A sporting chance

Mar 01, 2000 10:30 PM  By

Just as there’s more than one way to skin a cat, Dallas-based Collegiate Pacific has found that there’s more than one way to grow a business. For the fiscal year ended June 30, 1999, the institutional sports equipment cataloger had sales of $6.9 million, a 67% jump from the previous year, thanks to a combination of acquisitions, increased circulation, and an emphasis on proprietary products. What’s more, president Mike Blumenfeld expects the company to more than double its size to $15 million by June.

Blumenfeld and his partners, all of them former executives with Sports Supply Group, another institutional sporting goods cataloger, bought the rights to the Collegiate Pacific trade name in January 1997. In the three years since, the company has acquired three cataloger/distributors: Vantage International (baseball equipment) in April 1998, Product Merchandising (supplies for summer camps) in May 1998, and Mark I (also a summer-camp supplier) in November 1999. At the same time, the company ramped up circulation from 250,000 books in 1998 to 500,000 last year. This year it plans to boost circulation again, to 700,000 books.

To build up its database, Collegiate Pacific has grown its list well beyond the high schools and YMCAs that make up roughly 50% of its customers. Collegiate Pacific is also prospecting to golf courses, tennis-court contractors, Little League baseball groups, “anything nonretail in sports,” Blumenfeld says. The company has helped keep its costs down by capturing most of its prospect names on the Internet for free. “We don’t rent any names,” he says. “We’re willing to sit there and crunch just about everything on the Internet. The entire worldwide Yellow Pages is on the ‘Net. And by virtue of that, everything is on there.”

The power of proprietary products

More important than increasing circulation, perhaps, Collegiate Pacific boosted its response rate from 1% in 1998 to 3% last year by “attacking the market with proprietary products,” says Blumenfeld, who believes the catalog can reach a 5% response rate this year by drawing more repeat business. While only 20% of Collegiate Pacific’s products are proprietary, they account for 80% of the cataloger’s total revenue, and Blumenfeld says he plans to increase the percentage of proprietary products offered in the future. Thanks largely to the exclusive merchandise, the cataloger’s average order size has swelled from $50 when Collegiate Pacific launched in 1997 to $400 today.

Blumenfeld describes the cataloger’s overall merchandising philosophy as “traditional, standard, and conservative. We offer 1,100 SKUs, but we don’t offer a rainbow of colors” for each product.

As for branching out, “we will expand our product line only if we quit growing,” Blumenfeld adds. “But so far we’ve penetrated only 10% of the market, so we still have a ton to do internally to reach more buyers.”

When the rights to the trademarked name “Collegiate Pacific” expired in 1995, Charlie Atkins, who had been running the brand as a subsidiary, bought the rights to relicense the name from parent firm Littlefield, Adams & Co. This way, the then-30-year-old company, which Littlefield had bought out several years earlier, could continue to sell its felt college banners to college bookstores nationwide via a 25-rep field sales force. The Roanoke, VA-based company also regained its independence from Littlefield, and has grown steadily since – at a 15% annual clip. Sales are currently in the $1 million-$5 million range, according to Atkins.

But in `97, Littlefield also sold the rights for the Collegiate Pacific name to Mike Blumenfeld and his partners. While the two Collegiate Pacifics haven’t encountered any serious problems, some confusion remains.

According to both Blumenfeld and Atkins, because Atkins’s company had bought the rights to the Collegiate Pacific name specifically to continue selling the banners to college bookstores, Littlefield still owned the right to sell the same name to Blumenfeld’s company, because it was selling unrelated sports equipment, such as soccer goals and tennis nets, primarily to high schools, YMCAs, country clubs, and municipal facilities.

But despite both companies’ apparent success, Atkins says the dual trademark rights have not been carried out properly, and that he’s working on some course of action that he won’t reveal. “Even though [the Dallas company] isn’t selling to college bookstores as we are, there’s been confusion,” he says. “There were certain stipulations that have not been lived up to, although it’s hard to say if it’s affected our sales growth or not.”

Atkins won’t comment on what those stipulations are, only that the Dallas-based Collegiate Pacific is creating “confusion in the marketplace” for his company. For instance, “there was an article several months ago about a company acquisition in a Dallas publication that made no mention of our company, but showed a picture of our Website.” The Roanoke Collegiate Pacific has the www.collegiatepacific.com address; the Dallas Collegiate Pacific operates off a co-op affiliate site, www.onlinesports.com.

If he chooses to pursue legal action, Atkins says he’ll take it up with Littlefield, Adams, not Blumenfeld’s company. (Littlefield, Adams, which sold the Collegiate Pacific trademark rights to both companies, has reportedly undergone a complete corporate overhaul in the executive ranks in recent months, according to a spokesperson at the Huber Heights, OH-based firm, which currently markets licensed T-shirts to retailers. Neither president John Tsucalas nor controller Don Hartman would return calls for interviews.)

On the other hand, Blumenfeld sees nothing wrong, even though both companies occasionally receive and pass along one another’s misdirected checks from customers. “It’s not unusual for one party to buy the rights to a name for one market and to others for another market,” he says.