Total sports apparel had a tough week vs. last year (+ only 1.3%) – but the trend continues to improved on a 2 and 3-year basis. I’d be shocked if this not accelerate further in the next two weeks due to the recent cold snap in the Northeast.
To that end, it’s fascinating to e to see that the three brands that are sensitive to a shift in mix at this time of year to higher-priced outerwear all lost 2-3 points of share sequentially – this includes The North Face, Columbia, and Under Armour (see charts below).
The big winner for the week? Russell Athletic. Yes, you heard me right…Russell Athletic, sister company of Fruit of the Loom under the Berkshire Hathaway umbrella. Russell’s share is up 500bps to 8.45% and is largely driven by a push into the higher end fleece business.
The real question for me is whether this will serve as a cheap substitute for otherwise highly technical and more expensive product from the incumbent brands.
I’m most worried about VFC’s The North Face label – which has been seeing a meaningful rollover in average price point. Columbia and Under Armour have both been steady, and have inventories in check. TNF is less certain to me given my view that the brand is losing leverage with retailers as it moves forward with its own store growth plan. Let’s not ignore that TNF is upwards of 1/3 of VFC’s cash flow.