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Callaway to be bought by Dick's?

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Your comparison is backwards. Dicks is bigger than Callaway. That's where you are missing the boat. Dicks 2009 balance sheet shows them having total assets of 2.18 BILLION dollars. Callaway - 865 Million

2.18 billion is a helluva lot of deer urine!

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So let's say that they do purchase Callaway... Wouldn't it be a conflict of intrest to stock other companies in the store?

If I buy a major company, I have a vested intrest in that company and would want it to produce to my bottom line. I couldn't in good faith sell the competitions equipment in my stores. To me that doesn't sound like a good plan if I'm Dick's.

Yes they have purchased smaller companies, but that's the point, they are small, failing companies. Callaway is a far cry from a small, failing company...

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Wouldn't it be a conflict of intrest to stock other companies in the store?

If I buy a major company, I have a vested intrest in that company and would want it to produce to my bottom line. I couldn't in good faith sell the competitions equipment in my stores.

 

 

You're right. From the get-go I've never believed this was a "good" idea. But where I think Dick's is coming from (I think, therefore I maybe) is the antithesis of what you're saying. You're idea of good faith, as right as I think that is, isn't what they're after... it's the addition to their bottom line. This move means that any Callaway sold would be pure profit for them, since there wouldn't be any overhead (or however that works... I'm not an accountant). That means the Callaway faithful that bought from other, non-eBay stores would HAVE to go to Dick's, which means more wallets in their stores.

 

In Dick's eyes, this is the cliched "win-win scenario". I'm also wondering how this plays out. Theories and guesses are one thing- the actual truth, and how it is practiced, is another altogether.

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I'm betting IF it happens, Dick's will allow them to be sold in other stores as well as in Dick's. Reason.... if they try to force people to go to Dick's they KNOW a lot of the people will switch brands because they KNOW they are not everyone's favorite place to shop. They will still make a profit even if sold in other stores.

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First post on here, so Hi everyone!

 

I've heard of Dick's looking to buy a golf brand since a few months now, but they are more looking into building their own brands, since the beginning of the months they are hiring and looking for golf experts, consultants and VP that are specialized in products development. If you know where to look, you will see the head hunters hunting

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Won't happen. Dick's unfortunately isn't going anywhere. They have a lot of cash stored up. And be on the look out for them to make some big moves in the near future. And their distribution channels and infrastructure is set-up perfect for this type of purchase. But I do not think it will be good for golf or the consumer in the long run. A lot of parallels to the big bank industry buying all the local chains.

I am in 100% agreement with you on this one.

 

One other parallel is that controls to conduct business in an open and ethical manner will be lobbied out of the business just like banks did with Congress six years ago, and look what that got us.

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This rumour doesn't make sense. They already have Maxfli; Walter Hagen and Slazenger product lines. To purchase Callaway would then mean that over 1/2 of their golf equipment is their own stuff.....competing with each other.

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Man, I don't know Dick. Do I now have to change the name on my clubs?

And my golf bag, and hat?

"What are you playing" "Dicks"

Doesn't sound right.

Guess I won't be playing Dick's balls either.

The mind boggles.

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This rumour doesn't make sense. They already have Maxfli; Walter Hagen and Slazenger product lines. To purchase Callaway would then mean that over 1/2 of their golf equipment is their own stuff.....competing with each other.

 

It's like how the auto companies do it: Chevy had/has the namesake line, Pontiac, Hummer, Buick, Cadillac, GMC and Saturn; Ford has Ford, Lincoln and Mercury; Chrysler has Chrysler, Jeep, Dodge, Ram (separated twins, basically) and General Electric Motorcars (GEM)- not to mention their upcoming merger with Fiat and their line of cars. All lines within the same "family" are targeted towards different marketshares. It doesn't necessarily mean one line is "better" than the other (another similarity to golf equipment), but one is billed as "premium", another as "mid-level", etc. I'm not advocating/denouncing this practice (especially since I want to stay employed LOL), but it's well within the scope of reality for Dick's to do something similar: Callaway becomes the "premium" line, Maxfli the "midlevel", Slazenger/WH/TF all either get consolidated, eliminated, or aimed at different, presumably lower, price points (either individually or as a merger of some sort).

