Dick's Sporting Goods told investors during the Goldman Sachs Retailing Conference that its gun-control stance hurt sales of its hunting business, outdoors business, and that it may close its outdoor-focused Field & Stream stores.
Edward Stack, chairman and CEO of Dick's, said during the event that the sporting goods chain's recent 3.9 percent drop in same-store sales was the result of a mix of factors beyond their control as well as some he called "self-imposed." Specifically, he said, "the decisions we made on firearms" negatively affected their bottom line but the drop in sales was something they expected. They did not, however, regret their decision to change a number of their gun-sales policies and back new gun-control legislation.
Recent Stories in Issues
"Well I think it's definitely a factor, and it's nothing that we didn't anticipate," Stack said during the call. "As we put out kind of our guidance for the year and our earnings guidance for the year, we knew this would happen when—we've made some decisions on firearms in the past and we've had a pretty good idea of what these consequences were going to be. We felt that was absolutely the right thing to do. We would do the same thing again if we had a mulligan, so to speak, to do it again."
Dick's first modified its gun-sales policy in the wake of the Sandy Hook shooting when it said it would no longer sell AR-15s and certain other semiautomatic rifles. The retailer quickly circumvented that pledge when it opened its outdoor-focused Field & Stream chain. But in the wake of the Parkland shooting earlier this year, the chain once again pledged to stop selling AR-15s and certain other semiautomatic rifles.
In addition, Dick's decided to hire their own gun-control lobbyists in order to push for stricter gun laws nationwide. That action led the National Shooting Sports Foundation—the firearms industry's trade group—to expel the retailer.
The retailer also said in February it would no longer sell firearms to legal adults under the age of 21. On Tuesday, the company settled an age discrimination suit stemming from that decision, according to a report from Oregon Public Broadcasting.
The company insisted during the earnings call that while their embrace of gun-control policies was hurting store foot traffic as well as their hunting and outdoors business, they've found ways to offset the losses.
"Has it had an impact on the foot traffic and people who were upset with us on this? Yes," Stack said. "Has it impacted our profitability? No. We found ways to offset that. We're taking 10 stores this fall and taking firearms out of all of those 10 stores and reconceptualizing the footprint, the product mix, and we'll find out—we'll have a sense of what happens if we took that out. Now these are stores that the hunt penetration is relatively low, so it's not a perfect test, but … we're going to test this in 10 stores and see what happens."
Still, Dick's admitted both firearms customers and the firearms industry have rebutted the retailer because of their gun-control advocacy.
"Well, we've made that decision at the end of February, what we're going to do with firearms," Stack said. "It's still a little early to tell. So, we're taking a look at this. It will depend on a number of things that we're going to be assessing through the balance of this year. So, we've had some vendors who've decided based on our decision to not sell the assault-style rifle that was used in the Parkland shooting that they wouldn't sell us any longer. So, as you know, there's been some people who said we're not going to sell you any firearms anymore. We're not going to sell you our product. We've had some other people who've indicated that they wouldn't shop with us any longer. So, we've got to take a look, and we'll assess this through this holiday season, if the brands are going to continue to or not. Some brands are not going to continue to sell [to] us. If consumers [are] upset with us, we will make a decision of what we're going to do with Field & Stream."
The company said it may soon close down their entire Field & Stream chain of 35 stores across 18 states.
"My sense is that we can either take a look at closing that store, that concept or reconceptualizing it into a more of an outdoor type concept, and we're taking a look at all of these things and by the end of—the peak of the hunting season is coming up in—and basically, the end of the third and the beginning of the fourth quarter and as we move into the end of the fourth quarter, we'll make a decision as to what we're going to do," Stack said.