Business operations and product strategy at Bill and Fred's Sporting Goods

Business Report for Bill and Fred’s Sporting Goods, Inc.

1. Relevant information
History of the company
Many large companies boast about their humble origins, but nothing in fact could be more humble than the origins of Bill and Fred’s Sporting Goods, Inc. (hereinafter alternatively “Bill and Fred’s” or “the company”). While major corporations such as Walmart began with a single store, Bill and Fred’s founded their company in 1972 with only a few feet of shelf space in the back room one of the founder’s father’s (Bill) liquor store in Springfield, Missouri. Despite these truly humble origins, Bill and Fred’s expansive knowledge of angling (they are both nationally recognized, award-winning fishermen), commitment to a family-friendly shopping environment and extensive experience in actually catching fish helped to consistently fuel the growth of the company over the years (About us, 2018). Not surprisingly, the company’s range of fishing products has also expanded from its original assortment of high-quality handmade fishing lures to include a veritable smorgasbord of sporting goods and services as described below.
Detailed description of the company’s products and services
A breakdown of the company’s products is provided in Table 1 followed by a description of the services provided by Bill and Fred’s in Table 2 below.




Table 1
Breakdown of Bill and Fred’s products
Product
Description
Comments

Fishing
Exhaustive line of fishing equipment and accessories, including reels, rods, lures and tackle for all types of seasonal fishing including ice and saltwater.
Ice shelters and underwater sonar systems are also offered.

Boating
Rowboats to high-ticket bass boats and cruisers. Marine electronics, boat accessories, boat seats, boat covers, trolling motors, trailers and accessories, kayaks and canoes.
These products also include picnic-type accessories such as pontoon furniture, grills, tables and umbrellas.

Shooting
Guns, ammunition, optics and scopes, shooting accessories, gun storage and parts, reloading supplies.
Products also include eye and ear protections, targets and trap throwers for recreational skeet shooting.

Hunting
Optics and scopes, hunting accessories, tree stands, game cameras, food plots and feeding, game calls, decoys, knives and hunting tools.
Products also include dog-training equipment and supplies as well as ATV hunting accessories.

Archery
Bows, arrows, accessories, targets, bowfishing and supplies, crossbows and treestands.
This product line also features arrow heads for different applications, bow strings, and other archery supplies.

Camping
Cameras and drones, heaters, tents, camp stoves and lanterns, coolers, packs and bags, as well as game processing equipment and supplies.
Products also include canopies and specialty dome tents.

Clothing
Full line of brand name men’s, women’s and children’s hunting-related clothing and accessories.
Products also include shoes and hunting boots.

Home and gifts
Home décor (indoor and outdoor), toys, kitchen and dining, food and drink accessories, books, DVDs and sunglasses.
This product line also include NASCAR novelties (the company is a sponsor) and gift cards.



Table 2
Summary of Bill and Fred’s services
Service
Description
Comments

Rod and reel repair
The company is authorized to perform factory warranty repairs at no charge to consumers. Other repairs start at only $20.95, plus parts and shipping. Plus, for anglers who repair reels on their own as a business or as a hobby, the company has the most extensive reel parts inventory including discontinued parts.
The company repairs the following brands of fishing reels: Bass Pro, Johnny Morris, Bionic, Extreme, Carbonlite, Gold Cup, Offshore Angler, Ocean Master, Tourney Special, Cat Maxx, Crappie Maxx, Abu-Garcia, Pro Qualifier, Mega Cast, Daiwa, Mitchell, Zebco, Browning, Shimano, Penn, Shakespeare and Johnson.

Embroidery services
Personalizing merchandise customized to your specifications. Stock designs with exacting attention to detail and quality. Add text to create the look or logo you want for your club, organization, or personal needs.
Custom Design services for clubs, companies, associations, and teams. Embroidery · Digital Printing · Sublimation

Boat centers
The factory-trained Power Pros technicians have the knowledge and skills to offer you the best marine services. From tune-ups to diagnostics, they’re here to keep you out there! We offer a variety of specialized packages at most locations to meet all budgets and needs. Select locations offer added protection for your boat in the form of shrinkwrapping or storage.
With more than 95 locations across North America, there’s sure to be a Boating Center location nearby. Our certified technicians can service virtually any boat model, using factory-matched parts to repair Mercury® outboards and MerCruiser® sterndrives. Many locations service Arctic Cat® and Bad Boy® ATVs and UTVs as well.



