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Champion Licensed Product.

Licensing Outlook:
Q&A with Jim Malseed
of Gear for Sports

October 3, 2006

Gear for Sports is the largest supplier of licensed apparel to the collegiate bookstore marketplace, by its own estimate doubling the annual sales of its nearest campus competitor in these venues. Known for innovation in product design and graphic process, and standard-setting service lead-times, Gear for Sports will be using its exhibit at the Sports Licensing & Entertainment Marketplace to talk about its future plans for the collegiate marketplace. The company also handles the popular Champion and Under Armour brands. JIM MALSEED, PRESIDENT OF THE COLLEGIATE DIVISION, shares his thoughts on the licensed apparel world with LOgo!

LOGO!: What percentage of your business at Gear For Sports falls into the licensed sports realm?

Jim Malseed: Overall, the licensed business represents approximately 55%-60% of our total Gear For Sports business, with over 95% of that figure coming from the Collegiate market. The licensed business has evolved greatly for us. We have expanded our Collegiate offerings beyond just the Gear For Sports brand label to Champion and Under Armour, for example, and developed a healthy, market-right brand strategy that accommodates brand distribution segmentation, retail "price point" segmentation, and product/process segmentation. This allows our customers the potential for both traditional core product and unique, trend product.

Gear for Sports Hoodie

LOGO!: How has the market evolved during the same time?

Jim Malseed: Overall, the market is far more competitive than in the past. It requires manufacturing vendors to create and develop new opportunities for their retailers. The market has also become far more reliant on both off-shore decoration and domestic replenishment in an effort to meet retailers’ needs for both profitability and service.

LOGO!: What kind of impact has the Collegiate business had on gear For Sports?

Jim Malseed: A significant one, not just on our top line sales performance, but on our overall multi-brand marketing strategy. It allows us to implement a fantastic grassroots marketing and brand-positioning plan. To give you an idea, our Collegiate licensed business will grow to over $120 million this year via our three core collegiate brands [Gear For Sports, Champion, and Under Armour].

LOGO!: What do you see as keys to this growth?

Jim Malseed: Our business has grown significantly by focusing on campus and traditional retail customers who are committed to the collegiate business. In other words, we have chosen not to pursue customers and/or business distribution segments that were not truly committed to a “real” in-store/web presentation of collegiate merchandise.

LOGO!: Where has this growth come from?

Under Armour Tee

Jim Malseed: Our largest growth has come mainly from the continuing emergence of our Champion and Under Armour brands. For both the retailer and us, the two brands complement each other well in terms of pricepoint differentiation, product category differentiation, and process/graphic differentiation. A subset of this growth can be clearly attributed to the continuing growth of women's licensed apparel and new, innovative graphic processes.

LOGO!: What do you see as the primary advantages of doing business with your company?

Jim Malseed: We do not sell everyone! More importantly, we PERFORM by offering our customers service diversification, with the ability to effectively and efficiently execute both market leading off-shore and domestic leadtime replenishment programs. Bottom line, we got to be #1 on campus by servicing the product, graphic process, and servicing the needs of our customers and the collegiate consumer.

LOGO!: Where do you see the most compelling opportunities for retailers in the licensed apparel category?

Jim Malseed: Obviously, I’m slightly biased, but I truly believe the greatest licensed apparel opportunity will be in the Collegiate market. This segment has traditionally lived outside of the economic factors that often impact the overall licensed business. The women’s business will also continue to grow in terms of garment trend, garment color, and process decoration. As for our growth focus, it will be on identifying and developing key retail partnerships, and officially entering the traditional Collegiate retail marketplace. We are truly excited about this opportunity and will be focusing on this initiative at the upcoming Sports Licensing & Entertainment Marketplace in Las Vegas.



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