SIA News 4.1
8/13/2009
CREDIT AND CASH FLOW PROBLEMS RESULT IN PALTRY PRE-SEASON ORDERS
Results of the 2009/10 Orders survey indicate significant declines in pre-season orders for snowboard and alpine ski equipment. Alpine ski equipment orders are down more than 20% and snowboard equipment orders declined more than 30% in dollars compared to last season’s orders. Retailers discounted prices and sold less last season resulting in thinner margins and less cash flow to pay for 2009/10 season's orders. Additionally, retailers face a market in which credit is much more difficult to get and interest rates are poised to rise rapidly.
The credit issue was exacerbated last month when the near bankruptcy of CIT, a major creditor to small businesses (including the sports industry), rocked markets worldwide. According to CIT, more than 1,000,000 business customers “depend on CIT to provide the financing they need to run their businesses. And for more than 100 years, CIT has remained committed to the lending needs of the small and middle market – providing needed capital to markets that other larger and smaller financial institutions often don’t.” CIT’s near bankruptcy and the subsequent bailout by bondholders may result in exorbitantly high interest rates and difficulty getting terms other than “net 30” into the foreseeable future. With limited cash and credit, retailers are curtailing their orders for the 2009/10 season.
SIA conducted a short survey with members in July about the potential impacts of CIT’s funding crisis. Most respondents worried that a collapsing CIT would hurt retailers who are already struggling from poor cash flow due to last season’s anemic margins and a very tight credit market. The domino effect created by retailers unable to pay for orders is clearly evident in the Orders Survey results and losing the most prolific creditor to small business would only exacerbate the problem with ever tighter credit and increasing interest rates.
One member surveyed summarized the situation:
“The credit market is extremely tight right now and has been for nearly one year. Access to working capital is already constrained and the collapse of the largest factor/asset based lender would make the problem even worse and drive the cost of capital even higher than it's been trending, as there would be too much demand for capital relative to the availability in the current market.”
The results of the SIA Orders survey were released last week to SIA members who participate by providing their data. There is no charge for the study’s results; however, only those who participate in the study have access to them. The results of SIA’s Sales and Orders Studies include data on wholesale sales at the end of the season and pre-season and mid-season orders across the industry. Participants provide data confidentially to an independent CPA firm and receive detailed reports on each category they provided data for once results are aggregated and tabulated. Participants can compare their sales and orders against the industry aggregate to get a clear view of their market position and compare overall performance relative to their competitors.
If you are interested in participating in the SIA Sales and Orders Studies, please contact Kelly Davis, SIA’s Research Director at KDavis@snowsports.org or (703) 506-4224.
RESEARCH
NOAA PREDICTS EL NINO FOR 2009/2010 SEASON
According to the National Oceanographic and Atmospheric Administration (NOAA), the climate is in an “El Niño” condition now and that condition is expected to last through Winter 2009/10. Both 1995/96 and 2005/06 were El Niño winters and participation levels for those seasons were excellent.
Snowfall amounts change during different stages of the winter in several areas of the U.S. depending on whether El Niño or La Niña conditions exist in the equatorial Pacific. The most significant changes in snowfall occur in the Northwest, Northeast, Ohio Valley, Midwest and northern Texas.
The charts above illustrate the differences in total snowfall in El Niño, La Niña and “Neutral” years (years in which the surface temperature of the current in the equatorial Pacific Ocean is average). El Niño is shown on the bottom left chart. The blue shading indicates areas where snowfall is higher than average over the course of the season in El Niño conditions. The Sierras in Northern California and Nevada, the Rocky Mountains in Utah, Colorado, Arizona and New Mexico, and the southern and northern ends of the Appalachian chain that run from Maine to North Carolina, get more snow than average in an El Niño year. While the Cascades, particularly in Washington areas that usually get “lake effect” snowfall and parts of Montana, Wyoming and Idaho, tend to get less than average snowfall.
A weak to moderate El Niño can produce dry periods during the winter in Colorado and Utah and prolific snows in November and in March. There may be periods from December – February with scant snowfall in the Wasatch and Front Range in particular but overall snowfall totals tend to be just slightly over or under average during El Niño winters.
