick’s Sporting Goods, a large retailer focusing on
athletic footwear, apparel, and equipment, this could have significant implications such as net
losses after a previously steady period of gradually increasing profits. In analyzing critical data
for Dick’s Sporting Goods over a three-year term from 2012-2014, interpretations can be
contextualized whether to buy, hold, or sell common stock. Through the computation of values
in the numerical analysis, it is possible to conclude where Dick’s Sporting Goods is positioned
amongst its competitors, as well as the direction in which it is headed.
First, the liquidity ratios for Dick’s Sporting Goods over the last three fiscal years have been
significantly lower than those of its competitors. With an average current ratio of 1.73 and an
average quick ratio of 0.60 over the last three years, Dick’s Sporting Goods trails the industry
averages by 44.7% and 62.4% respectively. Additionally, the quick ratio for Dick’s Sporting
Goods has fallen in each of the years since 2012 resulting in a total decline of 57.1%, while the
industry has consistently maintained its position. These low figures suggest that Dick’s Sporting
Goods has less liquid capital to pay off its short-term liabilities than its competitors. This may be
the result of a macroeconomic factor influencing a certain category of products that is offered
more extensively by Dick’s than its competitors. For Dick’s Sporting Goods, the explanation
likely originates in the recent stagnation of sales in golf equipment over the past several years in
its brick-and-mortar stores and its Golf Galaxy operations. According to articles from the Wall
Street Journal and Business Insider, Dick’s Sporting Goods stores have laid off hundreds of golf
specialty employees as golf sales fell approximately 10% in the second quarter of 2014. With
fewer numbers of people actively playing golf each year (reference Marketing section I), Dick’s
is beginning to reduce floor space for golf merchandise and expand its women’s and youth
apparel sections in many stores. This downward trend in golf sales is noteworthy because of the
potential effects on Dick’s Sporting Goods’ current ratio; where high cost golf merchandise is
sitting around in the company’s inventory. SportsOneSource sporting goods analyst, Matt

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Powell, noted in a Victorville Daily Press article that Dick’s has a long way to go in terms of
marking down golf inventory to clear its abundant backlog. This analysis can be conducted more
accurately by evaluating asset management ratios for the firm and its competitors.
Asset management ratios for Dick’s Sporting Goods’ suggested generally positive findings.
Inventory turnover ratio is slightly higher than the industry average, which suggests that its total
sales are competitive with the industry leaders. Dicks’ average days to sell inventory was also
lower over the course of the last three years. Based on the calculations, Dick’s is able to replace
inventory and sell it to customers more times per year than its competitors. This constitutes an
ability to rapidly turn assets into cash and pay off debts relatively easily. The firm’s average
collection period is also at equilibrium with the industry average of 2.81 days. The ability to
quickly collect cash payments on account sales is crucial for any retailer. Dick’s Sporting Goods
demonstrates this by managing its assets through a firm credit policy to ensure customer
payments and minimize uncollectible accounts. Fixed asset turnover was one ratio that does not
seem to be a relevant indicator of market positioning for Dick’s Sporting Goods because reported
net fixed assets on the balance sheet are book values, which may differ from the current market
values. In lieu of this, looking at total asset turnover allowed for the quantification of how Dick’s
Sporting Goods manages its assets to generate revenues. Once more, Dick’s has a slightly higher
average total asset turnover ratio than its main competitors at 1.93. This means Dick’s generates
more revenue per dollar of total assets, indicating favorable profit margins for the firm, and
possibly a higher volume of sales. However, this assumption is not completely accurate because
the total asset turnover ratio is a measure of efficiency used to generate sales, not a measure of
cost efficiency. Because the prices of similar goods offered by Dick’s and its competitors within
the sporting goods industry are extremely competitive and often established by the vendor, these
results suggest that Dick’s Sporting Goods sells more goods relative to total assets than its
competitors.
Debt management is another key factor in analyzing a firm’s performance. In terms of total
liabilities relative to total assets, Dick’s Sporting Goods has incurred lower amounts of debt over
the last three fiscal years than the industry average. However, the industry average was brought
up significantly by Sportsman’s Warehouse, which had higher debts than asset values in 2012
and 2013. With this in mind, Dick’s Sporting Goods has maintained an unchanging debt ratio
over the last three years, which indicates stability in the firm’s propensity to finance its assets.
Low long-term debt ratios over the last three years ranging from .14 to .10 place Dick’s among
the industry leaders in this category, which means Dick’s is not very dependent upon loans to
expand the chain. A better indicator of a firm’s debt management is determining how assets are
purchased, which can be measured by the equity multiplier formula. With a steady average
equity multiplier of 1.83 over the last three years, Dick’s Sporting Goods is doing significantly
better than the average of its competitors, which averages out at 2.28. Because most of its
product offering is in the price range of $20 to $200, Dick’s Sporting Goods does not likely have
to finance its inventory purchases, which keeps the firm out of debt relative to its total assets.
The final debt management ratio that is essential in this analysis is the times-interest-earned
ratio. If Hibbett Sports (an extreme outlier) is eliminated from the industry average, Dick’s
Sporting Goods becomes the clear industry leader. From 2012 to 2014, the company’s ability to
cover its interest costs surged by nearly 500%, increasing from 30.99 to 185.90. This increase is
a considerable indicator of the economic health of Dick’s Sporting Goods. Not only did Dick’s
boost revenues, resulting in a 26.7% growth in earnings before interest and taxes from 2012 to

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2014, but it also reduced its overall interest costs by 78.9%. This can likely be attributed to
paying off debt holders and incurring less debt over the previous three years.
Profitability ratios for Dick’s Sporting Goods displayed no significant variances from year to
year, nor are there any alarming deviations from the industry averages. While the firm’s revenues
increased by about $1.2 billion, expenses grew at a proportional rate, which left profit margins
unchanged. However, in analyzing first quarter data from the current year (2016), profits fell
17% and shares in the company fell 7.5% since the end of 2015 (Steele, 2016). According to
Dick’s CEO, Edward Stack, these first quarter losses can be attributed to challenging conditions
including unseasonably warm weather and rapid expansion plans in new partnerships and
product lines, which may have resulted in greater expenditures. Despite these figures, Dick’s
Sporting Goods’ executives expect to see rapidly increasing profits from such efforts, which also
include plans to acquire capital from closed Sports Authority stores, a top competitor that
recently filed for bankruptcy.
Figure 1. A time graph illustrating the growing trend in revenues for Dick’s Sporting Goods
leading into 2017.
In addition to these ratios, earnings per share and dividends per share on common stock, as well
as the price-to-earnings ratio were calculated for the past three years for Dick’s and its
competitors. No substantial changes were apparent in the analysis relative to the market.
However, dividend payouts did undergo an unusual pattern at the end of 2012. Dick’s Sporting
Goods offered its first dividend payout on common stock at the end of 2011 with a $0.50 single
payout. Shortly after, Dick’s began a series of $0.125 quarterly payouts until December 2012.
With stock price jumping from $45.05 to $47.97 between 12/24/2012 and 12/31/2012, Dick’s
Sporting Goods dispensed a special, one-time payout of $2.00 per share. With this time of year
being extremely busy for retailers, excessive Christmas holiday shopping is a likely cause for

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such an increase, which allowed the company to reward its investors. This could have had
positive or negative repercussions on future investment. On one hand, investors may have been
incentivized to reinvest more money into Dick’s Sporting Goods because of the unusually large
dividend. Dicks’ executives presumably announced the special dividend in order to establish
favorable expectations for the following quarter. Alternatively, investors may have been unhappy
when dividends returned to a more normal amount at the end of the next quarter. Finally,
earnings per share increased 27.9% from 2012 to 2014, indicating higher future profitability
relative to its competitors and the industry average growth of 14.8%.
Based on the overall ratio analysis of Dick’s Sporting Goods, it can be concluded that Dick’s is
in a healthy position among top sporting goods retailers in the market. Over the past three years,
revenues and earnings have increased. This directly correlates with maintaining a high inventory
turnover rate, indicating that they are still selling high volumes throughout the year, which
enables them to operate without incurring debt expenses. Unfortunately, due to socioeconomic
macro-environmental forces and expansion expenses, Dick’s Sporting Goods did not experience
increasing profit margins. For these reasons, it may seem logical for investors to hold their
current shares in the short run and consider purchase of additional common stock to continue
reaping the benefits of consistent dividend payouts and profitable projections that come with
future expansion. Looking at future long-term trends, however, tells a different story.
There is significant room for Dick’s to grow on multiple platforms. With the growing trend of
omni-channel “e-tailing” along with a rise in health and fitness trends, Dick’s is in a comfortable
position where expansion of brick-and-mortar stores, an expanding e-commerce platform, and a
generally healthy balance sheet are reasonable enough to suggest a buy for potential investors.
Due to a consistently dominant price-to-earnings ratio well above its competitors in the sporting
goods industry, Dick’s investors should be willing to pay more for a growth in anticipated
earnings. Until sales fall or market conditions change, there is no strong evidence that Dick’s
Sporting Goods will lose market share or diminish in value, but rather grow. Therefore, we
conclude that buying is the most reasonable action for long-term investors.

