Snow sports' 'Smallest Big Store'
Christy Sports’ product line is just one linchpin in the Lakewood-based company’s steady expansion that now spans more than five decades. During that time the snow-sports retailer has weathered recessions, industry consolidation, the emergence of e-commerce, and competition from big-box stores and multi-sport giants such as REI and Sports Authority.
Amid all that, Christy Sports has flourished, adding 14 stores over the last 12 years and nearly doubling annual revenue under CEO Patrick O’Winter, a former competitive skier.
“The ski industry is difficult to get into unless you have a passion for it — it’s not the path of least resistance,” O’Winter says. “The number of profitable ski retail businesses can be counted on one hand.”
O’Winter was born in Lyon, France and raced in the Alps from age 15 to 25. After earning an MBA and a master’s in science from the University of Paris, he moved to the U.S. in 1980.
In 1994, he met then-Christy Sports owner Keith Van Velkinburgh. At the time, O’Winter was an investor in SportsStalker, a ski rental store founded in 1972 by Ben Hambleton outside of Steamboat Springs. Velkinburgh and O’Winter merged the two companies in 1995, retaining the name Christy Sports.
“I always loved to ski, and the opportunity to invest in the ski industry came up,” O’Winter says. “It’s called a mid-life crisis. It was a completely irrational decision. I would have never thought I would still be here 24 years later.”
When Velkinburgh began hinting at retirement in 2000, O’Winter was already a significant shareholder, so it seemed logical for him to become majority owner. Velkinburgh and COO Keith Leifer remain part owners today.
Christy Sports, which began as a mom-and-pop shop in Lakewood in 1958, had grown to 30 stores by the time O’Winter became CEO in 2002. It now boasts 45 stores in Colorado and Utah and ranks No. 7 on this year’s Top 50 Family-Owned Companies list.
Patrick O’Winter’s eldest son, Thomas, is vice president of merchandising and has worked with the company for more than a decade. O’Winter’s daughter, Amandine, is the soft-goods buyer; O’Winter’s other son, Hugh, is the director of real estate. Outside the office, the O’Winter family is close. Besides skiing regularly, they take at least one annual vacation and celebrate the holidays together.
“I’ve seen family-owned businesses function extremely well and function extremely poorly,” says Patrick O’Winter. “As the CEO, the major challenge is to not appoint your kids to keep their positions because of their blood lineage, but because they are the best for that job.
“Blending and maintaining family members is the hardest part,” he continues. “It’s a more dynamic environment, and there’s an added element of complexity. Decisions can be made very quickly. If one of our employees disagrees with me, he may be more respectful; if it’s one of my kids, he might be more vocal.”
O’Winter attributes the family’s success, both professionally and personally, to his wife, Carole. And her influence hasn’t gone unnoticed to Christy Sports employees.
“As a mother and wife, Carole instilled the importance of family, the importance of education, and moral and behavioral values into the kids,” says Randy England, Christy Sports’ director of marketing. “She is the heart of the family and was key in how effectively they all work together professionally.”
For the love of snow
“We need to have fun,” Patrick O’Winter says, “and if we don’t, we will stop the connectivity within the business. Every single one of us remains true to our roots – the fact that we grew up skiing. Sometimes it’s tempting to forget that truth when your company grows.”
The CEO offers an example of maintaining that commitment to the mountain experience: “Occasionally I park my car in the dirt lot on the top of Loveland Pass and ski down,” he says. “Some days I don’t do that because I have a meeting. But when I forget to do that I’m no longer running a ski business, I’m running a corporation, and we just become another big box.”
Christy Sports gets calls almost weekly from interested suitors. The company is also known for its strong and enduring partnerships with its manufacturers.
“We have a very understanding partnership with Christy Sports,” says Mike “Gags” Gagliardi, snow sales manager for Denver-based snowboard manufacturer Never Summer Industries. “If we get involved with a shop like a Christy’s, we can control the distribution a little bit easier compared to a Zumiez or an REI, where they’re putting product right where they want to.” For small, grassroots manufacturers, working with a specialty retail chain can be reassuring.
Ben Anderson, founder of Colorado-based Icelantic Skis, says Christy’s has been helpful “from product development to ski artwork to how we can continue to evolve as a brand. They’re organized, calculated and know exactly what their margins are.”
Big-box stores with vast, multi-sport selections can more easily phase out products if the select market or the economy dips.
“We don’t work with big-box outlets, because of the commoditization of the product,” Gagliardi says. “Christy Sports is the biggest small store that we work with, and the smallest big store that we work with. That’s entirely a compliment. They swing a pretty big bat, but you never feel like they’re trying to leverage you.”
Most ski and outdoor specialty stores don’t boast 40-plus locations, like Christy Sports, O’Winter points out. Chain stores with similar specialty lines and customer service models typically have a handful of shops, such as Sturtevant’s in Seattle.
With shifting shopping habits, e-commerce sales in the U.S. totaled $222.5 billion in 2012 and are projected to nearly double that by 2017, according to data integration company Statista Inc. Christy’s was an early adapter to the trend, as it added an online shop along with rental service in 2000.
“Online retail, which was negligible 10 years ago, is probably in the mid-20 percent range in terms of total market share of retail,” Patrick O’Winter says. “And the major change in the U.S. has been the continued shrinking of big-box stores — 10 or 12 years ago they were half of business, and now they’re less than 20 percent. Specialty retail and regional chains have grown to 50 percent.”
In the snow sports market, specialty channels represent 55 percent of industry sales volume. Online sales total 25 percent, and chain stores account for about 20 percent, according to the 2014 Market Intelligence Report released by SIA Snow Sports.
Amid competition and industry consolidation, Patrick O’Winter has continued to look for growth opportunities and acquisitions. Some of the company’s most active buying occurred from 2008 to 2011, during the recession, when it added to both its retail locations and real estate holdings.
During the last two years, the company has shifted from opening new stores to increasing the size of existing ones, as was the case with Christy’s Boulder store that was expanded from 6,000 square feet to 16,000 square feet.
Not every store site is a winner, though, and over the years O’Winter has closed five Christy’s locations, though he points out that assessing an underperforming shop can be tricky, especially in urban areas where issues such as traffic patterns or street development may be temporary or permanent.
On the other hand, he says, “Unless someone moves a gondola or a chair lift, mountain stores don’t have a reason to change fundamentally. In Denver or Boulder, it’s a more dynamic traffic area and you see changes in traffic flow happening constantly.”
Adding to Christy Sports’ resilience is that it also sells outdoor furniture, giving it a product line that is counter-seasonal to skiing, and vice versa.
Whatever the season, O’Winter is intent on maintaining the company’s core values of providing top-tier customer service and employee wellness in the broadest sense, or simply having fun.
“Overall, I think it’s a combination of the trust they have for each other, and the environment that they’ve created for the other people they’ve brought into the company,” Icelantic’s Anderson says. “You can tell they really care for each other and that they’re working as a unit.”