Taken together, the exhaustive lists of sporting goods products and services set forth in Tables 1 and 2 above make it clear that Bill and Fred’s has become a one-stop shopping experience for its target market as discussed further below.
Target market
Although the company offers a limited line of specialty sporting goods and attire for women and girls, the main target market for Bill and Fred’s remains young North American males.
Culture of the organization
As a privately owned, multinational company headed by its male founder with an all-male board of directors, the organizational culture at the company is best described as patriarchal with an emphasis on profitability and growth.
Organizational structure
Despite the addition of 82 new retail stores as a result of the recent $4 billion-plus acquisition of its former main competitor, Cabela’s, the company’s structure remains highly centralized, with just two distribution centers servicing its retail locations in the United States and Canada. Each retail location, though, is highly customized to reflect the unique characteristics of the geographic regions in which they compete.
Number of employees
Current estimates place the number of employees at the company at approximately 22,000 in its 177 retail locations in North America (this figure includes the newly added former Cabela’s employees).
Location
The company’s current 177 retail locations in North America are depicted in Figure 1 below.

Figure 1. Geographic locations of the company’s retail stores
2. Restatement of the business challenges
As indicated previously, the two most significant business challenges facing the company today are as follows:
Business challenge one: Develop and implement a transition program to groom a replacement for the current CEO.
Business challenge two: Create a marketing division focusing on female-oriented sporting goods and services, including sports-related video games.
While the views concerning the specific reasons for these business challenges differ among key stakeholders, this author’s empirical observations concerning the reasons these business challenges exist are presented below.
3. Empirical observations concerning the reasons these business challenges exist
a. Business challenge one: The company’s current CEO, Bill, is nearing 75 years old but shows no sign of slowing down. Informal conversations with other executives and department heads indicate that efforts have been made to convince the CEO of the need to implement a program at the earliest opportunity to ensure the smooth transition when the need arises but Bill remains reluctant or even unwilling to formally commit to this initiative. More importantly, perhaps, questions posed during the interview with the CEO reinforce this perception, with Bill flatly stating at one point that, “I still have plenty of good years left in me and I intend to devote them to running this company just the way it has always been run.”
b. Business challenge two: The sporting goods industry has been confronted with a number of significant changes in recent years that make the landscape far different from that when the company was formed nearly a half century ago, including changes in the types of sports played and by whom. The sporting preferences of the company’s traditional target market of younger North American males has also experienced substantive changes over the past half century, and there is an overarching need to formulate effective responses to these changes.
One of the most significant changes that has taken place in the sporting goods industry, most especially in the most recent years, has been the increase in the numbers of women participating in individual and group sporting activities (Woods, 2016). These shifts have not gone unnoticed by sports marketing analysts, with the “This girl can” media campaign (see Figure __ below) being cited as a salient example of the new marketing appeals to this demographic group. It is especially noteworthy that the project leader of this campaign emphasized that, “It was about making sport relevant to women who didn’t previously think it was for them” (as cited in Woods, 2016, .p. 106).
Figure 2. Representative screenshot from the “This Girl Can” media campaign
Source: https://www.campaignlive.co.uk/article/need-know-sports-marketing-2017-beyond/1424873#Pwll35ZVeHUSZqKR.99
To date, this media spot has been viewed more than 40 million times on YouTube and Facebook, and tens of thousands of women have been influenced by its powerful message that women are capable of participating in virtually any sport they care to try (Woods, 2017). In addition, there have also been some profound changes in the types of sports enjoyed by young people in the company’s North American market. For instance, Woods (2017) reports that:
Participation in youth sport was at an all-time high [in] 2000 [when] the number of American youth who played on at least one organized sport team was found to be 54% of kids between ages 6 and 17 [but] a similar study 5 years later showed that among a slightly older age group of 10- to 17-year-olds, sport participation had jumped to 59%. (p. 106)
Other recent trends that have implications for the company’s future marketing initiatives include changes in the peak age of participation in team sporting activities. Research has shown that participating in team sports reaches at peak at age 11 years and declines thereafter among both boys and girls, but more girls are remaining active in these sports than in years past (Woods, 2017). Although the precise reasons for this recent relative decline in participation by boys and relative increase in the percentage of girls remaining active in sports team activities remain unclear, there have been several potential reasons for these trends advanced by market analysts including the following::
· Overemphasis on winning as the objective with resulting increases in pressure to win and achieve;
· Stress on high performance that translates into longer hours of practice, longer seasons, and specialization in one sport at an early age;
· Expenses of participation, traveling teams, sport camps, sport academies, coaching, and equipment that are out of reach of middle-class families;
· Increased injury incidence due to inordinate demands on young bodies;
· Increased participation in alternative sports by young people who are turned off by traditional adult-organized programs;
· Lack of training for youth coaches and the resulting frustration of kids who take orders from well-intentioned but misguided coaches;
· Earlier starts in youth sport (sometimes as young as 3 or 4 years of age); children simply grow bored with a sport after a number of years (Woods, 2016, p. 107).
Other studies have also identified some important trends in sports preferences among youth people with implications for the company’s future marketing efforts. For example a study conducted by the Women’s Sports Foundation found that nearly three-quarters (72%) of American young people were either currently participating in a sport or had done so within the past year, while 15% had never played sports and another 12% had dropped out of their sporting activity (Woods, 2016). These findings suggest that a majority of North American youth remain active in the types of sporting activities for which the company already markets equipment and supplies.
There were some interesting differences in sports participation levels, including differences in gender levels depending on the geographic region and race, but boys continue to play more multiple sports compared to girls and boys tend to begin their participation in sports earlier than girls (6.8 years versus 7.4 years, respectively) (Woods, 2016). Here again, although the precise reasons for these differences remain the subject to investigation, the prevailing theory concerning these differences involves social and geographic factors. For example, according to Woods (2016):
Youth sports are racially and ethnically diverse and at many ages, boys of color tend to have higher participation rates in sport than Caucasians. However, the picture for girls of color is not encouraging. They seem to be hit by both gender and skin color discrimination, and their participation levels fall significantly below those of Caucasian girls. The reasons for this are a combination of culture, family responsibilities, income level, and living locations. (p. 108)
Likewise, and perhaps not surprisingly, girls were more likely to participate in sports such as dance, volleyball, soccer, cycling, lacrosse, field hockey, ultimate Frisbee, cheerleading, double Dutch, and competitive rope jumping and compared to their male counterparts who remained active in traditional sporting activities such as football, basketball, baseball and soccer (Woods, 2016). At present, the company markets products in these sporting categories as shown in Table 3 below.
Table 3
Current female-oriented sports products offered by Bill and Fred’s Sporting Goods, Inc.
Product
Description
Comments

