Big 5 Sporting Goods Corporation (BGFV): Business Model Canvas [Dec-2025 Updated]

You're digging into the Business Model Canvas for Big 5 Sporting Goods Corporation (BGFV) right after its move to private ownership, and frankly, the picture is one of necessary, sharp focus: they are running about 410 stores in the Western US, booking TTM net sales of approximately $762.76 million, but the cost side is tight, with SG&A hitting 40.3% of net sales in Q1 2025. As an analyst who has seen this cycle before, the real action is in how they execute store closures, lean into higher-margin private labels like Rugged Exposure, and service the $150.0 million credit facility now that the public scrutiny is gone. Let's break down the nine blocks that define their path forward, from their value proposition to their revenue streams, to see if this new structure can deliver the margin improvement you're looking for.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Key Partnerships

You're looking at the structure of Big 5 Sporting Goods Corporation following its transition to private ownership in late 2025. The partnerships underpinning the business are now centered around its new owners and its existing financial and supply chain relationships.

New Private Owners: Worldwide Golf Group and Capitol Hill Group

The relationship with the new private owners, Worldwide Golf Group and Capitol Hill Group, is the most significant recent change. The all-cash transaction to acquire Big 5 Sporting Goods Corporation was valued at approximately $112.7 million in enterprise value, which included the assumption of about $71.4 million in credit line borrowings as of June 29, 2025. Upon completion in October 2025, Big 5 stockholders received $1.45 per share in cash, representing a 36% premium to the 60-day volume-weighted average price before the announcement. Big 5 now operates as a wholly owned subsidiary, leveraging Capitol Hill Group's financial resources and Worldwide Golf's specialty retail expertise.

National Brand-Name Manufacturers

The core of Big 5 Sporting Goods Corporation's product offering relies on its relationships with major brand-name vendors. These partnerships are essential for inventory flow across categories like athletic shoes, apparel, and equipment.

• Partners include major names such as Adidas, Columbia, and Under Armour.
• Fiscal 2024 Net Sales for Big 5 Sporting Goods Corporation totaled $795.5 million, illustrating the scale of product movement through these vendor channels.
• Merchandise inventories as of the end of fiscal 2025 second quarter were consistent with the prior year period.

Financial Institutions for the $150.0 Million Credit Facility

The relationship with Bank of America provides critical working capital flexibility. The amended, five-year secured revolving credit facility matures in December 2029. The committed availability is set at up to $150 million, with an option for an additional $50 million increase, for a potential aggregate of $200 million.

The interest rates are tied to SOFR or a base rate, with SOFR loan margins ranging from 1.75% to 2.125%. As of the fiscal 2025 second quarter end (June 29, 2025), borrowings under this facility stood at $71.4 million.

Logistics and Freight Carriers for Supply Chain Management

Efficient movement of goods from vendors to the 422 stores relies on established logistics partners. Big 5 Sporting Goods Corporation utilizes a 953,000 square-foot distribution center in Riverside, California, to support all store operations.

Local Youth Sports Organizations for Grassroots Marketing

This channel supports community presence, a key element for a retailer focused on the western United States. While specific 2025 spending figures aren't public, this activity supports the customer base that generated $184.9 million in net sales during the fiscal 2025 second quarter.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Key Activities

The core operational activities for Big 5 Sporting Goods Corporation, particularly following its transition to private ownership in October 2025, center on optimizing its physical footprint, managing complex logistics, strategic sourcing, and brand development, all under a new mandate for long-term capital deployment.

Store base optimization and closing underperforming locations

This activity involves a continuous review of the physical store portfolio, which as of October 2025, stood at 410 stores concentrated in the western United States. The company signaled an aggressive optimization stance by anticipating the closure of up to 15 stores during fiscal 2025. This follows a trend where 25 stores were closed over the preceding five years due to underperformance or lease issues, against 13 openings. The average store format remains a traditional sporting goods store, averaging 12,000 square feet.

Managing a 953,000 sq. ft. distribution center in California

Logistics management is a critical function, supported by a centralized facility. The company operates a 953,000 square-foot distribution center located in Riverside, California, which services all retail locations and the e-commerce platform. This activity is financially pressured, as distribution expense, as a percentage of net sales, was a factor in the gross profit margin decline to 28.2% in the fiscal 2025 second quarter from 29.4% in the prior year's second quarter. Capital expenditures guidance for fiscal 2025 included investments for the distribution center, budgeted between $4 million and $8 million.

