First it was Sports Authority that went under, then Graf Canada, and now Total Hockey has fallen victim to their own growth and expansion. Total Hockey may have achieved about 30% of sales from e-commerce alone, but really in the context of how e-commerce operates it wasn’t enough to sustain their 32 brick-and-mortar stores. Even though they had some ideal hockey locations, the US market softened to the point where they couldn’t compete.
Total Hockey blames the bankruptcy on one of the warmest winters on record, the collapse of key vendors, and a failed integration of the recently acquired Players Bench Corp. Another key factor was the adverse Canadian exchange rate which kept Canadian hockey teams from coming to the US to play in tournaments.
The real reason may have to do with terrible customer service reviews, lack of overall online e-commerce market share, and too many brick-and-mortar stores. Total Hockey received a plethora of bad reviews from both Canadian and US customers. It seems like they lacked trained employees in achieving interconnectivity with the consumer which failed to generate repeat traffic in their stores.
In terms of market share dealing with e-commerce, both employees serving the sporting goods industry and hockey customers are well aware that Hockey Monkey is the industry leader. As an industry leader Hockey Monkey is able to exploit economies of scale to a greater extent than its competitors. Their website also offers promotions such as free shipping over $50 USD, 20% summer discount, and more. Due to the volume of sporting goods Hockey Monkey can order due to economies of scale, they can offer prices that are hard to match for most other retailers.
Additionally, because Hockey Monkey deals with hockey, goalie equipment, lacrosse, and baseball, they can strike deals with companies such as Warrior Sports which deal with lacrosse and hockey to obtain larger discounts that they can offer to the end consumer while generating more revenue. Total Hockey had to match these prices even though their sales volumes weren’t as large to prevent customers from taking advantage of arbitrage by shopping online through Hockey Monkey, which eventually ate away at Total Hockey’s profit.
In the digital world, Hockey Monkey quickly established its online dominance with technology such as its strong and professional YouTube presence. Hockey Monkey’s YouTube videos compared to Total Hockey’s videos are sharply different. Hockey Monkey was able to convey the technology of its products using professional and endearing individuals to sell the product. Total Hockey’s lack of expertise was evident through its archaic environment that did not transpire in generating sales on a large scale.
When you have too many brick-and-mortar stores it’s hard to recognize whether you specialize in online sales or foot-traffic sales to generate revenue. Total Hockey has about 32 of these locations. The problem is that foot-traffic relies on the special connection with customers that feel important and comfortable when entering a store. The overall experience has to translate from the employees and managers that must execute the sales. The senior management of Total Hockey may have felt they had the right personnel and managers to establish lasting relationships, unfortunately their reviews told a whole different story.
Hockey Monkey is a different animal. They take an enormous amount of pride in their online e-commerce, but are also able to successfully connect with customers at their 6 US brick-and-mortar stores. One of my employees Mike travelled to California a few months ago. His experience was enlightening: the sales representative did not have the product on the shelf but happily crossed the street to retrieve the product he wanted from the warehouse. The employee professionally represented himself and the product and made sure Mike was informed and happy with what he was purchasing. The lesson here is that because of Hockey Monkey’s few locations, they are confident in having efficient personnel on hand to create lasting and repeat relationships with customers.
TSG Enterprises LLC is the parent company of Pure Hockey and Pure Goalie. They are in the process of acquiring Total Hockey’s assets and technology for some odd reason. The major problem here is that they already own over 40 brick-and-mortar stores. They appear to establish the same model of Total Hockey and are already in hot water with similar negative customer service reviews.
Hockey Monkey have a built-in animal instinct that will tear their competitors apart and make it extremely hard for TSG Enterprises to remotely compete and generate revenue for that matter. All TSG Enterprises’ brick-and-mortar stores would be fighting for a piece of the total market share. In the process they will cannibalize themselves and run into the same problems Total Hockey encountered.
Remember one thing: the monkey believes in the survival of the fittest.