Industry Insites – February 2015

Eye Catching Headline

A headline in the December 2014 daily on-line RV Business newsletter really caught my attention: Work Underway on $100 million Florida RV Resort. The story describes The Fountains of St. Augustine to be “located in the nation’s oldest permanently settled city.”

Having worked now for about 13 years as a consultant primarily doing feasibility studies for developers and investors interested in building new RV parks in various places around the country, I was intrigued by the headline and the scope of the investment. To my knowledge (and I may be wrong here), there has not been a new RV park built on this scale or any where near this scale EVER. Some condominium RV parks built in the early 2000’s came in the mid $20 million range and to the best of my knowledge nd those built in that price range have struggled to make the business model work.

I wish the developers of The Fountains great success as that would be provide strong evidence of significant strength in the high end of the RV and RV resort market. However, I must admit to considerable skepticism that this project can be successful with that kind of investment.

The Fountains is offering 246 sites each with a “casita” or villa ranging in size from 485 square feet to 2 story homes up to 1447 square feet. While the promotional materials and website refers to the resort as a premium motorcoach resort or a class A motorhome resort, the project comes close to being a home or residential community with RV parking next to each home.

Based on the announced $100 million investment, that comes to about $406,000 per site at cost so we are probably looking at $550,000 to $600,000 retail/site! Does anyone know of any motorcoach resort that has been successful at that level?

It is interesting to note that through November 30, 2014, the industry shipped just over 20,000 class A motorhomes. In 2013, the number was 19,000+. This is about 1 class a unit for every 10 towables. Based on 11,000,000 or so RVs on the road today in the US, about 1.1 million may be class As and this includes units that may have been on the road since the 1980s. Given the size of this class A market, would seem to me that the developers of The Fountains have their work cut out for them – a relatively small market size of class A owners, a nice location but hardly a world class area like Hilton Head or Napa Valley or Aspen, very high development costs and pretty high prices.

Will be interesting to watch the development and hopefully report back on a smashing success sometime down the line.

ARVC: Washington, DC to Denver

While attending the recent Outdoor Hospitality Conference & Expo (OHCE) sponsored by ARVC in Las Vegas in early December, it was interesting to note how the ARVC’s education program now centers entirely on the Outdoor Hospitality Education Program (OHEP) and how the OHEP is being integrated throughout the ARVC program. Good idea, I thought. It flows nicely through the education sessions at the conference, is being integrated into the curriculum of the National Schools of RV Park & Campground Management in West Virginia and now in Colorado in July. It appears in the ARVC Voice articles and I understand a text book is being created to use in all seminars and classes taught for OHEP credit at state conventions and elsewhere. And now even a special designation – Superior Quality Staff – to recognize those parks that enroll all of their staff and have them all certified at some level.

I applaud Barb Youmans, Mark Mahacia and Saundra Brynn for their hard work in developing and bringing this program to the forefront of the industry. I only hope that ARVC members embrace the program although I expect that the numbers of participants may be slow to grow as the program is far from simple, requiring participants to complete assignments, undergo reviews and prove their learning – not a bad idea but something that I think will be hard for many small business owners to get excited about.

The other thought that occurred to me during the convention was that its been 7 years since ARVC left Washington in covered wagons and headed across the great Applachian Mountains and the western prairies for Castle Rock outside of Denver, Colorado. As I recall, the primary reasons for the move were twofold.

First, it was the sense that the cost of living in the Denver area would be significantly less than in the DC area and the first rate staff could be hired at lower cost than a similar staff in DC. Secondly, the original move was to Castle Rock where the ARVC building would be situated on a large property adjacent to a campground on property where the Center for Outdoor Hospitality could be developed by the
ARVC Foundation.

On the cost of living side of this discussion, current data strongly supports the move to Denver, According to the online bank BankRate.com, salaries in the Denver area are approximately 22% below Washington DC salary levels for comparable positions. An individual making $100,000 in DC would be able to take a 22% pay cut to about $78,000 while maintaining the same standard of living in Denver. So it would seem that ARVC could be employing a more professional staff at significant savings.

