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TROPHY MARKET

Outdoors gear giant Cabela’s building two megastores in Lone Star State

BY JESSICA ROE

One Cabela’s is not enough to serve the hordes of hunters, fishermen and outdoors enthusiasts in Texas. So the Sidney, Neb.-based retailer is planning to build two new megastores in the state, both of which will open sometime next year.

As the world’s largest direct marketer of outdoor gear, 43-year-old Cabela’s is able to leverage the data it collects to help it choose store sites, figure out where its best customers live and track regional merchandise preferences. “This provides Cabela’s with a tremendous advantage over its peers and is the main reason for its strong new-store openings and rapid sales maturity,” said Ralph Jean, a Charlotte, N.C.-based retail analyst at Wachovia Securities. He speculates that Cabela’s 247,000-square-foot Hamburg, Pa., store, which opened in August, will see as many as 7 million visitors per year and generate average sales per square foot of about $445.

The $1.4 billion-revenue company, which went public on June 25, has the financial resources to put into new stores; the IPO raised $230 million for that purpose. Cabela’s currently operates 10 stores in such sportsmen’s paradises as Wisconsin and Minnesota. And the company is chugging along with plans to open between 15 and 65 new stores by 2014, though it has yet to announce any locations. Analysts predict that the retailer could also open 60 smaller-format stores (about 75,000 to 100,000 square feet, versus 150,000-plus square feet for the larger formats) before the concept reaches saturation.

Last year Cabela’s stores drew a combined 25 million shoppers. Now it’s the Lone Star State’s turn to experience the phenomenon. Cabela’s, which develops its own stores, is building outposts in Fort Worth and in the Austin suburb of Buda. (For more on Austin’s retail activity, see story.) In the Cabela’s tradition, each store will anchor a mixed-use development that will include such complementary businesses as motels, restaurants and other travel-related service providers.

Cabela’s says the Texas stores will each draw 4 million to 6 million visitors annually, without cannibalizing one another. The stores will be outfitted with all the amenities that, according to the chain, make Cabela’s a spectacle that customers travel as far as 250 miles to see. The centerpiece of each store will be a 40-foot-high mountain replica, a trout pond and trophy animals displayed in re-creations of their distinct habitats.

Fly casters can shop the full-service fly-fishing “store in a store.” Gun aficionados can browse through a world-class gun library displaying examples of the gun-making art. Adults and children alike can test themselves or learn basic skills in the shooting gallery or the indoor archery range. Discontinued or returned merchandise sells at discounted prices at the so-called Bargain Cave.

The Fort Worth store will have a 65,000-gallon, walk-through, freshwater aquarium stocked with native Texas fish. The Buda store will feature a 60,000-gallon tank. Each store is to have a second-floor art gallery, a fieldstone fireplace and a deli-style restaurant serving wild-game sandwiches alongside more-standard fare.

The selection of Buda (population 2,404, according to the 2000 U.S. census) mirrors the rural locales of Cabela’s existing megastores in such places as Kearney, Neb., and Owatonna, Minn.

“That’s Cabela’s m.o.,” said Warren Ketteman, director of economic development for the Buda Economic Development Corp. “They don’t like to move into major cities or major shopping centers.”

Buda may be small, but it is not out of the way. The 126-acre site is on Interstate 35, a major north-south artery. Popularly known as the NAFTA Highway, I-35 puts Cabela’s within 20 minutes of Austin, one hour from San Antonio and less than four hours from Houston. Ending at the town of Laredo on the Mexican border, 218 miles from Austin, the highway also provides shoppers to the south with access.

However, the move into Fort Worth is a departure. With a population of 5.2 million, the Dallas/Fort Worth Metroplex is by far the densest and most urban market Cabela’s has yet entered. But the retailer is confident that Fort Worth’s concentration of outdoors enthusiasts can support the megastore.

The site is north of Fort Worth on Interstate 35W and state Highway 170. The location places Cabela’s less than 20 miles west of Grapevine, which is quickly becoming known as a retail and tourist destination.

Moving into any part of the Metroplex puts Cabela’s into direct competition with its leading rival. Bass Pro Shops has a 200,000-square-foot store in Grapevine. An established retail presence, the Bass Pro store also benefits from being near the Grapevine Mills mall. Gander Mountain is another competing concept that operates stores in the Texas markets of Amarillo; Corsicana, a Dallas suburb; and Houston.

Sporty shoppers aren’t Cabela’s only fans. Local government is welcoming the retailer with open arms — and subsidies. The retailer negotiated about $40 million in incentives for each store from the state and from the county and local governments in Buda and Fort Worth.

While the public investment is substantial, so are the anticipated payoffs. According to a study conducted on behalf of the cities of Fort Worth and Buda by Dallas-based Inflight Research Corp., “The economic impact of construction and operation of these new facilities over 25 years is expected to generate $4.86 billion, experienced as the ripple effect of new money in the economy.”