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Sunday, April 06, 2008

Local outdoors retailers stay afloat amid the threat of big-box stores

Small, independent outdoors retailers emphasize customer service and savvy staff

Diane and Arthur Kearns opened their Mountain Trails store in 1993 in Winchester.

Courtesy of Diane and Arthur Kearns

Diane and Arthur Kearns opened their Mountain Trails store in 1993 in Winchester.

Dee Markham shops with her 7-year-old daughter, Summer, at Walkabout Outfitter in downtown Roanoke.

ERIC BRADY The Roanoke Times

Dee Markham shops with her 7-year-old daughter, Summer, at Walkabout Outfitter in downtown Roanoke.

Toney Smith strode into the small Outdoor Trails store asking about hiking boots.

An experienced backpacker who manages the family-owned business in Botetourt County responded.

For the next 15 minutes, Mark Futrell handed Smith different pairs of boots and offered details about each pair's features -- about fit, function, waterproofing options, soles and stitching.

Smith did not buy new boots that day. But he said he'd be back and sounded convincing.

"You might save five dollars at one of those big-box retailers but I'd rather come to a mom and pop store," Smith said. "There's more personalized service and they carry a lot of things the big stores don't."

For small, independent outdoors stores in the region, big-box competition is growing. Sportsman's Warehouse opened before Christmas in Roanoke. Shoppers jammed the parking lot for weeks.

Gander Mountain plans to open this month in a building of 65,997 square feet off Interstate 81 near the Hollins exit.

In the Roanoke Valley, these two big-box retailers of hunting, camping and fishing gear join Dick's Sporting Goods, which opened in Roanoke in 2003.

The three chains differ in offerings and emphasis. But all present competitive challenges to small, locally-owned outdoors stores. In many cases, the big boxes sell the same brands of sleeping bags, tents, camp stoves, hiking boots, socks, water bottles and other gear.

Customer service

Arthur Kearns and his wife, Diane, opened their 1,800-square-foot Mountain Trails store in 1993 in Winchester. Gander Mountain arrived in late 2006.

"Anytime the pie gets sliced into more pieces, the pieces get smaller and smaller," said Arthur Kearns.

Kearns' formula for staying afloat includes emphasizing customer service from a small but knowledgeable staff -- employees who have had real-world experiences in the outdoors. In addition, he said, specialty outdoors stores must offer new and innovative products.

"Often, we end up showing a customer something they never knew existed," Kearns said. "The boxes are pretty conservative, only wishing to stock the proven items."

Many now-famous brands -- such as North Face, Columbia, MSR and SmartWool -- first found a home in small outdoors stores, Kearns said.

Futrell agreed.

"They got to where they are because of small, independent retailers like us," he said.

But then, Kearns said, the brands threw in with the big boxes.

"There's no more 'dancing with them that brung you,' " he said.

But small stores can find, promote and sell new niche product lines of high quality, said Futrell, and consider additional advertising.

The Outdoor Trails store in Daleville is about 500 yards from the Appalachian Trail. Long-distance hikers on the AT typically know, from guidebooks or word of mouth, where they can find gear, replacement parts and other resupply goods along the trail.

"That's one of the main reasons we chose this location," Futrell said.

But AT business is seasonal, with most through-hikers passing through Virginia during late spring and summer, he said.

"It's not like we can rely on them for all of our business," Futrell said.

Small outdoors stores work to build a loyal customer base -- a process that requires, as Kearns observed, employees who can walk the walk.

"We have a knowledgeable, focused and energetic staff," Futrell said.

Kirk Miller is co-owner of two Walkabout Outfitter stores. One is in Lexington and the other in downtown Roanoke.

"I did a complete through-hike of the Appalachian Trail in 1999," Miller said. "I learned the products inside and out by doing that. That's the whole idea behind what we do. We know the products we sell.

"Imagine you have decided you are going to hike the Appalachian Trail and you want to go to a store and say, 'Gear me up.' Where would you go?"

Miller said he recently "geared up" a guy for the AT. He said he also fixed the customer's lightweight, backcountry stove even though the man had purchased it elsewhere.

