Cycling is the new golf, bolstering demand for expensive sport equipment once driven by golfers. For more frugal consumers there are cheaper alternatives. Sports equipment retailers face an economy on the edge of a downfall, and increasing competition .Rhys Hughes, MD of independent sports and equipment retailer The Pro Shop and Cycle Lab stores, said this week that the golf business had been flat for the past two years."Unit sales are under pressure, but because of the rand's devaluation and the inflation in prices, turnover in rand is actually going up quite nicely," he said. "We are up in rands and slightly down in volumes."But big operators, with their strong buying power, are able to better weather the slowdown in consumer spending.story_article_left1Cobus Loubser, chief financial officer at specialist retailer Holdsport, said: "While what we sell is discretionary, in our share of that discretionary wallet, we have seen good demand for our product, despite the economic hardships."Loubser said that although weak consumer sentiment governed spending habits, the group had employed strategies which might help mitigate the effects of the exchange rates on consumers."Most of the products that we sell are imported. We source a third of our products internationally ourselves and the rest we procure locally and much of that local procurement, from international brands, which we buy from in rands."Last week the group - owner of Sportsmans Warehouse, Outdoor Warehouse and a wholesale business, Performance Brands - released its annual results for the year ended February 29.These showed an 11.8% increase in sales to R1.72-billion, while the group's operating profits increased 15.8% to R308.9-million.Orin Tambo, a senior analyst at Intellidex, said that much of Holdsport's revenue growth came from price inflation of about 8.1percentage points and stores' expansion of about 3.4 percentage points.But despite that, "volumes were largely flat", said Tambo."With the group's current share price of about R61 you will be paying 12 times its earnings, which are mostly in cash. But that's a bargain when compared to its larger peers with similar growth prospects whose shares cost almost double that of Holdsport."Other retailers with sports brands, such as The Foschini Group, had a share price of R137.66, while the Mr Price share price was R174.block_quotes_start The races attract 30,000 and 32,000 people respectively and cyclists can spend from R5,000 to about R185,000 on bikes block_quotes_endTambo said independent retailers might have to look to expand their footprint because competitors such as The Foschini Group, with sports brands such as Sportscene, Totalsports and DueSouth, have a larger footprint across the continent.Alec Abraham, senior equity analyst at Sasfin Wealth, said Mr Price put branded items on sale to get them out of the stores.Mr Price's in-house branded items are cheaper than branded goods from, for instance, Nike and adidas, "so it's a little bit of a distorted view that all of a sudden their turnover growth from the sports division was lower than the other [sports retailers]. It's partly because of the strategic decision that they took," said Abraham.In the group's report for the 12 months to February, like-for-like growth in the sporting division was 2.1%, with an overall sales growth of 13%.Abraham said that although sports retail was more fragmented than other retail sectors, listed entities still took market share from the independents, with Mr Price kids sportswear being more cost-effective than other niche retailers."As people look for more value, the listed retail groups have got much more buying power and tend to have a much more competitive price position," he said.story_article_right2Recognising the power of brand positioning, Holdsport recently opened an 800m² concept store at Mall of Africa which recently opened in Gauteng.But it's not all doom and gloom for the independents.Hughes said that sales in the cycling market had boomed in the past seven or eight years, with the industry growing at 10% a year between 2010 and 2014, despite slowing down by about 7% since 2015.In the build-up to the Cape Town Cycle Tour or the 94.7 Cycle Challenge, "they buy all of those last-minute requirements", according to Hughes."The retail industry is well served by big events," he said. "The races attract 30,000 and 32,000 people respectively and cyclists can spend from R5,000 to about R185,000 on bikes."tshandup@sundaytimes.co.za..