Hurricane Sandy and the “Fiscal Cliff” Create Rough Start for Retailers

By George Schissler (December 2012) SnowSports Industries America (SIA) and Leisure TrendsGroup have released SIA Retail TRAK numbers for August through October 2012. The data was collected from the Point of Sales systems of more than 1,200 snow sports retailers and the numbers, unlike the temperatures presently throughout ski country, have taken a dip. Although […]

twbsiaBy George Schissler

(December 2012) SnowSports Industries America (SIA) and Leisure TrendsGroup have released SIA Retail TRAK numbers for August through October 2012. The data was collected from the Point of Sales systems of more than 1,200 snow sports retailers and the numbers, unlike the temperatures presently throughout ski country, have taken a dip.

Although the snow sports market reached $616 million in sales so far for this season (Aug. through Oct.), this amount represents a 2% decline overall and the factors cited range all the way from Hurricane Sandy on the northeast to the uncertainty of the “fiscal cliff” and the lack of momentum from the previous season. Apparel sales showed the only increase with a 1% gain reaching $161 million and accessories sales (goggles, gloves, wax, hats, cameras) fell 4%. October 2012 snowboard equipment sales significantly decline by 19% (see previous SIA report predicting a decline in snowboarding) cross country sales slipped 30%, alpine equipment sales were down to the tune of $4 million or 8% for the month of October.

In late October Hurricane Sandy devastated the Eastern seaboard resulting in the shutdown in the South and Northeast retail market, so much so that the storm had a direct impact on the residences of a third of the skiers and riders in the U.S. market. The Northeast specialty retailers suffered a $14 million (26%) decline in October sales and the South sales dipped $6 million or 27%. Equipment dollar sales in these two storm-struck regions were down dramatically with the Northeast region down 30% and the South even lower at 44%.

Another contributing factor affecting the impact on retail sales is politics. The widespread fears of falling off the “fiscal cliff” would have a severe economic impact across the U.S. economy. Uncertainty and the resulting fear will tend to depress the snow sports retail market until the “fiscal cliff” issues are resolved. If congress fails to come to an agreement on a new national budget we can expect to see sharp declines in consumer confidence and consequently an even further decline in snow sports retail sales.

Of course colder temperatures and good snow cover throughout ski country could brighten this bleak picture. There is no better winter scene than a White Christmas to rejuvenate a skiers’ thoughts of playing in the snow. Merry Christmas to all from TWB.