Author: Scott Gieseke
On Oct. 26, the ATA released a best practice statement on behalf of the ATA Retail Council:
Industry Best Practice Statement
To maximize annual sales and margins for all sectors of the archery and bowhunting industry, the ATA Retail Council, the Archery Range and Retailers Organization (ARRO), and the National Archery Buyers Association (NABA) support the release of new products in January. These groups want manufacturers to know that retailers prefer to buy and take delivery on the latest archery products at the ATA Trade Show, ARRO and NABA shows starting in 2017 for as many products as possible. They want that request to cover all archery products by January 2018.
The statement above, excerpted in full, is supported by six “Best Practice Rationales.” Each week we’ll unpack each rationale via Q&As with retailers, and delve into the challenges of introducing products in the fourth quarter.
Best Practice Rationale 1
“Advertising new products during the fourth quarter tends to devalue existing products, making many current-year products obsolete for the rest of the year.”
The fourth quarter is the busiest time of year for archery-shop retail sales. That’s when most stores have the highest amount of product stocked. The minute a manufacturer drops a new bow, those stores are sitting on inventory they had to have on the racks but now can't move. Photo Credit: Shane Indrebo
Q. The rationale seems self-explanatory. New products steal attention from existing inventory. What does this cause-and-effect action look like in an archery store?
Owner, Archery Headquarters, Chandler, Arizona:
I’ve already got current-year inventory purchased that I planned on selling that time of year, right? It’s the busy season. The fourth quarter is the time of year we actually sell bows. So when a manufacturer posts a social promo saying, “Check out this new bow,” the issue becomes two-fold: First, I will have to discount the existing bows in inventory to get the customer to buy those because he’s seen the new, next-year bow on social. Second, I have to tell the customer: “You know that new bow you saw? You have to order it, and it’s going to take a few months to get it.”
Co-Owner and General Manager, A-1 Archery, Hudson, Wisconsin:
So far this fall I’ve had two launches for next year’s bows. Two of them. And I can tell you, I’ve taken three emails and sold one bow off of those bow launches so far.
Q. So the new-product releases stifle the sale of bows retailers have in stock, but the releases don’t prompt new-bow sales, either. If the customer isn’t buying the new bows, why won’t he buy the bows in stock?
Manufacturers do a good job of driving impulse buyers into the store through product-launch promotions. When the customers show up, I have to tell them the bows aren’t available, but they can order the bow. So those guys leave without ordering because the impulse buyer is ready to buy something right now. We watch those sales walk out the door.
Store Director, Jay’s Sporting Goods, Gaylord, Michigan:
We all have that commander-in-chief of the family to report to, and if she gives the green light, you don’t hold back. You don’t order and wait. It’s a microwave society and you see its effects in retail. When someone comes in with impulse money in his pocket to buy a new bow in the fourth quarter, he’s not going to wait a few months.
Q. Some manufacturers distribute a demo bow to retailers when the new bow is released. Customers can check it out, hold it, shoot it. Is the demo bow effective in securing the sale?
Getting a sample bow for the fourth quarter is nice, because they get to see it, but it’s still a wait. And then there’s the other factor that makes the fourth quarter so difficult for new-product releases: Our business is seasonal. In the fall, that’s when we sell bows. So, with the fourth-quarter product release, the manufacturer puts me in a position to ask my sales team to dedicate time to bows that aren’t available to impulse buyers. And, as the name suggests, the impulse buyer is impulsive. He’s not likely to place an order for a bow. He wants to walk out the door with one. On top of that, he’s taking time away from the other customer, the one who is locked in on current inventory. I don’t want my staff selling what amounts to futures, especially during the fourth quarter. I need my staff dedicated to moving current inventory.
The inventory is on hand because that’s what we do. Because the fourth quarter is the busiest time of year, that’s when I’ve got the highest amount of product in my store. During the busy season, I can sell 12 bows per week, so I have to have 24 bows on hand. So the minute a manufacturer drops a new bow, I’m sitting on 24 bows.
Next week we’ll post the second of this six-part series to unpack rationale No. 2 in supporting the ATA Retail Council’s request to release new archery products in January. If you’d like to weigh in on the best-practices statement or, if you’re an archery retailer and want to share your experiences with product-launch cycles and how it affects your store, post a comment in the section below or email us at firstname.lastname@example.org.
The Retail Council meets weekly to discuss pressing issues raised during the ATA’s 2016 strategic-planning meeting, including the current product-launch cycles. To learn more or to get involved in the Retail Council, contact the ATA toll-free at (866) 266-2776.