"Why would you shop at a big-box store?" Miller said. "Our prices are the same. We know the products better and we offer better customer service."

The pricing question

David Ewald is a spokesman for Minnesota-based Gander Mountain. At the end of 2007, the company had 115 stores in 23 states.

"Gander Mountain prides itself on customer service and product knowledge," Ewald said. "We hire people who are passionate about the outdoors."

Gander Mountain, Sportsman's Warehouse and Dick's Sporting Goods all sell hunting and fishing gear.

Walkabout Outfitter, Outdoor Trails and Mountain Trails do not. Ewald said Gander Mountain focuses on hunting, fishing and camping "in that order."

Thus, among these large and small retailers, the lines of competition intersect primarily in the realm of camping gear and clothing.

Are prices the same?

Sometimes.

Ewald said Gander Mountain "works off a model of everyday low pricing."

Occasionally, especially for less-expensive items, the small guys actually beat a big boy on price.

For example, two types of SmartWool socks stocked at Walkabout Outfitter each sell for a nickel less than the same socks at Sportsman's Warehouse, where the price is $14.99 per pair. Walkabout sells small canisters of butane/propane fuel for $3.85; the Sportsman's price for the same MSR canister is $3.95.

In many cases, prices are, in fact, the same -- based on a manufacturer's suggested retail price.

But Sportsman's prices can be cheaper on large-ticket items such as backpacks and fancy cooking gear. Sportsman's beat both Walkabout and Outdoor Trails by a margin of about $20 for a Kelty Coyote women's backpack.

But how well does that backpack fit?

It can take more than 20 minutes to be helped at the bigger stores, and it recently did on a visit to Sportsman's Warehouse.

"There's nothing worse than getting a bad-fitting pack or hiking boot," said Futrell, who said he and his staff can help ensure a good fit.

Hal Cansler is general manager for Back Country Ski & Sports, which has stores in Salem and Blacksburg.

"People get disillusioned very quickly with shopping at these big discounters," Cansler said.

Back Country Ski & Sports' specialties include kayaks and canoes.

"There is nobody who can touch us for the knowledge we have about paddle sports," he said, adding that Dick's Sporting Goods has sent customers to his store when their questions about kayaks and canoes become more technical.

Big boxes, bookstores

In Winchester, Kearns takes a macro view.

"It continues to be increasingly difficult to be a small, independent retailer no matter what you sell because of the commodification of retail," he said.

Wal-Mart, Barnes & Noble Booksellers, Home Depot and all the other retail giants pressure vendors, buy for less and frequently sell for less. Independent bookstores, neighborhood hardware stores, small retailers of all sorts go belly up.

That process has been under way for decades, he said, accompanied by the standard laments uttered by people on their way to Wal-Mart.

"Until the public at large understands how local economies work, the trend will continue," he said.

CMT Specialty Sports closed in 2004. Roughly a year ago, Blue Ridge Outdoors, founded in 1977, closed its Roanoke and Blacksburg stores.

At the time, owner Bill Wilson said it was tough to compete with larger retailers and Internet sales.

"The consumer has been more interested in price and a lot less interested in service and quality," he said.

Wilson also described customers trying on boots and then going home to buy them on the Internet. Cansler said Internet competition also hurts Back Country Ski & Sports.

Futrell, Kearns, Cansler and Miller said many big-box patrons don't think locally.

"When it comes down to it, I live here," Kearns said. "I employ people here. I pay taxes here."

Both Gander Mountain and Dick's Sporting Goods, headquartered in Pittsburgh, are publicly-traded companies. Sportsman's Warehouse is based in Utah.

Kearns said it has been hard to track how Gander Mountain has affected his sales.

"I do know that I lost a good percentage of my Boy Scout business," a reality he said has been tough to swallow after years of working with Scouting programs in the community.

Futrell said he and his family never expected to get rich with its two small stores -- one of which is in Lynchburg.

"I was raised in the area and my dream was always to do something like this," he said.

Cansler said he believes increasing competition from the Internet and big-box outdoors stores will sink one of the region's surviving independents.

"Somebody is going to have to fall out because there is not enough support for us all," he said. "People aren't going to realize what they've lost until it's gone."

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