During El Niño events, the jet stream that blows west to east across the U.S. becomes stronger and tends to block very cold air masses from moving south from Canada. In general (predictions are based averages over 58 years), El Niño winters tend to be warmer over Colorado as a whole and wetter for the central and southwestern parts of the state. El Niño often means a wet spring for Denver and the eastern plains. (from the Colorado Weather Almanac by Mike Nelson).
Mammoth, June Mountain, Big Bear, and Lake Tahoe resorts can expect an excellent season in El Niño conditions with up to 25 inches above normal snowfall.
One of the best sites we have found for information about the effects of El Niño on various ski areas, is Tony Crocker’s website http://www.bestsnow.net. Tony is well known in both statistics snow sports circles for keeping meticulous track of snow conditions at more than 100 resorts worldwide. He is an avid skier and a statistician with a penchant for understanding weather patterns.
TRADE SHOW NEWS
ON-SNOW DEMO AND FREE RIDE FEST LODGING
Room blocks for the 2010 On-Snow Demo and Free Ride Fest at Winter Park, February 1 and 2, will soon be opening. Rates range from $64 to $344 a night. Click here to get all the information that you need on the 2010 Snow Show and Denver!
INDUSTRY SERVICES
CONSUMER PRODUCT SAFETY IMPROVEMENT ACT UPDATE
On July 21, 2009, the federal Consumer Product Safety Commission (CPSC) issued guidance regarding a key provision of the landmark federal Consumer Product Safety Improvement Act of 2009 (CPSIA) –Section 103, the requirement that children's products have permanent tracking labels if the products were manufactured on or after August 14, 2009.
Some SIA members have asked whether they should anticipate problems with shipping products manufactured prior to, but imported shortly after, August 14. Will the CPSC be looking for tracking labels on such products and, as a practical matter, will importers need to prove such products were manufactured before August 14 and thus do not require tracking labels? The short answer is -- likely not. The CPSC has said that it recognizes that an education period will exist for adopting effective tracking label systems and that products manufactured before August 14, 2009 will take time to reach U.S. Customs. Consequently, the CPSC is unlikely to be in an aggressive enforcement posture regarding tracking labels until some time has passed beyond August 14, 2009.
However, you should consider avoiding problems with a quick fix, if possible. To avoid confusion, importers might consider, if practicable, including with import documents some statement indicating that the products were manufactured prior to August 14, 2009. In the days and weeks after August 14, 2009, this simple step could avoid potential issues at Customs related to the CPSIA tracking label requirement.
For more information regarding the CPSC's recent guidance on the CPSIA's tracking label requirements, you may read a recent article by SIA's counsel, DLA Piper LLP (US), at http://www.dlapiper.com/manufacturers-and-importers-note:cpsc-issues-key-guidance-on-impending-tracking-label-requirements/.
2009.10 SNOW SPORTS INDUSTRY PLANNER IN THE MAIL AND ONLINE NOW!
The 2009.10 Industry Planner is online at snowsports.org. Listing some of the most important dates in the industry trade season, you can search by event type or date. An iCal tool has been created to upload events to your Outlook calendar. Continue to check the information, as dates and events are subject to change throughout the year. If you have not already received the hard copy Industry Planner, yours will arrive soon. Please contact Sherry Gilbert at SGilbert@snowsports.org if you need additional copies.
MEMBERSHIP
JOIN SIA AS AN INDUSTRY SALES REP
We are proud to introduce this new SIA Membership category for you, the Industry Sales Rep*. Join SIA and become more of an influential, educator and data expert to your retailers. Click here to join SIA. Your role in the snow sports industry is crucial to the snow sports market, to the growth, the perception and the influence as the conduit between the supplier and the retailer. We have created this SIA Membership to help with your sales operations through discounts with FedEx, industry research and rental cars. Click here to learn more about your membership benefits.
*QUALIFICATION: You must be a member of one of the Winter Sports Rep Associations and Rep for at least one of SIA’s exhibiting members. You will need an LLC or Inc in your business in order to enroll in the SIA FedEx shipping program.
