Sportsman’s Warehouse Bankruptcy Filing Contains Lesson for Industry

Shock waves were sent through the industry from the late…

Shock waves were sent through the industry from the late March announcement that mega outdoor retailer Sportsman’s Warehouse filed for Chapter 11 bankruptcy protection. While this is a severe blow to many whose distribution relied on this outlet, it reinforces and illustrates the viability and sound business approach of the two-tier distribution system espoused by the National Association of Sporting Goods Wholesalers for so many years.The filing leaves a number of shooting sports industry manufacturers with more than $22 million in unpaid invoices. With today’s credit crisis making front page news, the financial difficulties caused by this filing are another example of how important the wholesaler is in the overall supply chain process.

It’s the tried-and-true approach advocated by the NASGW, whose members consistently take the inventory risk — the financial risk associated with a credit sale; and pay their bills on time.  Additionally, since wholesalers’ very business is the sale of large volumes of merchandise, manufacturers are assured that their wholesalers will turn their product over.

The current state of the U.S. and global economy has created an environment that is hardly “business as usual” for any of us.  However, the benefits offered by the 2-tier distribution system, supported by distributors serving as solid partners with manufacturers, lends to a foundation of stability for independent businesses and our industry.

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  • Great article. Received my discharge a couple of months ago and looking forward to the future.

  • G James

    Too bad, their stores are efficient as well as enjoyable to shop in.