Dance
No relevant product offerings

Volleyball
Amateur volleyball sets and volleyballs
These are the only two relevant products offered in this category.

Soccer
No relevant major product offerings.
The company does offer a giant 6-foot novelty soccer ball for team practice and events ($120).

Cycling
No relevant major product offerings.
The company offers two types of bicycle locks only.

Lacrosse
No relevant product offerings

Field hockey
No relevant product offerings

Ultimate Frisbee
No relevant product offerings

Cheerleading
No relevant product offerings



The above listing underscores the current focus on the company’s traditional target market of young North American males, but it is reasonable to suggest that the company is also missing out on some lucrative market niches that it continues to ignore or undervalue. Responding to these recent trends in sports and participation levels in an efficient and effective fashion will therefore require ongoing vigilance concerning opportunities to grow the company’s business in its primary North American market as well as beyond. Such responses, however, are currently constrained by the lingering aftereffects of the company’s merger with its former major competitor, including forging a new organizational culture that combines the best of both enterprises. Taken together, it is clear that these foregoing issues and trends have significant implications for the future of the company and underscore the need for timely leadership today in order to sustain and improve Bill and Fred’s competitive advantage in an increasingly competitive and dynamic marketplace as discussed further below.
4. Evaluation concerning how each of the three areas of responsibility is impacted by the overall challenges
Leadership. Notwithstanding the current CEO proven abilities to guide this multinational enterprise during periods of changes in consumer preferences and economic downturns, it is reasonable to suggest that at some point, Bill will need to permanently retire due to physical infirmities, diminished cognitive abilities, age-related disorders or for personal reasons. In any event, implementing a leadership transition program will require corresponding leadership on the part of the key executives in the company to convince the current CEO of its necessity and urgency as well as the individuals who is tasked with creating the program and the ad hoc committee that will be used to identify potential candidates and formulate an appropriate transition strategy.
Likewise, the current – and future CEO as identified above – will need to be educated concerning the growing popularity of sports-themed video games and recent trends in female participation in group and individual sporting activities as well as the need to develop informed responses and redefine the company’s current (and historic) male-oriented target market.
Administration. Collaboration between the company’s human resource, new product planning and development and marketing divisions will be needed together with their representation on the ad hoc committees. While the composition of the ad hoc committees may change over time as their progress proceeds and new requirements are identified, the original representation on the two ad hoc committees for the two business challenges outlined above will be as follows:
Ad hoc committee #1 (executive search committee): Business problem task: Develop and implement a transition program to groom a replacement for the current CEO.
· Project leader (this will be a member of the board of directors);
· Director, human resources division (assistant project leader and recording secretary);
· Assistant director, human resources division;
· Director, marketing;
· Director, communications; and,
· Expert input from staff and outside counsel as needed.
The designation of a member of the board of directors as the project team leader for this business problem is consistent with the guidance provided by one executive search consultancy that emphasizes, “The selection of a chief executive officer is one of the most important decisions the Board will ever make. Thus, it makes sense to populate the Committee with current board members who are the most attentive to and knowledgeable of the work of the organization” (Who should be represented on the search committee, 2018).
Ad hoc committee #2: Business problem task: Create a marketing division focusing on female-oriented sporting goods and services, including sports-related video games.
· Project leader (director, marketing);
· Chief, new product development (assistant project leader and recording secretary);
· Chief, U.S. marketing;
· Chief; Canadian marketing; and,
· Expert input from staff and outside counsel as needed.
Delegation. Project leaders will be assigned to head the two ad hoc committees as noted above that will be formed to implement the recommendations that are described below following a discussion concerning how these solutions will address the above-stated business challenges in these three areas of responsibility.
5. Solution to address the business challenges involving each of the three areas of responsibility
Leadership. As noted above, project leaders will be assigned to each of the two business challenges (i.e., develop and implement a transition program to groom a replacement for the current CEO and Create a marketing division focusing on female-oriented sporting goods and services, including sports-related video games) including heading an ad hoc committee that will be tasked with appropriate responsibilities.