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2. Strategic Marketing Analysis
a. Immediate Environment, Segmentation, Targeting and
Positioning
As a leading competitor with the largest market share in its industry, Dick’s Sporting Goods
must focus in on its ability to play the best offense, so-to-speak, when placed into the
competitive arena of other retailers. The immediate environment for Dick’s Sporting Goods
consists of key competitive factors such as the company’s target customer base, the competitive
arena in which it positions itself, and the partners to whom it links with. The company’s long-
term strategy is designed to gain, maintain, and enhance loyalty for the Dick’s Sporting Goods
brand while also promoting its broad assortment of sporting goods equipment, apparel, and
footwear to its current and potential target consumer base. Building this unique brand passion
and scrutinizing today’s diverse market segments does not draw out so easily, because within the
competitive arena of the sporting goods industry, the game being played for retailers like Dick’s
spells out more like an ascent against a tall mountain compared to a one-mile jog.
In regards to its consumer base, Dick’s Sporting Goods pinpoints its attention toward an
audience that possesses specific needs based upon the type of outdoors and/or sporting lifestyle
people identify with. In other words, Dick’s main sales categories break down its target
consumers based on the active participation lifestyle that targeted and potential customers
classify with. Thus, it is important to first look at what exactly Dick’s Sporting Goods actively
pursues among its target customers. This approach may link directly and accordingly with
activity participation across the United States. A factor like participation levels helps determine
how much revenue Dick’s can expect to earn given the market segment it seeks. Figure 2, on
page 11, represents the percentage of people ages 6+ participating in some sort of physical
activity. According to the 2016 Physical Activity Council Report, this chart shows the potential
customers Dick’s can gain from individuals in this current generation. Generation Z (years
2000+) has lower inactivity percentages than the previous three mass-labeled generations
(Generation Y, years 1980-199, Generation X, years 1965-1979, and Baby Boomers, years 1945-
1964). Although the total percentage of inactive customers is relatively low compared to other
generations, Dick’s Sporting Goods must maintain a watchful eye on this statistic, which exhibits
a completely inactive population of 18.2% of Americans. This could negatively impact Dick’s in
the long run if this statistic does not continue to decrease. However, with activity levels
increasing among all age categories, sporting goods retailers are innovating new ways to meet
customer demands.

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Figure 2. A division of different activity participation levels throughout time.
The primary factors that have historically influenced the company's profitability and success
have been the growth in its number of physical locations, increasing same store sales, and
positive gross profit margins. For example, over a five-year period, the company has expanded
from 419 Dick's Sporting Goods stores at the end of fiscal year 2009, to 603 Dick's Sporting
Goods stores at the end of fiscal year 2014. As a complement to the firm’s store growth, Dick’s
has also modernized its e-commerce platform year after year. Over the past three years, the
company has innovated its e-commerce sites with enhancements in customer experience, a new
release of its mobile site, and the development of capabilities that integrates Dick’s online
presence with its brick and mortar stores. These include ship-from-store, buy-online, pickup in-
store, return-to-store and multi-faceted marketing campaigns that are consistent across stores and
e-commerce websites. The firm's store network remains fundamental to the strength of its omni-

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channel platform, and it continues to expand its presence through the opening of many new
stores. In other words, Dick’s Sporting Goods aims to find a competitive “sweet spot” advantage
where physical store growth, offering a physical presence to better serve customers, will go
hand-in-hand with an expanding digital platform, offering a gateway into maximizing more
profits.
Dick’s Sporting Goods’ executive team believes it has the potential to reach approximately 1,100
locations, including smaller-market shops across the United States. The expansion of its store
network will also promote growth in e-commerce sales, as Dick’s continues to deliver a premium
omni-channel shopping experience for all of its customers.
Within a highly competitive market, Dick’s Sporting Goods must focus on what differentiates
itself from top competitors within the sporting goods industry. The company competes with other
sporting goods retailers on all fronts, including large, traditional, specialty, online, and catalog-
based sporting goods retailers. It focuses its intentions on enhancing customers' performance and
enjoyment of athletic and leisurely pursuits, rather than solely concentrating its merchandise on
the latest fashion trend or style. One unique attribute is Dick’s Sporting Goods’ "store-within-a-
store" concept that allows brand name exhibits to dwell underneath the Dick’s Sporting Goods
umbrella, an example being Nike’s ‘Field House.’ This physical design feature creates a
distinctive shopping environment for designated customers by combining brand name sporting
merchandise with access to a sporting goods multi-marketplace.
Within Dick’s Sporting Good’s Annual Report (Fiscal Year 2015, Form 10-K) the company
makes note of its private brands that provide unique value and quality that customers cannot find
anywhere else. Products and brands such as Adidas baseball, CALIA, DBX, Quest, Reebok,
Slazenger, Top-Flite, Umbro and Walter Hagen are not commonly distributed to many of its
retail competitors. This speaks loudly to Dick’s large inventory and exclusive product offerings.
Additionally, other popular brands such as Nike, Under Armour, and Titleist maintain a strong
presence on the shelves at Dick’s Sporting Goods in order to reach out to a wider array of
consumers. This multitude of available brands allows its target market of physical activists and
sport enthusiasts to find exactly what they looking for and when they wish to find it.
Furthermore, Dick’s Sporting Goods does not only seek to carry leading brands, but to diversify
a large range of these brands. A wide breadth of sporting goods product selections, spread among
different categories will ultimately give its consumer a better range of products to choose from.

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Fiscal Year
Categories 2015 2014 2013
Headlines(1) 45% 44% 44%
Apparel 35% 36% 35%
Footwear 19% 19% 20%
Other 1% 1% 1%
Total(2) 100 100 100
1. Includes items such as sporting goods equipment, fitness equipment, golf equipment and
hunting and fishing gear.
2. Includes the company's non-merchandise sales categories, including in-store services and
shipping revenues.
Figure 3. Segmented revenues among different product categories, including headlines, apparel,
and other.
Figure 3 above illustrates how Dick’s approximate sales are distributed among four main
categories of its product offerings. The categories Dick’s has listed, including hardlines, apparel,
and footwear, help define the generic buying behavior of its target market. Branding itself at the
sporting goods industry, the company knows that equipment must be at the top of the line.
According to the company overview originating from the corporate website, Dick’s Sporting
Goods attempts to “serve and inspire athletes and outdoor enthusiasts to achieve their personal
best.” Having extraordinary quality equipment allows athletes to not only participate in a sport,
but to perform at the most elite level.
Dick’s Sporting Goods tags itself as “the largest full-line U.S. retailer in the sporting goods
industry,” (investors. dicks). For its respective segments of apparel and footwear, Dick’s
competes with top competitors including Footlocker, Champs and Finish Line, which are
traditionally known for larger selections of footwear. Retailers such as Cabela’s, Academy
Sports and Outdoors, Sports Authority, and Hibbett Sports compete with Dick’s in the sports
equipment and athletic apparel segments. As illustrated below in Figure 4, Dick’s Sporting
Goods currently holds the largest individual market share in the full-line sporting goods industry
with a 10% market share, versus a 23% share divided among its five main competitors.

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(1) DICK’S market share includes FY2014 sales from Golf Galaxy and Field & Stream.
(2) Estimated $67 billion U.S. sporting goods market based on 2013 NSGA Equipment,
Footwear and Apparel sales and 2013 NBDA Bike sales.
Figure 4. An estimated market share of the current sporting goods industry.
Taking a closer look at various competitors within the sporting goods industry will propose a
framework for just how Dick’s Sporting Goods is relatively positioned. The competitive
environment consists of game-players such as Cabela’s, Hibbett Sports, Foot Locker, Finish
Line, and Sports Authority.
Cabela’s
Cabela’s revenues fell behind Dick’s Sporting Goods for fiscal year 2015. Dick’s turned $7.3
billion in revenue and a net profit of $2.1 billion, while Cabela’s reported $3.9 billion in revenue,
which is a 43% lower than Dick's Sporting Goods. A $1.7 billion
net profit, however, is a more accurate figure for comparison with
expenses accounted for as well. Cabela’s retains a 5.8% share of
the sporting goods market as of the end of fiscal year 2015.

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Hibbett Sports
Hibbett Sports reported a revenue of
$943 million, 87% less than Dick’s Sporting
Goods. Hibbett’s net profit of $332 million is
84% less than Dick’s Sporting Goods’ profit.
However, its profit margin ratio has consistently
exceeded the industry average in recent years.
Hibbett Sports holds a relatively small market
share for a major competitor at only 1.4%.
Foot Locker
Foot Locker had a revenue of $7.4 billion in
fiscal year 2015, a 2% margin on Dick’s
Sporting Goods’ reported revenue. Fortune 500
lists Foot Locker’s market value at $8.7 billion,
which is 23% greater than that of Dick’s
Sporting Goods. Foot Locker’s profit rang in
slightly above Dicks’, at $2.5 billion. Foot
Locker is the only major competitor with a
stronger market share, edging out Dick’s by
0.1% (Finance.yahoo).
Finish Line
Revenue for Finish Line totaled $1.8 billion in 2015, leaving a 73% gap between itself and
Dick’s Sporting Goods. Additionally, its net profit of $583.3 million fell short of Dick’s by 72%.
Finish Line reserves a 2.7% market share in the sporting goods industry; however, the firm is
much more selective in its locations and offers a fraction of the products carried by total sporting
goods retailers like Dick’s Sporting Goods.

