Category: Brooks

(BRK.A), (BRK.B)

Berkshire Hathaway’s running shoe and fitness apparel company Brooks’ revenue increased for an eighth consecutive quarter in Q3 2021.

From January through September 2021, Brooks grew revenue 43.5 percent globally.

In the U.S. adult performance running footwear category, Brooks captured 19% market share, based on revenues, and gained 2 percentage points, versus last year, according to The NPD Group Retail Tracking data.

Contributing to this result was third quarter revenue growth of 24 percent year over year as the company continued to feed strong consumer demand around the world. Brooks’ leading footwear franchise styles led the gains as revenue from the Adrenaline GTS, Ghost, and Glycerin super franchise are up 50 percent versus 2020.

“More than twenty years ago, we made a big bet that if we put the runner at the center of everything we do—delivering the product they need and then celebrating the many reasons they run and the positive energy they get from it—we could become a leading brand in run,” said Jim Weber, CEO at Brooks. “We look forward to welcoming more people into the running community as we close out 2021 and enter the new year.”

Brooks’ growth is benefitting from distinctive products, a premium brand positioning, strong multi-channel distribution, digital engagement, and a tailwind of increased participation in running and walking around the world.

Brooks entered the third quarter with strong brand demand amid ongoing pandemic-related quarantines and mandated factory shutdowns coupled with widespread supply chain disruptions. These headwinds began to affect Brooks’ ability to meet consumer demand for the quarter, reducing revenue in September. While supply chain challenges are not unique to Brooks, the brand expects impacts to continue through Q2 2022 and is well positioned to manage through the disruption with strong partnerships in its geographically diverse yet categorically focused supply chain ecosystem.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

Berkshire Hathaway’s Brooks Running announced its new 2030 planet strategy, a science-backed approach that will take responsibility for the impact the brand has on the environment.

“At Brooks, we think that climate change demands urgent and universal action,” said David Kemp, Senior Manager of Corporate Responsibility at Brooks Running. “Because more than 150 million people worldwide run outside, it’s critical that we take responsibility for our impact on the planet.”

While the brand’s sustainability efforts span over a decade, this initiative will accelerate commitments, with a focus on climate action and sustainable consumption.

Brooks’ commitment to achieve net zero carbon emissions by 2040 will be achieved by first reducing emissions in line with climate science, with Brooks’ Science Based Targets to reduce carbon emissions recently validated by the Science Based Target initiative. Brooks has developed a robust climate roadmap on how they will achieve these emissions reductions with key strategies to decarbonize including converting factories to renewable electricity, converting textile yarns to low impact dyeing processes and sourcing materials with recycled content.

In partnership with ClimateCare, Brooks will purchase high-quality carbon credits from projects that avoid or reduce carbon emissions from entering the atmosphere. The portfolio of projects includes projects from the U.S., where Brooks is headquartered and a majority of product is sold, and international countries where Brooks employees are located and some of the brands product and materials are manufactured. In addition to meeting strict criteria for selecting carbon offsets projects, each of the projects provides additional environmental and social benefits – including a focus on improving air quality and advancing health and well-being.

The brand will make an immediate impact by offsetting emissions from its highest-volume style, the Ghost. The Ghost 14, launching July 1st, is Brooks’ first carbon neutral product. In addition to reducing the product’s environmental impact by incorporating recycled materials, Brooks will purchase carbon offsets from projects that meet strict criteria for making a meaningful difference in addressing climate change.

Brooks plans to reduce its usage of non-renewable resources by incorporating more sustainable materials into products while minimizing the waste associated within the manufacturing process.

In 2022, the brand will launch a take-back program, which will lay the groundwork for a fully circular shoe in the years to come. By 2023, Brooks will move to 100% recycled polyester in footwear and new apparel materials and is committed to zero footwear manufacturing waste to landfill, incineration, and the environment by 2025.

“We believe that the run can change everything: your day, your life and even the world. But to make those benefits available to all, we need to participate on a global scale,” Kemp said. “We’ve charted our program to support United Nations 2030 Sustainable Development Goals, and joined The Climate Pledge, because partnerships will be critical to achieving our ambitious goals.”

