Pursuing satisfied customers rather than high profits isn’t a mainstream Wall Street strategy for success. Yet, since 1938, when Max Gotchman began selling tires in San Antonio, Academy Sports and Outdoors met success with that very notion.
For Academy, this means establishing dominance in a core market and fostering happy customers. For Rodney Faldyn “88, president of Academy, this makes perfect sense. To execute this strategy, Faldyn adheres to four cornerstone values. “My job is pretty easyâ€¦not to stray from these four strategies that the company is built on.”
Speaking to room full of Mays grad students, Rodney Faldyn ’88 put the company’s strategy simply: “Focus on what you are good at.” (view more photos)
Faldyn put Academy’s strategy simply: “Focus on what you are good at.”
A geographic focus allows the company to know its customers better based on specific markets. Because Academy is a regional company, it can focus on a specific customer demographic. According to Faldyn, the Academy footprint is in the south and southeast. “There are a lot of similarities between a person in South Carolina, Georgia, Louisiana, and Dallas or Houston.”
Instead of a customized inventory with surfboards in California and ski equipment in Colorado, the company develops product lines for its core customer, a customer they “know the customer inside and out.”
The Academy strategy all comes back to “EDLP” or “every day low price.” Still, having low prices doesn’t mean selling low quality items, said Faldyn. Instead, their tactic is a “good, better, best” approach, an approach that sets Academy apart from its competitors. It carries low price products similar to those that big box discount stores offer. However, Academy also stocks mid-level and higher end products that sports retailers like Dick’s Sporting Goods and Sports Authority. At his stores, “You have every type of sneaker from $19.99 to 199.99,” said Faldyn.
Relative to its competitors, Academy typically has much more inventory. “We’re not going to miss sales due to an item being out of stock.”
The strategy is one that public companies and analysts would disparage, but Faldyn holds firm to doing what’s best for the customer. Though having a large amount of inventory is usually labeled as risky, Faldyn believes that avoiding an unhappy customer outweighs that risk.
In order to have happy customers, a store must have happy associates. “That positive attitude is an integral component of Academy’s culture,” said Faldyn. As a private company, Academy grows organically to maintain the culture and values that it was founded on, instead of through mergers.
One of the obvious elements of Academy’s great service cornerstone is its lenient return policy. Though some customers do abuse the generous policy, Faldyn explained that it is well worth the company’s reputation and continued customer loyalty to overlook these instances. “For every one customer that abuses it, there are many others that respect our policy.”
For Faldyn, leading Academy this way makes running a successful business simple. Know what you are good at, stick to your strategy, and, “if you have something that works, don’t change it.”
Rodney Faldyn recently spoke to students at Mays. He earned a degree in business from A&M in 1988. Before serving as president of Academy, he was the company’s CFO.
Faldyn held assorted executive positions at N.F. Smith associates, as well as eight years at Enron and seven years with Deloitte & Touche, LLP.