Cabelas sold...maybe?

I agree Al. I don't understand bashing Cabelas, Gander or Bass Pros - the reason there is so many inferior goods at those stores is because most people don't want to spend the money for quality. These stores didn't go to the far east just to make more money - they went there to bring the cost of goods down so their customers would buy them. If we all demanded all American made goods of great quality - guess what, they wouldn't be importing them.

I for one have no issues with Cabelas as my go-to store for outdoor gear because I don't usually buy the cheapest crap in a catagory. The times I do I understand that I will likely sacrifice quality for price and accept that risk.
 
Sunday, Cabelas had a closed Cabela Club deal... only Club Members... So I was actually LOOKING for things... I will say, this isn't new but it is getting worse... very little waterfowling stuff (this was the Prairie du Chein, WI store).... 4 decoys out... etc... ALL of the waders were private labeled (Cabelas or Herters)... very disappointing.. I ended up Spending $580.. but as a club member they gave a 20% discount.... and I had enough points to make bill $3.38.

All that being said, I am not thrilled with what is in the store.
 
Lately I find that the clothes they sell seem to be sized and designed poorly, arms tight, body baggy, and short, zippers are crap, etc.
most of this I blame on letting the chinese cheapen the products, instead of holding them to prior standards, but I guess the savings go back to cabelas too so we get to overpay for substandard junk.

When a xl guy can't get into a 2x garment, something is bad wrong.
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It's not "letting the Chinese cheapen the product", it is the company asking them to cheapen the product. When US companies hold the Chinese companies to a high standard, good, and even great products are produced. Own a cell phone? Think any are made here?

The US consumer is always asking for more for less. When a great product can be made here that the consumer sees as a value, that product will be a big hit. In general, if a consumer can find something cheaper, that they believe is "good enough" they will justify the lower cost product. Please note I said in general.

We can continue to blame the retailers for cheap crap but the only solution is to not buy it and demand better. Going and spending hundreds of bucks in a store that you/we complain about is not sending the message you/we want that store to hear. All they know is that their sales went up and the amount of product that moved increased. This equals the message that they must be doing something right.

Mark W
 
Well said Mark. When held to a high standard, the Chinese are quite capable of making a quality product. Violins, for example....yep, plenty of cheap, crappy Chinese violins on eBay. On the other hand, some of the finest performance violins in the world are made in China...and they are not inexpensive. Different clientele with different needs and demands = different product.
 
Pete brings up a good point, commonly referred to as Pareto Principal or the 80/20 rule. Cabela's knows very well, after all their years in catalog, what drives THEIR consumer to purchase.

Often times what consumers miss is they don't fit a retailer's idea of who their consumer is.

Retailers play a constant battle between price, inventory, and sales. To manage this risk better the largest players took a vertical integration strategy and began private labeling.

What was lost in that, the former brands that private labeled outdoor clothing like Browning, lost out. They held, in my opinion, a higher standard for quality and were better at innovation.

Now we have private label brands and the way high end. What has been lost over time is the middle, but the volume on a 20%-40% higher priced quality product gets squashed by the lower cost "similar attribute" product.

I run a food manufacturing company and it is a constant battle between what consumers state they want and what they are willing to pay for. Organic, non-gmo, all natural, etc. has a price premium of 50-100% on shelf, but mass market acceptance is likely in a 10-15% premium. Add into the challenges of introducing innovation, developing brand/product awareness, etc...... there's a reason people don't start new companies everyday.

I don't think BP buying Cabela's will have much of an impact on any experience. Having been in both their stores, there is a significant lack of any distinguishable differentiation between the two.

The irony will be when both brands merge is the story they'll spin to tell you how good this will be for you, the consumer :)
 
I just read that as of Jan 1 2016 they will close ? I used to love Cabelas but going into there store here in New England definitely gave me that "Bargain Basement " feel to bad that had good stuff for years . I am not a huge fan of Bass Pro there clothing is not as good nor are there supplies . Good time for mom and pop shops to get on board and carry the gear we all need .
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if they do close- it would take one heck of a fire sale to do it by Jan one

and if Bass Pro does buy them - i would think some of the stores will be converted

for example BP looked at going into Buffalo NY, they did not - Cabelas did

the nearest BP store is in Auburn NY - well over a 100 miles east, i would bet the Buffalo store would stay as a BP to cover the market

as for mom and pops - nice nostalgic thought, but in most cases those days are gone- Macks may get the waterfowl guys, someone else the upland hunters, another big national player the fishing crowd
 
Rob, thanks for your comments. Very interesting information. I wonder if BP will keep the Cabela's name, redo the stores into new BPS stores, close some of the poorer performing Cabela's stores, or all of the above?
 
