Supported by one of the leading sports retailers in Poland, the Iguana Group has built up a portfolio of complementary sports and outdoor brands that it started offering to retailers across Europe and Asia as a retail concept, or to fill in gaps in their offering.
The Iguana group is the wholesale distribution arm of Martes Sport Group. This company actually started off in the wholesale market with brands such as Hi-Tec and Arena. It then moved into retailing, building one of the leading Polish sports retailers, with more than 250 stores around the country. The rapid expansion of this retail business supported the growth of a well-oiled operation in sourcing and distribution, which was further reinforced with a couple of acquisitions.
The wholesale operation was named Iguana group after Martes Sport purchased the formerly Californian brand. It previously secured licensing and distribution rights for the Hi-Tec brand in twenty east European and Balkan countries, making it one of the outdoor footwear brand's closest partners. Other rights relate to Nike accessories and the Brugi brand in Poland, the Czech Republic and Slovakia. The company sells several more brands in Poland alone, from Icepeak to Russell Athletic, Colmar and Arena.
Eight other brands owned by Martes are mostly sold in its stores, such as Elbrus for outdoor products, Cool Slide for action sports gear, Huari for team sports and Aqua Wave for water sports products. IQ is a label used for base layers and training, which was bought by Martes three years ago. At the higher end of the portfolio, the Iguana brand has widened its offering from action sports and snow sports to provide mountain activewear.
The brands distributed, licensed and owned by Martes make up about 65 percent of the turnover in its stores, but the group has built up the infrastructure of the wholesale division in the last years to offer it on a larger scale, around Europe and Asia. Its office and distribution center in Bielsko-Bia?a handles deliveries to its own stores as well as retail and distribution partners across Eastern Europe. The group's distribution center is expanding to 16,000 square meters this year.
The Iguana Group will be displaying Iguana and other group brands at Ispo in Beijing and Munich in the next few days. The group is targeting retailers who are searching for complementary brands, arguing that it's more practical for them to get products from several brands and from several categories delivered from the same supplier. Just over one year ago the group hired Tomasz Sikora, formerly export director at Spokey, to take care of wholesale development for the Iguana group.
The Polish group was represented in Beijing by MS Trademarks, a part of the company that deals with licensing, focusing on Iguana, Elbrus and IQ. In Munich it will exhibit for the second time in a large stand as the Iguana Group with the Iguana brand, Elbrus, IQ, Aqua Wave, Bejo and Huari.
These efforts run parallel with the continued development of the retail business. The group said that its comparable store sales increased at double-digit rate last year, which was driven by extra brands and online retailing. Instead of competing head-on with competitors such as Decathlon and Intersport, Martes Sport moved into retailing by targeting small Polish cities with strong demand for affordable products. That turned out to be an efficient strategy, allowing Martes to build up a network comprising 256 stores at the end of last year.
However, Martes is starting to run out of such locations, which has encouraged it to start exploring another concept for larger cities in 2016. It has opened six stores trading as Martes Sport Premium, in cities such as Warsaw, Krakow, Wroclaw, Poznan and Katowice. They are larger than other stores, covering up to nearly 2,500 square meters in Warsaw, and they have more options and price points in most categories, as well as a stronger emphasis on leading third-party brands.
While the group has yet to fully gauge the potential for these stores, it will continue to open Premium locations or to remodel some of the existing stores into larger formats. An example is the store in Bielsko-Bia?a, which covered less than 800 square meters but will be expended to more than 1,000 square meters.
After about 50 openings in 2017, the network includes 249 regular Martes Sport stores, six Martes Premium stores, 13 Hi-Tec outlets, three Elbrus outlets and one Aqua Wave shop. The company opened its first Martes Junior store in November, and it relocated another 24 stores, involving enlargements and refurbishing.
The Martes Sport Group was projected sales equivalent to $266 million and operating profit (Ebitda) of $35 million in 2017, as outlined in a group presentation. This compares with an operating profit of $31 million on a turnover of $199 million in 2016.
The expansion is continuing this year, as Martes Sport is working toward its target to have 500 stores by 2022. It has a program of no fewer than 70 openings and 20 relocations in 2018, and at least six openings in the Czech Republic. Martes is slowly but steadily making progress in the country, where it doubled its network to four stores in the last months, with openings in Prague and Sumperk.