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Sports Authority
Sports Authority
was ranked #123
in Forbes list of
America’s Largest
Private Companies
for fiscal year
2015. Having a
recorded revenue
of $3.5 billion,
Sports Authority
clinched a
respectable market
share of 5.2%. However, according to a recent article from the Wall Street Journal, this long-
standing competitor filed for bankruptcy in March of 2016, claiming it will be closing nearly 140
stores. The result will directly impact Dick’s market share, as decreased competition and
potential acquisition of business and capital look to be in the near future for Dick’s Sporting
Goods. This also indicates more room for stock growth as more traffic will be directed toward a
local Dick’s brick-and-mortar store that has outlasted the foreclosed Sports Authority locations.
The table below sums up the competitive landscape for Dick’s Sporting Goods, as it displays
different measures between the top competitors within the sporting goods industry.
Competitors 2015 Total Sales (in
billions)
2015 Profitability (in
billions)
2015 Market Share
(%)
Dick’s Sporting
Goods
$7.3 $2.1 10.9%
Cabela’s $3.9 $1.7 5.8%
Hibbett Sports $.943 $.332 1.4%
Foot Locker $7.4 $2.5 11%
Finish Line $1.8 $583 2.7%
Sports Authority $3.5 N/A 5.2%
Table 1. A look at three distinctive competitive measures that adhere to the line-up of top
competitors within the sporting goods industry.
Brand Partnerships
Dick’s Sporting Goods counts its relevant brand partnerships as part of the lure for fitness and
sports enthusiasts. It carries a wide variety of well-known and trusted brands including Nike,
Adidas, Asics, Callaway Golf, Columbia Sportswear, Remington, The North Face, and Under
Armour. The retailer sells more Nike and Under Armour items than any other national store.
Dick’s has also developed original content series and films to celebrate the power of sports and

17. 17
build long-lasting relationships with its customers through their many different tastes and
interests. The company taps into unique partnerships for value-added attributes like shared cost
efficiencies, leverage over competitors, new product launches, access to athletic brand
ambassadors, and exclusive new products making it an authentic omni-channel provider of
certain licensed sporting goods and merchandise on ESPN.com and other digital channels.
The Consumer and Competitive Environment
Understanding the framework set forth for the both the competitive sporting goods arena along
with targeted customers gives insight as to which contenders in the field play the game, so-to-
speak, versus those who may be progressively losing yardage. The market for sporting goods
retailers is highly fragmented and intensely competitive. By offering a wide range of products
both in-store and online, Dick’s seeks to attract potential customers by creating a unique omni-
channel retail experience.
North America currently dominates the market for sporting goods retailing. The sporting goods
industry is comprised of establishments engaged in the manufacturing and retailing of sporting
goods, camping equipment, exercise & fitness equipment, athletic uniforms, specialty sports
footwear, apparel, and accessories. Approximately one quarter of sporting goods equipment sales
in the U.S. is handled by chain sporting goods retailers like Dick’s Sporting Goods, Bass Pro
Shops, Cabela’s, and Sports Authority. In total, sporting goods revenues exceeded $43 billion in
2013 in the United States (Statista).
There are several current factors that accelerate the velocity of the sporting goods industry.
Major components include growth in disposable income, increasing consumer spending habits,
governmental promotion of sports activities and participation, and the skyrocketing health and
fitness boom (“Global”). This last factor is really driving the bus for the growing demand in this
industry, where a rise of health-conscious people in the last few years Additionally, an increasing
popularity for both American and international sporting events is projected to encourage more
people to participate in sports and outdoor activities. This behavior consequently drives demand
for the essentials of sports - equipment, apparel, footwear, and accessories. The expanding
market is forecasted to reach an estimated $266 billion by 2017, with a compound annual growth
rate of nearly 4% from years 2015-2020 (Reuters).
In this industry, focusing attention on the consumer and absorbing buying behavior is a critical
piece of information. This approach allows a retailer like Dick’s to make better, more strategic,
and more ingenious decisions that will ultimately decide where and to what extent its target
consumers purchase their sporting goods equipment among the competition. The current
situation of the sporting goods industry is one where competitors may just be sweating to stay in
the game. A key halting feature can be attributed to the bottom line decline in sports participation
among youth. A number of today's children in the U.S. and Europe choose video games over
physical and outdoor activities, setting a trend that has shifted the sporting goods industry's core
customer from the adolescent to the adult (Yahoo!-Sporting Goods). The consumers’ changes in
sports activity has also led to a change in fashion interests, where here again companies like
Dick’s must adjust and respond to the ever-growing fitness boom. New trendy yet casual sports-
logoed looks have overshadowed a generic, moderate look in traditional fashion wear.

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In a relatively new phenomenon, sporting goods retailers are beginning to unite to increase sports
participation and promote a healthy, active lifestyle. Some competitors have formed specialized
lobbying groups while others have launched promotional campaigns. The sporting goods
industry can only benefit from persuading more people to leave the couch for the court. In other
words, more sweat from more people could equal more revenues for companies like Dick’s. All
things being considered, top channels like Dick’s Sporting Goods must begin to look for new
strategies that will increase spending from both existing customers, as well as the more
unintended, “sedentary” counterparts into the purchasing premises. Although Figure 5 (below)
illustrates a steady, consistent growth in sporting goods sales over the years, sporting goods
retailers must counteract the pace at which this trend is slowly flattening.
Figure 5. Illustrates overall U.S. consumer spending trend on sporting goods from 2002-2015.
The figure above illustrates how demand for sporting goods has increased over the last decade.
Yet the trend is slowly decelerating, so more strategical methods must be implemented for
retailers like Dick’s in order to play the game and hit homerun sales.

19. 19
The sporting goods industry has yet to find a place on the once-burgeoning online frontier. In
fact, sporting goods equipment continue to rank low on the list of consumers' favorite products to
buy on the Internet (Yahoo!-Sporting Goods). This coupled with the competition from sport-
specific specialty e-tailers (like those that are golf or fishing-focused), has driven many of these
sporting goods retailers to outsource its digital online platforms (Yahoo!-Sporting Goods).
According to Dick’s Sporting Goods’ Annual Report, this is just the case. The statement reads:
“We [Dick’s Sporting Goods] have contracted with a single third party to operate and host our
www.DICKS.com E-Commerce website and provide related fulfillment and customer service. We
rely on that party's operational, privacy and security procedures and controls to operate and
host our www.DICKS.com E-Commerce business. Failure by such third party to adequately
service these aspects of our www.DICKS.com E-Commerce business could result in a prolonged
disruption that affects our customers' ability to utilize our website or receive product in a timely
manner. As a result, we may lose customer sales and/or experience increased costs, which could
materially affect our reputation, operations or financial results (Dick’s Sporting Goods, Inc.
Annual Report Form 10-K).”
Dick’s main goal now should be investing more efforts into its e-commerce platform. Since more
and more people are shifting their shopping experience to computer screens, Dick’s and its
competitors have no choice but to adapt to this e-tail trend. In recent years however, Dick’s
Sporting Goods has brought innovation to the table as its e-commerce sites have been enhanced
through customer experience, new releases of mobile and tablet sites, and development of
capabilities that integrate the its online presence with its brick and mortar stores, including ship-
from-store, buy-online, pick-up in-store, and return-to-store. From a numerical standpoint, the
company's e-commerce sales penetration to total net sales has increased from 2.8% in fiscal
2010, to 9.2% in fiscal 2014, and to 10.3% in fiscal 2015 (Dick’s Sporting Goods, Inc. Annual
Report Fiscal Year 2015, Form 10-K). In the last quarter of 2015 alone, e-commerce consisted of
15.7% of total net sales, compared to 14.4% during the same quarter in 2014. These increases,
however, may be seen as a direct result from a transparent showrooming effect beginning to take
place within stores, as more and more customers place an opportunity cost on buying in store vs
online. As more and more shoppers shift their purchasing focus online due to showrooming, in-
store sales may even be at risk for cannibalization. Nonetheless, Dick’s has reported that it hopes
to increase total e-commerce revenue anywhere between $1 billion and $1.2 billion for fiscal
year 2017, up from $628 million in 2014 (Germano).

