A CEO Takes a Stand
Ed Stack, CEO of Dick's Sporting Goods, transformed his father's two-store company into the industry's biggest player. But going up against the gun lobby may have been his riskiest move as an entrepreneur.
Why Ed Stack, CEO of Dick’s Sporting Goods, went up against the gun lobby.
If you don’t have people who will call BS on you, and you start to believe your own BS, you have a problem.
In a time of seemingly unrelenting mass shootings, American corporations, especially retailers, have struggled to respond. In September, 145 CEOs signed a letter to the U.S. Senate demanding tougher background checks and better red-flag laws to deny guns to potentially dangerous individuals. Ed Stack of Dick’s Sporting Goods was one of those CEOs. But Stack was already far ahead of his peers. After 17 students and staff were killed at Marjory Stoneman Douglas High School in Parkland, Florida, in 2018, Stack led the company to decide to permanently remove assault rifles from its 850 stores, which include Dick’s, Field & Stream, and Golf Galaxy. It has also stopped selling guns of any sort to anyone under 21 years of age. These policies would cost Dick’s some $250 million in sales as some outraged customers boycotted the store. But Stack, a gun owner, never looked back. Sales have since rebounded, and the company is on the way to revenue of about $9 billion this year. In his book, It’s How We
Play the Game, Stack takes readers through the days following Parkland, and subsequent decisions to back away from parts of the gun business as Dick’s business evolved.
It’s How We Play the Game is also a tale about the mom-and-pop tackle shop started by Dick Stack in Binghamton, New York, which his son Ed transformed into a dominant, publicly traded retailer. The hard-drinking, no-nonsense pop was scarred by early failure and was notoriously tough on his son. Ed was raised in the store, and by the time he became an adult, he wanted nothing to do with sporting goods or his overbearing old man.
Fate would intervene.
So tell me Dick’s creation story. The company was started by my father in 1948 as a small bait-andtackle shop, when he was 18 years old. He had been working in the army surplus business, and a guy he was working with asked him what he would need to get into the tackle business, because surplus was starting to dry up. My father was an avid fisherman and put an order together for him. The guy took the order out of my father’s hand, crossed out half of it, and told him he was a dumb kid and didn’t know what the heck he was doing.
My father walked out, went over to his grandparents’ house, and talked with his grandmother about it. This was a family that still hadn’t recovered from the Depression. They had nothing. She asked him, “How much would it cost to open this business yourself?” He said $300. He was shocked when she dug $300 out of an old cookie jar and said, “Go start this yourself.”
But that first tackle shop failed. He never got over that. He started the business again shortly afterward and did OK. Never really great. We were always in debt. We were always a season away from going out of business.
And you grew up in the store? I started working there when I was a kid, 13 years old. As my father would say, he was going to teach me responsibility. I hated every minute of it. I wanted nothing to do with that business. I had to work there through college, but had no interest in coming back after that. But he had to have a double-bypass operation in ’75. Back then, that was a pretty serious procedure. I came back into the business, never thinking I was going to stay.
Did your siblings work with you there? What would you recommend to other family businesses? All of us kids worked in the store. It was just a small family business, and that’s kind of what you did. But I would encourage entrepreneurs and people running a business not to force it down their kids’ throats. I actually told my kids that they could not come into the business right out of college. They had to go do something else.
Your father grew cautious for obvious reasons. How did you get beyond his fear of risk? I saw that there was an opportunity to do more. When I was younger, I didn’t understand why he was so risk-averse. Now I think it’s just that fathers and sons, one generation to the next, have different agendas. You kind of go for broke when you’re young. I wanted to grow the
business. If I’m honest, I wanted to build something myself.
You took your first big risk on a big-box store in Syracuse, New York, in 1987. What drove that decision? You could see what was going on with the big-box retailing. When I saw the big-box home-improvement stores, when I saw what was going on with Sport Mart or Sports Authority, I thought, “These guys have much better stores than we do. If they ever come into our town, we can’t compete.” Fear is a great motivator.
So how were you able to fend off better-funded rivals? How can I say this? I don’t think sporting goods stores had real, professional management teams. They were really mom-and-pop operations that got big and then flamed out. We’d have to have a different conversation about Sports Authority. Sports Authority was just mismanaged.
But Dick’s was a mom-and-pop too. How did you become professional? The first thing I did when I bought the business from my father was put together a board of directors. I knew there were a lot of things I didn’t know, and that I would need some people to guide me. They were really helpful. They weren’t afraid to look at me and say, “You know what? You’re full of shit. You shouldn’t be doing that.” If you don’t have people who will call BS on you, and you start to believe your own BS, you have a problem.
