DICK'S Sporting Goods bucks trend to open large-format stores
/I would say today, smaller is better than bigger when it comes to store size. Just ask Macy's, Burlington Stores, Inc., Kohl's, IKEA, Sprouts Farmers Market, Whole Foods Market, even CVS Pharmacy. All are rolling out smaller locations to reduce real-estate costs, carry mostly fast turning merchandise and increase their sales per-square-foot productivity.
But, there's one exception. DICK'S Sporting Goods continues to open large-format House of Sport locations, which average between 120,000 and 140,000 square feet, many of which have to be carved out of former department store buildings.
DICK’S needs that much space to house a variety of amenities, including rock-climbing walls, golf simulators, outdoor running tracks and lots of merchandise. These stores generate about $35 million in their first year of operation (including e-commerce sales attributable to the store), compared with $14 million at DICK’S new smaller locations.
And if you are a landlord with a vacant big box, you might be asking about required tenant allowance. These large-format stores cost about $15.5 million more to build than DICK’S smaller stores.
DICK’S has already opened 19 House of Sport locations since the first one in 2021. According to DICK’S Executive Chairman Ed Stack, whose father, an avid fisherman named Dick Stack, founded the sporting-goods chain in Binghamton, N.Y., 77 years ago, DICK’S plans to add dozens more House of Sport locations over the next 10 years, with House of Sport stores eventually comprising more than a quarter of the company’s total fleet. DICK’s currently operates 856 stores in various concepts including DICK’S, Field House, House of Sport, Golf Galaxy and Going Going Gone!