CASE STUDY >
Scoring high profits
Written by: Kateřina Zapletňuková
Photo by: Jan Vágner
sign appeared on the Czech market for the first time just three
years ago - but the retail sportswear chain is already one of
the three local leaders.
LIKE MANY athletes, Aleš Laušman faced the question
of what to do with his career after he quits sports. A former professional
footballer who played in the Premiere League for Dukla Praha from
1982 till 1987, Laušman opted for business. "After the Velvet
revolution I decided that instead of becoming a coach I would rather
use my contacts and go into a sports-related business," he
In 1989, with his friend Martin Šťastný (now the director of Reebok
in the Czech Republic), Laušman became a sales representative of
foreign sports brands like Speedo, Reusch, etc. "It was a
wholesale activity, but I was always fascinated with building my
own retail shops," says the businessman. Three years later,
Laušman opened a small shop in Dejvice that offered selected brands'
products for both retail and wholesale purchase. Before 2001 the
name Sportisimo could be seen on several shops, although the shops
were not that large, only 250-300 square meters. That year the
company opened eight large outlets all over the Czech Republic,
including Olomouc, Teplice, Mladá Boleslav, Brno, Prostějov, Jihlava,
Karlovy Vary and Prague. "We put our stakes in large shopping
malls," says Laušman.
By that time, however, the Czech market had already seen the entry
of retail chains such as Giga Sport, an Austrian company with over
20 years' experience and recognition behind it. "We were a
step behind our competition," acknowledges Laušman. These
days, Sportisimo cooperates with about 80-90 suppliers, including
such international brands as Nike, Adidas, Puma, and Reebok, as
well as Czech producers that are trying to compete with foreign
firms, like Hannah and Klimatec. Since the establishment of Sportisimo's
first small shops, annual sales have increased from the low millions
to around CZK 500 million in 2002.
Variety is the spice of business
From the very beginning Laušman decided not to focus on one brand,
becoming a retail outlet for Adidas or Nike. "We wanted
to create a shop where the customer will be able to find any
sports-related products with a range of prices," he says.
Sportisimo sells high-profile international brand goods, alongside
no-name products of good quality aimed at budget-minded consumers.
Laušman explains that after the Revolution, when people saw the
Adidas stripes on a product, they bought it. He feels that nowadays
shops need to specialize - they should focus on some particular
field, like tourism or fishing, and offer any and all goods related
to this sport. "If a customer plays football, your shop
must be able to offer him not only running shoes or guards, but
a complete range of equipment, starting with a gate and ending
with a net. You should also be able to provide contacts for services
that go along with a product," says the retailer, adding
that this gives his Sportisimo outlets "direction".
- one of the few Czech specialized retail chains
- steady expansion
- focus on creating shops with complete product/service "direction"
- emphasis on well-trained staff
- savvy investment to fund expansion
Laušman wants his chain to become a market leader in such sports
as football, hockey, skiing, cycling, and tourism. He says that
is to make customers understand why it is better to shop at Sportisimo
instead of Tesco, Carrefour, or other department stores. To a great
extent this depends on his professional staff. "A customer should
see a difference between coming to Tesco to buy skis and buying them
at a specialty shop, where the assistant is an experienced skier himself," says
Laušman. He believes that a shop assistant must be able to offer
a customer accessories, or to recommend what kind of skis will best
the skier's level of skill. The retail chain currently employs up
to 200 people, and every Sportisimo shop has a ski expert, football
and the like - but finding qualified people is not easy. Some candidates
had good knowledge about sports but no sales skills, others avoided
communicating with customers about things outside their area of expertise.
To help bridge this gap in know-how, Sportisimo organizes training
programs for staff in conjunction with suppliers.
Information as a selling tool
Unlike some of its competitors, Sportisimo does not invest heavily
into real estate or retail property. Shops are located in rented
spaces in shopping malls, which helps the company avoid a massive
initial investment. The firm combines several methods of financing,
including leasing, capital, and supplier credits. It actively
cooperates with factoring companies in order to improve cash-flow.
Based on the firm's own research, the product range of each shop
differs depending on the emphasis a certain city or region gives
to a particular sport. "We know what kind of goods, what
brand, what price category, and what size move the best in each
particular shop through our computer network. This information
about the market is used to forecast our future contracts with
suppliers," Laušman says.
Rather than build a huge chain as quickly as possible, Laušman is
driven by the motto "slowly but surely", and works to
ensure that every outlet generates profit. He didn't hesitate to
close down shops that were proving unprofitable, then carefully
analyzing the reasons behind each failure. The athlete-turned-entrepreneur
is aware that competition will increase as other sportswear retailers
expand into the market, but he has no immediate intention of expanding
abroad. "At first a team should learn how to defend on their
home field - only after that can they go and win abroad."
Sportisimo's founder Aleš Laušman got the chance to realize
his dream of creating a retail chain when large shopping
centers like Zličín started their rapid expansion in the
Czech Republic. Shopping malls such as those that house Sportisimo
shops take care of all marketing themselves and always try
to attract customers. The main challenge for a retail chain
is to be present in these malls, which serve up to 40,000
customers per week. "It is important that we are there
and not our competition," says Laušman. Every new shopping
mall that emerges must be more attractive than the ones already
in place, which makes them very choosy in regards to which
shops will best contribute to their popularity.
For Sportisimo, advertising comes only after creating the
perfect offer for customers. "It wouldn't work the other
way round," says owner Aleš Laušman with conviction.
The company carries out its advertising campaigns in conjunction
with the brands it sells. For example, it is currently preparing
a football campaign in cooperation with Nike for this year's
European Cup. Nike billboards with a small Sportisimo logo
in the corner are designed to inform customers that if they
want to buy a Nike product at Sportisimo they will find a
wide selection. "We also have some 'dominant' brands
at our shops, so that customers connect these brands with
Sportisimo," notes Laušman.