Dwight,

Most of it will depend on if Bass Pro has MBAs making the decision or founder Johnny Morris.

If I was back in grad school my case study analysis would look like this:
1) Close stores that have declining year-over-year revenue for more than 2014-15. Profit can be fixed, no sales~ not so much.

2) The differences in store models are virtually nil. Re-badge stores to remain open to Bass Pro.

3) Pick-up Cabela's superior hunting clothing line. Keep Cabela's tags on it for a year or two, then rebadge to RedHead. Cabela's also owns Herter's tags, so that might be an option to rebrand all "former" Cabela's clothing as Herter's.

4) Co-brand hunting catalogs for a couple years, like "Cabela's by RedHead" or similar ("Herter's"?). As mentioned, RedHead doesn't have the brand chops in hunting that Cabela's does. RedHead could also co-opt Herter's as a larger play on the aging water fowling population that associates Herter's with better quality/nostalgia.

5) dump Cabela's fishing in favor of BP.

6) Remove Cabela's boat dealer deals in favor of Nitro, BP, etc. 1/3 of BP sales are their boats.

7) integrate BP stores into the Gun Library. BP sucks at Guns.

The big risk is in duplicate/competing markets: the stores are all big. Large format stores have been shuttered and been difficult to fill. Total Wine can only take up so much deserted retail space.....

A) The January 1 closing reports seem a bit dodgy. Cabela's is publicly traded and no announcement has come forth yet. If there is a store closing, it is likely a pre-sale "clean-up" of dead wood.

B) I don't know, but I think CAB would have to file an amended 10Q if it entered an LOI with Bass Pro. Ultimately, the CAB market value will be based on a larger Universe of Buyer's. No one is saying CAB is performing poorly, so it should mean the fiduciaries are most interested in seeking the highest value. That happens through multiple interested buyers/offers.

C) BP would be expected to pay a premium since it can manifest more cash via synergies (lines, talent, distribution, etc.) Other buyers without the synergies would anticipate a closer to market value (currently $46.10 per share).

D) The sale is being pushed by an activist investor and Cabela's has reportedly hired a firm to help protect their interests from the investor's actions. It gets fuzzy at this point, I'll leave that for a different day.

All in~ yes, BP would make the most sense.... particularly from Cabela's perspective :)

Even without a sale, the share price is up over $4 in after hours trading. Either new news is coming out that a deal is going to be done or the "herring" have done their job. If you notice a decline in share price going into Monday morning, anticipate this was an investor pump and dump and Cabela's will "consider" options moving forward.
 
Thanks again Rob....good to hear analysis from a guy with your background. The local media says BPS and Cabela's not returning their calls so of course that fuels the fires of speculation about what is happening or what might happen. Billings is not a big city (approx. 110,000) by most measurements but is certainly the retail hub for a large area of MT, western ND and northern WY. The local Cabela's used to be a "destination" store but the new mega Scheels draws people from all over. Cabela's interior and exterior is looking tired and run down and that huge parking lot they built is never crowded. The local talk is to use your Cabela's gift cards and spend those Cabela's Club Visa points now.
 
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The "Destination Store" concept had legs, but I think they got addicted to it and kept opening Destination Stores at an unsustainable pace. There is too much SqFt in outdoor retail to be sustained, so say retail analysts.

Cabela's and Bass Pro made their money in catalog. With online capabilities now, if/when I want something from Cabela's I order online and typically have it delivered. The destination store is less required and both retailers are poised to take advantage of online, which is essentially e-catalog.

There is a Cabela's 30 minutes from my house, 10 minutes from my mom's, but unless I have something delivered there, it's not worth the effort.



In the immortal words of our Founder Emil Faber, "Knowledge is Good"
 
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