20. 20
Figure 6. Representation of Total and E-Commerce purchasing trends of sporting goods ranging
from 2004-2013.
With this discussion of an increasing e-tail platform at hand, it is important to take a step back
and evaluate this growth industry-wide. The figure above illustrates the growing trend of e-
commerce that sporting goods consumers have been shown to adapt to as time has elapsed. From
years 2004 to 2013, a slow and steady increase in e-commerce sales as a fraction (in billions) of
total sales is evident for sporting goods sales in the U.S. Although this time graph excludes years
2014-2015, our assumptions based on our analysis thus far would lead us to conclude that the
number of e-commerce sales accounting for total sales has only increased since 2012-2013, and
will ultimately continue to do so.
CEO Edward Stack has addressed investor concerns that Dick’s will be hurt by Nike’s pledge to
grow its online sales six-fold in the next five years, simply because the retailer will not have as
much product exclusivity. Dick’s has been experiencing a cost disadvantage to other expanding
e-commerce retailers like Nike. Even Nike and Under Armour, two of the company’s major
suppliers, are increasingly advancing its direct-to-consumer operations, as seen by expanding
factory outlets and growing e-commerce platforms, making them rely less and less on Dick’s
brick and mortar stores as a mechanism of sales (Germano). Dick’s has been hurting in the past
few years from online retailers, once more pushing the demand to improve its e-commerce
digital platform further.

21. 21
“This is a bit overblown right now from the investor community,” Mr. Stack said, adding that the
retailer will still provide a service in being a showcase of products across the industry. “The
thing we have over the brands themselves is that customers are looking for selection across
brands (Germano).”
With this in mind, Dick’s may just be at a cost disadvantage to most other e-commerce retailers.
Even Nike and Under Armour, two of the company’s major suppliers, are increasingly advancing
its direct-to-consumer operations like expanding factory outlets and growing e-commerce
platforms, making them rely increasingly less on Dick’s brick and mortar stores as a mechanism
of sales. For instance, Under Armour's most recently reported direct-to-consumer sales as a
percentage of total revenue increased 28% from a year ago, while Nike's was up about 29% from
a year ago (Rossolillo). Dick’s has been hurting in the past few years from online retailers, once
more pushing the demand to improve its e-commerce digital platform further. With its 644
massive stores, the company also has large infrastructure expenses that put it at risk for
showrooming effects.

22. 22
Perceptual Map
Figure 7. A perceptual map that balances price against customer satisfaction. Customer
satisfaction ratings obtained from J.D. Power & Associates customer reviews.
The perceptual map above illustrates a clear spectrum for where each company is positioned
within the sporting goods retailing industry relative to its competitors. Consumer reports and
feedback are instrumental factors in determining why certain athletes and outdoor enthusiasts
choose to buy products at one company over another. Interestingly enough, price ultimately may
not be the determining cause for specific positioning for companies like Dick’s Sporting Goods,
Sports Authority, Academy, Cabela’s, and Foot Locker. Another measure such as customer
satisfaction can give a clearer picture of the magnitude of appraisal by the customer. This
variable can highlight a more significant competitive advantage amongst competing retailers.
Pricing
INEXPENSIVE EXPENSIVE
HIGH
LOW
CustomerSatisfaction
HIGH

23. 23
The horizontal axis of the perceptual map examined seven different products that can be found
across each competing retailer in the industry. These products included Nike’s Air Max 2016
Running Shoe, Nike’s Brasalia 6 L Duffle Bag, a Schwinn 430 Elliptical, a Columbia Sportswear
Men’s rain weather jacket, Nike Men’s 6-pack Dri-Fit crew socks, Under Armour Core
Performance sunglasses, and a Spalding NBA Street basketball. Some products such as the
basketball and elliptical machine will not be available in stores like Cabela’s or Foot Locker.
Therefore, pricing assumptions for each product based on the store they are actually found in,
helped get a more accurate idea of where each company should be positioned. Due to the
extremely competitive nature of the industry, almost every product offered nearly identical sales
prices across the line. For example, a Nike Air Max 2016 Running shoe retails at $189.99 at each
company. Cabela’s also shares a similar pricing range with these companies where a Columbia
Men’s Rain Jacket is sold for $39.99, the same price offered at Dick’s Sporting Goods,
Academy, and Sports Authority. The exception to this relatively linear relationship was Wal-
Mart. Wal-Mart was placed on the lower left end of the pricing spectrum because most of its
products generally sell at a lower price than its competitors. For instance, a Spalding basketball
can be purchased for $12.99 at Wal-Mart compared to $17.99 at Dick’s Sporting Goods. Because
of its consistently low pricing, consumer behavior tends to migrate towards Wal-Mart if being
cost conscious is a primary objective. All of these findings resulted in the placement of Dick’s
Sporting Goods, Academy, Sports Authority, Foot Locker, and Finish Line in a vertically linear
line for its x-coordinate positioning. Thus, concerning its pricing strategy, Dick’s Sporting
Goods cannot conclude that it positions itself considerably better than its competitors’ positions
and cannot be placed at a pricing extreme on this perceptual map simply because pricing strategy
does not play to its favor. Overall, Dick’s Sporting Goods does not have any advantages or
disadvantages with its pricing strategy. This general neutrality still allows the firm to remain
competitive in the industry, which suggests it should maintain its current pricing model. Any
drastic changes of price hiking or discounting could potentially harm the company.
The vertical axis of the perceptual map depicts customer satisfaction. Several factors that helped
dictate the positioning of the companies included staffing, labor costs, and facility which came
from J. D. Power and Associates’ Customer Satisfaction Rankings. An extensive examination of
customer reviews and complaints from Yelp.com, Glass Door, and Consumer Affairs were
evaluated. The majority of customer reviews were similar to the following: “The associate had
no idea where to find a football sleeve with padding or athletic tape” or “It took five minutes to
simply find an associate in the entire store” (Yelp, 2016) Countless reviews were of the negative
nature which explains Dick’s Sporting Goods positioning well below average in overall customer
satisfaction. Employing knowledgeable associates that have experienced substantial amounts of
training to its associates is paramount if Dick’s Sporting Goods hopes to improve customer
satisfaction levels and see customers return to its stores. J. D. Power and Associates further
proves this through its findings that employees have a 30% weight of importance in deciding
overall satisfaction, which is the highest percentage of any other determining factors. Excellent
customer service is a direct benefactor in increasing sales and maintaining a loyal customer base
who have memorable experiences with the organization, examples being Cabela’s, Chick-fil-a,
and Publix.

24. 24
BCG Matrix
Figure 8. BCG Matrix balancing Dick’s Sporting Goods’ relative market share against
potential market growth, along with associated stars, question marks, cash cows, and dogs.
Figure 8 exhibits a Boston Consulting Group Matrix that is a corporate planning tool used to
portray a firm’s brand portfolio and strategic business units on a quadrant along relative market
share axis (horizontal axis) and the speed of market growth axis (vertical axis). It is critical for
Dick’s Sporting Goods to recognize its strengths and weaknesses in its business portfolio to take
advantage of market-share growth opportunities. The BCG matrix allows analysts to rank the
growth of Dick’s strategic business units and categorize them according to growth rate and
market share.
SportsEquipment Hunting& Firearms
Footwear& Apparel Golf

25. 25
The first quadrant in the BCG Matrix is a firm’s “stars”. Stars are products that operate in high
growth industries and maintain high market share. Stars are both cash generators and cash users
because they are the primary units in which the company should invest its money. Therefore,
stars are expected to become cash cows and generate positive cash flows. For Dick’s Sporting
Goods, its sports equipment segment is a star. This segment generates the largest percentage of
total revenue for Dick’s making up 45% of total revenue, as illustrated in Figure 2. This SBU
keeps Dick’s Sporting Goods competitive with specific sporting goods oriented competitors like
Academy, Cabela’s and Sports Authority. As illustrated in Figure 2, the consistent performance
for this segment allows Dick’s Sporting Goods to estimate how much to invest in it, knowing
that its “star” will bring in roughly 44%-45% of total income. Because this SBU accounts for
almost half of total revenue, Dick’s can invest in this segment as much as they deem necessary
and expect it to have huge returns. Dick’s Sporting Goods can also use revenue from this SBU to
invest in firearms or footwear. The only concern for Dick’s with its stars is if they might
eventually become cash cows. This can happen if the company sustains its success until a time
when the market growth rate declines (Arline, 2015).
The second quadrant contains “question marks”. Question marks are business units that require
much closer consideration. They hold low market share in fast growing markets which consumes
a large amount of cash and can incur negative losses. They have potential to gain market share
and become a star but they do not always succeed and even after large amount of investments
they can still struggle to gain market share and eventually become dogs. Therefore, they require
very close consideration to decide if they are worth investing in or not. Hunting gear and
firearms are the “question marks” for Dick's Sporting Goods. Smaller product offerings and
fewer specialized employees make Dick's Sporting Goods the least optimal destination to shop
for guns and hunting gear relative to a competitor such as Cabela’s. Because Dick's is widely
recognized for its sporting goods, this “question mark” is a wild card for Dick's Sporting Goods,
with many factors that can affect the way this segment performs. Following the Sandy Brook
incident and the possibility of regulation on gun laws, Dick's Sporting Goods “inventory of
firearms was drastically reduced and many mainstay items came off the shelves” (Carlozo,
2015).
The third quadrant of the BCG matrix is made up of products that are “cash cows”. Cash cows
are the most profitable brands and should be given considerable attention to provide as much
cash as possible. Cash Cows have high market share but low market growth, these products or
services are believed to “provide the cash required to turn question marks into market leaders, to
cover the administrative costs of the company, to fund research and development, to service the
corporate debt, and to pay dividends to shareholders” (Arline, 2015). Therefore, companies
should look to invest in its sources of income to maintain the current level of productivity.
Footwear and athletic apparel are “cash cows” for Dick’s Sporting Goods. Second and third to
sports equipment, these cash cows bring in 35% and 19% of total revenue for Dick's Sporting
Goods, as illustrated in Figure 2. This segment keeps Dick's Sporting Goods competitive with
companies like Footlocker, Finish Line and Hibbett who are more popularly known for athletic
footwear. What separates Dick's Sporting Goods from this segment’s competitors are products
like track spikes, hiking boots, golf and football cleats, that customers cannot find a large
variation of or if any.
The fourth and final quadrant of this matrix is comprised of the “Dogs”. These are products that
companies should avoid or contemplate divesting because they are low in both market growth

