Fleet Feet’s Next Steps
In a move heard round the run industry, Fleet Feet announced last month that it is acquiring JackRabbit. The transaction, expected to close in early December, will end CriticalPoint Capital’s nearly four-year investment in athletic/run specialty retail with JackRabbit and create a national, omnichannel running specialty business of more than 250 doors under a Fleet Feet single banner. Financial terms of the deal were not disclosed.
The JackRabbit acquisition is clearly a turning point in Fleet Fleet’s 45-year history. From the onset, the deal should give the retailer more buying power and greater leverage with key running vendors. Immediate plans post-closing include installing 3D foot scanning areas in all stores by the end of Q1/22 and redirecting all jackrabbit.com online traffic to fleetfeet.com. Longer-term, all JackRabbit branding will move to Fleet Feet by the end of 2022.
Having JackRabbit.com redirect to FleetFeet.com will help in a few ways, Fleet Feet CEO and president Joey Pointer explains. He says. “By being redirected to our site, these new customers will not only see the inventory available through our e-commerce site, but will be able to check their local inventory; learn about our training programs; read our blog that includes information on exercises, health and nutrition; and, be introduced to our Diversity, Equity and Inclusion initiatives and charitable partnerships. In the long-term, we believe this increased traffic and awareness of our brand will lead to greater conversion both in-store and online.”
Fleet Feet’s acquisition of JackRabbit is the latest strategic investment the company has made in its brick-and-mortar footprint this year. Over the past 10 months, Fleet Feet has acquired four franchise locations as a part of its succession plan for retiring owners; acquired FITNiche, a Central Florida independent running retailer with three locations; and, opened five new stores with an additional two stores planned to open by the end of the year. Prior to the JackRabbit deal, Fleet Feet’s store count stood at 191.
“With 250 stores at the end of this year, we still believe there is a tremendous runway to develop stores across the United States.” – Joey Pointer, CEO & President, Fleet Feet
In November, Fleet Feet also acquired its fourth franchisee this year, a Pittsburgh, PA store from its retiring owner Bob Shooer, to increase its company-owned store count to 38. Fleet Feet experienced its all-time highest sales month in August with a 34 percent year-over-year increase. Subsequently, the retailer’s Q3 results to-date have remained strong, up 34 percent in physical doors and 32 percent digitally, it said.
At the end of 2021, Fleet Feet will have 156 franchise-owned locations and 94 company-owned locations. And the retailer will continue to seek development opportunities with existing and new franchisees, Pointer says. “We currently have five new franchisees in the pipeline who will be opening Fleet Feet locations in markets new to the brand; additionally, more than a dozen existing franchisees are looking to add new stores within their current markets. As some markets experience growth, we are actively pursuing acquisition opportunities and expansion to support that growth within our legacy markets. With 250 stores at the end of this year, we still believe there is a tremendous runway to develop stores across the United States.”
How Fleet Feet balances its new, larger presence with the need to maintain community-focus at the local level will bear watching.
Bill Kirkendall, CEO of JackRabbit, in A Sept. 2020 interview, highlighted scale when we asked him what the Denver-based JackRabbit business brings to market. “The advantages are scale. It allows us to provide more resources, tools for our staff, more advancement for staff, larger benefit packages,” he said. “It allows us to create a more competitive cost structure in our business and it allows to continue to build an omnichannel model. You need that to compete in today’s retail market. When you’re larger, you’re able to execute on that strategy.”
When the transaction closes in early December, it will be Fleet Feet with the largest scale of any retail run specialty operation in the U.S.