Opportunistic inventory buying and close-out merchandise sourcing

Big 5 Sporting Goods Corporation actively engages in sourcing inventory that is not solely based on regular seasonal buys. This includes opportunistic purchases of vendor over-stock and close-out merchandise. This strategy was evident in Q1 Fiscal 2025, where merchandise inventory increased 6.5% year-over-year, reflecting earlier receipts of seasonal merchandise compared to the prior year. The focus on value-conscious consumers meant this included promotional efforts, which contributed to merchandise margins decreasing by 78 basis points in Q1 Fiscal 2025 compared to the prior year.

Developing and marketing private label brands (e.g., Rugged Exposure)

The company develops and markets its own private label items, which include shoes, apparel, camping equipment, fishing supplies, and snow sport equipment. Key private label trademarks include Golden Bear, Fit Essentials, Harsh, Pacifica, Rugged Exposure, and Sport Essentials. This product mix is a core part of the offering alongside national brand name merchandise.

Executing the strategic plan under new private ownership

The execution of the strategic plan is now guided by the new ownership structure, which finalized the acquisition on October 2, 2025. The transaction valued the retailer at approximately $112.7 million. This move from public to private ownership removes public market reporting requirements and quarterly earnings pressure, allowing leadership to focus on long-term planning. The new owners, Worldwide Golf and Capitol Hill Group, aim to inject long-term capital to re-energize growth. The financial context leading into this transition included a net loss of $24.5 million for Q2 Fiscal 2025, which included $2.8 million in merger transaction-related expenses.

Key Operational Metrics Snapshot (As of Late 2025 Data Points)

The company's key activities are focused on operational efficiency and strategic realignment under private control, evidenced by the planned store closures and the management of the large distribution center while navigating recent financial headwinds, such as the 7.8% drop in same-store sales reported for Q1 Fiscal 2025.

• Managing credit facility utilization, which stood at $71.4 million in borrowings against a $150.0 million facility at the end of Q2 2025.
• Focusing capital expenditures for fiscal 2025 in the range of $4 million to $8 million.
• Maintaining a product mix that includes both national brands and private label items.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Key Resources

You're looking at the tangible and intellectual assets Big 5 Sporting Goods Corporation relies on to execute its business strategy as of late 2025. These are the foundational elements that make the rest of the canvas work.

The physical footprint remains a core asset, concentrated entirely in the Western US. As of the second quarter of fiscal 2025, Big 5 Sporting Goods Corporation operated 414 stores in operation. This network is supported by a single, large, centralized distribution center located at 6125 Sycamore Canyon Blvd. in Riverside, California, which is a 953,100 square foot facility. This DC is critical for managing the flow of goods to the regional store base.

The company also relies on its owned intellectual property to drive better margins. This is the private label portfolio, which includes brands such as:

• Golden Bear
• Fit Essentials
• Harsh
• Pacifica
• Rugged Exposure
• Sport Essentials

Inventory management is a constant balancing act, especially given the current economic climate. As of the end of the second quarter of fiscal 2025, the merchandise inventory level was reported at $283.3 million, noted as being flat year-over-year for that period. This consistency, following earlier inventory increases to secure spring/summer deliveries, is a key operational metric.

To maintain and improve this physical and digital infrastructure, Big 5 Sporting Goods Corporation has a planned investment budget for the year. The anticipated capital expenditures for fiscal 2025, excluding non-cash acquisitions, are projected to be in the range of $4 million to $7 million. This spending is earmarked primarily for store-related remodeling and investments in IT infrastructure.

Here's a snapshot of these key resource metrics as of mid-2025:

The planned capital spending for 2025 is focused on keeping the existing asset base current. For example, the first quarter of fiscal 2025 saw capital expenditures totaling $1.7 million, which covered store remodeling and distribution center investments. That pace suggests the full-year target is achievable, though the company is clearly prioritizing maintenance and optimization over expansion, given the plan to close approximately 15 stores in fiscal 2025.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers walk into a Big 5 Sporting Goods store or visit their site, even when facing a tough retail environment. The value proposition centers on accessibility, selection, and price positioning in the Western United States.

Value-oriented pricing for the price-conscious consumer

Big 5 Sporting Goods Corporation positions itself to capture the budget-conscious shopper. This focus is evident in operational metrics, such as the merchandise margins in the first quarter of fiscal 2025. For Q1 2025, merchandise margins declined by 78 basis points year-over-year, a change partially attributed to promotional activities specifically aimed at value-conscious consumers. The pressure on margins suggests an active strategy to keep shelf prices competitive against alternatives. For context, in Q1 2025, Net Sales were $175.6 million, and the Gross Profit Margin stood at 30.9%.