26. 26
and market share. “Dogs” are generally considered cash traps because businesses have money
tied up in them, even though they generate little to nothing in return. Dick's Sporting Goods’ golf
department is considered a “dog”. It brings in the lowest percentage of revenue for Dick's
Sporting Goods as seen in Figure 2 in which it is costing Dick's Sporting Goods more money
than it is generating. Chief Executive Officer Edward Stack said the company now, “expects a
downward trend in golf sales to continue for the rest of the year, which forced Dick's to trim its
earnings outlook. Shares sank 18%” (Germano & Rubin, 2014). Same store sales also dropped a
sizeable 9.3% at Golf Galaxy this past quarter. Furthermore, the restructuring of its golf business
cost Dick’s $20.4 million in the quarter (Lahtinen, 2014). Because of the recent decrease in
golfing, Dick's Sporting Goods fired over 500 PGA Professionals on staff (Covey, 2014).
b. Macro-environmental Forces
Social Trends
As demonstrated below in Figure 8, a recent “fitness” trend has evolved where less people are
completely inactive. This means that people are participating more in sports and other exercise
activities. For Dick's Sporting Goods, this trend means that they can expect a growth in its
customer base. An increase in demand for sporting goods will correlate with an increase in sport
activities. Figure 1 reveals how the overall inactivity percentage has been decreasing with this
generation. This correlates with the financial analysis conducted for Dick's Sporting Goods’
where revenue is increasing from years 2012 to 2014 going from $5,211.814 million to $6,213.2
million (Reference Financial Analysis Part I).
Figure 9. A time graph that compares fitness and activity levels to age from time period 2010-
2015.

27. 27
Economic Situations
The study from Aspen Project Play in Figure 9, presented evidence that certain team sports have
high percentages of their players coming from high income households. “Families that can afford
more, play more,” (aspenprojectplay.org). With this being said, higher income families have the
means to invest more in sports participation. This reflects in the purchasing of quality equipment
and apparel.
Figure 10. Income levels impacting participation among different sports.
Weather Patterns
As stated in an article by Market Watch, Dick's Sporting Goods did not meet its sales projections
for 2015. Additionally, shares of Dick's Sporting Goods “fell more than 7.5% in premarket trade
after the company missed profit expectations for the fourth quarter. Same-store sales also
declined 2.5% in the fourth quarter. The sporting goods retailer CEO, Ed Stack attributed these
misses due to unseasonably warm weather (Williams 2015). Other sporting goods retailers felt
the pressure from changes in weather. After the long stretch of consistently warmer
temperatures, retailers are buried in inventories of seasonal apparel, from sweaters to boots to
scarves and hats, that shoppers just have not been buying (Rubio, 2016.) Weather is a factor that
often goes overlooked, but in instances such as this, can largely influence consumer demand and
therefore impact profitability. Dick's Sporting Goods offers equipment for various sports, which

28. 28
means weather plays a huge role in the business. With different weather comes different seasons
and different sports. Therefore, Dick's Sporting Goods purchases merchandise with regards to
the weather conditions so customers can feel warm or cool during changing seasons and
temperatures.
Regulations
Variation in gun laws across the United States has enormously affected the stability in the sales
of firearms. This is partially a reason for this segment being labeled a “question mark” for Dick’s
Sporting Goods in its BCG Matrix from Figure 5. As previously mentioned, Dick’s stopped
selling semi-automatic firearms in the wake of the Sandy Hook Elementary School shooting
spree on December 14, 2012. Dick’s inventory of firearms was also drastically reduced and
many mainstay items came off the shelves (Carlozo, 2015). Dick’s Sporting Goods recently
released press statements explained, “In connection with the sale of firearms in our stores, we
must comply with a number of changing federal and state laws and regulations related to the sale
of firearms and ammunition,” (Dick's Sporting Goods Annual Report Fiscal Year 2015, Form
10-K). Factors like these play a huge role in this segment and create room for unpredictability in
analyzing whether they want to continue investing in this segment or consider other options.
c. Strategic Marketing Mix
Product
Dick's Sporting Goods is relatively competitive when it comes to its product offerings. Since it is
a retailer in a large industry that does not manufacture its own products, many products are
similar to those offered by its competitors ranging from Nike running shoes to Gamo Air Rifles.
This illustrates a strong level of reliability Dick's Sporting Goods has with its suppliers. Having
the same products as competitors constitutes Dick's Sporting Goods selling them at the price
range as shown in Figure 4. However, Dick's Sporting Goods offers “a wide variety of private
brands and products through exclusive licenses, that customers cannot find anywhere else,”
(Dick's Sporting Goods Annual Report, 2016). Dick's Sporting Goods has a competitive
advantage over its competitors with brand exclusivity for its customers through these private
label brands such as Calia, DBX, Quest, Lady Hagen, and many other brands that consumers can
only find at Dick's Sporting Goods.
Price
Dick's Sporting Goods is very competitive within the sporting goods market seeing as how its
competitors sell a number of the same products from manufacturers. Referring back to Figure 4,
with the exception to Wal-Mart, all of the retailers that sell the same products as Dick's Sporting
Goods offer them at a considerably close price, if not the same price. As mentioned earlier, the
Nike Air Max 2016 sells at all different stores at a consistent $189.99 price tag. However, Dick's
Sporting Goods attempts to stay competitive with its price matching policy exhibited in Figure 8.
This marketing strategy explains, “If you find a lower price on an identical item (brand and

29. 29
model number) currently available for sale at a local retail store, we will match it. Just bring in
the retailer’s ad at the time of purchase (dickssportinggoods.com).”
Figure 11. Dick’s Sporting Goods Price Guarantee for its customers.
Place
According to its most recent Annual Report, Dick's Sporting Goods has operated 741 stores in 47
states (Dick's Sporting Goods Annual Report, 2016). The firm’s headquarters in Pennsylvania
also has the most locations with 52 stores total, including Golf Galaxy, Field & Stream and other
specialty concept stores. Its four distribution centers are located in Arizona, Pennsylvania,
Georgia and Indiana. The facility located in Arizona is the only one owned by Dick's Sporting
Goods while the remainders are held on leases (Dick's Sporting Goods Annual Report Fiscal
Year 2015, Form 10-K). Dick's Sporting Goods has its sights set on growth opportunities
through the addition of more stores and expanding its E-Commerce platform. The Pittsburgh-
based sporting goods and apparel retailer will drive profitability by investing $1.8 billion in
capital expenditures over the next five years, primarily by adding physical stores, stores
remodels, expanding its e-commerce platform and growing its Field & Stream outdoor specialty
brand (Kulikowski, 2013). With such a big investment in expansion, Dick's Sporting Goods
made this move “after forecasts of sales increasing up to $9 billion annually by 2017,” (Torres,
2015).
One relevant trend seen in Dick's Sporting Goods’ annual report, is that most stores are located
in densely populated states. California occupies 43 stores, Ohio has 50, and Pennsylvania has 52
stores. Dick’s is ranked third in having the top number of stores in which all are ranked in the top
7 states with the largest population. California has a population of 39,144,818, Ohio: 11,613,423
and Pennsylvania: 12,802,503 (infoplease.com). Dick's Sporting Goods anchors some stores near
shopping centers or inside malls, where large numbers of people shop. For instance, Dick's
Sporting Goods stores can be located in the St. Johns Town Center in Jacksonville, FL or in
Town Center Commons in Kennesaw, GA. Dick's Sporting Goods is attracting customers that
are already in a shopping mood and strategically placing its stores where people who are ready to
spend money can see them.

