October 25, 2012 | Back to: News

2011-12 snow sports retail profits grew, study finds

LAKE TAHOE - Though the 2011-12 winter might have had skiers and snowboarders praying daily for snow, Snowsports Industries America reported last week that business could have been a lot worse.

In what SIA calls one of the toughest seasons in the snow sports industry's history, snow equipment and retail sales finished the winter down by 13 percent in units sold. Participation in alpine skiing dropped 11 percent nationwide, while snowboarding decreased by 7.5 percent. Resort visits declined by 16 percent.

But despite those drops, the season's market for apparel, equipment and accessories brought in more dollars than either the 2008-09 or 2010-11 seasons, rising by about $300,000 from the prior year. Specialty shops didn't slash prices like they had in previous seasons so retail sales held steady throughout the winter, SIA Market Research Associate Emily O'Hara said.

"Ultimately the reason why there's more money is because retail stayed stable. We didn't see the 40 percent-off sales like we did in previous seasons. And apparel is another reason retail stayed strong. You don't have to ski or snowboard to wear that new North Face," O'Hara said.

Now retailers have to deal with swollen inventories from last season, and O'Hara said snow sports consumers can expect big sales this winter from stores trying to empty out the backrooms.

At Powder House, a ski and snowboard rental shop in South Lake Tahoe, sales remained fairly strong considering the lack of snow, said Stuart Maas, the store's director of Sales, Marketing and Information Technology.

"It was definitely quite a slow start, but it didn't turn out quite as bad as we thought it might be," Maas said.

Powder House launched a strong marketing push to keep the money flowing in, and despite putting some merchandise on sale, revenue stayed high, Maas said.

Vail Resorts, Inc. didn't fair quite as well. According to the ski company's fiscal 2012 full year results, net income declined by more than 50 percent to $16.5 million. Revenue from operations held steadier, and the "resort reported EBITDA," a number which includes mountain and lodging segments, fell by only 3.8 percent to $205.3 million.

"I think last year was a great test of what we're all about here at Heavenly. We won't decrease the guest experience no matter what Mother Nature throws at us. It was a challenge last year. But it's great to see that business can sustain even in tough years," Heavenly Mountain Resort General Manager Pete Sonntag said.

With the 2011-12 season behind them, Vail Resorts and South Shore retailers prepare for the 2013 winter. As of September, Vail's season pass sales for next winter were up by about 17 percent in units sold even though Sonntag said he'd seen some hesitancy in the number of reservation bookings.

Of course snow helps, and Maas said visitors to Powder House's website have already doubled in the past two days as about 6 inches of snow accumulated in the basin.

"This early snowfall helps considerably. It gets the momentum going early. I think it's huge. It gets people in the mindset for winter. They put away the golf clubs and get out the skis. It's definitely all about snow. We find snowfall is the key in driving skier numbers and sales," Maas said.


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Tahoe Daily Tribune Updated Oct 25, 2012 11:36AM Published Oct 25, 2012 11:35AM Copyright 2012 Tahoe Daily Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.