The web takes on a bigger sales role at Dick's Sporting Goods
The company has been selling online for a more than a decade, but e-commerce appears to be finally coming of age at Dick's Sporting Goods Inc.
On Dick's recent year-end earnings call, chief operating officer Joseph Schmidt told Wall Street analysts that the web is now the retailer's prime growth channel. More important, the web accounted for 4% of total sales in 2011, giving Dick's, No. 126 in the Internet Retailer Top 500 Guide, e-commerce sales of $208.4 million in 2011, up about 43.7% from web sales of around $145 million in 2010.
For the year ended Jan. 28, Dick's also reported:
- Total sales increased year over year 7% to $5.21 billion from $4.87 billion.
- Comparable-store sales increased 2%.
- Net income increased 44.9% to $263.9 million from $182.1 million.
In 2011, Dick's, which has been selling online since 1999, embarked on several new e-commerce initiatives that will become operational over the next two years, Schmidt told analysts. "Turning to our e-commerce business, which represented approximately 4% of total sales in fiscal 2011, we're making remarkable progress," Schmidt said. "We are on track to implement new capabilities that will improve the profitability of this business."
In 2011, Dick's added more employees to its e-commerce staff in the areas of merchandising, web site development and analytics, though the company didn't break out a specific head count. By 2013 Dick's will add more buy online/pick up in store options and open a fourth distribution center supporting all sales channels, encompassing 600,000 square feet in Arizona.
"In our e-commerce business, we are building on our momentum as we plan to pilot 'ship from store' in the next year and 'in-store pickup' in 2013," Schmidt told analysts. "Both are intended to provide customers with more and better buying options, as well as leveraging our inventory investment and improving our fulfillment time and our in-stock positions."
For the fourth quarter, Dick's also reported:
- E-commerce sales increased 52%, though the company didn't provide specific numbers.
- Total sales increased 6.6% to $1.61 billion from $1.51 billion in Q4 2010.
- Comparable-store sales rose 2.5%.
- Net income grew year over year 26.9% to $111 million from $87.5 million.