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WisBusiness: Climbing gyms, indoor rec facilities retaining foothold despite plunging economy
8/19/2010

With so many businesses closing or hanging on by a thread during the recession, Adventure Rock, an indoor rock climbing gym in suburban Milwaukee that opened in 1991, just had its best year ever. It and other indoor sports facilities in Wisconsin are doing things like hiring and planning new construction -- activities that for other luxury businesses are well out of reach these days.

“We added a lot of staff,” said Adventure Rock manager Eric Olson. “Some areas of our business are down, but overall revenue is up double digits. Kids’ birthday parties are down, but membership is way up. We had by far our best year ever as of the end of October. “

The facility scaled back its retail shop but is expanding its climbing areas, and is trying to purchase adjacent land for a building addition and more parking.

In Madison, Boulders Climbing Gym has been crowded on recent evenings, to the surprise of general manager Phil Kerckhoff, who says that summers are normally the industry’s slow time, and his building isn’t even air-conditioned.

“We’re doing well,” said Kerckhoff, adding that the gym, which opened in 1996, has seen the number of students swell from around 40, just four years ago, when he started as an instructor, to more than 250 now.

And on a Milwaukee site where a big box home improvement store closed its doors, developers of an indoor mountain bike park fully expect to draw customers from several states.

Set to open in November, it will be the second location for Ray’s Mountain Bike Park, which has operated a similar facility in Cleveland, Ohio, since 2004.

“We’ve seen record numbers every year,” said Eric Schutt, who will be general manager of the Milwaukee location. And that’s for a business that’s only open half a year, from November to April.

Indoor action sports seem to be a niche that is surviving the great recession.

Schutt says Ray’s customers are serious mountain bikers – mostly adult and male – who will drive for miles and spend what it takes to be able to practice their favorite sport during winter.

“We attract people within a 5-hour driving distance,” he said. Many stay the weekend, benefiting nearby hotels and restaurants.

Rock climbing facilities also credit staying afloat to hard-core enthusiasts, but say they’re also seeing more and more newcomers and families seeking reasonably priced activities.

“There are probably two sets of people who do this: serious climbers and people who just check it out,” said Kerckhoff. “For serious climbers, it’s what they do. It’s not that expensive a sport once you get the gear. For the other part of our clientele, you know, as an entertainment activity, it’s a pretty reasonably priced thing.”

Olson speculates that the economic downturn has driven families to forgo expensive trips, and instead seek local activities. When the economy plummeted, “that’s when we really started seeing things improve,” he said. “For $18, you can stay all day long.”

Unlike the mountain bike crowd, which Schutt describes as mostly ages 25 to 45, Olson says indoor climbers span generations.

“Our demographics are all over the place. We have college kids, high school teams, lots of men and women in their 60s,” he said.

Long winters have a lot to do with the resilience of indoor sports facilities, say Wisconsin proprietors. But Bill Zimmermann, executive director of the Climbing Wall Association, based in Boulder, Colo., says that despite the recession, the industry is surviving nationwide.

“It’s not consistent from state to state,” said Zimmermann. “I just talked to someone in Massachusetts and it was his best year – in a down economy.” For other gyms, though, there’s been a big drop in revenue from school outings, Boy Scouts and other groups who use the facilities, he said.

Problems getting bank loans and securing investors has created “a queue of people waiting to start new climbing gyms,” said Zimmermann. “About a year ago, the construction part of the business was off, mainly because of a lack of funding, but it seems construction projects have started again,” he said. “There was definitely a bump in the road, especially a year ago, but that seems to be correcting.”

Using the association’s annual conference attendance as a gauge of the industry’s health, Zimmermann said, “Registration last year was stable, although our soft-money contributions and fund raising were off considerably.”

"But you have to understand something about climbing,” said Zimmermann. “Climbing is a lifestyle sport. It’s not like the health club membership that you never use. If you’re serious about it, it’s a lifestyle. I kind of liken it to surfers or paragliders: they’re really into it. There’s a significant investment in time and skill and learning for you to be able to participate in the sport at a serious level. There’s some stick-to-itiveness, some glue. “

Still, Wisconsin gym owners say they’ve taken steps to broaden their market while conserving expenses. They don’t advertise much, preferring to set up portable climbing walls at fairs or community events to introduce the sport. Internet groups and social media help spread the word, too.

Adventure Rock invested in 17 automatic belay devices that allow new participants to climb without having to first take a two-hour class.

“You can walk in and clip into the harness. You don’t need a partner. It’s extremely user-friendly,” said Olson.

Boulders Climbing Gym has added general fitness training classes and expanded its corporate team-building programs. In lieu of spending money on advertising, Boulders has been increasing its visibility in the community, through participation in local festivals, speaking to local groups about fitness and safety, and donating climbing activity tickets to fund-raisers.

Once people discover indoor sports, many become repeat customers, building a camaraderie among other regulars. Job losses have certainly forced out some participants, said Zimmermann, “but as long as people remain employed, they seem to continue to come.”

-- By Kay Nolan
For WisBusiness.com

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