Retailers are heading into this next season with a tremendous amount of uncertainty. Covid-19 has changed everything in our life, our livelihood, our passion ... aka the ski industry. There will be a new normal, but it will be far from any “normal” that we have experienced before. There is no playbook to get through this, nothing we can look back on as a point of reference -- just nothing. Retailers are going on gut feelings because we have even less of an idea now what will happen than we did when the industry closed down one Saturday last March.
We have been attending numerous industry webinars, and underlying the discussion is the sobering opinion that Covid-19 didn’t change anything that wasn’t going to happen to the ski industry eventually, it just accelerated the process by a few years. There is a sentiment that the ski retailer purely as a commodities mover is a dying model and the only way to survive will be to adapt and focus on service (this will be the topic of Part 2). This reshaping of the industry was to be a gradual change over the next few years, but the events of the past 120 days have turned it into a complete shift that must happen as soon as now.
While retailers were writing their 2020-21 orders, the entire ski industry came to a screeching halt. Not only did shops lose those orders, they also lost their spring sales, A ski shop's financial timeline goes something like this: Most retailers are on extended terms with their suppliers (the manufacturers). The gear that they receive in the fall and sell over late winter is paid for in late winter. Spring is when shops hope to bring in revenue that will be their profit. The income from these sales is what most retailers use to pay the last of their bills for the season. Think “Black Friday” for the industry, not as in a big sale for the consumer, but when retailers go into the black and start seeing a return on their year-long investment. But Covid hit, and shops lost those spring sales, which are vital to their financial stability.
Because of new buying trends in an Amazon-fueled era of two-day shipping and instant gratification, “click and add to cart” retailers will need to adapt and adapt fast -- as in immediately. If a retailer does not have an interactive website and either an online presence or access to the virtual consumer, they might as well plan on an exit strategy. What got them here in their business -- ie, waiting for consumers to walk in the front door with cash in their hands -- will not be getting them where they need to be to survive moving forward.
I reached out to retailers, buyers, and industry insiders; all have different philosophies with their orders for the coming season. Some are very calculated, some are all in, still others have just whipped out their trusted Magic 8 balls. Some have even thrown in the towel, shutting the doors and getting out of retail completely.
Let’s look at the spectrum here. One of the largest retailers, Vail Resorts, canceled all of its pre-orders, and we are hearing it is abandoning its retail stores as we know them. Yes, that is huge news … but this is an industry-wide change, not just one retailer, even as large as Vail Resorts Retail is. Canceling everything? Well, that is a very conservative (or is it risky?) path; VR is one of the most financially diverse organizations, so it can afford to take this direction. Next are the service-oriented shops acting on the safer side, which means just trimming their orders and banking on skis and boots that have been tried-and-true sales successes. They are adjusting the variety of their selections and not really focusing on the depth of a model collection. Other shops think there will be excess production from these previous models and expect that there will be demand, that affluent skiers will still be buying gear and will need a place to do it.
The one thing that most shops agree on is that they need to change how they access and interact with their customers, and how they get product to them. More now than ever, a retailer's online presence is paramount. This can be either through their own database or through sites and communities such as Pugski.com. Skiers will be making purchases, but many will be unwilling to come into a shop. Curbside pickup, shipping, and any other “hands-free” method of interaction will be more important than ever. These past few months have shown that a sale is made before a consumer ever enters a store via independent reviews, interaction with influencers, and a click of the mouse.
The question I have for every retailer and supplier reading this: Are you ready, and what have you prepared moving forward?
Disclaimer: This research was compiled over a weeks at the end of last season. Think about what we thought we knew a month ago as compared to what we know today, and remember that what we think we know today will be different than what we will know next month.
We have been attending numerous industry webinars, and underlying the discussion is the sobering opinion that Covid-19 didn’t change anything that wasn’t going to happen to the ski industry eventually, it just accelerated the process by a few years. There is a sentiment that the ski retailer purely as a commodities mover is a dying model and the only way to survive will be to adapt and focus on service (this will be the topic of Part 2). This reshaping of the industry was to be a gradual change over the next few years, but the events of the past 120 days have turned it into a complete shift that must happen as soon as now.
While retailers were writing their 2020-21 orders, the entire ski industry came to a screeching halt. Not only did shops lose those orders, they also lost their spring sales, A ski shop's financial timeline goes something like this: Most retailers are on extended terms with their suppliers (the manufacturers). The gear that they receive in the fall and sell over late winter is paid for in late winter. Spring is when shops hope to bring in revenue that will be their profit. The income from these sales is what most retailers use to pay the last of their bills for the season. Think “Black Friday” for the industry, not as in a big sale for the consumer, but when retailers go into the black and start seeing a return on their year-long investment. But Covid hit, and shops lost those spring sales, which are vital to their financial stability.
Because of new buying trends in an Amazon-fueled era of two-day shipping and instant gratification, “click and add to cart” retailers will need to adapt and adapt fast -- as in immediately. If a retailer does not have an interactive website and either an online presence or access to the virtual consumer, they might as well plan on an exit strategy. What got them here in their business -- ie, waiting for consumers to walk in the front door with cash in their hands -- will not be getting them where they need to be to survive moving forward.
I reached out to retailers, buyers, and industry insiders; all have different philosophies with their orders for the coming season. Some are very calculated, some are all in, still others have just whipped out their trusted Magic 8 balls. Some have even thrown in the towel, shutting the doors and getting out of retail completely.
Let’s look at the spectrum here. One of the largest retailers, Vail Resorts, canceled all of its pre-orders, and we are hearing it is abandoning its retail stores as we know them. Yes, that is huge news … but this is an industry-wide change, not just one retailer, even as large as Vail Resorts Retail is. Canceling everything? Well, that is a very conservative (or is it risky?) path; VR is one of the most financially diverse organizations, so it can afford to take this direction. Next are the service-oriented shops acting on the safer side, which means just trimming their orders and banking on skis and boots that have been tried-and-true sales successes. They are adjusting the variety of their selections and not really focusing on the depth of a model collection. Other shops think there will be excess production from these previous models and expect that there will be demand, that affluent skiers will still be buying gear and will need a place to do it.
The one thing that most shops agree on is that they need to change how they access and interact with their customers, and how they get product to them. More now than ever, a retailer's online presence is paramount. This can be either through their own database or through sites and communities such as Pugski.com. Skiers will be making purchases, but many will be unwilling to come into a shop. Curbside pickup, shipping, and any other “hands-free” method of interaction will be more important than ever. These past few months have shown that a sale is made before a consumer ever enters a store via independent reviews, interaction with influencers, and a click of the mouse.
The question I have for every retailer and supplier reading this: Are you ready, and what have you prepared moving forward?
Disclaimer: This research was compiled over a weeks at the end of last season. Think about what we thought we knew a month ago as compared to what we know today, and remember that what we think we know today will be different than what we will know next month.