Businessweek Extra-Ken Hicks

of grew up with. I absolutely did. I was a longtime customer before I moved out of Texas, So that was definitely part of the conversation that we had with Ken Hicks. We're recovering. We're you know, like most of the country, um, you know, learning how to live and deal with the virus. People are wearing masks, um, we're the hand sanitizer, the spacing and most of the places are now open at some diminished capacity, ranging from fifty to have any five depending on the type of business.

We stayed open the entire time because we were viewed as as uh, you know, an essential retailer under the CSIL laws, and we we learned how to operate in this but I things definitely are not back to normal, but we're learning how to manage through this difficult time. Well, so talk to us because you know, Jason and I've talked about you know, things will open, but it doesn't mean people want to go. What kind of flows have you seen in terms of customers coming in and out.

I'm sure it varies some location to location, but I'm sure your managers are saying, hey, here's how it's going. Yeah. Actually, our our traffic is up over last year and and part of that is people's lives have changed and people are doing more things that that we sell. Jason has a good understanding. We have a very broad assortment of a lot of of things that for experiences and outdoors and people are taking up fishing there, putting together their

own home gyms. Uh, they're even starting back with sport, hiking, camping, and so we're seeing you know, our business for the second quarter was up uh and you know business has has continued uh well for us into the third quarter. But you know, the good thing is people are want to take care of themselves, so and we're a great place to take care of yourself at so if I may ask you, guys went public last week thirteen dollars a share. It was taken public by the private equity

firm kk R. The stock open below that price. They think it traded around thirteen, maybe a little bit above it today. Were you disappointed by the I P O D. Is there some part of your story that you think investors aren't completely understanding. I think the biggest issue is we don't have enough Jason's in the world. Uh. Well, that that's all without saying and as mother Debbi's listening right now and just say, yes, that is so true.

We're located in the south and central part of the country, and people who know us know our story and know how great it is. Unfortunately, most of the investors, because of COVID, weren't able to get to see the stores, talk to our customers. Uh, and so they don't have

a full understanding of of what academy is. So I'm not I wasn't really disappointed because our goal was to become public, and I I have from my time when I was at CEO of foot Locker and when I was part of the turnaround at Pennies, back when when Pennies was was doing well. I know that our performance will show what Academy is to the market, and in the long run, people will forget about what we opened at. What they'll remember is where we're at right, So Ken,

let's talk about that. But because you know you, this is a fairly familiar playbook. And I have to say, having followed KKR pretty closely over the years, UH, I have seen Edry gravitson George Roberts and their colleagues do this a few times. Go get a guy who has done this before, install him in a company that that they have bought. What was what were the marching orders that you got from from KKR? What was on sort of your checklist to go through before you could get

to the point of of getting Academy public. Well, I KKR was a great partner, they invested in US and supported us, but the marching orders really were fixed the business. And again, having seen you know this is my third big company and part of I knew what we need to do. Assembled a very strong team. I'm very fortunate. I've got a great team. UH. We identified six or seven priorities working on UH the omni channel we were underpenetrated.

Improving that improving the service level and the look of our stores, localizing our assortment, targeting our marketing, UH, getting our expenses and operations inline, very very specific things. And starting the middle of last year our performance was good. We had a good back half and a good start to this year before COVID, and then when COVID hit, we were able to turn on a dime and we

operated very well with under the COVID situation. So we proved our strategy works in normal times and then the most challenging of times, Ken Hicks is with us chairman presidency. You have Academy Sports and Outdoors. He's on the phone in Katie, Texas. So, Ken, Man, you are someone who really understands retail. Former chairman CEO foot Locker. You've had senior positions at J. C. Penny Payless home Shopping. Um, we've also worked at McKinsey and Company. You're on the

board of Whole Food. So man, you see so saying man a lot, sorry about that, but you see so into that Texas thing. I do have a lot of relatives in Texas who I love in a door, so it does happen. Um, So tell me what you're seeing about retail because it does feel like we're going through an evolution, a revolution um that was happening even before the pandemic. Yeah, you are so correct at what what we're seeing is a shift in the consumer and and

