Academy Sports + Outdoors

Academy Sports + Outdoors

Type	Private
Industry	Retail
Founded	San Antonio, U.S. (1938)
Headquarters	Harris County, Texas, U.S.
Key people	Max & Arthur Gochman, Founder[1][2] Rodney Faldyn, CEO & President
Products	Discount stores
Revenue	US $2.70 billion, (2011)
Net income	US $65.0 million, (2005)
Owner	Kohlberg Kravis Roberts Halliburton
Number of employees	17,000 (2011)
Slogan	Academy, The Right stuff the low price!
Website	www.academy.com

Academy Sports + Outdoors is a sports goods discount store chain. For 74 years it was a privately held company owned by the Gochman family, until its May 2011 sale of partial ownership to the investment firm Kohlberg Kravis and Roberts LP and oilfield services company Halliburton.^[3] Academy operates nearly 190 stores throughout Alabama, Arkansas, Florida, Georgia, Indiana, Kansas, Louisiana, Mississippi, Missouri, North Carolina, Oklahoma, South Carolina, Tennessee, Texas,Kentucky and Indiana. Academy Sports and Outdoors has its corporate offices and product distribution center in unincorporated western Harris County, Texas, United States, near Katy.^[4]

History

Privately owned by the Gochman family, Academy Sports & Outdoors operates the fourth largest chain of retail sporting goods "megastore" outlets in the United States. In 1999, it had 35 stores in Texas, three in Oklahoma, two in Alabama, three in Louisiana, and one in Florida. The majority of these are "superstores," ranging from 35,000 to 100,000 square feet in size. In them, Academy carries an extensive line of name-brand equipment and clothing and shoes for competitive sports, physical fitness training, and outdoor recreational activities such as camping, hunting, fishing, and boating. Included among its name brands are Champion, Jantzen, Justin, K-Swiss, Nike, Reebok, Rollerblade, Spalding, and Wrangler. Academy's company headquarters are located in Katy, Texas, a suburb of Houston, where it also owns a large warehouse used for effective inventory control and distribution.

1970s: Early History and Directions

Academy Sports & Outdoors came into existence in 1970, when Arthur Gochman and his business partner purchased Southern Sales, a Houston-based army-navy surplus chain comprising six stores that were by that year no longer making any profit. At the time, Gochman was a practicing attorney in San Antonio. He had not been formally educated as a businessman, but he had learned much about the surplus retail business from his father, Max Gochman, who had owned a surplus goods outlet in San Antonio and in 1970 still owned and operated a small chain of stores in Austin.

Gochman bought out his partner in 1973 and changed the company's business name from Southern Sales to Academy Corp. The Academy name was borrowed from his father's stores. It came from a now-defunct San Antonio Catholic school named St. Henry's Academy. Max Gochman had opened his first store across the street from the school in the 1930s, selling pre-World War II surplus goods. Later, when he moved to Austin, he used the name for his four army-navy surplus stores. Because many University of Texas students and graduates lived in the Houston area and were familiar with the Austin stores, Max Gochman permitted his son to use the name, knowing that it would help his son's business.

For the first few years of Academy's operation, Arthur Gochman's involvement was, in large part, passive. He continued to practice law in San Antonio until 1978, when he gave up his practice and moved to Houston to assume active control of the company and complete the overhaul of its basic merchandising policies.

1980s: From Surplus to Sporting Goods

Gochman made streamlining the chain's image his first priority. He closed two of the original stores and completely discontinued the sale of military surplus goods, responding to market changes reflecting new tastes and lifestyles. Academy already had begun refurbishing its image in the late 1970s, when, prompted by the increasing popularity of athletic shoes and leisure wear, it had begun selling sporting goods and clothing. In the 1980s the company's management completed the Academy changeover into a chain of outlets offering a wide and competitively priced range of brand name, top quality sporting goods and clothing—creating the company image that it has since retained.