Administration. An ad hoc committee will be created for each business challenge headed by the project leaders noted above.
Delegation. An assistant project leader for each ad hoc committee will be delegated specific tasks by the project leader as the need and opportunity arise. In addition, both assistant project leaders may delegate their recording secretarial responsibilities to support staff members with the requisite minutes-recordation skills.
6. Resources required to implement each recommendation
a. People (leadership style). Both transformational and transactional leadership styles overlaid with a generous helping of charismatic leadership will be required to address the business challenges described above. Although both of these leadership styles share the same fundamental purpose of achieving organizational goals, they differ somewhat in how they approach human resource management. For instance, according to Mahdinezhad and Suandi (2013), “Transformational style of leadership is a stimulating technique through which a leader can inspire and apply that ability of motivation thinking” (p. 30). Although leadership analysts differ with respect to a precise definition, Mahdinezhad and Suandi (2013) cite the following as the main elements of a transformational leadership style:
· Inspirational motivation and idealized influence which functions as a charismatic paradigm and expresses an image of the future that is communal;
· Customized consideration comprises the leader considering individual variances; and,
· Intellectual stimulation defined as a general awareness of leaders’ ideas and thoughts (p. 30).
By contrast, transactional leadership involves a quid pro quo exchange of some sort, even if this exchange is not recognized as such. Transactional leadership is especially well suited for larger companies such as Bill and Fred’s with a well established, organization-wide hierarchy and structure. For example, Spahr (2016) reports that, “A transactional leader is someone who values order and structure [and who is] likely to command military operations, manage large corporations, or lead international projects” (para. 3). In general, effective transactional leaders rely on the aforementioned mutual exchange to achieve the desired results. In this regard, Mahdinezhad and Suandi (2013) note that transactional leaders achieve cooperation “through exchange of rewards” by “encouraging followers to perform as anticipated” (p. 31). Consequently, transactional leadership also subsumes contingent reward theory wherein leaders stipulate certain types of performance levels in exchange for proffered rewards (Mahdinezhad and Suandi, 2013).
b. Equipment. Because all of the ad hoc committee members are physically present in the company’s Springfield headquarters, they will meet face-to-face from time to time which will require the use of a conference room, recording equipment for minutes-taking purposes, refreshments (i.e., coffee and pastries) as well as meeting accessories such as legal pads and writing implements. The virtual meetings of the two ad hoc committees will require the use of the current desktop and notebook computers issued to committee members and a virtual collaboration application package such as Zoom Videoconferencing’s virtual team conferencing software available at https://zoom.us.
c. Tools. No specific tools will be needed by either ad hoc committee.
d. Budget: The respective budgets for the two business challenges described above are as follows:
1. Business challenge one: Develop and implement a transition program to groom a replacement for the current CEO: $15,000 (this figure includes $3,500 for outside consultation/expert assistance if needed).
2. Business challenge two: Create a marketing division focusing on female-oriented sporting goods and services, including sports-related video games: $250,000.
e. Necessary processes to effectively implement recommendations: The respective processes that will be necessary to effectively implement the above-stated recommendations are as follows:
1. Business challenge one: Develop and implement a transition program to groom a replacement for the current CEO. Besides the current conventional administrative processes that are already in place at the company, the following processes will be needed for these recommendations: (a) administrative mechanisms to report the status of the executive search to top executives and ad hoc committee members; and (b) a mechanism to formally approve the ad hoc committee’s selection of eligible candidates for consideration and their final choice.
2. Business challenge two: Create a marketing division focusing on female-oriented sporting goods and services, including sports-related video games. Since this will be a completely new marketing department, this business challenge will require the following new processes: (a) organizational chart and reporting revisions to reflect addition of the new department; (b) annual budgetary requirements; (c) recruiting of staff from within to the extent possible and outside recruitment to the extent necessary.
7. Visual timeline for each recommended action and activity
As previously reported, a timeline for each recommended action and activity is presented in Table 5 below.
Table 5
Timeline for each recommended action and activity
Stage
Phase one: initiation
Phase two: planning
Phase three: execution
Phase four: closure