really the connection to omni channel. And I firmly believe that the winner is are going to be people who are able to do both brick and mortar and online. Uh. And we we were underdeveloped, and we made some significant improvements to our our net business and we saw a significant increase, but we expect to continue to see that. But of our online business is pick up in store, and of the that is sent to home, half of

that is shipped from store. So stores are a critical part of the online business, and that's who's going to win. And you can't be just breaking mortar. You can't be just online. And it's quite frankly, it's I believe one of the reasons why Amazon about Whole Foods was to

get a better understanding of that brick and mortar business. Well, it's funny, we we we talked about that very topic with your colleague John Mackie just a couple of weeks ago here on on our air, and he was talking about some of those those same learnings which obviously you've seen up close and personal um through your work with

with Whole Foods. I do wonder, ken, how does it change having seen sort of the previous world and now this current world and where we're going in terms of that omni channel, How does it change where you expand how does it change who you hire? What? What does it change about your strategy in the in the near term, we obviously have to have people in the home office

that understand how to merchandise online and in stores. Uh in the stores, it changes their focus because in the past they were dedicated to the customer who was in the store. Now we we have to serve a customer

who is coming in just to pick something up. And one of the things we learned is we had a little beep when somebody who came in for what we call a bopus order by online pickup in store, but we used the same one for somebody who wanted a curbside who didn't want to come into the store, and they were confused, so we changed it to a car horn. So when they hear a car horn, they know somebody's pulled up and they've got to get out there to take care of them. What does this you know, that's

that's clever, right, so easy to fix. But then it's very clear about who's doing what, who what customers you know, you know is here? Basically what does all of this

do for your staffing needs? Um, it makes it more challenging because you don't know when the person is going to come in for the buy inline pickup in store, So we have to have much more flexible staffing and people who uh you know can One of the big things is people who can go around the store and find everything to fill our either ship from store orders or the bopus orders. It's not like you can have somebody who's just an expert in one part of the store.

They've got to be able to go all the way around the store to fill out that shopping basket for the customer. Yeah. In other words, your pickers, right, Like I mean you've got to be like, you know, a picker on steroids basically, yes, And then they've got to move fast because when the customer comes in, uh, either when they pull up in their car or they come in to pick up that Botus order, they expect it to be there and they're not. You know, it's not like I'll walk around on the store and try to

find there. I'm here, I know what I want to do. I want to get get it and get out. Yeah. So what about product mix? Can I mean in this sense that you know, we are living in a world where people are more focused on health and wellness. Fitness has you know, sort of come to the four in many ways, we've seen you know, high end retailers like Lulu Lemon do very well. Uh in this sort of market. How have you changed the product mix and how do

you see that going forward? Because as you said at the top, and as I know from from being a customer, you guys sell a lot of different stuff. Yeah, and and we've had to change some of our mix. So we for example, in the UM athletic equipment or the exercise equipment area, we've had to put in connected fitness so people have that. UM We've had to increase certain things dumbbells, you know, bicycles, they're they're worldwide shortages on both of those things. But also something is as old

fashioned is fishing. You know, the number of people who are now fishing is phenomenal to really increased and so we've had to uh increase and improve our assortments there because that customer has gotten more demanding and they're very well educated because they can go online and they know what they want. And that was Academy Sports and Outdoors chairman and CEO Ken Hicks, very well healed, well experienced in the retail business. This is a brand, as we

talked about, close to my heart. I definitely spent some of my hard earned high school money they're at Academy over the years. But an interesting window I think into how retail is moving forward. Of course, this is a guy who ran foot Locker. He was part of j C. Pennies when James Pennis was still a thing, and he gave us some really good insights into where retail goes

from here. Yeah, spent time at payless home shopping, made apartment stores, and I think my favorite line of the week, it was maybe my favorite line of the years that he said, we need more. Jason is out there well, if only, if only you've been listening to Bloomberg Business Week Extra for sure to listen to Bloomberg Business Week Radio, airing live Monday through Friday at two pm Wall Street Time, I'm Bloomberg Radio, I'm Carol Naser, and I'm Jason Kelly. This is what