The Great Outdoors is Good for Business
05 Sep, 2013
By Mark Kleszczewski
Beautiful settings inspire owners of outdoor product companies.
From ski resort vacations to family camping getaways, outdoor recreation covers a wide variety of pursuits and has always played a major role in boosting the quality of life for people across the country.
It’s difficult, if not impossible, to put a price on the benefit of our outdoor activities and traditions as individuals, but as an industry, outdoor recreation is a major economic force — one of the few to actually thrive during the recent recession when many others contracted. According to the Outdoor Industry Association (OIA), the outdoor recreation economy grew approximately 4 percent annually between 2005 and 2011.
It’s one of the few sectors where the majority of resources and value can’t be offshored, yet brings in dollars from residents, out-of-state visitors and international guests. The outdoor industry is also one where companies can literally design, test and sell products and services in their own backyards — which in some cases are even bolstering the nascent “reshoring” of production and jobs back to the United States.
The outdoors is obviously available everywhere, but the most successful places and organizations involved in the outdoor recreation economy are leveraging both their natural and business advantages using a targeted, long-term approach.
Advancements in technical apparel, footwear and equipment for outdoor activities are driving innovation and entrepreneurial activity in the sector, while creating a demand for highly skilled workers in areas like technology, product design, manufacturing, sustainability and global trade.
Outdoor Recreation Takes Off
Data compiled by the OIA last year illustrates the impressive impact of outdoor recreation on the economy. The group calculates that Americans spend $646 billion each year on outdoor recreation, directly supporting 6.1 million jobs nationally and generating nearly $80 billion in tax revenue.
The bulk of direct spending on goods and services in the sector goes toward the purchase of gear and vehicles, and dollars spent on trips and travel, yet also significantly impacts a variety of associated industries like manufacturing, leisure and hospitality, transportation and wholesale and retail trade.
“Outdoor recreation is a growing American industry that produces significant economic benefits,” confirmed Will Manzer, chairman, OIA board of directors and former CEO of Eastern Mountain Sports, in a public statement. “For example, Americans spend almost twice as much on outdoor recreation as they spend on pharmaceuticals each year. And outdoor recreation supports more than twice as many jobs as the oil and gas industry.”
Innovation and Investments Drive Growth
Advancements in technical apparel, footwear and equipment for outdoor activities are driving innovation and entrepreneurial activity in the sector, while creating a demand for highly skilled workers in areas like technology, product design, manufacturing, sustainability and global trade.
One of the leading places to tap into this growth is Utah, where the outdoor industry contributes $12 billion to the state’s economy — including $4 billion in annual retail sales — and employs an estimated 122,000 Utah residents.
“The outdoor industry is doing very well here, thanks to a lot of factors,” says Riley Cutler, director of the outdoor products and recreation cluster, Utah Governor’s Office of Economic Development. “Besides the great business climate and multi-lingual workforce, we’ve got a great recreational environment and have been home to Outdoor Retailer, the largest outdoor products trade show in the nation, for the past 20 years.”
“We’ve got many big names like Rossignol, Specialized Bicycle, Black Diamond and Petzl with operations in the state, but smaller companies and startups are either moving to or expanding in Utah as well, because of the entrepreneurial spirit here,” Cutler adds.
A key part of the state’s advantage is having extensive recreational venues and public lands that make for great testing facilities. For example, a ski company, Cutler explains, can build up some test skis on a Wednesday, go right outside its back door and test them on Thursday, then refine the best ones by Friday.
Further supporting its targeting of the industry cluster, the state recently created a dedicated Office of Outdoor Recreation to promote the economic benefits of outdoor recreation and tourism, and the benefits of making it easier for outdoor industry businesses to make Utah home.
Over in South Carolina, multinationals and smaller firms in the sector alike are benefitting from a robust business and manufacturing climate.
“South Carolina’s sunny beaches and tree-covered mountain vistas attract millions of tourists each year,” says Bobby Hitt, secretary, South Carolina Department of Commerce, through a department spokesperson. “But these resources are also attractive to manufacturers and business people wanting to locate in a recreation-friendly state. The Palmetto State is home to a number of recreational boat makers, as well as recreational vehicles. In addition, we have a number of equipment makers that serve our forestry sector. All of these companies have found South Carolina to be just right for business.”