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Promotion
The promotion strategy of Dick's Sporting Goods is to “build loyalty for the Dick's Sporting
Goods brand while promoting our broad assortment of brand name sporting goods equipment,
apparel and footwear in a specialty store environment,” (Dick's Sporting Goods Annual Report
Fiscal Year 2015, Form 10-K). Dick's Sporting Goods attempts to achieve this goal through
leaning more towards digital marketing. On its YouTube channel, Dick's Sporting Goods has an
array of commercials that circulate around unique taglines such as ‘Sports Matter’ and
#WhoWillYouBe. Dick's Sporting Goods’ ‘Who Will You Be’ commercials champion the hard
work that is invested by athletes and how sports are a test like no other “where the decisions you
make, make all the difference” (Youtube). Showing different athletes perfecting the craft,
working out or playing in a game, suggests that the moments created by sports during in game
situations and offseason training have athletes answering this question that “demands an answer
and lies to no one.” Promotional campaigns such as these want to target and encourage this
athletic consumer. Additional commercials like these involve famous professional athletes like
Robbie Ray of the Arizona Diamondbacks and Quarterback Robert Griffin III. In doing this,
Dick's Sporting Goods is demonstrating the passion they have for athletes and sports while
showcasing its broad assortment of sporting goods.
Another promotional method implemented by Dick's Sporting Goods is its loyalty programs.
Dick’s looks to “expand the customer relationship marketing database from our "ScoreCard"
loyalty program” (Dick's Sporting Goods Annual Report, 2016). Dick’s ScoreCard is free to sign
up for and is intended to benefit loyal customers. ScoreCard members get one point for every
dollar spent at DICK'S Sporting Goods, Field & Stream, Golf Galaxy, and online stores where
they can also earn a $10 Reward for every 300 points and get exclusive discount coupons via
mail and e-mail (My Scorecard Account).”
According to its annual report, Dick's Sporting Goods believes it is, “actively involved in
communities, sponsoring thousands of teams in various sports at the local level,” (Dick’s
Sporting Goods Annual Report, 2016). Dick's Sporting Goods’ engages promotional
opportunities through its community program, which has a website for sport teams to sign up for
and receive donations or sponsorships (Dick's Sporting Goods’ community.sponsorport). Dick's
Sporting Goods has the Tournament of Champions for lacrosse and a National High School
Basketball tournament for nationally ranked teams (dicksnationaltournament).

31. 31
d. Isolated Sales Forecasting
Figure 12. Revenues originate from Bloomberg Terminal data while GDP data (in billions) for
years 2011-2015 relative to DICK'S Sporting Goods. Source: www.tradingeconomics.com.
The regression analysis for Dick’s Sporting Goods uses Gross Domestic Product as the
independent variable, over the same five-year period. The results revealed that a gradually
increasing GDP was followed by an increase in sales revenue. The coefficient of determination,
also known as r-squared, was .9871. The close proximity to 1.00 indicates that the regression line
is almost a perfect fit with the data provided. This positively correlated relationship between
annual sales revenue and GDP can suggest that the same macro-environmental factors directly
influence this relationship between retail sales and GDP.
Gross Domestic Product is an economic indicator of the total dollar value of all goods and
services produced in one year. Over the last five years, GDP has been steadily increasing,
providing adequate indication of good economic health and a continuous output of products. In

32. 32
other words, consumers are purchasing more. As a result, retail sales in stores such as Dick’s
Sporting Goods are increasing alongside a growing GDP (Trading Economics, 2016).
In the next four years, GDP is projected to grow from $17.419 billion to $20.188 billion (Trading
Economics, 2016). Based on the findings in the regression analysis, this would suggest Dick's
Sporting Goods retail sales should increase at a similar rate. However, some unpredictable
macro-environmental forces such as competition, weather variations, household income, or law
regulations as seen in Figure 11, could facilitate deviations from either side of the relationship.
3. Strategic Assessment of Operations, Supply Chain,
Technology, and Infrastructure
a. Key Order Winners and Qualifiers
When identifying key winning traits, or “order-winning” criteria for a company like Dick’s
Sporting Goods, it is important to realize the strengths it possesses. In broad terms, Dick’s taps
into the sports, outdoors, and camping markets by offering an array of firearms, hunting and
fishing gear, golf equipment, tailgate necessities, while in the meantime directly targeting
outdoor enthusiasts, amateur athletes, sports fans, and active women and children. But with such
an extensive customer base and such a wide array of product offerings, it may seem slightly
unclear in how Dick’s win orders in the sporting goods arena. The company must align its focus
on a competitive strategic advantage that differentiates itself from numerous competitors, who
either offer the same variety of products or specialize in one or more of Dick’s core “shop-in-
shops” departments. Various competitors like Cabela’s, Foot Locker, Finish Line, Sportsman’s
Warehouse, and Hibbett Sports offer many of the same products, which either can attract or deter
customers based on subjective order qualifiers, and ultimately close transactions as a result of
unique order winners.

33. 33
Figure 13. Order-winning criteria for Dick’s Sporting Goods.
Order qualifiers are a set of offerings that grant a company entry into the competitive arena and
maintain the company’s position, but are not reasons a customer makes his or her final decision.
While these qualifiers tend to have order-losing characteristics, they have the potential to become
order winners. In the case of one winner, Dick’s Sporting Goods offers a wide selection of
equipment for athletes, fans, and outdoor enthusiasts. A wide and versatile variety of product
goes a long way in the sporting goods retailing world. Dick’s Sporting Goods’ current 644 retail
stores stock many products for beginner-level users at affordable prices for low-to-moderate
income customers, as well as higher-priced models for elite level athletes. Old and out-of-season
inventory are often available at clearance prices, usually up to 50% off, to keep customers
returning and increase add-on sales. Dick’s incorporates diverse products that appropriately
highlight the upcoming sports season. Its promotional newspaper ads often include seasonal
coupons for footwear, apparel, and equipment as well. But it could also be the retailer’s close
scrutiny to the way it offers these merchandising needs that keep customers coming through its
doors. Dick’s “store-within-a-store” concept may just be what keep these people coming back.
Although this approach has been emulated by retailers like Best Buy in electronics, it serves
unique to a sporting goods store like Dick’s. For example, popular brands like Nike and Under
Armour help shape the edgy interior design and fixtures throughout the store layout with
apparatuses like the “Nike Field House” or “Under Armour All-American. (Howland). Product
versatility and store concept design may be described as “order-winners” for a retailer like
Dick’s.
Typically, Dick’s Sporting Goods retail stores are conveniently located in higher socioeconomic
regions where shopping malls or populated plazas within suburban areas drive in customers from
different destinations. This strategic placement of 644 total stores across the US adds
convenience and accessibility to Dick’s brand image, and ultimately gives way to another order-
winner. Additionally, Dick’s Sporting Goods is credited with creating its memorable and
impactful tagline, “Every season starts at Dick’s,” which has been featured in many national
television and newspaper advertisements. The omni-channel retailer’s commercials feature
E-Tail Mobility
Locational
Convenience,
Accessibility,
and "grit"
Deep Product
Assortment/
unique store
concept

34. 34
elements that may be appropriate to describe as intense, motivational, and gritty. From the
trained pro-athlete to the aspiring young kid, these promotional advertisements serve a unique,
deep, and heartfelt message to a vast range of people susceptible to media, something that no
other sports retailer can say it accomplishes to the caliber in which Dick’s does.
One last order-winning criterion is Dick’s Sporting Goods’ “all-in” commitment to omni-channel
growth and mobility. Over the past few years, Dick’s has embraced new opportunities to build
upon its e-tail platform with sales fulfillment methods like ship-from store, buy online-pickup in
store, and in-store returns for online purchases (Howland). Scott Galloway, a New York
University Stern marketing professor, places Dick’s Sporting Goods at the pinnacle of his top-10
“retailers playing offense” list in context of Dick’s e-commerce efforts and expansion. Galloway
puts it this way – Dick’s is becoming the “cross-fit of industry,” where technology and e-
commerce is becoming the means for meeting the actual needs for a company like Dick’s, while
the physical brick-and-mortar part is essentially the giant warehouse referred to as a “store”
meant for showrooming, display, and enticing marketing capabilities.
Figure 14. 3 order-qualifying criteria for Dick’s Sporting Goods.
Conversely, Dick’s Sporting Goods portrays a few distinctive characteristics aligning with
customer experience that are not quite as favorable when compared to competitors within the
industry. Ironically, most common complaints extend to the associate himself. For Dick’s,
average customer service and basic associate knowledge gear the overall retailing experience
toward an order-qualifying rather than a winner. Multiple customer reviews illustrate the
apparent lack of human capital from both managerial staff and hourly associates Dick’s may
indeed be known for, as one customer writes,
Customer
Service/
Human Capital
Pricing
Product
Specialization