Under Gochman's tutelage, the company began its continuing growth cycle. At first it widened its in-state operating area, in part as the result of family loss. Max Gochman died in 1985, and Arthur Gochman took over his father's four Austin stores, refurbishing them in Academy's new image as sporting goods megastores. The Austin market was both reliable and profitable, and it helped Academy's gradual "transition from 'giant killer' to a retail giant in its own right." It also brought the number of stores in the chain from eight in 1980 to 12 in 1985.

Smart responses to market realities also helped the company's growth. In the 1980s, through surveys of his customers, Gochman realized that the great majority of them were men. To encourage women to shop in Academy outlets, he introduced lines of women's casual clothing and aerobic wear. It was a wise policy move, for within a few years women would account for 50 percent of the chain's shoppers.

Starting in 1986, Academy also adopted an EDLP (EveryDay Low Pricing) sales philosophy, rejecting the widely used deep discounting of select items to attract customers. That policy assures Academy shoppers that they will pay low prices across the entire line of merchandise and not be penalized by the higher markups many stores put on nonsale items to offset the deep discount prices on their "specials."

Wisely, too, Academy retained much of a regional identity, offering the company's home base Texas customers several lines not carried by other sporting goods outlets. An important example is Western footwear. By 1990 the company was selling more cowboy boots than any other chain in the United States. In that year alone, its sale of women's Western-style boots increased by a full 70 percent over the previous year.

By the end of the 1980s Academy had become a very popular Texas chain. Among other things, its outlets sold more state fishing licenses than its chief competitor, Oshman's Sporting Goods, or any other group of stores in the state. But its success in Texas also raised new possibilities. In the mid 1980s the company began an impressive sales record, with yearly increases in revenue matched with stable margins and excellent cash flow. The health and stability of the company encouraged its expansion, both in Texas and, starting in the 1990s, beyond.

1990s and Beyond: Expansion, Managerial Changes, and Successful Strategies

By 1990 Academy had grown to 18 stores. It also began a period of more rapid expansion, jumping to 34 stores by 1995, the year after it first moved into two adjoining states. It opened its first store outside Texas in Edmond, Oklahoma in June 1994, then added a store in Lafayette, Louisiana the following November, thus ending the company's exclusive Texas identity.

Academy's roots remain in Texas, though, and the epicenter of the company's business always has been the greater Houston area. Almost half of its stores are located there, as are the company headquarters and its distribution facility. As it has expanded beyond its home base, Academy has sought "hot-market" locales, places that from careful market analysis offered the promise of high-volume sales. The result has been that it has never had to close one of its new stores, all of which have been profitable since their first day of operation.

In 1995 David Gochman, the founder's son, joined Academy on a full-time basis. By that time his father, then 65, had built Academy into a $350 million retail chain and was ready to turn control of the business over to his 30-year-old son. David Gochman initially served as vice-president of store operations and general counsel, but in the following year he succeeded his father as Academy's chairman, president, and CEO.^[5]

In 2011, Academy Sports + Outdoors was acquired by the investment firm Kohlberg Kravis Roberts & Co. The corporate headquarters located in Katy will be doing an expansion of its facilities with a completion date of 2015.^[6]

Business

Academy stores have six departments:

• Team Sports (Including the Golf Shop and Fitness Flat)
• Footwear
• Camping (Including patio furniture and cooking supplies)
• Hunting and Fishing (including firearm sales, boating, and truck and trailer accessories)
• Apparel
• Front End (cash registers, including hunting and fishing license sales at select registers)

Academy Sports and Outdoors E-commerce site launched summer of 2011.^[7] The web site is a product of IBM eCommerce portal that includes WCS and Sterling.

See also

• Cabela's
• Bass Pro Shops
• Dick's Sporting Goods
• Gander Mountain
• REI
• Scheels All Sports
• Sportsman's Warehouse

References

External links

• Official website
• Eaton, Collin. "KKR to buy big stake in Texas-based sporting goods chain Academy." The Dallas Morning News. May 31, 2011.
• Forbes.com article (2007)