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FORCE OF NATURE

Cabela’s boldly expands chain of giant hunting stores

BY GREGORY J. GILLIGAN

Cabela’s is a ‘Disneyland for hunters and fishermen,’ says one exec.

Cabela’s says its outdoor sporting goods superstores are too big for shopping centers, and anyone arriving at its store about 45 minutes south of Detroit can see why these might, shall we say, dominate.

Customers are first greeted outside by a nearly nine-ton bronze sculpture depicting two 20-foot-tall fighting grizzly bears. Once inside, the focal point becomes a 40-foot-high, two-story mountain with a waterfall flowing into a fully stocked trout pond. There also are 65,000-gallon tanks stocked with a variety of freshwater fish. Museum-quality whitetail deer and other game are on display throughout the store. There’s even a laser shooting gallery where kids and adults alike can test their shooting skills.

In fact, this 225,000-square-foot outdoorsman’s paradise is as much a wildlife museum and entertainment complex as it is an ultimate place for outdoor gear.

“We are the Disneyland for hunters and fishermen,” said Tim Holland, Cabela’s director of retail.

This store and seven others offer huge assortments for hunting, fishing and camping, everything from guns, tents and outerwear to fishing rods and bait spinners. The stores draw on Cabela’s nearly 42 years’ experience and the massive customer following for outdoor sporting goods it has gained mostly through the 90 million-plus catalogs it mails each year. Company Chairman Dick Cabela founded the chain in 1961.

But Cabela’s, based in Sidney, Neb., has in recent years branched more into operating retail stores. Plans call for somewhere between 15 and 65 Cabela’s megastores to open over the next five to 10 years, Holland said. These will probably not be in malls or shopping centers, but on sites of 75 to 100 acres in mostly rural areas and near two major interstates or divided highways. “If we can acquire the property, we can do it,” he said.

The existing Cabela’s stores are located in rural parts of Kansas, Michigan, Minnesota, Nebraska, South Dakota and Wisconsin. This fall, the company is scheduled to open its ninth store in Hamburg, Pa., about 40 miles from Harrisburg. None are part of any retail development. Despite their bucolic locations, the units are big attractions, Holland said, and become destination stores.

The Cabela’s in Dundee, Mich., which opened in 2000, draws about 6 million visitors a year, making it the largest tourist attraction in the state. The 150,000-square-foot store in Owatonna, Minn., is Minnesota’s second-largest tourist attraction, trailing only the giant Mall of America.

“They are a natural history museum and a big-game museum combined into a store,” said Michael Faw, former editor of North American Hunter magazine and now a freelance writer for similar publications. “What they offer makes them a great destination.”

Depending on the store, the average customer spends between three and four hours per visit, the company says.

“You come to these stores that are attractions and you spend more time in them,” Holland said. “You don’t come in and buy just one item. You come in and buy many items and spend a whole day experiencing the store.”

Hotels and restaurants have even sprouted up nearby to take advantage of Cabela’s shoppers who come for the day and often spend the night. At the Dundee location, for instance, Bob Evans Farms and Applebee’s opened restaurants, and Carlton opened a lodge. At Owatonna, meanwhile, there are now a Wendy’s and a Timber Lodge Steak House, as well as Holiday and Comfort inns and a Truck Plaza. All of this has been done on land that Cabela’s once owned. In fact, the company often buys more land than it needs for its stores and sells off parcels to other developers, restaurants and hotels.

“It is mind-boggling that a store can draw that many people,” said John Patterson, president of the Monroe County (Michigan) Convention and Tourism Bureau.

But Patterson isn’t complaining. Cabela’s, he said, has “done wonders to add to our tourist and retail base.”

Most of Cabela’s stores measure more than 150,000 square feet. The store to open in eastern Pennsylvania will, like the Michigan store, span 225,000 square feet, making these two the chain’s largest.

In size terms, Cabela’s stores are on a par with a typical Wal-Mart Supercenter. But despite being about the size of four football fields, they are not designed to feel or look like huge discount warehouse stores.

“Our stores feel like hunting lodges,” said Holland.

The ceilings are made of wood, usually taken from trees recovered from fire-swept forests. Skylights let in natural light, and every pillar is made from real stone. Nothing is fake here.

Unsurprisingly, the stores are not cheap to build. “It is a huge investment for us,” Holland said. The privately owned company won’t say how much they cost, however, or disclose financial results.