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Realize that Dick's owns Golf Galaxy and the options for them to place the brand really expand. Word on the street is Fortune Brands is looking to liquidate Acushnet (Titleist and FootJoy) as well. They only comprise a minute percentage of FB overall business and their margins are not that good in comparison. Taylor Made has a flagship deal with Dick's and dumps all old inventory to them - by owning Callaway this would eliminate the need to purchase premium goods and make margins nearly double. I really don't think it's out of the realm of possibility seeing Callaway posted poor numbers in third quarter. They may have the number one this and that product but the bottom line says that doesn't mean a thing...profit is not their. Look for something big to happen with one or more of these companies in the next year.

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Realize that Dick's owns Golf Galaxy and the options for them to place the brand really expand. Word on the street is Fortune Brands is looking to liquidate Acushnet (Titleist and FootJoy) as well. They only comprise a minute percentage of FB overall business and their margins are not that good in comparison. Taylor Made has a flagship deal with Dick's and dumps all old inventory to them - by owning Callaway this would eliminate the need to purchase premium goods and make margins nearly double. I really don't think it's out of the realm of possibility seeing Callaway posted poor numbers in third quarter. They may have the number one this and that product but the bottom line says that doesn't mean a thing...profit is not their. Look for something big to happen with one or more of these companies in the next year.

 

 

Excellent points. In my honest opinion, I think this could be good for golf. Hopefully this teaches the "big boys" a lesson: change your ways- especially Callaway, who's CEO trumpeted growing the game by making it more affordable (in a recent Golf magazine article) for the recreational golfer, yet still pumps out the products with "it" material and shafts as a means to justify their price point (and I REALLY hope someone from Callaway reads this and takes notice). Maybe if one or two of them goes down, it'll open the rest of the OEM's eyes.

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I just can't wait to say....."I've got a big Dick in my bag!"

 

or

 

 

when discussing drivers on the tee box....."Who's got the biggest Dick?"

 

LOL

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I just can't wait to say....."I've got a big Dick in my bag!"

 

or

 

 

when discussing drivers on the tee box....."Who's got the biggest Dick?"

 

LOL

 

 

Thanks Foz, I almost ruined my new monitor when I nearly spit coffee from laughing! Thanks for the laugh! :)

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It's funny that 3 of the 7 brands that you mention were purchased by Callaway!

Again, Callaway is a GLOBAL brand and in my mind considered one of the big three. The companies that have fallen did not have as strong of a foot-hold in the market as Callaway currently does. Maybe they did at one time, but at the time of there collapse, they were no where near the powerhouse that Callaway is right now.

And by the looks of it, they posted slightly better numbers than they thought, and improved over last year... Still think they'll be sold?

 

http://www.reuters.com/article/idUSSGE66R0MF20100728

 

Callaway only bought two brands, Top Flite (not Top Flight) and Ben Hogan. Spalding (not Spaulding) remained seperate and licensed their name to several different sports equipment manufacturers.

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Hey guys did you see the latest? while watching the tournament from Hawaii today Dick's ran an ad featuring Rocco. He was on the launch monitor and liked the Nike driver and then grabbed 2 putters. He said i dont want or need an equipment sponsor this year. I can play any club I want to I only need one sponsor Dick's. I almost fell out laughing from remembering this thread!!!!

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Seems like everyone wants a bigger share of the golf market. The Dicks in my town have people working in the golf department who haven't a clue of what they are doing. Hope that changes if Dicks buys them

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Is there anymore updates about this? I have a lot of friends that are big Callaway fans and they are at still in awh of whats going on. Your site has been my biggest help in keeping them informed.

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Been hearing this for a while now...but more and more credible sources are saying that this will be the next shake up amongst the OEM's.

 

So what do you guys think about more and more OEM's being bought by Big Box Stores like Dick's?

 

Do you think this is good or bad for the industry?

 

How do you think this will effect the landscape in the near future?

 

 

 

 

I only think it will matter if one conglomerate ends up creating a monopoly or whatever the US definition of that is? I'm Canadian.

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