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

Berkshire Hathaway’s running shoe company, Brooks Running, ended 2020 with global revenue of nearly $850 million, an increase of 27 percent year over year.

“In 2020, the Brooks team stayed very close to the runner for cues on how to navigate the uncertainty caused by global retail and supply chain disruptions,” said Jim Weber, CEO at Brooks Running. “We quickly found new demand signals to track shifts in running participation and shopping behavior and acted decisively to engage runners and gain market share in every channel of distribution.”

While markets were interrupted with inventory disruptions from the impact of COVID-19, Brooks’ market share grew around the globe. At retail, Brooks was the No. 4 adult performance running footwear brand in the U.S. in 2020 with 8.5% dollar share, up 1.8 points year over year.

In the same period, the Brooks Ghost became the No. 1 franchise for adult performance running in the total and run specialty markets combined.

Brooks’ investment in its consumer research Run-Sight Lab and singular focus on runners was a major advantage and contributed to 2020 success. With these insights, the brand quickly adjusted its communication approach and reinforced its omni-channel distribution support to engage with runners and make sure they could find Brooks whenever and wherever they chose to research and shop.

Brooks’ Sales & Operations team created a process that included a new demand model to replace retailer signals with cues coming from digital sell-through and running participation. By the middle of the year, this customer-focused process gave the brand the confidence that demand for Brooks was exceeding previous year sales, prompting a green light to reignite production to meet demand.

Brooks gained more than 3 points of performance running dollar-share among runners in 2020 compared to 2019 and for the first time ever became the No. 2 brand among runners based on dollar-share position*. Within the final two months of 2020, Brooks was the No. 1 adult performance running footwear brand in the athletic specialty/sporting goods (ASSG) channel, generating powerful momentum leading into 2021.

In 2020, during brick-and-mortar retail closures, Brooks sales online shifted north of 75%, stabilizing at 46% by year end. With the runner in control of their shopping journey, Brooks’ multi-channel presence mattered as they moved from physical stores to online shopping.

Brooks believes its ability to deliver on its “Run Happy” promise to customers starts within its own walls; when COVID-19 hit, the health and safety of Brooks employees was the company’s top priority. Over the course of the year, Brooks invested in developing its leaders and managers to lead execution and model the brand’s core values at scale via virtual engagements and platforms.

Over the past 12 months, Brooks’ active employee count surpassed 1,000 as the company added nearly 100 employees and retained talent with zero layoffs throughout the year.

© 2021 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

While indoor athletic activities were curtailed this summer and fall due to Covid, outdoors was a different matter. Items such as bicycles and running shoes were flying off the shelves.

Berkshire Hathaway’s Brooks Running reported record third quarter global revenue up 49 percent year over year, leading to a 2020 outlook of 27 percent growth.

“We believe in the positive power the run can create in someone’s day and its additive benefits over time. It is also an effective antidote in troubling times, and we’ve seen that prove true as running participation increased since March,” said Jim Weber, CEO at Brooks Running. The 2020 running boom created amidst the pandemic has been driven by people running for mental and physical health.

According to Brooks sales data, the brand gained 1.6 million runners through October of this year.

“We have worked alongside our retail, factory and distribution partners to ensure those who want to run can find the product they trust and need to bring positive energy into their lives,” Weber notes.

Despite challenges and uncertainty felt around the world caused by COVID-19 and an ensuing volatile economy, Brooks came into the global pandemic with strong product lines. Market share growth accelerated in Q3 as the brand added new runners.

According to The NPD Group, Brooks captured the largest share increase year-to-date through September in the U.S. adult performance running footwear category, gaining 4 share points versus the same period in 2019.

© 2020 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

Berkshire Hathaway’s Brooks Sports, Inc., a footwear, apparel and accessories company headquartered in Seattle, has filed a lawsuit against Brooks Brothers Group, Inc. in federal court for breach of contract, unfair competition and trademark infringement.

The lawsuit seeks to stop Brooks Brothers from using Brooks’ famous BROOKS trademark on its stores and products and prevent public confusion and dilution of the BROOKS mark by Brooks Brothers.
Brooks also seeks damages for Brooks Brothers’ unfair competition and breach of contract.

