Fanatics is grading hobby shops, but what will it accomplish?

Fanatics has evaluated 60-70 stores on three-point scale, but impact of scores remains unclear

Cover Image for Fanatics is grading hobby shops, but what will it accomplish?
Fanatics has direct relationships with nearly 700 hobby shops and more than 110 breakers. (Credit: Getty Images)

Fanatics Collectibles slowly has been evaluating hobby shops in person for months and assigning grades to each store based on a variety of elements it says are critical for the collector experience.

But after several months and dozens of evaluations, it’s still unclear how the information gathered by Topps and Fanatics will directly impact shops, something a number of business owners told cllct needs to change quickly.

So far, Fanatics has evaluated shops using a three-point scale, with exceptional shops earning 3s and shops needing the most work earning 1s.

Explained in detail to owners for the first time during April’s Topps Industry Conference, the evaluation process grades shops on nine elements that fall into either retail experience, marketing capabilities or operations.

Avery Jessup, Fanatics Collectibles’ chief commercial officer, says the evaluations are simply there to provide a series of best practices.

“I think we wanted to implement basic retail fundamentals that are pretty consistent across multiple industries,” Jessup told cllct. “So, if you think about the retail experience, does the store feel contemporary, organized, clean? Do they deliver a premium branded experience in-store and online?”

Fanatics currently has direct relationships with nearly 700 hobby shops and more than 110 breakers. Of those, Jessup says, between 60 and 70 have been evaluated in-person over recent months.

Of the elements Fanatics is evaluating, most would be expected of any modern business in 2024. Organization and cleanliness are basic requirements, while digital point-of-sale options, inventory management systems and active social media accounts aren’t unique to the collectibles industry.

More specific to the hobby, Fanatics has wanted to see a variety of product offerings, specifically diversity in terms of sealed wax, singles and supplies. Participation in events such as Hobby Rip Night or promotions like the MVP Buyback are considered important elements, too.

As of May, the majority of shops evaluated have performed well but have much to improve on. According to Jessup, most shops fall into the middle of a Bell Curve while graded as a 2. These shops typically know what their strengths and weaknesses are.

A key element for evaluation so far has been the physical appearance of the stores. High-quality flooring, proper light fixtures and an efficient retail layout all add up to what Fanatics calls the Hobby 2.0 experience.

Fanatics has evaluated about 10 percent of the shops with which it has a relationship. (Credit: Getty Images)
Fanatics has evaluated about 10 percent of the shops with which it has a relationship. (Credit: Getty Images)

Those elements can all be considered good for any retail space, not just hobby shops. But for many stores, especially those that have been operating on thin profit margins for decades, those improvements are also costly and likely unattainable.

To some shop owners, avoiding physical improvements or lacking a strong online presence just isn’t acceptable for a modern business.

“There are a lot of mom-and-pop shops out there, and I respect them,” said Mark Channing, founder of Markman Sports Cards & Collectibles in New Orleans. “They’ve been in business a long time. But a lot of those stores are not engaging enough with kids, they’re not engaging enough with product online. The cream will rise, and the crap will sink to the bottom.”

First opened in 2000, Channing says his Markman shop has slowly had to evolve and make improvements to stay open. Originally opposed to box breaks for years, Channing added the service when one of his most loyal customers recommended it.

There are free options to improve, too, with social media an easy portal to reach new and potentially loyal customers through regular engagement.

There are, of course, smart ways to invest, too.

“I understand that some old-time shops don’t think they have the money for new lighting or new shelving,” Channing said. “In that case, do it fractionally. Do a little bit here and now. You know, get new shelves this month, and in six months you’re going to get new lighting. You update your store if you’re going to be in this for the long haul. You have to look to the future. If it looks like 1987, people don’t want that anymore.”

Outdated shops have long been a frustration for collectors, though Fanatics’ investment into the space paired with an influx of new and younger collectors entering the hobby have likely made the discussion more paramount.

Fanatics, after all, didn’t spend $500 million purchasing Topps in 2022 just to have a lineup of underwhelming brand ambassadors engaging with millions of customers on a regular basis.

