Sporting Goods Manufacturing
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Industry Overview
The US sporting goods manufacturing industry includes about 2,000 companies with combined annual revenue of about $14 billion. Large companies include Callaway Golf Company; Easton-Bell Sports; Russell Corporation; Wilson Sporting Goods (a subsidiary of Finland-based Amer Sports); and Rawlings Sporting Goods (a subsidiary of Jarden Corporation). The industry is concentrated: the 50 largest companies account for about 60 percent of industry revenue.
Competitive Landscape
The primary demand drivers for sporting goods are consumer income and demographic trends. The profitability of individual companies is determined by efficient manufacturing and effective marketing. Large companies enjoy advantages in economies of scale and brand recognition, and often offer a wide range of products. Small companies can compete effectively by offering specialized or unique products that interest enthusiasts.
Products, Operations & Technology
Major products include golf (excluding apparel and shoes), gym and exercise, playground, and fishing tackle and equipment, and other sporting and athletic goods. General sporting and athletic goods include equipment used to play racket sports such as tennis, badminton, and squash; and team sports including baseball, basketball, football, soccer, and hockey. General sporting and athletic goods and golf equipment each account for about 25 percent of industry revenue; gym and exercise equipment for about 20 percent.
Products are used generally for recreation and fitness. Some products, primarily those for team sports, are also sold to collegiate, amateur, and interscholastic organizations. Specific companies may also supply products to professional sports leagues.
A wide variety of manufacturing processes are used to produce various types of sporting goods including metal, plastic, and woodworking operations and tooling; assembly; packaging; supply chain coordination; and shipping. Although much sporting goods manufacture is automated, some processes, such as golf club assembly, can be fairly labor-intensive. Most manufacturing operations have fewer than 200 employees.
Raw materials include wood, steel, aluminum, plastics and resins, fiberglass, textiles, and packaging. Products are generally shipped directly to retailers and sporting goods distributors. Third-party warehouses and logistics providers are often used to bring products to market.
Products often are designed and manufactured using CAD and computer-aided manufacturing (CAM) software. R&D can be important in creating product innovation that can be used to market products as offering a competitive advantage. Companies typically spend about 1 to 3 percent of revenue on R&D. Supply chain management systems electronically link suppliers and customers with manufacturing and assembly facilities. Technology is also used to implement just-in-time strategies that reduce inventory needs while shortening product delivery times.