Broad product mix for a wide range of sports and recreation

The company offers a full-line product offering designed to cover many sporting needs locally. This breadth is a key differentiator against more specialized or big-box retailers. The product mix includes:

• Athletic shoes, apparel, and accessories.
• Equipment for team sports.
• Gear for fitness and home recreation.
• Equipment for outdoor activities like camping, hunting, and fishing.
• Items for seasonal sports like golf and winter/summer recreation.

Convenient, traditional mid-sized store format (average 12,000 sq. ft.)

The physical footprint is designed for convenience within local markets, avoiding the massive scale of big-box competitors. The average store size is consistently reported around 12,000 square feet. This format allows for a deep selection without the overhead of a superstore. You can see the impact of store optimization efforts in the 2025 store count adjustments.

In-stock availability of seasonal and local-demand equipment

Inventory management is geared toward ensuring local relevance. For instance, as of the end of Q1 2025, merchandise inventory increased 6.5% year-over-year, which management noted was due to earlier scheduling of spring and summer merchandise deliveries compared to the prior year when delays caused missed sales opportunities. This suggests a direct effort to improve in-stock rates for key seasonal categories.

Balance of national brands and cost-effective private label goods

Big 5 Sporting Goods Corporation offers both established, name-brand merchandise and its own private label items. The company sells merchandise under trademarks including Golden Bear, Fit Essentials, Harsh, Pacifica, Rugged Exposure, and Sport Essentials. While general market data suggests private label sales growth was 2.3% in 2024 compared to national brand growth of 4.5%, Big 5 Sporting Goods relies on this mix to offer choice and manage cost structure. Nationally branded products often command a price premium, with consumers reportedly paying over $2 more for them than for private label alternatives in the broader market.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Customer Relationships

Transactional, driven by promotional sales and weekly circulars

Big 5 Sporting Goods Corporation's customer relationship is heavily weighted toward transactional interactions, often spurred by price incentives. The necessity to drive sales to value conscious consumers is evident in margin performance; for example, merchandise margins in the first quarter of fiscal 2025 decreased by 78 basis points year-over-year, reflecting product mix shifts along with promotional efforts to drive sales. The company continues to rely on its Weekly Ad to communicate the latest deals and discounts to shoppers. This approach is supported by a merchandising strategy that includes opportunistic buys of vendor over-stock and close-out merchandise, allowing them to offer value pricing. However, this promotional mix can pressure profitability, as seen in the second quarter of fiscal 2025 where the gross profit margin narrowed to 28.2%, partly due to a heavier mix of promotions.

In-store customer service and product expertise

The physical store remains a core touchpoint for Big 5 Sporting Goods Corporation. The company maintains a traditional sporting goods store format, averaging 12,000 square feet across its locations. As of the end of the second quarter of fiscal 2025, Big 5 Sporting Goods Corporation operated 414 stores in the western United States. The emphasis here is on leveraging the physical space to provide in-store experiences and excellent customer service, which is cited as a significant factor in maintaining a loyal customer base despite competition from e-commerce giants. The sales performance in Q2 2025 showed same store sales decreased by 6.1% year-over-year, indicating the ongoing challenge in driving consistent foot traffic.

Loyalty programs to retain a consistent customer base

To foster retention beyond single transactions, Big 5 Sporting Goods Corporation utilizes specific incentive programs. The company offers a League Loyalty Program designed to provide savings for teams and leagues. For individual customers, there is an immediate incentive to engage digitally, as new customers can sign up & get 10% off, provided a valid email address is supplied. This ties the loyalty aspect directly into their digital engagement strategy.

Direct engagement through email and digital marketing

Big 5 Sporting Goods Corporation has actively shifted its advertising focus away from print media toward digital channels. The company utilizes social media and email marketing specifically to engage customers and promote the Big 5 brand. Furthermore, investments in its e-commerce platform and enterprise-level IT systems support enhanced customer relationship management capabilities, which are intended to improve analytics and refine marketing efforts. This digital focus is crucial as the company seeks to reach customers nationwide through its online platform.

Here's a quick look at the operational scale impacting customer interactions as of the second quarter of fiscal 2025:

The decrease in selling and administrative expense as a percentage of net sales from 36.1% in Q2 2024 to 40.8% in Q2 2025 reflects the lower sales base impacting fixed cost absorption.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Channels

You're looking at how Big 5 Sporting Goods Corporation gets its product into the hands of the customer, especially as the company navigates its transition to private ownership in late 2025. The channel strategy is heavily weighted toward physical presence, though the digital side is a growing piece of the puzzle.

