Sports Direct

Infobox_Company
company_
company_name = Sports Direct International plc
company_type = Public (LSE|SPD)
foundation = 1982
location = Shirebrook, Derbyshire, England
subsid = SportsDirect.com
key_people = Mike Ashley (Founder and Deputy Executive Chairman)
Dave Forsey (CEO)
Simon Bentley (Chairman of the board)
industry = Retailing
products = Sporting goods
revenue = £1.259 billion (year to April 08)cite news
title=Annual Report 2008
publisher=Sports Direct International
accessdate=2008-08-27
url=http://www.sports-direct-international.com/library/AnnualReport2008.pdf]
net_income = profit £77.7 million (yr - Apr 08)
num_employees = 11,000 (year to April 08)
homepage = [http://www.sports-direct-international.com/ www.sports-direct-international.com]
intl = yes

Sports Direct International plc is a British retailing group. Founded in the late 1970's by former county squash coach Mike Ashley, they are now the UK's largest sporting retailer [cite news
last=Finch
first=Julia
title=Flotation makes Sports Direct founder a billionaire
publisher=The Guardian
date=28 February 2007
accessdate=2007-11-07
url=http://business.guardian.co.uk/story/0,,2022857,00.html] through a number of retail subsidiaries and sports equipment brands. Although now a publicly traded company on the London Stock Exchange, Ashley continues to hold around 72% of Sports Direct as of April 2008. [cite web|url=http://www.sports-direct-international.com/library/1.04.08%20-%20%20M%20Ashley%20shareholding.pdf|title=Holding in company|date=1 April 2008|publisher=Sports Direct International|accessdate=2008-08-27]

History

After leaving school at 16, Mike Ashley began trading on the high street, opening Sport and Ski shops in and around London in the 1980's - by 1990, there were three registered and recorded outlets. The chain expanded quickly funded by private money and profit from the stores, and by the late 1990s Ashley had rebranded the chain Sports Soccer and opened over 100 stores across the United Kingdom. However, as a sole trader and not having to file accounts at Companies House, little was known about him even by rival retailers. Although sole-trader status preserved his privacy, Ashley was missing out on the limited-liability advantage offered by company status, and in 1999 incorporated the business [ [http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article703400.ece Revealed: UK’s first sports kit billionaire - Times Online ] ] .

Today

The group has over 470 UK stores including the chains SportsDirect.com (Sports World prior to 2008), Lillywhites (acquired in 2002) and Field & Trek. The group employs around 11,000 people in the UK and at stores in Ireland, the Netherlands, Belgium, Luxembourg and Slovenia. Sports Direct-branded stores exist under a franchising agreement in South Africa and the Middle East. In 2006 it overtook JJB Sports as the UK's largest sports wear retailer [cite news |url=http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2006/04/06/cnswi06.xml |title=Sports World International sales climb 45pc and knock JJB off top spot |publisher=The Daily Telegraph |date=April 6, 2006 |accessdate=2008-09-23 ] . In mid-2006 it was also revealed that Ashley had held talks with John Hargreaves, founder of Matalan on both taking a 25% stake in the trouble retail business and installing mezzanine floors in larger Matalan stores, on which SportsDirect.com outlets could be operated. [ [http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article722598.ece Billionaire sports tycoon plots move into Matalan - Times Online ] ] .

Brands

In February 2004 the company acquired Dunlop Slazenger for £40M, which included the Dunlop, Slazenger and Carlton brands. [cite news |url=http://www.telegraph.co.uk/finance/2876059/Game%2C-set-and-match-for-Dunlop-Slazenger.html |title= Game, set and match for Dunlop Slazenger |accessdate=2008-09-23 |publisher=The Daily Telegraph |date=February 5, 2004] This was closely followed by the acquisitions of outdoor gear manufacturer Karrimor, Kangol for a reported £10M [cite news |url=http://www.mpdclick.com/mudpie/action/viewListItem?id=7228&listId=19 |publisher=MPDClick |title=Kangol sold to sports empire |date=November 17, 2006 |accessdate=2008-09-23] , boxing brand Lonsdale and tennis brand Donnay. Most of these brands were bought from distressed sellers. After looking at a takeover, [ [http://news.independent.co.uk/business/news/article304528.ece Sports World tycoon mulls bid for Umbro - Business News, Business - Independent.co.uk ] ] Sports Direct took a £9 million stake and signed a lucrative long-term deal in August 2005 with troubled brand Umbro, [cite news
title=Sports World tycoon mulls bid for Umbro
url=http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article544722.ece
publisher=The Independent
accessdate=2007-11-07] which has subsequently been acquired by Nike.

