Anyone who has been in the US golf equipment business knows the retail environment has been exceptionally challenging for the past 15 months as unit sales have contracted significantly while Average Selling Prices have risen.  In fact between November of 2015 and September of 2016 Total On/Off/Online equipment sales in dollars failed to grow or dropped every single month (for those of you counting, that is 11 consecutive months of sales declines).  Finally in October of 2016 we eked out an improvement of less than 1%, followed by 7% growth in November and less than 2% in December, for 3 consecutive months of growth.  Those are not huge increases, and there are extenuating circumstances, however 3 in a row is after all, 3 in a row.

Some of the Q4 sales improvement was most certainly due to the close outs coming from the bankruptcy and liquidation of a substantial number of Golfsmith stores, however most of that transition was orderly and lacked the feel of a “fire sale”.  Breaking out the Golf Datatech data and analyzing the Off Course/Online channel separately from the Green Grass suggests 2016 was a much more challenging year for the Off Course operators in total, who specifically had to deal with lesser availability of second/third generation golf club product and close outs, areas where retailers traditionally are able to “move product” at key price points.

As January meanders toward its close, how the equipment business gets out of the gate for 2017 will be crucial to better understanding where we may be headed for the year.  January of 2016 equipment sales were down almost 17% from the prior January.  So the “comp bar” would seem to be set relatively low.

If 2017 starts extremely slow it could be a warning signal for what lies ahead, however early indications are that there are new product and technology stories generating significant early season interest.  Translating awareness and interest to cash register rings will be crucial.

But for now, we can celebrate being 3 for 3!