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Note 14 - Segment Information
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

14. SEGMENT INFORMATION

 

Reportable Segments - We have identified three reportable segments: Wholesale, Retail and Contract Manufacturing.

 

Wholesale. In our Wholesale segment, our products are offered in over 10,000 retail locations representing a wide range of distribution channels in the U.S., Canada, U.K. and other international markets, mainly in Europe. These distribution channels vary by product line and target market and include sporting goods stores, outdoor retailers, independent shoe retailers, hardware stores, catalogs, mass merchants, uniform stores, farm store chains, specialty safety stores, specialty retailers and online retailers.

 

Retail. In our Retail segment, we market directly to consumers through our Lehigh business-to-business including direct sales and through our CustomFit websites, consumer e-commerce websites, third-party marketplaces and our Rocky Outdoor Gear Store. Through our outdoor gear store, we generally sell first quality or discontinued products in addition to a limited amount of factory damaged goods, which typically carry lower gross margins.

 

Contract Manufacturing. In our Contract Manufacturing segment, we include sales to the U.S. Military, private label sales and any sales to customers in which we are contracted to manufacture or source a specific footwear product for a customer.

 

Net sales to foreign countries represented approximately 4.8% and 7.5% of net sales for the three months ended September 30, 2024 and 2023, respectively. Net sales to foreign countries represented approximately 3.2% and 5.5% of net sales for the nine months ended September 30, 2024 and 2023, respectively.

 

For segment reporting purposes, management uses gross margin to evaluate segment performance and allocate resources. Operating expenses such as warehousing, distribution, marketing and other key activities supporting our operations are integrated to maximize efficiency and productivity; therefore, we do not include these expenses within our segment results, but instead review them at the consolidated level.

 

The following is a summary of segment results for the Wholesale, Retail and Contract Manufacturing segments for the  three and nine months ended September 30, 2024 and 2023 .
 
   

Three Months Ended

    

Nine Months Ended

  
   

September 30,

    

September 30,

  

($ in thousands)

  

2024

    

2023

    

2024

    

2023

  

NET SALES:

                                

Wholesale

   $ 84,033     $ 99,716     $ 232,082     $ 251,228  

Retail

     26,771       24,523       83,288       79,114  

Contract Manufacturing

     3,750       1,375       10,348       5,539  

Total Net Sales

   $ 114,554     $ 125,614     $ 325,718     $ 335,881  
                                 

GROSS MARGIN:

                                

Wholesale

   $ 31,514     $ 34,599     $ 85,977     $ 89,084  

Retail

     11,683       11,781       38,719       38,379  

Contract Manufacturing

     449       158       1,136       406  

Total Gross Margin

   $ 43,646     $ 46,538     $ 125,832     $ 127,869  

 

Segment asset information is not prepared or used to assess segment performance.