But its managing director believes brighter times are on the horizon.
Turnover at the Glasgow business, which trades from premises on Gordon Street and Sauchiehall Street, slipped 1.8% from £8.25 million to £8.1m.
However, pre-tax losses widened from £356,848 to £1.14m in the 12 months to January 31, 2013 mainly as a result of leaving a lease on its Nike-branded store in Buchanan Galleries with about 12 years of its 25-year term still to run.
Greaves also suffered a financial hit when Millets went into administration as the outdoor chain occupied a property the sports firm owns in Edinburgh.
Sandy Greaves, managing director, said: "We felt the way trading was it was in the best interests [of the business] that we got out of that lease at Buchanan Galleries."
He indicated that ongoing costs associated with getting out of the lease may see Greaves report a further loss during the trading year.
Yet he is confident the business will be around for the long term as it battles competition from online, supermarkets and giants such as Sports Direct.
Mr Greaves believes there are some signs of recovery in the economy and he is confident about the company's prospects in the key Christmas trading period.
He said: "This year will be a tough year, there will still be some effect of coming out of the Galleries.
"They don't just let you walk out of a lease with a month's rent.
"There are still some ongoing costs that will impact on the business for the next 12 to 14 months. I won't be in the black this year but I won't be far off it and I'll be back in the black next year."
While Mr Greaves readily admits the company he heads cannot compete with the large multiple retailers on price he believes the service it offers is valuable.
He said: "I wouldn't still be here if I didn't believe in what we were doing."
Greaves, which sponsors the Glasgow City women's football team and also operates the Scottish Rugby shop at Murrayfield, has agreed a major supply deal with American sports giant Under Armour.
That will see the Gordon Street store become the first Under Armour store-within-a-store in the UK.
Mr Greaves said: "It is pleasing to me that suppliers like Under Armour feel they can invest a substantial amount in our store and in Glasgow.
"They want 10 cities across UK and Ireland and [ours] will be the benchmark for them rolling out to Leeds, Liverpool and other places."
Upmarket equipment supplier TechnoGym is also entering into a partnership with Greaves, making the Glasgow retailer the only UK retail outlet outside of Harrods to have the kit on its shop floor.
That builds on a recent investment by New Balance which saw treadmills installed and an iPad used for recording running data in store.
A new Greaves website will go live in the next few weeks and will be designed to make it easier to buy from smartphones and tablets.
Mr Greaves, who runs the business with sister Ann Leslie and is the fifth generation of the family to be involved, said: "That online business will grow. It is getting close to 10% [of turnover] and it will grow to over that within the next six to eight months with the launch of the new site."
The company has also broadened its offering into countrywear with brands such as Barbour and Australian footwear firm RM Williams. Mr Greaves described that venture as a "phenomenal" success.
With the feel-good factor created by the Olympics and Paralympics and Andy Murray's ongoing success on the tennis court, Mr Greaves is hopeful more people will take an interest in sport.
Several suppliers are already competing for marketing space ahead of the Commonwealth Games next year.
Mr Greaves said: "It is great from our point of view because they want to invest in us and they believe in what we are doing."