The two companies have coexisted for more than 100 years without consumer confusion due to their distinct product lines and trademarks. Brooks is known for athletic-inspired innovative footwear, apparel and accessories under its famous BROOKS mark while Brooks Brothers makes ready-to-wear fashion apparel and tailored business and formal wear under its BROOKS BROTHERS mark. To support this distinction, there is a coexistence trademark agreement between Brooks and Brooks Brothers dating back to 1980.

Brooks Brothers recently attempted to block Brooks from obtaining registrations for its BROOKS trademark in the United States and other countries, despite decades of unopposed use. Additionally, on December 30, 2019, Brooks Brothers filed new trademark applications to use BROOKS alone, without the word BROTHERS, on eight categories of goods, including clothing, sporting goods and accessories for athletics. Brooks Brothers is also marketing “athletic” footwear and “sneakers,” which are among the items on which Brooks Brothers seeks to use the BROOKS trademarks.

“For more than 100 years we’ve built a brand that consumers worldwide recognize and trust,” said Jim Weber, Brooks CEO. “We will aggressively protect our intellectual property and defend the investment that’s created our valuable brand.”

© 2020 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

Brooks Running Company and Locally will partner to launch Same-Day Delivery to runners in 10 markets across the United States on Aug. 22 to get performance running product onto feet and into hands fast. Brooks will be the first running brand to offer same-day delivery partnering with Locally and local running stores in this way. In addition to the 10 original Same-Day Delivery markets, Locally will begin offering the service in 25 additional U.S. cities.

“We know that for many runners, going for a run can depend on having the right gear on hand at any point in the day, which is why we’re thrilled to partner with Locally to offer Same-Day Delivery in cities throughout the U.S.,” said Brooks Running VP of U.S. Specialty Retail Accounts Rick Wilhelm. “In addition to delivering gear to runners within 24 hours, Same-Day Delivery will create new sales for our specialty running accounts by introducing new customers to their local stores.”

Runners will be able to shop on BrooksRunning.com and find available inventory at local specialty running stores using Locally software. The local store will fulfill the order and deliver it via one of Locally’s delivery partners, Deliv or Postmates.

The first 1,000 runners to place an order for Same-Day Delivery in the 10 launch cities will receive free delivery using a promo code that will be available via Brooks’ social and email channels. After that point and outside of those cities, runners will have the option to pay a delivery fee—which starts at $5 and depends on proximity to the store—to have their gear arrive within the day, often within hours.

Exact delivery times and cost will depend on the runner’s proximity to the store, store operating hours and the time of day the order is placed.

“We built Locally to help brands and retailers work together to delight shoppers,” said Locally President Mike Massey. “We’re so excited to work with Brooks to push the platform towards its ultimate goal: true on-demand shopping with nearby in-store pickup and Same-Day Delivery options.”

The launch cities include:

• Atlanta
• Baltimore
• Chicago
• Houston
• Minneapolis
• New York
• Philadelphia
• San Francisco
• Seattle
• Washington

As the Same-Day Delivery launch partner for Locally, Brooks will initially be the first running brand to offer its service to runners. Brooks and Locally will evaluate how to increase the number of cities they make the service available in.

In addition to offering the Same-Day Delivery service to runners, Brooks’ partnership with Locally allows runners to locate performance running gear at stores near their homes, driving sales for local retailers. Other Brooks investments to help bolster sell-through at retail include developing an award-winning customer service team, launching the Fast Track application which allows store associates to drop-ship Brooks product to runners and more.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

Berkshire Hathaway’s Brooks Running Company is marketing the Melts Collection to pay tribute to runners’ favorite post-run treats during the summer: ice cream.

New designs inspired by iconic flavors adorn the limited-edition Ghost 12 and Ricochet LE, and became available to runners on July 25.

“Some our favorite runs are under the sun during summer, and we know that many runners, like us, enjoy a cold, tasty post-run treat to cool down,” said Director of Footwear Merchandising Brice Newton. “With the Melts Collection, we give a special nod to those moments by paying tribute to the ice cream and Popsicle flavors we turn to after the miles are in the bank.”