“At SIA, we are committed to the success of the snow sports market and work to create programs and benefits that will help all of us involved to adapt and thrive in this changing environment. We will continue to serve you and find the most meaningful ways by which we can give back to our members and the community that we are passionate about – snow sports.” David Ingemie, SIA President.
As you may know, SIA is a national not-for-profit, North American, member-owned trade association, representing the snow sports industry. We would not be successful without our extensive membership that directly supports our commitment to develop and strengthen the industry through member programs, initiatives, exclusive research, government affairs and an evolving international trade show. Click here to make SnowSports Industries America Your Association… Partner. Resource. Advocate.
Please contact SIA's Membership Department with questions: E: PGrenke@snowsports.org P: 703.506.4222.
CONSUMER MARKETING
INDUSTRY ORGANIZATIONS GEARING UP FOR LEARN A SNOW SPORT MONTH
Five national organizations, including SIA, and 13 state/regional associations in the industry are laying the groundwork for the second year of Learn a Snow Sport Month - January 2010. Organizers met recently in Salt Lake City to put together the framework for the initiative that last year attracted 20,000 children and adults to try a snow sport. A spokesperson for the initiative as well as details on how to benefit will be announced in the next issue of this program. Questions can be directed to Learn@snowsports.org.
EDUCATION
REACH UP TO 75,000 STUDENTS AT THE WINTER GET OUT CONFERENCE
The Winter Get Out Conference set for December 3-5 at the Gunstock Resort will reach up to 75,000 youth. Organized by the American Association for Physical Activity and Recreation (AAPAR) and supported by a number of snow sports organizations, Get Out will feature two full days of workshops for teachers and other recreation professionals who want to get kids active in snow sports. Approximately 150 are expected to attend and those professionals represent the 75,000 kids.
Sponsorship opportunities are available for this conference. This is the perfect opportunity to present your brand to this influential group. For a description, schedule and list of sponsor opportunities go to WinterFeelsGood.com and click on the Get Out button on the home page.
CURRENT PEP GRANT WINNERS ANNOUNCED, SNOW SPORTS CAN BENEFIT FROM NEW ALLOCATION FROM GOVERNMENT UP TO $80 M
Congress is allocating between $75M and $80M for Physical Education Progress grants for next year. The funds can apply to the purchase of snow sports products and training for physical activity programs such as snowshoeing, cross country skiing, snowboarding and alpine skiing. Click here for the list of this year's grant award winners which were just announced. Recipients of the grants are schools, school districts and non-profit community organizations. Companies in the snow sports industry can benefit by encouraging physical activity programs that involved winter outdoor sports.
THE WORD ON THE SLOPES
SNOW SPORTS NEWS
Keep SIA in the know of what’s going on in the industry! It’s hard to believe that summer is almost over and time to begin gearing up for the season. Parties, events, new products, innovations? SIA wants to know all about it! Send your news to PR@snowsports.org....
Sad news to report: On June 2, 2009 the industry lost a friend, mentor and important figure in the industry, Edwin Blate. Below are a few words from his wife, Susanne Blate:
To the industry, all loyal Friends and Acquaintances,
Dear Edwin "Eddie" Blate is now in a place where the snow is always soft and the fishing is endlessly great. His quiet simplicity, warmth and zest for the outdoors was contagious.
Eddie passed away June 2. 2009, after a valiant fight with cancer over a prolonged period. He will be missed by many friends in the ski business along with fishing buddies alike, in addition to his dear loving wife and daughter.
Eddies business since 1965 "Regina Imports" is ongoing with production and timely Fall delivery of product still in process.
Thank you for the past concerns and support in a trying year.
