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Thoughts on the Financials of the Ski Industry

KingM

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Billski made some excellent points in the 2007/2008 season thread and I realized as I was responding that I was writing enough to hijack the thread, so I thought I'd start a new thread.

The "snow in the backyard" syndrome is legend. We can't organize a trip to save our souls when no snow is showing. When I come back and tell people "it's a winter wonderland up there", they seem genuinely surprised.

That is very true. When it's snowing on the Boston/NYC corridor, the phone rings off the hook up here, regardless of what's happening outside. If it's dumping here, but raining on the coast, it is much quieter.

I'm no pro, but I'd say that we've had an up and down season. While the snow and snowpack is good/better than average, having some huge downpours right after new years and again last week, really dampen the suburban spirits.

For the industry as a whole, I am a bit worried. When you have unpredictable weather like this, do you really want to slap down a big nonrefundable deposit months in advance, when the weather is a crapshoot? Then again, Stowe-area lodging was almost entirely booked last week, but perhaps that's because there is so much else you can do in the valley even if it rains.

It's been a better than average season in the MRV, at least. The weather has been pretty good right around the holidays, which is critical, as those are the big money makers for everyone in the business. We had a couple of rough patches, but compared with last year, which started terribly and ended fantastic, it's been more consistent.

The same goes for SB (and I would guess MRG, in spite of a few challenges). Ticket numbers at SB were fantastic for President's Weekend, and I was at MRG that Sunday and it was packed.

It's too early to say for sure, though, as March is a surprisingly important part of the business. If the snow is good, we'll fill up every weekend, plus there are some races that bring in ski teams, and fresh snow can bring a fair amount of midweek business as well. It's often the second best month of the season for us, after February. December only makes money in the last couple of weeks, and in January people are tapped out, plus the typical January thaw.

Late season skiing is a losing business because all the burbs get distracted with the school sports activities ramping up for the spring. Early season is not much better. So you get Jan, Feb and some of March to get your dough.

Very true. April, money wise at the inn, is in the same category as May and November. Once it starts warming up in the south people think about getting their boat in the water, not skiing. Doesn't matter if we get twenty inches on April 6, it's not going to fill us up. I can't figure out, however, why more people don't come skiing in early December on a year like this, when the snow is excellent. I know we're skiing outliers, but here on AZ we're so anxious to start the season that there's no way we'd pass up the opportunity.

Tough business, even with snowmaking....

One other thing that people don't think about is that a good chunk of your lift ticket/lodging pays for all of those facilities to idle during the off-season. As an inn, we've got to make enough money in winter to pay our mortgage, electricity, property taxes, etc., in months when nobody is staying. Things start picking up in June, but it's not until the middle of July most years when there's enough business in the north country to support these businesses. Then you've got August, September, and the first half of October that pay for themselves and two more slow months.

The ski resorts face even more of this pressure. Their costs drop way down in the off-season, but their revenue falls further. You've got to make enough in the winter to last all the way until the following Christmas before you make money again.
 

billski

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Thanksgiving to Christmas in the burbs is packed with holiday parties, pageants, office parties, family travel, school functions, church functions, that the weekends are shot. The only time I was able to sneak away was midweek. "home for the holidays" is a value that most aspire to.

Then there's shopping, shopping, shopping, shopping, shopping, shopping, and shopping. Weekends, weekdays, lunch hours, 5am openings, midnight closings.... Not me, but checkout the mall parking lots down here.

I wish we could all tone down the gift giving and settle in with a fire and some eggnog....
 

Warp Daddy

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I can appreciate the complexities that you guys in the hospitality industry face.

The revenue stream cycle is often compressed while the overheads continue albeit to a less degree when in a slow cyle phase. ALLof which makes for margins that often are just that, marginal, unless an enterprise is very well managed. Those who understand it can be profitable.


As a consumer i often preach to those that will listen that time and $$ spent on an enjoyable and relaxing activity/vacation with those you care about away from teh stress and hustle and bustle IS THE BEST $$ and TIME SPENT .

I used to ENCOURAGE my colleagues to TAKE VACATIONS and relax citing that they and their students would be much better off for having done so :D
 

Greg

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Another thing to consider is the effect of the feeder hills on the Industry and the success of resorts up North. Take advantage of them and support the local hills and the future of the Industry. Go night skiing, buy a burger, teach your kids to ski, etc.
 

Grassi21

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Another thing to consider is the effect of the feeder hills on the Industry and the success of resorts up North. Take advantage of them and support the local hills and the future of the Industry. Go night skiing, buy a burger, teach your kids to ski, etc.

You really must like those Sundown burgers. You keep pushing them.
 

hardline

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Some things I have noticed is that most of the people I know fall into the following categories and the easiest metric I can think of to use is income. Given sometime I could come up with a better one but im being kind of mentally lazy right now. So here there are.
80,000+:
These people are primarily focused on their careers and getting there lives into order. They are pretty busy with their jobs. They will normally take 1 big trip a year, which is for the most part to CO. These people are also looking for some sort social scene. They for the most part think Vermont I just one big sheet of ice. So there frame of mind is why waste money on staying on the east coast when they can fly in about the same time it take them to drive to VT.
50,000+:
Single:
These are the people that I see taking the most trips. They have just enough disposable income to take weekend trips. Soon these people are going to be priced out of going to the big resorts. Lift tickets are going to break $100 next year and that number is going to drive some of these people to the midsize areas.
Married with children:
These people are just being priced out of using the big resorts. It’s really expensive for a small family to go to resort for a weekend. I see these people using the catskillz more and more namely the BELL.
50,000
These people have very little disposable income and maybe go once or twice a year to local areas. It very expensive to live in the city.

These are just some general observations about the people around me in the city. This in now way applies to everyone. I firmly believe if you really want to go you will find a way.
 

SKIQUATTRO

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Took the family this past weekend to Bromley (me, wife and 2 kids 5 & 2.5)

Between the gas/tolls/hotel/lifts/daycare/ski school/lunch Sat/dinner Sat night...(we went into town and bought stuff for lunch on Sunday and snacks/drinks) it was close to a grand...we stayed at the Toll Road, great spot, everything you need for a weekend trip, dinner was at Christos in Manchester (upscale pizza place)....its crazy...
 
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