Brick-and-mortar retail stores across the Western United States

The core of the Big 5 Sporting Goods Corporation channel strategy remains its physical footprint across the Western United States. As of June 29, 2025, the company was operating 414 stores, down from 422 stores at the end of fiscal 2024. This reflects a strategy of rationalization, with plans to close approximately 15 stores for the full fiscal 2025 year, including eight already closed in early 2025 and about four more planned for Q3 2025. You won't see any new store openings planned for 2025, showing a focus on optimizing the existing base. Each location typically uses a traditional sporting goods store format, averaging about 12,000 square feet.

Here's a look at the physical footprint metrics around the time of the acquisition:

E-commerce platform for online ordering and fulfillment

Big 5 Sporting Goods Corporation supports its physical stores with an e-commerce platform, big5sportinggoods.com, for online ordering. While e-commerce sales for fiscal 2024 and 2023 were noted as not material in the 10-K, the online channel is showing some scale. The largest online store generated annual sales of US$153m in 2024. Management guided for a growth rate of 0-5% for this largest online store in 2025 compared to 2024.

Curbside pickup and home delivery options

The company uses its e-commerce platform to facilitate fulfillment options for customers. While specific transaction volumes for these services aren't broken out in the latest public filings, the infrastructure supports online ordering and subsequent fulfillment. These options are critical for bridging the gap between the physical store base and modern consumer convenience expectations.

Direct-to-consumer marketing through print and digital ads

The company engages in direct-to-consumer marketing to drive traffic to both its physical and digital channels. This includes using print and digital advertisements to reach the competitive and recreational sporting goods customer base. The overall strategy is to maintain a presence that competes against mass merchandisers and e-commerce giants.

• Print advertising supports local store promotions.
• Digital ads target specific geographic areas in the Western US.
• Marketing efforts aim to reinforce value on quality merchandise.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Customer Segments

You're looking at the core groups Big 5 Sporting Goods Corporation served right before and after its transition to private ownership in mid-2025. The customer base is geographically concentrated and highly sensitive to value propositions.

Price-conscious, value-seeking consumers

Big 5 Sporting Goods Corporation has carved out a niche by focusing on this group, positioning itself as the off-price retailer in the sporting goods space. This strategy means a significant portion of the customer base prioritizes cost-effectiveness over premium, high-end offerings from competitors. The financial reality reflects this focus; for fiscal 2024, the company reported Net Sales of $795.5 million, and in the second quarter of fiscal 2025, Net Sales were $184.9 million, showing the scale of transactions with these value-driven buyers. The pressure on margins, with gross profit margin at 28.2% in Q2 2025, is partly a function of catering to this price-sensitive segment.

This segment is targeted through specific merchandising tactics:

• Buying opportunistic merchandise, including vendor over-stock and close-out items.
• Balancing well-known brand names with private label products.

Competitive and recreational sports enthusiasts

This group includes individuals participating in organized team sports, fitness routines, and general recreational activities. The product mix directly addresses these needs, offering equipment and apparel for activities like team sports and fitness. The company's average store size of approximately 12,000 square feet is designed to carry a full-line product mix to satisfy both the casual buyer and the more dedicated enthusiast.

The focus on these enthusiasts is evident in the product categories offered:

• Athletic shoes and apparel.
• Equipment for team sports and fitness.
• Gear for tennis and golf.

Families and individuals in the Western US regional footprint

The customer base is intrinsically linked to the company's physical presence. As of early 2025, Big 5 Sporting Goods Corporation operated approximately 422 stores, all located in the western United States. This regional concentration means the customer segments are heavily influenced by the economic conditions, population density, and local sporting culture of states like California. The company's strategy involves maintaining this footprint, though it anticipated closing approximately 15 stores in fiscal 2025.

Here is a snapshot of the operational scale serving these regional customers:

Hunters, campers, and outdoor recreation participants

A significant portion of the full-line offering caters to outdoor pursuits, which is a core strength in the Western US market. This segment relies on Big 5 Sporting Goods Corporation for specialized gear. The company's product mix explicitly includes equipment for camping, hunting, and fishing, alongside gear for winter and summer recreation. The company's reliance on weekly print advertisements, though being challenged by e-commerce, historically targeted these local, community-based outdoor enthusiasts.

