Dick's Sporting Goods Dumps 20% of its Suppliers

Dick's Sporting Goods will dump about 20 percent of its vendors and stock more of its own brands as it looks to fortify itself against the market forces that killed its defunct rivals like The Sports Authority. The abandoned brands will be made up of minor labels rather than its 10 best-selling brands like Nike and Adidas, Dick's CEO Ed Stack said on a conference call with Wall Street analysts earlier this week. Stack didn't name any of the brands being dropped. At the same time, Dick's will expand its in-house brands, which generate $1 billion a year.

Total Retail's Take: The upheaval in the sporting goods business, with the closings of The Sports Authority and Sport Chalet, as well as the bankruptcy filing of the parent company of Eastern Mountain Sports, has Dick's re-evaluating its business model. With market share available to gain, Dick's is betting on its private-label brands in favor of some of the lesser-known brands it carries. In addition to giving more exposure to its private-label brands, this decision by Dick's will give even more space to its leading brands, including Nike and Under Armour. Dick's sees an opportunity in its market, and is making moves to capitalize on the failures of others.