“I think what we’re doing is we’re working with the shop to establish an action plan around an allotted time frame,” Jessup said. “We’d love to see these things fixed or updated in the next 90 to 120 days. It’s really a case-by-case basis. I think what we’re trying to do is make sure that we see constant modernization of our shops and our retail as we see new collectors coming into this space.”

Regardless of intent, the process has been met with mixed feelings from a variety of shop owners contacted by cllct. Paired with Fanatics’ push to learn more about the financials for businesses with direct accounts, some owners believe the evaluations are a gross overreach.

“We only allow the government in our books,” said Bruce Dutton, co-owner of West Georgia Sportscards. “We do not want a manufacturer, whether it’s Topps or Panini or whoever else comes in, to have access or dictate to us how our shop is stocked, laid out or anything.”

West Georgia Sportscards opened its brick-and-mortar location last February and hasn’t felt the desire to secure direct accounts from the major manufacturers over privacy. To Dutton, Fanatics stepping in to address concerns or upgrades in any capacity is an overstep.

“They’re putting their tentacles into it too deeply,” Dutton said.

Through months of inspections, a key problem that has emerged for shop owners has been that evaluations are heavy on planning but light on action. Recommendations have been made, but there has been no clear incentive to forge forward.

Fanatics’ push toward the modernization of shops has had many believing old-school shops must spend to modernize or die. For now, it has been the contrary.

In fact, outside of recommendations for specific changes, Fanatics hasn’t directly motivated shops in either direction. Bad shops aren’t currently in line to see penalties of any kind, and great shops aren’t set up for grand rewards.

There has been plenty of speculation among collectors and owners that poor-performing shops could see cuts to allocation, while great shops could see increases. There also has been anecdotal evidence that some high-effort shops were rewarded with star athletes for Hobby Rip Night, but nothing has been confirmed.

To Burbank Sportscards owner Rob Veres, Fanatics hasn’t gone far enough and too many shops, specifically the outdated shops that simply sell wax allocation, need a major overhaul.

“You need shops that can do more with the product than Fanatics can do themselves,” said Veres, who owns one of California's biggest shops. “What’s the value add? If you do the same thing [Fanatics] can do, why would they give you product? That’s been my thought process this whole entire time.”

Simply throwing money at the problem isn’t a solution either.

“They don't want your store looking like a pigsty, and I’m fully in agreement,” Veres added. “You can’t have stuff stacked up, dusty, dirty, dark, rude. But you can’t have an iPhone store either with no personality and no inventory. It needs to be a hybrid.”

Of the card shops contacted by cllct, most believe the recommendations were at least partially helpful. The action items, however, had less of a consensus.

For Channing, the best way for Fanatics to support hobby shops is to just deliver great products — Fanatics announced at the industry conference that iconic sets such as Topps Chrome Basketball would be making a return, though with unlicensed cards to start.

Veres believes Fanatics needs to make the action items given to card shops more attainable through easy-to-access education. It’s great to give shops guidance on what to update, replace or reimagine, but it’s more helpful to give shops the resources to do those things.

Online tutorials for improvements would be great, Veres says, and a dedication to more education and panels at events such as the industry conference would be ideal.

“I would put together an education conference and make it as mandatory as you can,” Veres said. “You could have the retailers with the best practices in place. I want people seeing in person how someone does something. I want that [shop owner] to be able to ask questions and have something that is actionable to go back with them.”

Veres’ Burbank shop has been one of the shops evaluated so far, and he says initial feedback recommended the shop should ditch its carpet for wood flooring and improve the lighting.

“I’d love to have the people that do those things well educate those that might struggle with it and give them cost-effective ways to maximize their shops,” Veres said.

It’s currently unclear whether Fanatics has plans to add additional educational resources for those action items. It’s also unclear if there are any plans to penalize or reward shops on either end of the evaluation spectrum.

Regardless of future plans, a variety of shop owners have told cllct that the best shops are likely already targeting some of the recommended improvements, though some shops will be motivated to make updates once evaluated.

“I think it’s just a swift kick in the ass that this industry has needed for a long time,” Veres said.

Ben Burrows is a reporter and editor for cllct.