Gander is strengthening its firearms sections. This is an area that Baker says should benefit from Wal-Mart's withdrawal from this product category. Gander "wants to be number one in firearms," he said. It is also bolstering its boat sales and rental business.

Yesterday the company announced a partnership with Camping World less than a week after it announced a partnership with Three Forks Ranch. Under the agreement with the 200,000-acre Three Forks Ranch, a popular destination that is located on the Colorado/Wyoming border, Gander obtains exclusive distribution of a slew of outdoor products under the ranch's brand.

Gander will begin selling Three Forks branded merchandise in September. "It will not be in all Gander stores," said Dennis Lindahl, EVP and CFO, during the call. He said an estimate of the size of the dollar-investment was "premature," but added that the products span the shooting, hunting and fishing categories.

Bowling Green, KY-based Camping World is the country's largest direct marketer and specialty retailer of RV, outdoor and camping accessories and services. Under this alliance, Camping World will offer selections of Gander's "Guide Series" outdoor apparel and camping and fishing equipment on its website, and Gander Mountain stores will be promoted in Camping World's publications, catalogs and stores. The agreement "allows us both to reach a broader base," Baker said.

He noted that first quarter is traditionally Gander's smallest quarter. Therefore, he said the company cut its ad budget by 40% and will shift that expenditure to the back half of the year. "It's clear to us that it's better to communicate during the peak seasons for our customers and let them know about our everyday low price strategy. They don't have to wait for a sale."

At the same time, Gander is beefing up its merchandise mix with a "broader assortment of seasonal products year round for customers who travel," Baker said. It is also cross merchandising more effectively, and he noted that the average ticket rose 5.5% during the quarter to above $52. "In the larger stores, the average is $10 above the overall average," he added.

Gander is in the process of expanding unit size, which is now 51,000 sf, to between 60,000 sf and 65,000 sf. "We continue to believe outdoor is underserved at retail," he concluded. Total sales for the quarter were $155.6 million. The company did not provide a comp-store guidance for the remainder of the year.