When you and your siblings bought your father out, how did you emerge as the controlling partner? Family businesses with siblings can be difficult. If there’s not someone in charge who has the final decision, there can be a lot of fighting, differences in opinion. My father put together two classes of stock. I had 51 percent of the voting control. If we had not had two classes of stock and someone clearly in charge, our business would not be where it is today.
You struggled initially to land big brands like Adidas, which deemed you too small a player. How did you win them over? Adidas, Puma, and Callaway. It was very difficult, because we wanted to expand into athletic footwear, and then later golf. Adidas and Puma were like Nike is today: If you didn’t have them, you weren’t really relevant. We tried and tried. It was really frustrating that they wouldn’t sell to us— wouldn’t even talk to us. The biggest reason we were finally able to land Puma and Adidas was not necessarily what we did. It was because Nike started to gain market share. And Nike was selling to us. I was very persistent, but it wasn’t my negotiating skills or my persuasion skills. It was what was going on in the marketplace.
So you just had to hang in there? I try to let entrepreneurs know that starting a business is not a straight line. They can look at a business like ours or they can look at a business like Nike or other businesses and not realize the dark and difficult times that those companies went through to get there—the ups and downs. You’ll have those quiet, introspective moments when things aren’t going well, when you’ll have so much selfdoubt. Can I really get this done?
I try to persuade entrepreneurs, if they have a great idea and they really believe in it, to stick with it. You have a good meal and get a good night’s sleep, and you’re ready to go at it again the next morning.
Following the massacre of high school students in Parkland, Florida, you made a huge decision in banning assault-style rifles from Dick’s. Take us through it. This was a long and evolutionary process in our discussion around guns, of how we want to handle the
I was in the conference room at this roundtable, and I said, “Do we really have to wait for this to happen to one of our kids before we do something?”
sale of firearms. Parkland was the straw that broke the camel’s back. Those kids and those parents had such a profound impact on me. Watching those kids, how brave they were to talk about it, those survivors, and listening about the kids who lost their lives, and listening to those parents. It was, “Somebody needs to do something about this.” The more they talked about somebody needing to do something about it, the more I thought, “We need to do something about it.” I sat down and wrote a paper on what I thought our response should be. Anytime I talked about these kids, I would get choked up. I was in the conference room at this roundtable, and I said, “Do we really have to wait for this to happen to one of our kids before we do something?”
How did you handle that process? Where did you go, where did you take your own thoughts, whom did you trust? I trust our management team implicitly. As soon as I started to write this response down, I sent it to Lauren Hobart, our president, and Lee Belitsky, our CFO, and asked for their comments. We kind of went through it, and when we came back into the office on Monday, I sat down with our entire management team. We had a great conversation about it. Everybody agreed that this was the direction we wanted to go in. Our CFO said, “Let me run some numbers and see what this is going to cost us,” which we agreed to do. Our whole management team was absolutely on board that we should do this. Nobody questioned it, other than what the financial ramifications would be, and how we would have to guide the Street.
Initially, you kept stocking assault rifles at Field & Stream stores, and later decided to remove them. What had changed? Field & Stream opened the August after Sandy Hook [which happened in December 2012]. We had meaningful discussions about whether we should put assault rifles in. Ultimately, we decided to. Then, after Parkland, I said, we’re done. We’re not selling these guns, we’re not selling highcapacity magazines, we’re not going to sell any guns to anyone who’s under 21. That was it. We’re never going to change our mind on any of that.
Walmart, L.L. Bean, Kroger, and others have followed your lead. Do you sense a desire on corporate America’s part to step up now? I think it’s an obligation for corporate America. There’s not much leadership coming out of Washington. There are a lot of sound bites. There’s a lot of talking back and forth. The country is so thirsty for someone, for leadership to come from somewhere. Right now, leadership is coming from the private sector, and it’s going to continue to come from the private sector, because I don’t see things changing in Washington very quickly.
All the business you lost has returned, and then some. How has the company changed? We’ve done a lot of different things in our business. We’ve reallocated some floor space. We reallocated marketing dollars out of the hunt business into other areas. Last year, we took hunt out of 10 stores completely as a test, and those stores did significantly better than the balance of the chain. We just started taking it out of another 125 stores, and we’re very happy with that so far.
So you could get out of that business in a few years? We’ve got the whole hunt business under strategic review, and that includes what we’re going to do with Field & Stream. Do we want to be in the gun business? Every time there’s another one of these shootings, we wait and wait and wait until the shooter’s name is revealed, and then we go through our records to see if we were the ones who sold the shooter the gun. I said to George Stephanopoulos on Good Morning America, “I just don’t want to be a part of this story anymore. We’ve got a few things to work through, but I just don’t want to be part of this story any longer.”