The limited-edition Ghost 12 features a newly engineered mesh as well as a 3D Fit Print upper for a secure fit. The shoe’s BioMoGo DNA and DNA Loft cushioned midsole provide a just-right softness without losing responsiveness and durability. The Segmented Crash Pad, an integrated system of shock absorbers, will cushion every stride and provide smooth heel-to-toe transitions.

The Melts versions of the shoe draw inspiration from crowd-pleasing favorite ice cream flavors like rainbow sherbet and vanilla with sprinkles on women’s colorways. The sherbet colorway features a colorful, swirled midsole, evoking melting ice cream. The vanilla sprinkle colorway has creamy neutral tones and a sprinkle-patterned midsole along with beautiful ombre shoelaces that fade from pink to orange. The men’s offerings channel other crowd favorites including cookies and cream and a rocket pop colorway. The cookies and cream shoe feature chocolate browns and blacks complemented by rich creamy whites. Cookie crumbles speckle the midsole and matching shoelaces. The rocket pop colorway draws inspiration from the popular tri-colored ice pop featuring blue, white and red, which fade from one color to the next on the midsole. The colors pop against the brilliant blue upper.

The Ricochet LE features BioMoGo DNA and DNA AMP cushioning, providing a light, responsive ride to give more energy back to each stride. The flexible, arrow-point pattern on the outsole provides a platform for quick transitions as you quickly move from heel-to-toe. The Melts Collection includes a women’s Ricochet LE in vanilla sprinkles, featuring the design elements of its Ghost 12 counterpart along with a waffle cone-inspired saddle.
The Ghost 12 sells for $130 and the Ricochet LE for $120. The collection went on sale beginning July 25 at brooksrunning.com and at select retailers.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

Brooks Running Company has opened a new, world-class distribution center that allows it to deliver product to runners and retailers faster than ever before.

Based in Whitestown, Ind., the facility serves as the Brooks North American distribution center and will employ more than 130 people by 2023.

“Opening our new distribution center is an exciting and crucial step on our journey to become the No. 1 choice for all who run,” said Jim Weber, CEO, Brooks Running Company. “We don’t want anything to get in the way of a great run, and that includes excessive wait times for new gear. Our team has thoughtfully created a center that streamlines this part of our supply chain, benefitting our retail partners, runners and the environment.”

With almost 60 percent of the U.S. population living east of the Mississippi River, the new distribution center allows Brooks to get product to more runners and retailers in less time. Additionally, the majority of orders placed on BrooksRunning.com are shipped east of the North Dakota-Texas line. By moving the Brooks distribution center to the Midwest, most orders will now arrive to runners within three days via ground shipping. Energy efficiencies in the building’s design and the proximity to more runners will result in an approximate 50 percent reduction in carbon emissions when compared to operating out of the previous distribution center in Sumner, Wash.

The new distribution center spans more than 400,000 square feet with expansion capability to facilitate future growth of the brand. It features state-of-the-art systems and automation to improve order accuracy and more efficiently flow inventory in and out of the center and better meet demand. Brooks’ new distribution center is fully operating now and servicing customers across the continent.

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

Things are looking up at Berkshire Hathaway’s Brooks Running Company, as the company continues to carve out a successful strategy of marketing itself to the serious runner.

Following a successful year in which the brand reported a 26-percent year-over-year increase in global revenue, Brooks has promoted longtime and accomplished leader Dan Sheridan to a newly configured role of Executive Vice President, Chief Operating Officer.

Sheridan’s responsibilities include leadership of the brand’s sales, e-commerce, digital, supply chain and information technology (IT) teams. As Brooks continues to pursue its goal of becoming the No. 1 brand for all who run, Sheridan will be critical in overseeing the growth of the brand’s enterprise and digital platforms, developing Brooks’ wholesale and e-commerce businesses, cultivating distributor partnerships across the world and building stronger connections with runners to fuel e-commerce.

“2018 was a fabulous year for Brooks. The growth we’re seeing is incredibly exciting because it indicates our brand is resonating with runners who are choosing our gear as they head out the door on their runs,” said Jim Weber, CEO, Brooks Running Company. “As we continue to grow, Dan’s experience leading teams, driving process and ensuring the runner stays at the center of all business decisions will be invaluable.”