Key outdoor product categories include:

• Camping equipment.
• Hunting and fishing supplies.
• Gear for winter and summer recreation.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Cost Structure

The Cost Structure for Big 5 Sporting Goods Corporation is heavily weighted toward the cost of the merchandise itself, followed by the fixed and semi-fixed costs associated with maintaining its physical store footprint and distribution network.

High cost of goods sold (COGS) relative to net sales is a defining feature. For the first quarter of fiscal 2025, with net sales of $175.6 million, the gross profit was $54.3 million, implying a COGS of approximately $121.3 million, or 69.1% of net sales, as the gross profit margin was 30.9%. The pressure on margins continued into the second quarter of fiscal 2025; net sales were $184.9 million and gross profit was $52.2 million, resulting in a gross profit margin of 28.2%. This means COGS represented about 71.8% of net sales for Q2 2025.

Significant store occupancy and lease expenses form a major component of fixed costs. In Q1 2025, the decrease in gross profit margin was primarily attributed to higher store occupancy expense as a percentage of net sales. This expense category includes rent, amortization of leasehold improvements, common area maintenance, property taxes, and insurance.

Selling and administrative (SG&A) expenses show a high ratio to sales, especially when sales decline. For the first quarter of fiscal 2025, SG&A expenses were 40.3% of net sales, up from 36.9% in Q1 2024, driven by the lower sales base. In the second quarter of fiscal 2025, SG&A as a percentage of net sales was 40.8%, compared to 36.1% in Q2 2024.

Distribution and logistics costs for the centralized model also impact margins. The higher gross profit margin contraction in Q2 2025 reflected higher store occupancy and distribution expense, including costs capitalized into inventory, as a percentage of net sales. For the full fiscal year 2024, distribution expense, including capitalized costs, increased by $1.2 million, or an unfavorable 83 basis points as a percentage of net sales. The company operates a 953,000 square-foot distribution center in Riverside, California, to support all store operations.

Interest expense on borrowings adds to the non-operating costs. For the second quarter of fiscal 2025, the interest expense was $1.3 million. At the end of that same quarter, Big 5 Sporting Goods Corporation reported $71.4 million in borrowings outstanding under its $150.0 million credit facility.

Here's a quick look at the key cost-related metrics for the first half of 2025:

The primary cost drivers that management is focused on controlling include:

• Merchandise Cost of Goods Sold percentage.
• Store occupancy expense as a percentage of net sales.
• Labor costs within SG&A.
• Distribution and logistics overhead.

Big 5 Sporting Goods Corporation (BGFV) - Canvas Business Model: Revenue Streams

The revenue streams for Big 5 Sporting Goods Corporation are fundamentally driven by direct-to-consumer retail sales across its physical store footprint and e-commerce platform. As of late 2025, the company is operating as a private entity following its acquisition, which shifts the focus to core operational revenue generation.

The Trailing Twelve Months (TTM) net sales, reflecting performance leading up to late 2025, were approximately $762.76 million. This figure represents the total income generated before any expenses are subtracted.

Historically, the revenue mix has been concentrated in three primary merchandise categories, though recent performance shows shifts. The expected or historical contribution percentages are:

• Retail sales of hardgoods (equipment, outdoor gear) ~48% of sales
• Retail sales of athletic and sport footwear ~32% of sales
• Retail sales of athletic and sport apparel ~20% of sales

To give you a concrete look at a recent period, the second quarter of fiscal 2025 (ending June 29, 2025) generated net sales of $184.9 million. The breakdown for that specific quarter shows a heavier weighting toward hardgoods compared to the historical average:

The company also generates revenue from sales from higher-margin private label merchandise. Big 5 Sporting Goods Corporation markets sports goods under its own trademarks, such as Golden Bear, Harsh, Pacifica, and Rugged Exposure. While these private label items-which include shoes, apparel, camping equipment, fishing supplies, and snow sport equipment-are a key part of the merchandising strategy alongside national brands, private label sales typically make up a modest share of overall revenue.

The revenue generation is heavily influenced by in-store performance. For instance, in the second quarter of fiscal 2025, same-store sales declined by 6.1% year-over-year. Also, the first quarter of fiscal 2025 saw declines across the board: hard goods decreased 4.7%, apparel declined 8.7%, and footwear was down 11.8% on a same-store basis.

The overall financial context for this revenue stream is challenging. The TTM net sales of $762.76 million represent a decrease of -8.04% year-over-year. The net loss for the second quarter of fiscal 2025 was $24.5 million, or $1.11 per basic share, which included $2.8 million in merger transaction-related expenses.