As far as the Center for Outdoor Hospitality and a showcase campground, when the deal on the Castle Rock building and property went south, that idea apparently was put on the back burner. Whether is ever comes back on the table, is anyone’s guess.

In early January, I sent an inquiry to Paul Bambei, ARVC President and CEO, asking him his impressions of the ARVC move to Denver. Paul was a Denver resident prior to his position with ARVC and chances are neither he nor any of the current staff would have ever been associated with ARVC were it not for the move. And as Paul noted in his response, he was not a part of the ARVC decision to move the association.

How the current salary levels would compare with those necessary to operate ARVC in DC is not the subject for this article but perhaps that subject will come up in the future.

For what it’s worth, here’s the exchange of emails with Paul’s view of ARVC in Denver as opposed to Washington, DC.
Gorin to Bambei: It’s been about 7 years since ARVC left the DC area. Do you have any thoughts on the pros and cons of that move and any thoughts on advantages or disadvantages of ARVC being in Denver as opposed to the DC area? What’s the current breakdown on ARVC membership east and west of the Mississippi River? Does ARVC maintain dues paying membership in the Small Business Legislative Council? The American Recreation Coalition? The US Travel Association? Is the association represented on the boards of these organizations?
Bambei to Gorin: “Let me try to give you an overall perspective of the move from DC to Denver, which as you know occurred before my start at arvc. One of the more important positives resulting from the move has been a lower cost structure incurred by the Association. According to recent data, DC ranks about 30 basis points higher than Denver in the cost of labor. Additionally, Denver’s overall cost of living is remarkably lower as well, which affects many day to day operating costs of our business. Arvc is in a much stronger financial position than it was seven years ago, due in large part to this move.
Regarding involvement in DC based associations such as SBLC, ARC, and USTA, we are dues paying members in organizations where the benefit and value is clearly demonstrated. I personally stay connected to these and many other organizations by reviewing the constant communiques that come on a frequent basis. I do not sit on their Boards, as it would be a tremendous commitment of time that I consciously choose to devote in other ways, but make no mistake I’m aware of what they do.
Of course, we have a dedicated staff person in Jeff Sims who stays on top of industry activity impacting arvc, which I don’t believe was the case prior to the DC move, and have also subscribed to the State Net service since 2011 to stay abreast of all regulatory and legislative activity affecting our industry at the local level. Should any issues of national impact require lobbying effort, we also employ the DC law firm McDermott, Will and Emery, whom we selected for their respected lobby influence.
In conclusion, I’d say the arvc Board made a wise financial choice by deciding to come to Denver, and feel we haven’t sacrificed our industry connections to DC from a lobby/networking aspect in the process. In fact, based on the direct work we conduct through staff, a very active Public Affairs Committee, State Net, etc., I feel we’re actually serving our members extremely well. “
What do you think? Has the move to Denver been beneficial from your perspective as a member of the association? How’s ARVC doing as a western-based organization?

Industry Insites – December 2014

Random Thoughts on the Business…….

The Latest HUD Park Model Issue

Sure hope the industry is looking at exactly what happened here. After a number of years of quiet, what suddenly prompted HUD to revise the method of measuring the size of a park model. I know they claim they haven’t changed anything, but for practical purposes measuring a park model to include the porch is a change in the process.

In Washington, nothing happens without a reason. Who is behind the October memo from Pamela Danner, the new HUD official overseeing manufactured housing? Somehow, I doubt that she woke up one morning and decided to screw the RV industry and the parks. More likely, someone put a document in front of her to get the ball rolling, followed by a visit from someone with a particular interest and then it just happened. Sure would be nice to know what the industry is up against because the same forces are most likely to be on the scene if and when congressional legislation becomes likely. My guess is that the new Congress in January is not going to be spending much time worrying about the RV industry and if the issue is at all controversial in the House or Senate, passage is going to be quite difficult if not impossible. So, who’s behind this?

Perhaps we should start by looking at Ms. Danner. Her long legal and government service career has many intersections with the manufactured housing industry.