Sheridan joined Brooks Running in 1998 and through his career has been critical in the continued growth of the brand and business. Prior to his new role, Sheridan led global sales, e-commerce, business development and customer service.

“I’ve believed in this brand since the day I started and it’s been incredibly fun and rewarding to see our growth. We’ve built an incredibly strong foundation focused on creating the best gear for runners worldwide,” said Sheridan. “I’m excited by the opportunity to build on this success as we bring Brooks’ unique premium brand experiences to more runners around the world. In this new role, I’m specifically looking forward to digging deeper into how we scale our enterprise and digital platforms to better service our retail partners and runners everywhere.”

© 2019 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

(BRK.A), (BRK.B)

With a clear focus on delivering the best gear and running experiences for runners worldwide, Berkshire Hathaway’s Brooks Running Company has announced record global growth as it closed out the third quarter of its fiscal year.

Year to date, Brooks reported a 29-percent increase in global revenue driven by a 32-percent increase in global footwear sales.

Success of the company’s footwear business in the third quarter was driven by franchise products such as the Ghost and Adrenaline GTS, which are up 52 percent and 32 percent respectively year to date. Brand new footwear styles that launched in the last 18 months including the Revel, Levitate, Bedlam and Ricochet are also resonating with customers and achieving strong sales in their inaugural period.

While the performance running category continues to face headwinds, Brooks brought new runners to its brand across all channels. According to The NPD Group’s Retail Tracking Service, Brooks grew its total U.S. adult performance running footwear market dollar share to 12.4 percent year to date through August 2018, moving into the No. 2 position within the category.

In the 12 months ending August 2018, the company also gained 4.4 share points in the $100 and above (average selling price) segment of the adult running performance running footwear category, making it the No. 1 brand with 23 percent dollar share (rolling year ending August 2018).

In addition to success with runners, Brooks also received product awards from industry experts across the globe, including:

• Editor’s Choice from Runner’s World for the Ghost 11 and Caldera 2;
• Best Buy from Runner’s World for the Ravenna 9;
• Gear of the Year from Outside Magazine for the Bedlam and Mazama 2;
• Editor’s Choice from Competitor for the Levitate 2;
• Editor’s Choice from Outdoor Gear Lab for the Adrenaline GTS 18;
• Best Running Shoe under $100 from Gear Patrol for the Launch 5;
• Sole Mate award from Women’s Running for the Glycerin 16;
• Editor’s Choice (Best Energize Return) from Canadian Running for the Levitate 2;
• Editor’s Choice from Women’s Running UK for the Launch 5 and Levitate 2;
• Editor’s Choice from Trail Runner for the FastForward Crossback;
• Best Sports Bra from Siftung Warentest for the Juno.

“The growth we’re seeing at Brooks is incredibly exciting because it indicates our brand is resonating with runners who are choosing our gear as they head out the door on their runs,” said Brooks CEO Jim Weber. “We are more focused than ever on delivering the best gear for all who run and inspiring more people around the world to run and be active.”

Increased revenue across the world contributed significantly to Brooks’ overall growth. In the Europe, Middle East and Africa region, year-to-date revenue grew 27 percent led by Germany, Austria and Switzerland. Similarly, the Asia Pacific and Latin America region sustained the upward sales trajectory it ignited early in 2018, reporting a 25-percent increase in year-to-date revenue led by Australia.

Brooks also announced it is expanding its global footprint in key running markets including India, South Korea and Mexico. In August, Brooks relaunched its brand in South Korea and opened a flagship store in Gangnam-gu that houses a Brooks retail store, workout space, corporate offices and a runner’s hub, all a short jog from the Han River lined with miles of running paths.

The brand also launched for the first time in India and is rapidly growing its presence in this important market, expecting to be available in more than 20 stores and on the Amazon India platform by the end of 2018.

Later this year, Brooks will launch in Mexico with a flagship store; partnerships at popular sporting goods and department stores including Marti Sports, Liverpool and Palacio de Hiero; and a branded web experience at www.brooksrunning.mx.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.