Time to be clearing stock

We know from past experience that the weather can have a major impact on golf industries sales. The last two months being classic examples. June was bright and sunny, the hottest since 1884, which is great for beach lovers but less so for golfers. July in contrast was much cooler, duller and overcast with heavy rain, weighing in at 170% of the average making it the wettest July since 2009. Again, not great for golf.

Against this background we could expect the worst. But no, July’s performance in value terms at +1.8%, outperformed June at +0.7% compared to the same time last year. Both periods down on the previous months but still showing growth. Drilling down to product groups shows a wide range of results from – 6.6% for clubs to +17.9% for apparel. The latter is not unexpected as sales of outerwear for the month were buoyant, mirroring the heavy rain.

Year to date sales over the last three months have been relatively stable at +2.2% in May and +1.9% for both June and July. These results, against the background of higher inflation, increasing mortgage rates and exceptional weather, shows the golf industry has weathered the storm and is holding its own.

Individual product sales for July in value terms ranged widely from -18.3% to +104% compared to last year. Three hardware products were down: irons at -18.3% no doubt reflecting their high price points, balls -5.3% reflecting the heavy rain and woods -0.1% almost breaking even. Top performers both at +15.0% were putters and gloves. In the apparel group six items showed growth with the best performance coming from outerwear at +104.0%. Only men’s trousers and shorts saw a decline at -11.4%.

We all know how shrinking sales have an immediate effect on profitability with pricing being a vital element of the marketing mix, reviewed in last month’s issue. This month we are focusing on stock levels in value terms. The problems that this can create are not immediately seen in profitability but in cash tied up. Recognising that August marks the end of the main season it’s time for stocks to be reducing, getting cash back into the bank in preparation for next year’s new buys.

July’s hardware stocks ranged from -22.4% for bags to +69.3% for distance devices, with the majority of products over 25% higher than last year. A similar picture is seen in apparel with men trousers and shorts at a staggering +114.3%. So, it’s time to take note and action to avoid this silent killer.

So, how is the High Street doing? July sales increased by 1.5% a little less than our industry but down on last year’s 2.3% increase. Interestingly online sales were down resulting from shoppers drifting back to bricks and mortar post covid.

Paul Martin, UK head of Retail for KPMG – UK’s leading management consultants 2023 – said “We are starting to see a big rise in the number of promotions that retailers are putting in place in order to get shoppers through the door, as they battle for market share”. “Both consumers and retailers are finding they are having to get used to doing more with less as conditions remain incredibly challenging.” GR

Golf Datatech is a world leader in golf industry research. It provides the trade with specialised market research covering retail sales, inventory, pricing, distribution, along with strategic sales and marketing consultancy. In the UK, Golf Datatech research is based on an average of 2,000,000 records per month, recorded by EPOS systems at the point of sale. For greater detail contact John Hassett on 07976 797081.