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“We wanted the manager to tell his associates that they need to be more careful and pay
attention to the customer’s request (Stacey),” while another claims,
“This company must have no idea about what customer serve is or how to make us
happy. I’m now going to tell everyone I know not to do business with them (Kenneth).”
As Dick’s does have an extensive selection of inventory to purchase from, more inventory also
results in a lack of specialization, which can even translate to a negative perception of quality by
some consumers. Ultimately, a consumer will not choose Dick’s over a store like Academy,
Sports Authority, or even Foot Locker solely based on price alone. Keeping all things equal,
price does not drive the bus for Dick’s Sporting Goods. Its pricing strategy is relatively similar, if
not equivalent to competitors. These “order-losers” do not necessarily deviate from the
company’s main goal of maximizing shareholder wealth while satisfying individual consumer’s
demands. Dick’s Sporting Goods may, in fact, win customer orders by appealing to the largest
customer base in the sporting goods and outdoors market. A customer can determine his or her
individual needs and make a decision based on quality, price, or another variable, and Dick’s will
likely have the desired product available. While specialty shops may offer standard customer
service or perceived quality, Dick’s selection is unmatched in terms of quantity, availability, and
versatility making Dick’s Sporting Goods an industry leader with a unique strategy to not only
gain, but maintain customers.
b. Supply Chain Integration and Outsourcing
The logistics behind a supply chain for a retailer like Dick’s Sporting Goods are no less than
imperative means for inventory and product tangibility. In essence, the ultimate goal for a large
retailer such as Dick’s is for minimal amounts of products to rollover into store-bound inventory,
whereas the right amount of goods will be available to the customers purchasing disposal at the
right place at the right time. This poses a logistical challenge for Dick’s, due to the company’s
heavy reliance on nearly 50 suppliers, outreach of nearly 650 store locations, and an expanding
e-tailing platform. To cover this breadth of locations, Dick’s Sporting Goods must rely on all of
its suppliers, distributors, and manufacturers to provide it with sufficient quantities of inventory
in a timely fashion. According to Bloomberg, it extends its reach to nearly 50 suppliers including
distinguished name brands such as Nike, Under Armour, North Face, Adidas, Columbia
Sportswear, Asics, Callaway, Puma, and Fitbit, to name a few (Bloomberg SPLC). Because of
the distinguished nature of its suppliers, Dick’s Sporting Goods controls only a small portion of
the overall chain, excluding transportation and distribution.
Dick’s Sporting Goods purchases its merchandise from approximately 1,600 vendors
(Bloomberg-DKS SPCL). Dick’s claims that Nike – its largest vendor – accounted for
approximately 20% of total merchandise purchases, while Under Armour accounted for around
12% of merchandise purchases, respectively (Dick’s Sporting Goods, Inc. Annual Report Form
10-K). Intuitively, this latter piece of information seems highly askew due to the deep assortment
and wide variety of merchandise Dick’s carries throughout its stores. Coming from the annual
report, perhaps the company over-emphasizes this fact primarily to enhance the outward-
looking-in view upon its relationship with these popular vendors. Nonetheless, Dick’s

36. 36
acknowledges the risk involved with heavy vendor reliance, and therefore eliminates issuing any
long-term binding contracts with any single vendor. Instead, Dick’s issues short-term contracts
among its suppliers based on short-term purchasing order basis. The company’s revenues,
demand satisfaction, and supply chain fluidity could potentially all take major hits if any of its
key vendors fails to supply what is needed. This poses one of the threats that Dick’s faces, which
is a heavy reliance on its vendors.
After raw materials have been transformed into products and the manufactured products have
been purchased, vendors in the supply chain ship floor-ready merchandise to one or more of
Dick’s four main distribution centers, where the goods are then inspected for damage or
defection. Common carriers under contract like UPS then deliver the processed goods to each
store location. The way in which this supply chain flows must facilitate prompt, efficient, and
effective means of transshipment in order for Dick’s to minimize its travel and freight costs and
improve overall inventory mobility.
Figure 15. A diagram illustrating a basic logistical flow of goods within Dick’s Sporting Goods’
supply chain.
The various manufacturing processes of Dick’s products available to sell are fully operated and
controlled by its providers, while the profitability margins of these suppliers is partially a result
of the efficiency in Dick’s management of quick transportation and distribution channels. Here is
where Dick’s controlling power in the supply chain comes into play. In one scenario, if suppliers
fail to meet transportation requirements, serious financial consequences are subject to rise
because of certain products’ inabilities to be placed for release. The magnitude of suppliers
serves as a protective cushion and power tool for Dick’s Sporting Goods knowing the retailer’s
revenues and cost of goods purchased are not tied up within a single supplier. With this

37. 37
knowledge, Dick’s Sporting Goods has been known to invest in healthy relationships with its
suppliers. In 2015, Dick’s invested over $331 million dollars into just three of its suppliers: Nike,
Under Armour, and Jarden. This was almost three times the amount relative to competitors such
as Cabela’s (Bloomberg-DKS SPCL).
Furthermore, in May of 2015, Dick’s Sporting Goods was the recipient of the annual “Shipper
Partner of the Year” award given by Manhattan Associates, Inc. (GlobeNews). By earning this
award, Dick’s portrays the face of carrier-friendly practices, valuing driver needs, and
understanding transportation from both shipper and carrier perspectives. Thirty-six other finalists
including top-tier retailers, grocers, manufacturers, distributors and wholesalers were enlisted for
this award behind Dick’s. The key ingredient to the retailer’s success in its supply chain is thus
fostering these healthy relationships with suppliers. On the other hand, Dick’s susceptibility to
weakness in the supply chain lies within the speed in which the supply chain operates,
coordinating to avoid inventory shortages and surplus, and forecasting demand. Instant
gratification has become a norm for customers in the current sporting goods sector.
For a retailer like Dick’s, keeping up with persistent consumer demand for timely order
placement and subsequent shipment is one of the biggest challenges it faces in terms of overall
customer satisfaction – tracing back to operations. Common knowledge illustrates that customers
want their items almost immediately after they place an order. Their expectations call for
fantastic service and efficient delivery. Therefore, the supply chain has no choice but to work
faster than ever. For a company that controls little of the supply chain, this can be largely
problematic. Another problem Dick’s may face lies in its planning and forecasting efforts that
ensure proper inventory stock matches with changing demand. When outsourced logistics enter
into the frame, globalization and thus variability in shipments from locations like Asia and
Europe can expose Dick’s supply chain to inconsistency, which leads to concerns with inventory.
In order to ensure this inventory meets demand, Dick’s strives to strike a balance between
keeping an adequate inventory stock on hand without having too much in case demand is weaker
than expected. In this case, Dick’s must anticipate seasonal changes in demand based on seasonal
variances. The retailer may choose not to hold onto too much stock of a certain seasonal product
due to changing styles with changing seasons. On the contrary, Dick’s cannot afford to hold too
little inventory in a rising demand situation, as it may miss out on potential revenues. In order to
avoid getting stuck with old seasonal inventory and equipment, Dick’s may choose to either sell
rolling product at discounted prices, or even taper inventory in collaboration with its supply
chain when a season winds to a close.
All things considered, Dick’s Sporting Goods can avoid most of these supply chain problems by
remaining knowledgeable about the best channels for its products, by working with trusted
suppliers and other retailers for the most efficient results, and by actively understanding and
adapting to seasonal consumer demand, global transactions, product order patterns, delivery
schedules, and inventory turns.
c. Operational Technology and Systems

38. 38
Technology and innovation have continuously changed the landscape of the retail marketplace.
The industry trend has shown that more and more retailers are using solutions that emphasize
mobility, efficiency, and sustainability. As Dick’s Sporting Goods remains one of the leading
omni-channel sporting goods retailers in America, the utilization of various technologies and
systems presents a new challenge for its remaining at the top, primarily since the company is
seeking to expand its e-commerce magnitude in the industry. E-commerce is one technology
growth area that a company like Dick’s Sporting Goods cannot afford to ignore. The surge in e-
shopping is arguably the most influential ingredient that can drive Dick’s sales up and its
technology systems forward. The company has found that today’s consumer will spend
approximately three-times as much on its online platform than those who shop at a brick-and-
mortar location, mainly due to promotional deals and unlimited access to content (2). Dick’s
must continue to harness this digital strategy in tandem with its physical brick-and-mortars to
win orders on its product availability platform. In context of this need for an e-commerce pulse,
Dick’s realized a significant 28% gain in online sales for fiscal year 2014, with a 31% gain in the
fourth quarter alone (Davis). By 2017, Dick’s will attempt to bring all e-commerce operations in
house on an internal platform (Davis). Incremental costs for the e-commerce shift will inevitably
rise - approximately four cents per share or $3.7 million in the upcoming year, yet “the
investments are substantive,” says CEO Edward Stack in a statement. “We are bringing a very
large site on to become independent. It is the right thing to do. We have a growth business that
continues to grow quarter in and quarter out (Davis).”
Dick’s Sporting Goods has also been focusing its efforts on integrating a mobile capability
strategy into both the in-store and online shopping arenas. The company believes that this new
user-friendly interface will, by design, improve accessibility to its products and prompt its
customer base to utilize a progressing omni-channel experience.
Figure 16. A look at Dick’s Sporting Goods mobile ScoreCard Rewards Program
with additional promotions and discounts.

