Members of Intersport Nederland have almost unanimously approved far-reaching adjustments in their central organization and their retail strategy for the next years, aimed at increasing profitability and reaching a market share of about 25 percent by 2012 – compared with an estimated share of 19.5 percent for 2009.
Intersport stores in the Netherlands bucked the market trend with a sales increase of about 2.2 percent to €175 million at the retail level last year, driven by the cold weather at the beginning and the end of the year. Braving altogether ghastly weather conditions earlier this week, 50 of Intersport Nederland’s 62 members got together for their general assembly in Hoevelaken. The management’s plans, which Intersport has been discussing since last summer, were approved by 47 members.
They call for the introduction of the new store concept launched by Intersport International, starting with a store in Borculo in April. The format will focus more strongly on performance products, while cutting back on lifestyle. Marketing is to be adjusted accordingly, and members will be encouraged to adopt upgraded IT systems to exchange information.
Furthermore, the group wants to introduce more discipline among the members, for example in sticking with central agreements, using in-store material and the Intersport format for electronic stores. Retail members who have Intersport stores as well as stores trading under other banners should no longer be allowed to use the products and benefits of Intersport for their other retail activities.
Another interesting part of the brief focuses on logistics, aiming to shift the preparation of individual orders to the Far East. For the time being, products are delivered directly to Intersport Nederland in Hoevelaken, which then picks, packs and sends out the orders to each member. Tests are under way with Chinese suppliers of Intersport Nederland’s private labels, whereby picking and packing for each store is done more cheaply in China. Intersport Nederland is also in talks with Nike and Adidas to introduce a similar set-up for their deliveries. Intersport Sweden has started running such tests as well.
While all this should lead to significant cost reductions, Intersport Nederland’s strategic plan is geared for growth as well. The buying group’s research has shown that there is still space for about 22 new Intersport stores in the Netherlands, adding to the existing network of 108 stores, with sizes varying from megastores to standard stores.
The central organization of Intersport Nederland itself has already undergone significant changes since Bart Muurling took charge in January last year. The organization had been loss-making for two years. Costs were slashed through a 20 percent reduction in the headcount, along with many other cutbacks and rationalization of inventories. Other sports-related banners were split off from the Intersport unit, particularly the Coach lifestyle formula and the so-called GOS members, who are leaning on the same buying group but using their own banner. The organization broke even in 2009 and should return to profits in 2010.