Cabela’s has designed its stores to operate like malls, offering various specialty departments, each of which are the size and generate the volume of a typical mall-based retailer.

This store-within-a-store concept has worked well for Cabela’s, said Holland. The gun “library,” for instance, offers a massive collection, including some firearms that cost as much as $24,000. The art gallery sells items by prominent wildlife artists. There are also a restaurant and a fly-fishing shop.

“We have product that many have never seen before or you can’t get at any other retailer,” Holland said.

The large assortment and the solid reputation from its catalog and Web site have helped Cabela’s retail ventures, Faw said. Cabela’s push into retail stores began in 1998.

Beyond the strong customer base, Faw notes, Cabela’s knows where those customers live and how much they spend. Such information gives mail-order companies a big advantage when opening stores, he adds.

Though the number of hunters and anglers has stayed relatively flat over the past few years and dropped over the long term, Faw says, that shouldn’t dampen the Cabela’s retail expansion. The average hunter, for instance, is someone in his late 40s or early 50s who tends to have more disposable income.

Besides, there are fewer stores — and no national chains — devoted solely to fishing and hunting.

“It is harder and harder to find hunting equipment on the retail level,” Faw said. “A lot of mom-and-pop stores have gone out of business.”

One retailer Cabela’s must contend with is Wal-Mart, which operates hunting and fishing departments inside most of its stores. But the selection is small compared with Cabela’s offerings.

Cabela’s also faces competition from Bass Pro Shops, which, in many ways, operates stores that bear a striking resemblance to its own. Both offer similar merchandise and draw big crowds to their entertaining stores.

“They have gone to great lengths to duplicate what we have done — to create ‘shoppertainment’-type stores,” said Larry Whiteley, manager of corporate public relations at Springfield, Mo.-based Bass Pro Shops. “Imitation is the best form of flattery,” he said.

The first Bass Pro Shop opened in 1981. The chain operates more stores than Cabela’s — 16, with as many as nine additional stores to open this year. Many Bass Pro Shops units are in more-urban areas, some alongside Mills Corp. value megamalls.

Cabela’s, by contrast, is a latecomer to store retail. In the late 1960s the company had a very small store next to its headquarters. In 1986 Cabela’s opened a 16,058-square-foot store in Kearney, Neb., the town where it also operated a telemarketing center. And in 1991 it opened an 87,630-square-foot store in Sidney.

But in 1998 Cabela’s really took the plunge by opening the Owatonna store. The chain has opened about one store per year since then.

Cabela’s decided to move into retailing because only a small portion of the population shops through catalogs or the Internet.

“People want bricks and mortar, so this is a way to be able to open a store and tell the Cabela’s story,” Holland said. “Otherwise they wouldn’t be aware of us or experience us.”

But is there room for both Cabela’s and Bass Pro Shops?

“What we have found when others open stores is that it doesn’t take away from our business,” said Bass Pro Shop’s Whiteley. “It makes more people aware of our locations and of the industry.”

The Bass Pro store in suburban Detroit, for instance, saw sales increase after Cabela’s opened its store near the Michigan-Ohio border, he said.

Some retail observers, however, question whether Cabela’s or Bass Pro Shops can be profitable. Not only are the stores expensive to build, but they require enormous capital to stock. And they devote a significant amount of space to entertainment, which raises costs and reduces selling area.

Not a problem, said Cabela’s Holland. “If they weren’t profitable, we wouldn’t keep building them.”

Cabela’s, he asserts, is on a solid expansion program, targeting parts of the country where its catalog and Internet sales do well. But he wouldn’t specify where those areas are.

The company also tries to acquire land relatively close to a major city as well as along major interstates. The store to open in Pennsylvania, for example, is on 100 acres near the intersection of Interstate 78 and state Route 61, about 60 miles from Philadelphia.

“We are a destination point,” Holland said. “We are the reason people are coming.”

Because of its draw, real estate agents, developers and local officials trying to persuade the company to locate in their area sometimes overwhelm Cabela’s.

“But almost every location we have was [obtained by] knocking on the door of the farmer and getting the land that way,” Holland said.

Still, shopping center developers should not give up hope. The company says only that it “probably” won’t go into existing or planned retail developments.

Gregory J. Gilligan covers the retail industry for the Richmond Times-Dispatch.

 

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