Sincerely,
Susanne and Michelle Blate
Official News: High Sierra Sport Company is honored to support RockyMountainTrail.com by providing 50 Impact day packs for the Continental Divide Trail Alliance Trail Fest 2009. Click here to learn more….August 29, 2009 set for Liberty Mountain Snowflex® Center Grand Opening. Click here to learn more….The beta on Venture Snowboards' 09.10 board lineup is now live on their website: VentureSnowboards.com... After 12 years as Chief Financial Officer of Sage Island Marketing, Ron Staton announced his retirement last year, and in his place at the financial helm, Sage Island is pleased to announce the addition of Amy Winstead, CPA. Click here to read more….Spyder Active Sports Inc. announced a new CEO this week, marking the first out-of-family leader of the company. Spyder, a Boulder-based leader in ski gear and apparel, named Thomas McGann as the company’s new chief executive officer. Click here to read more….Wintersteiger has announced its sponsorship as a supplier to The U.S. Ski and Snowboard Association's Center of Excellence equipment tuning room, and was on hand for the grand opening dedication. Click here to read more.… Check out Ride Snowboards 2009-2010 product they’ve been working so hard on all year. This is a soft launch but the meat of the site is there; Boards, Boots, Bindings, Outerwear, Cappel, RCTV etc. Click here…. Nordica USA continues its tradition of industry leading service with a retooled and fully equipped competition and promotion team. Andy Hare, who was recently promoted to Director of Product and Promotions, will head up the Promotions Department for Nordica USA. Click here to read more…. Néve Designs Inc a Boulder, Colorado based manufacturer of natural fiber sweaters, accessories and knitwear announced today that Tom Irvine an existing partner and CEO of Néve has purchased the remaining assets of the company from founder Rhonda Swenson. Click here to read more…. Colorado Cyclist Copper Triangle organizers are striving to raise at least $100,000 in their fight against Parkinson’s disease this weekend. One of America’s top cyclists Davis Phinney, will join more than 3000 cyclists in their fight against Parkinson's disease during the 4th annual Copper Triangle Saturday, August 1. Click here to learn more…. Mountain Sports International (MSI) announced today the 2010 Subaru Freeskiing World Tour (FWT) schedule includes two new international events in Chile and Canada with the World Tour finals and Championships at Snowbird. Click here to read more…. Kokanee Crankworx is calling all the ladies with the 3rd Annual WomenzWorx competition, presented by Sombrio Girl, August 10 to 11, 2009. An open competition designed by women, for women, WomenzWorx is set to showcase professional and amateur female riders in a fun and social event focused on technical descents, jumps and tricks. Click here to read more…. Black Diamond Equipment Ltd. announced the completion and launch of its new website www.BlackDiamondEquipment.com. Click here to read more…. Solitude Mountain Resort has begun installation on Powderhorn II, a $1.5 million improvement to lift infrastructure. Click here to read more….In some cool environmental news, Protect Our Winters (POW) announced Sunday night that the organization has made a $5,000 contribution to The Center for Snow and Avalanche Studies (CSAS) in Silverton, Colorado. Click here to read more…. Americans are more active than you think, according to data in the NSGA Sports Participation: Series I report. Among Americans age seven and older, 78.7% (212.7 million Americans) participated more than once in the 23 sports and recreational activities included in the Series I report. Click here to read more…. Women will be skiing, snowboarding, skating and shooting in the 2010 Winter Olympic Games in Vancouver, British Columbia, but they will not be ski jumping according to a ruling Friday by the British Columbia Supreme Court. Click here to read more…. After a season in which he won his first World Cup and ended the year as the top American competitor on the circuit, Olympic gold medalist Seth Wescott (Sugarloaf, ME) hasn't slowed down one bit. With trips to Alaska, Costa Rica, and a new house almost ready to be moved into, Wescott is finding himself right where he wants to be on the cusp of an Olympic season. Click here to read interview….FREE employment website for SIA Membership! SkiProphet.Com, LLC. is offering unlimited, FREE job postings on its web site, SkiingJobs.Com™, until December 31st, 2009. According to the Founder, Tim Flanagan, “In this economy, we all need to help each other. The number of highly qualified job seekers is a rarity right now providing the perfect time to find highly motivated individuals who want to work”. Tim is committed to helping the snow sports industry survive into the future. “This is one way I can contribute to the industry that has given me everything,” he said. All the SIA Member needs to do is go to: skiingjobs.com and use the free posting code; SIA09.
Send us your news, press releases and stories to PR@snowsports.org, SnowSports Industries America.
Please feel free to forward this message to anyone who is interested in the growth and further development of the snow sports industry, and continue to do your part. Let it Snow!
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