Last fall, Honda of South Carolina Mfg. Inc. (HSC) marked its 2.5 millionth all-terrain vehicle (ATV) production milestone in the state. Based on the potential for future expansion at HSC and its American side-by-side (multiutility vehicle) dealer network this year, Honda decided to transfer its production from Mexico to the United States and started manufacturing the 2014 Pioneer in Florence County this summer. HSC is investing $27 million in its Timmonsville plant over the next four years, leading to more than 65 new jobs. In addition to being manufactured in South Carolina, the new vehicle was designed and engineered by Honda’s R&D operations in the United States.
Smaller, home-grown companies are also expanding in the state, especially in boat and watercraft manufacturing.
In Dorchester County, Sportsman Boats Manufacturing, a maker of saltwater fishing boats, plans to invest $2.35 million to expand its current operations with a move into a larger facility, expecting to generate 50 new jobs within the next five years.
In Greenville, Confluence Watersports completed its consolidation of several operations in a 300,000-square-foot facility, where more than 400 employees produce kayaks, canoes and paddle sports accessories.
In addition to customized financial incentive programs, the state offers low corporate tax rates, competitively-priced land and wages, and proximity to nearly two-thirds of the U.S. population. Companies in the sector can also take advantage of programs such as readySC and Apprenticeship Carolina for workforce development, as well as BuySC, a material and service locator program for South Carolina vendors and buyers.
Over in North Carolina’s High Country, an outdoor lifestyle culture plus investments in outdoor recreation infrastructure are leading to new opportunities that go beyond the tourism development generally seen throughout the Blue Ridge Mountains, notes Joe Furman, director, Watauga County Office of Economic Development.
In addition to unique resources like Rocky Knob Mountain Bike Park and the international biosphere reserve at Grandfather Mountain, the area features activities from watersports and skiing to zip lines, rock climbing and more, Furman notes. “We’re also constructing new greenways, river parks and trails to make Watauga County the top outdoor recreation destination in the eastern United States,” he says. “The presence of Appalachian State University, good weather and a certified entrepreneurial community also appeal to a lot of folks who want to work to live, rather than live to work.”
One of the local companies he points to as benefiting from these resources and lifestyle opportunities is Misty Mountain Threadworks, located in the mountain town of Banner Elk.
“The Appalachian range is a great place for designing and testing our products,” says Goose Kearse, president, Misty Mountain Threadworks Inc. “Grandfather Mountain and other several climbing and wilderness areas make this a great spot for us. In the last few years, we’ve grown our recreational climbing business and now we’re riding a new wave of developing harness systems for tactical, pararescue and military customers. One of the best characteristics of this location is that we have access to a big concentration of military personnel at Fort Bragg, Camp Lejeune and even Virginia Beach.”
“We would like to recruit more companies like Misty Mountain Threadworks,” Furman adds. “If all goes well, by this fall we will own land for a new, light-industrial business park in which to put them.”
“The area here is great for testing our products and doing business, but it’s also a big inspiration, since it gets me excited to go climbing. The other company owner and I are climbers and that’s a big part of what we’re about. When I think about living in this beautiful setting and being able to produce really good products that can be enjoyed by others, I think of myself as living in heaven.” – Goose Kearse, president, Misty Mountain Threadworks Inc.
Opportunities Ahead
When assessing a location’s overall business climate and quality of life, public leaders and site selection decision makers don’t have to make an either/or choice between outdoor amenities and economic progress. Rebounding consumer spending bodes well for the continued growth of the outdoor industry and presents communities across all types of physical environments an opportunity to be part of a major economic success story.
“Outdoor recreation is good for the American economy and our future,” said Frank Hugelmeyer, president and CEO, OIA, in a recent public statement. “When we invest in the nation’s network of public lands and waters, we are protecting and enhancing outdoor experiences for the benefit of the thousands of businesses, communities and families whose livelihoods depends on the outdoor recreation economy.”
“The area here is great for testing our products and doing business, but it’s also a big inspiration, since it gets me excited to go climbing,” Kearse says. “The other company owner and I are climbers and that’s a big part of what we’re about. When I think about living in this beautiful setting and being able to produce really good products that can be enjoyed by others, I think of myself as living in heaven.”
For complete details on the organizations featured in this article, visit:
Misty Mountain Threadworks, Inc.
South Carolina Department of Commerce
Utah Governor’s Office of Economic Development
Watauga County (N.C.) Office of Economic Development
Illustration by pat138241 at Free Digital Photo.net