39. 39
As aforementioned, a paradigm e-shopping shift has taken over much of the brick and mortar
shopping platform that America has adapted to over many years, and Dick’s understands the
necessity for this shift. Dick’s must be aware of emerging mobile-savvy shoppers, and must find
innovative mechanisms, like its mobile app, to keep its customers engaged and satisfied. It must
place an emphasis on how the customer’s mobile device can enhance the in-store shopping
experience and ensure they have the ability to shop when and where it is convenient. The
updated app allows consumers to have unlimited access to Dick’s ScoreCard Rewards Program,
which features important criteria like current inventory, special offers, ad campaigns, and
personal points (Samuely).
Not only is mobile technology beginning to prompt Dick’s Sporting Goods’ into better
connecting the customer to merchandise, it is also beginning to re-shape the way Dick’s connects
the customer to the actual transaction. This trend as of late has redefined traditional POS (point
of sale) methods most often used by retailers. Traditional POS has been about simply taking
money from customers and tracking down reduced inventory as a result. But now POS is
becoming more of a mechanism for things like customer loyalty, customer relationship
management (CRM), back office transfers and receiving, time-keeping, scheduling, and task
management through the world of mobility (Delgado). Dick’s sporting goods is just one example
of a retailer that has begun to jump on top of mobile POS. Smartphones and tablets have
revolutionized the way customers shop at retail stores, while the retailers themselves are
beginning to want to replace big clunky hardware machines for mobile transaction methods. The
ability for a customer to pay for a transaction with a smartphone is beginning to change the retail
experience across all industries, since eventually people will not even need wallets anymore.
According to the Retail Technology Group, the smartphone will have ultimately replaced the
wallet within 3 years (Delgado). And as more and more brick-and-mortar retailers begin to
accept this mobile e-commerce boom, mobile payment and checkout will eventually become the
norm. Even though mobile devices are no longer cutting-edge, the boom in mobile e-commerce
certainly is; it is estimated by the end of 2016, 25% of all U.S. retail sales will take place via
mobile devices (Goldman). Even though there will always be customers who prefer the fixed
POS purchasing method, sporting goods retailers like Dick’s are beginning to ride with the new
shift. Mobile POS options give a better meaning to customer service beyond the point of physical
transaction, i.e. the relationship can be furthered by add-on sales, more convenient e-receipts,
confirmation updates, and future deals or incentives. Ultimately, retailers are fighting in
changing the nature of how they achieve customer service. Finish Line, for example, is one of
the only sporting goods retailers in the country to implement mobile POS technologies in almost
every store it operates (Delgado). Competitors like Finish line with its quickly expanding
technology efforts are what Dick’s needs to preempt and “out-innovate” in order to stay alive in
this expanding world of “e-tailing.”

40. 40
This internalized focus on both mobile and omni-channel mechanisms is what is fueling
Dick’s to further bridge the gap between its physical and digital layout, since e-commerce sales
have been shown to grow by 50% in markets where a brick-and-mortar store exists (Samuely).
The company realizes that perhaps a portion of its consumer base finds value in browsing
through inventory in-store, yet simultaneously sees that a shift has occurred where people take
advantage of making a purchase either online or through their mobile devices. Investing in
technology is the new trend for brick-and-mortar retailers like Dick’s, and to become a leader in
the industry, sometimes adapting to new trends is the only answer. Dick’s Sporting Goods will
ultimately not cease in continuing to expand its physical brick-and-mortar store distribution, yet
the company is doing itself a favor by realizing the value in expanding its brand through an
online and mobile e-commerce extension.
Figure 17. ComputerWeekly.com
estimates for the percentage
of retailers planning to invest in
certain areas in 2014.
In reference to store-level
execution, Dick's Sporting Goods
implements the use of Reflexis
Task Manager, an industry
leading task management
solution from Reflexis Systems,
in all of the stores in its chain.
This technology enables Dick’s
to better manage task execution,
monitor ongoing merchandising
and promotional efforts, leverage
real-time metrics, ensure
consistency from enhanced store
walks and audits, and optimize
labor schedules (Reflexis). This
is an important feature for the
company, since without these
kind of leveraging analytics,
Dick’s workforce would
otherwise not be able to quickly
adapt and react to fast-changing store and customer needs. Another in-store “tech technique” is
what Dick’s refers to as Endless Isle; a strategy that equips each associate with a mobile device
that can be used to provide additional options for customers who are interested in products that
are out of stock or only available online. This technique “widens the selection of products
available and provides the convenience of having purchases sent directly to consumers’ homes,”
says Rafeh Masood, Dick’s VP of customer innovation technology. Dick’s is also known to
heavily incorporate QR codes (quick response codes) in all of its retail locations. A QR code

41. 41
essentially translates a URL into a website on the spot, allocating valuable product knowledge to
both an associate’s and customer’s disposal right at the point of sale (Delgado).
Moving forward, systems are just as integral to efficient operations of Dick’s business and future
growth plans. Core retailing systems like space management in stores, pricing controls across all
channels, allocation of seasonal and fashion merchandise, and replenishment of perpetual
inventory all have an effect in optimizing the core features of Dick’s operations (Giannopoulos).
Dick’s also utilizes more strategic systems in order to better sell its product. For instance, in
2012 Dick’s introduced ship from store, a system that connects online customers with any
inventory in any store (Giannopoulos). This system now operates in every Dick’s store. Some
benefits of the system include lower shipping costs, higher delivery speed, and better utilization
of stored inventory. Other systems include Dick’s buying online and pickup-in-store method,
ship to store method for large items and cheaper local delivery, and even free shipping for orders
placed in-store (Giannopoulos). Systems that work with Dick’s supply chain have also been
deployed to maximize the movement and management of inventory. Such systems are controlled
by Intelligrated’s InControlWare software system to better allocate information technology with
Dick’s supply chain system. This Intellegrated software communicates with a Warehouse
Management System (WMS), which is located at Dick’s corporate headquarters in Pennsylvania.
A brand new conveyor belt system now exists in Dick’s Sporting Goods’ Plainfield distribution
center with little interruptions to Dick’s operations (Intelligrated). This supply chain software
system allows Dick’s to further control costs, automate distribution, and provide real-time insight
into the productivity of the retailer’s large network.
d. Processes, Facilities, and Location
As Dick’s Sporting Goods operates on a multi-channel retailing platform, its extension of
resources plays a critical role in how it meets its daily demands. These resources consist of
physical brick-and-mortar locations, distribution methods, supply chain logistics, brand partners,
e-commerce extensions, and human capital. As of January 30, 2016, Dick’s Sporting Goods
operates 644 Dick's Sporting Goods stores in 47 states, 73 Golf Galaxy stores in 29 states, and 19
Field & Stream stores in 9 states (Dick’s Sporting Goods, Inc. Annual Report Form 10-K). In
some specific locations, the company operates two adjacent stores on an identical property with a
pass-through for customers. This format is known as a "combo store." The retailer employs
approximately 12,000 full-time and 25,600 part-time associates. Dick’s admits that total
employment figures fluctuate throughout the year, while typically peaking during the fourth
quarter of every fiscal year. The company also describes the relationship with its associates as
“good” (Dick’s Sporting Goods, Inc. Annual Report Form 10-K). Dick’s Sporting Goods has
also capitalized upon additional subsidiary stores like Golf Galaxy, Field and Stream, and
Chelsea Collective, as pictured below. These subsidiary stores are projected to grow in location,
according to Dick’s. These specialized concept stores give Dick’s the opportunity to gain a
broadened and expanding spectrum of brand development, and open up more avenues for brand
loyalty, customer connection, and new merchandising tactics that it can strategically spread
among its entire network of stores.

42. 42
Figure 18. An umbrella of acquired subsidiary brands under Dick’s Sporting Goods.
The spread of physical brick-and-mortar stores are also currently leveraged by four distribution
centers. Dick’s operates a 914,000 square foot distribution center near Atlanta, Georgia, a
725,000 square foot distribution center in Plainfield, Indiana, a 601,000 square foot distribution
center in Smithton, Pennsylvania, and a 624,000 square foot distribution center in Goodyear,
Arizona (Dick’s Sporting Goods, Inc. Annual Report Form 10-K). The company insists that any
sort of natural disaster or other serious disruption to one of these facilities can significantly
damage material inventory, impair the ability to adequately stock multiple stores and process
returns of products to vendors. All of this to say that a malfunction in Dick’s distribution process
could ultimately affect inventory track, sales, timeliness, and profitability.
Distribution Facility Location Approximate Square Footage Owned/Leased
Atlanta, GA 914,000 Leased
Plainfield, IN 725,000 Leased
Smithton, PA 601,000 Owned
Goodyear, AZ 624,000 Leased
Table 2. A representation of Dick’s Sporting Goods’ 4 primary distribution facilities.
A key component in regards to this locational spread for Dick’s Sporting Goods lies within an
opportunity of the company’s potential for future expansion. Integrating this potential for Dick’s
brick-and-mortar store expansion with an opportunity for future growth gives way for the
company’s vision to downsize in new stores it aims to open in the near future.
The various ways in which Dick’s manages its everyday operations give insight into how the
company’s accomplishes it daily logistical goals. Dick’s upper-level management uses certain
key indicators to monitor both performance and process across each and every location. The
various indicators come directly from the company’s annual report (fiscal year 2015). These
indicators include:
 Same store sales performance – Dick’s uses same store sales results to see how costs are
leveraged and how they affect net sales, cash, and working capital in relation to the
bottom line.