The brands themselves are an increasingly important part of the business, and Sports Direct made £10m from selling the intellectual-property rights to the Slazenger Golf brand to arch-rival JJB in 2005.

Other holdings

Sports Direct has built a 29.4% stake in Blacks Leisure Group, the owner of Millets and Mambo, [ [http://www.timesonline.co.uk/newspaper/0,,2769-2496087,00.html Ashley empire may be worth £2.5bn - Times Online ] ] as well as a 12.3% holding in the John David Group, parent of JD Sports. Sports Direct has also held 5% of Amer Sports, the world's largest sporting goods manufacturer, since January 2008. [cite news|url=http://ftalphaville.ft.com/blog/2008/01/24/10414/sports-direct%E2%80%99s-ashley-rebuilds-amer-stake/|title=Sports Direct’s Ashley rebuilds Amer stake|last=Robinson|first=Gwen|date=24 January 2008|work=Financial Times|accessdate=2008-08-27] "He [Ashley] likes to park his tanks on peoples' lawns," said a banker. http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2006/12/10/cnsports10.xml]

IPO sale

In late November 2006, a number of business newspapers reported that Ashley was looking at an IPO of Sports World International. He hired Merrill Lynch [ [http://www.imaginerecruitment.com/news/news.php UK Retail News ] ] , who valued the group at up to £2.5bn ahead of a possible flotation on the London Stock Exchange. The group debuted on the LSE on 27 February 2007. [cite news
title=Sports Direct: timeline
publisher=Guardian Unlimited
date=24 July 2007
accessdate=2007-11-07
url=http://business.guardian.co.uk/story/0,,2133708,00.html]

Marketing tactics

Often derided as a Tesco like "pile it high, sell it cheap" merchant after his transformation of the croquet-set loving Lillywhites, Ashley's chain has a more sophisticated approach. The chain will often use a "closing down sale" tactic on its multiple brand outlets, and re-open in another location soon afterwards. Customers are also drawn into the store by almost margin-less promotions on perceived high-value brands like Nike trainers and Adidas tops, making money for Sports Direct when they also buy an own brand item marked up at a substantial margin. The company also operates a "no refunds" return policy, offering customers an exchange or credit note, which allows it to retain a substantial profit.

Ashley also likes to keep costs on his employees down. In March 2007 he closed his Dunstable warehouse and moved everything north to Shirebrook where employees are paid less.Fact|date=November 2007 SportsDirect.com is also selective in what it pays to its staff for example, staff who are over eighteen earn £4.60 an hour whereas other staff who are the same age can earn up to £5.75 an hour. This is too due with certain bands the stores are in examples are the Kiddieminster and Stratford storesFact|date=January 2008. Full time employees work 50 hours a week, minimum.

Staff purchases and discount (of 15%) are restricted by availability only on a Thursday after 17:00. Staff are also only allowed to purchase products for themselves.

Brands

Retail

Current brands

* [http://www.antigua.com/antigua.htm Antigua]
* [http://cyclesdirect.com CyclesDirect.com]
* [http://www.fieldandtrek.co.uk Field & Trek]
* [http://www.golddigga.co.uk Goldigga] - acquired by Sports Direct in 2008. [http://www.drapersonline.com/news/2008/07/ashley_adds_golddigga_to_his_empire.html]
*Lillywhites
* [http://www.sherunsheruns.co.uk SheRunsHeRuns]
*SportsDirect.com - internet and high street retail.

Previous brands

*Bike Clearance
*Gilesports - merged into SportsDirect.com
*Hargreaves Sports - merged into SportsDirect.com
*Original Shoe Company - sold to JJB Sports in December 2007. [cite news|url=http://www.hemscott.com/news/static/tfn/item.do?newsId=56416543337313|title=JJB Sports buys Original Shoe Company from Sports Direct for 5 mln stg|date=18 December 2007|work=AFX News|publisher=Hemscott|accessdate=2008-08-27]
*Streetwise Sports - merged into SportsDirect.com
*Sports Soccer - merged into SportsDirect.com
*Sports World - merged into SportsDirect.com

Clothing and equipment

*Carlton
*Dunlop
*Donnay
*GoldDigga
*Everlast
*Kangol
*Karrimor
*Lonsdale
*No Fear (outside North America)
*Slazenger
*Voodoo Dolls

References

External links

*Official|http://www.sports-direct-international.com