Stage one: CEO transition
1-1-18/1-31-18
2-1-18/2-28-18
3-1-18/5-31-18
6-1-18/6-1/21

Stage two: Female-oriented marketing division
1-1-18/1-31-18
2-1-18/4-3-18
5-1-18/7-31-18
Indeterminate



8. Discussion concerning the expected long-term (3-5 years) organizational and/or financial impacts based on the implementation of the recommendations
Business challenge one: Develop and implement a transition program to groom a replacement for the current CEO: By ensuring that a qualified replacement has been groomed and is poised to assume the leadership of the company, the solutions to this business challenge will help Bill and Fred’s maintain its current market leadership position and profitability levels over the course of the next several years.
Business challenge two: Create a marketing division focusing on female-oriented sporting goods and services, including sports-related video games: Although the company features a number of high-ticket products such as specialty firearms and luxury boats, the profit potential from reaching out to this largely untapped market are enormous. Notwithstanding the potential for the solution to the business challenge to effect changes in the current masculine orientation of the company’s marketing efforts (including the specialty décor of their mega-store formats), the potential for this solution to help the company remain profitable during periods of significant changes in consumer preferences and trends in sporting activity participation levels that continue to change the sporting goods landscape.
9. Log of time spent with client
A preliminary recapitulation of the time spent with this client is presented in Table 6 below.
Table 6
Preliminary recapitulation of time spent with client
Date
Description
Comments
Time spent (hours)

July 6, 2017
Initial telephonic inquiry from client
First meeting scheduled
.5

July 14, 2017
First face-to-face meeting with client
Interview with principal concerning current business challenges
1.5

August 28, 2017
Draft of findings from interview with client sent to the company for review and approval.
Telephonic confirmation of receipt of hard copy of draft
8.0

September 15, 2017
Follow-up telephonic interview with principal concerning draft
Draft approved with some additions and changes made by client
1.0

December 1, 2017
Business report finalized and proposed recommendations submitted for approval by client
Preliminary research commenced concerning the resources and processes needed to implement these recommendations
16.5

February 19, 2018
Finalized recommendations submitted to client for approval.
Recommendations approved by the client.
3.5

Total


31.0



10. Executive summary highlighting salient points of the business report
Today, Bill and Fred’s Sporting Goods, Inc. has come to a critical period in its organizational history. Although the company enjoys strong brand recognition throughout North America, there have been some profound changes in consumer preferences for sporting goods in recent years that will have a significant impact on their operations and profitability unless they take action today to formulate informed responses, including the recommended new marketing division for female-oriented products and services. In addition, identifying a suitable replacement for the company’s current chief executive officer represents a critical need that must be addressed at the earliest opportunity in order to avoid disruptions in the company’s operations due to the untimely departure of this septuagenarian.


References
About us. (2018). Bill and Fred’s sporting goods, inc. Retrieved from https://www.billand freds.com/shop/en/about-us.
Mahdinezhad, M. & Suandi, T. (2013, November). Transformational, transactional leadership styles and job performance of academic leaders. International Education Studies, 6(11), 29-33.
Spahr, P. (2016, October 19). What is transactional leadership? How structure leads to results. St. Thomas University. Retrieved from https://online.stu.edu/transactional-leadership/.
Sports marketing. (2017). Campaign. Retrieved from https://www.campaignlive.co.uk/ article/audi-cooling-down-bbh-london/1455075.
Who should be represented on the search committee. (2018). Kittleman. Retrieved from https://www.kittlemansearch.com/executive-recruitment/faq-about-search-committees/#represented.
Woods, R. (2016). Social issues in sports, 3rd ed. New York: Human Kinetics.