What is the RV Park & Campground Business?

I’m pleased that the Pennsylvania Campground Owners Association invited me to present a seminar this Tuesday on Trends in the Park Industry. I’ve done a similar seminar at various meetings in recent years and always find it interesting to use the opportunity to track the relevant changes in the park industry.

As I prepared for the PA seminar, I decided to take a look at the various business lines that park operators are engaged in every day.

Here’s a quick rundown of the lines of business that come to mind: Camping……Outdoor Recreation…..Hospitality……..Entertainment……..Travel…….Amusement Park……Attractions……… Lodging……..RVing……..Tourism……..Sports. And you can probably think of many others.

In thinking about this question, I’ve concluded that a campground or RV park is really an amusement park. Yes, a different business model than we normally associate with that business, but an amusement park none the less.

A campground has activities and events intended to amuse and entertain the audience. The park has food services at varying levels ranging from park-wide meal events (pancake breakfasts, holiday themed meals) to snack bars, ice cream parlors and restaurants of various service levels. A park has a wide variety of amenities and facilities designed to amuse and entertain such as swimming pools and water-related features ranging from large water parks to water slides, splash pads and lazy rivers, hay wagon rides, various styled bikes from three wheelers to water bikes, laser tag, zip lines, holiday parades, basketball courts and soccer fields, themed events like Water Wars, Christmas in July and murder mystery weekends. Most campgrounds operate on a seasonal basis with some special shoulder season events. Stores that sell souvenirs, t-shirts, hats and special fun cups and other unique items are found in m ost campgrounds. Most parks offer a single price that includes all of the facilities and amenities while other parks offer an admission fee (camping fee) plus an extra fee for the amusements and entertainment. And special park discounts at certain times of the year encourage visits for different markets.

Now the amusement park. Try re-reading the above paragraph and substitute amusement park for campground or park. Pretty much the same thing, right?

When you have a chance, go visit an amusement park in your area. Guaranteed you’ll come home with some new ideas on how to please your guests.

Praise for Suppliers

Every now and then on Facebook or Linked in or in some other venue, there’s a supplier posting or talking about how they find campground owners to be among the nicest, most down to earth and hospitable people to be found in every industry. They praise park owners openness and willingness to help others, even their competitors.

Rarely if ever have I seen a Facebook or Linked in post or other comment from a campground owner praising the services of a supplier to their business who plays a role behind the scenes in their success. So, here I go.

Suppliers I met in the park industry, especially those I’ve known for 25 years or more are among the nicest folks I’ve known or worked with in any venue. Their desire to provide the best products and services and competitive prices is unsurpassed in any industry.

As campers have many choices of where to camp, so too do campground owners have many choices when it comes to where to purchase the essential needs of running their business. Many campground industry suppliers have been around serving the industry for many, many years while others are new to the industry, having been drawn to it by the great positive publicity the camping and outdoor recreation and RVing has received in recent years.

The suppliers I’ve known for many years are great folks who, like campground owners, rely heavily on good reviews and repeat business (sound familiar?).

When you can and when you feel its deserved, why not write a comment or review of a supplier experience you’ve had and post it on Facebook or on Linked In. Or visit Yelp or other review sites and share your positive experiences.

Go Suppliers!!!!

The KISS Principal

Time to remind everyone of the KISS principal – keep it simple, stupid!.

Check out your website – is it intuitive, simple and quick to respond to commands, available for Ipads, smart phones and any and all other media, clean and not too cutesy, is any music appropriate and at a reasonable volume?

Arrival and check in process is often fraught with delays and time consuming processes. Is it easy, quick and simple for your guests to arrive?

You get the idea. Take the time to review all of your policies, practices and so forth and see if you can KISS them to make it easier for you, your staff and your guests.

And a word to associations out there – national, regional, state and local campground associations. Want to gain new members? Want to retain current ones? Want to increase involvement and attendance? All programs and activities should be reviewed for KISS compliance.

