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Wednesday, May 25, 2022

Sport Chalet Ramping Up Same-Day Delivery

Good sports teams adapt their style to the opposing team. Sports retailer Sport Chalet Inc. is trying the same tactic to keep its customers happy. Earlier this month, the La Canada Flintridge company announced a new service that allows customers to order products by phone and receive delivery the same day. Sport Chalet is the first brick-and-mortar sporting goods retailer to offer same-day delivery. However, Internet retail giants Amazon. com Inc. of Seattle and eBay Inc. of San Jose have begun offering a similar service. And reports have surfaced that Bentonville, Ark.-based Wal-Mart Stores Inc., the world’s largest retailer, is considering the idea too. For Sport Chalet, the need to separate itself from the competition is paramount. The company lost $1.9 million last quarter and posted losses each of the last five years, though it had some profitable quarters last year. The stock has been hammered after topping $10 in 2007. Shares closed on April 10 at $1.42. The program began April 4 and requries customers to call in orders to nearby retail outlets by 1 p.m. for delivery the same day. “Time is a currency, This is another way to leverage all the assets we have.” said Chief Executive Craig Levra. Sport Chalet has implemented the program in the areas surrounding all of its 53 retail stores, which are in California, Arizona, Utah and Nevada. There are seven outlets in the Greater San Fernando Valley that have access to the service, including La Canada Flintridge, Burbank and Palmdale. Customers within a 30-mile radius of a store are eligible. But the service comes with a steep price: Delivery will cost $25 to $35, according to Levra. In major metro areas such as the Valley, the standard rate is $25. And inventory is still an issue. If the nearby store doesn’t have the set of skis needed for tomorrow’s snow trip in stock, the service is moot. Neil Stern, a senior partner at Chicago-based retail consulting firm McMillanDoolittle LLP, called same-day delivery “The Holy Grail” for a business. And though internet retailers have experimented with the service, Sport Chalet may be a trend setter at the local level. “A brick-and-mortar retailer has never done this in a meaningful fashion,” he said. Paul Swinand, an analyst that covers sporting goods companies at Morningstar Inc., a Chicago investment research firm, said the service is more for emergencies, as the average shopper in need of new Under Armour Inc. workout shirts won’t want to pay the delivery fee. “It’s not a money maker, it’s a service builder,” he said. “Are people really going to pay $25 extra for a $50 item? I don’t think so.” Levra conceded that the service would not appeal to all customers, especially casual shoppers, but said already orders are coming in. “When Zappos sold its first shoes online, people wondered how far that could go,” he said. “Where this goes is hard to say. But it’s off to a great start.”

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