Heelys- Opps

Months and months ago I wrote a Public Market Watch in Transworld describing Heelys business model and financial results. I noted that they seemed to be succeeding with a business model that was contrary to what we in action sports thought was contrary to how you build a brand. Specifically, they started in the big box stores and were working their way down to specialty retailers.

Happily, I included in that article a comment about how they were expecting much lower sales the next quarter. Guess what? It seems they were right. On February 28th Big 5 Sporting Goods issued a press release announcing that sales were down for the quarter with same store sales declining 4.7%. They blame the economy but then go on to say, "sales results were impacted by a significant deterioration in the performance of the roller shoe product category over the prior year, which accounted for approximately 45% of the same store sales decline."

Though I'm sure it's happened, I don't remember ever seeing a retailer focus so directly on a single product caused sales decline. I guess I better go check out Heelys' filing. Maybe they are another Razor Scooter after all. Sometimes, I guess, conventional wisdom is right.