Small business that comprise the majority of the campground and RV park business don’t have time or the inclination to engage in complex, confusing or lengthy steps to take advantage of the values of the membership. The longer it takes to take an action, the less likely it is that the action will be taken. And the less actions taken by members, the greater the likelihood that they will explore whether or not the membership is worthwhile.

Nine times out of ten, measuring your business processes against KISS will lead to business improvements. Try it.

Industry Insites – November 2014

43 Years…..Moving On

On September 30, 2014, I turned over the management of the Virginia Campground Association to Derek Dick, a former ARVC staffer now living in Virginia. With that, I concluded 43 years in the association management world. Over those years, I’ve been associated with the American Jewish Congress, the American National Metric Council, the Solar Energy Industries Association, the National Association of RV Parks & Campgrounds and finally the Virginia Campground Association.

Association management has been a fulfilling career but its time to turn my full time attention to consulting work in the RV park and campground industry as the industry steps up its growth and development into a modern 21st century hospitality and recreation business. And it’s time to pursue some new ventures and advocacy in the business.

Advocacy

In the August issue of Campground Management and also in RV Business, I wrote a column suggesting that it is time for the terrific Go RVing promotion program to expand its horizons into Go RVing……and Camping promotion.

I feel strongly that the time has come for the three legs of the RV industry stool – the manufacturers, dealers and accommodations – to re-establish the close relationship that created the Go Camping America program in the 1980’s and was the foundation for the eventual emergence of the Go RVing program. While it’s clear that RVs have multiple uses depending on the desires of the owners of the rigs, it’s equally clear that the dominant use of an RV is camping in one form and one place or another.

RV parks are popping up in many places. NASCAR and other racing venues are moving to formalize camping in RV areas that were previously informal parking areas for tailgating. The same is happening around major universities where RV tailgating is a major event combined with college football. And golf resorts, ski resorts, amusement parks are increasingly recognizing the growing popularity of RVing and the need to provide campgrounds or RV parks (the terminology is not really important). Federal, state and local parks are sprucing up their camping areas to serve the growing RV market.

It’s kind of like the old days in Las Vegas when hotel rates and food costs were incidental and the profits were all from gambling. Many entertainment and sports venues provided for RVs but either didn’t charge or charged very little. Now, there’s an awakening that there’s money to be made in RV parks – why give away what can become a profitable revenue source.

The Go RVing program has over the years focused on the many uses of an RV – taking the kids to soccer games and tournaments, tailgating, “pursuing passions” of all kinds, getting “away”, and so on. But most of these uses include nights out in campgrounds and RV parks.

Go RVing has the mechanism in place to raise additional funding to expand the Go RVing program to include camping. It’s up to the leaders of Go RVing and, more importantly, to the leaders of ARVC and the park industry, to get together and figure out how to expand the program to include camping. Demonstrating to potential RVers the many diverse campgrounds available for their enjoyment and use should certainly contribute to a better understanding of the joys of RVing and help increase RV sales while supporting the growth of the park industry.

It was somewhat disappointing to note that the column proposing this expansion of Go RVing received not a single comment or response – pro or con – from readers. As the campground industry would be the major beneficiary of the expansion, I expected that there would be some response from that end of the industry.

As a long time member of both ARVC and RVIA for many years, I would encourage the leaders of those organizations, chief executives and elected leaders to let the industries they represent know where they stand on this proposal to expand Go RVing. If it’s a lousy idea, say so and tell us why. If the idea is positive, say so as well.

At least from the park industry perspective, expansion of the promotion program should be something with broad support. The silence is deafening.

RV Site Ownership

Back in the early part of this century, RV condominium site ownership was growing rapidly in many parts of the country. As the real estate market pushed land and home prices skyward, many park owners in key locations were selling out to developers who had plans for a higher and better use of the land. RVers, especially in Florida, became concerned that their winter RV parks would be sold out from under them and they would have to relocate elsewhere. The popular thinking was that RV sites in desirable areas would become fewer and fewer and RVers would be forced to settle for second rate locations.

And thus was born the RV condominium park where an RVer could buy a site, become an owner of the campground and assure its continuation for years to come.

The own your own site business flourished in many areas from 2001 to the real estate implosion and the recession of 2007 to 2009. RV condo site sales dropped dramatically – in fact almost disappeared. Developers were forced to drop prices significantly and while that helped in some cases, for the most part RVers like the rest of the country, were not in a spending mood. If the price was down 50% today, why not wait until it goes down 75%?

As the recession has eased, site sales have edged a bit in certain areas where price declines have put the sites in the range of affordability for more RVers. But it is now appearing that except in some very special circumstances where the location of the park is too good to pass up, the price declines have not been sufficient to show RVers that it is less expensive to own then to rent.

And as the building boom in Florida and elsewhere has not come back to the fever pitch of the period before the recession, few RVers are worried about their favorite RV park disappearing to make room for re-development. And the view of RV site ownership as an investment with strong upside

The keys to a successful RV site sales program are several. First and foremost, as noted above if the lot price is set at a point where owning is as good or better than renting. For a broad segment of RV owners, this is most important in a successful sales program. Second, the location has to so strong that it has a wide appeal to RVers of all types and where pricing to secure the location is reasonable and within reach of a large market segment. Third, the development has to be so exceptional in terms of location, limited number of sites, amenities, aesthetics, service and high end appeal that it will capture the attention of the small cadre of RV owners for whom price is no object.

The RV condominium business is likely to continue to come back as RV sales continue to expand. In certain areas, RV site supply may fall behind site demand and the condo market could heat up again. In this case, owning sites in a quality park with high demand for rentals could prove to be a solid investment over time.

Keep a careful eye on this market segment as converting an RV park to an ownership resort is a good exit strategy in the right circumstances.

Industry Insites – September 2014

Jayne Cohen Joins DGA as Senior Consulting Associate

I’m really pleased to announce that Jayne Cohen has become affiliated with DGA as a Senior Consulting Associate with a specialty in park operations and marketing. Jayne has over 35 years of hospitality and customer service experience. She and her family owned a large and very successful family camp resort in New Hampshire until it was sold in 2003. For 8 years, until October 2011 she was the President of Adventure Bound Camping Resorts, a privately owned company that owned 10 camping resorts. Jayne uses her skills and experience to assist clients to improve their revenues and profits by creating better experiences for their guests and creating systems, procedures, and strategic plans to obtain a client’s financial goals. Jayne earned her bachelor’s degree in Business Administration from the Whittemore School of Business & Economics with concentrations in Marketing and Finance.
The addition of Jayne to the DGA team further enhances the firm’s ability to provide the most expert and comprehensive consulting services in the outdoor hospitality industry.
Welcome aboard, Jayne.

Regulating Campgrounds & RV Parks

A recent release from National ARVC described some renewed efforts by the association to try to use the NFPA Standard 1194 as a vehicle to address some long simmering regulatory issues that impact on campgrounds and RV parks in certain areas of the country. By addressing some of these issues in the NFPA standard, ARVC hopes to educate planners and regulators on positions that are favored by the industry.
In addition to the NFPA work, ARVC and RVIA are collaborating on improving the understanding among officials and the public of the park model RV. Park Model RV is the new designation for what was previously referred to as a recreational park trailer or a park model.
These two important initiatives raise questions and issues that need to be addressed as these efforts move forward.
The first question that comes to mind is……..does the park industry support regulation that goes beyond the traditional area that NFPA standards address – issues of life, health and safety of RVers and campers. Remember, NFPA stands for the National Fire Protection Association and its standards are focused on standards linked to life, health and safety issues. Setting standards for separation of RV units within a campground would seem appropriate. However, setting a minimum size for an RV site is probably unnecessary if you have a unit separation. Is the NFPA standard the right place to address issues outside the life, health and safety realm?
The second question has to do with full time RVing vs. year round RVliving. Until the recent merger of the former park model unit into RVIA and its renaming as an RV park trailer, it was generally accepted that park models were not intended for year round living but were specifically for temporary, short term recreational use. Now, with the merger of the RV park trailer into the range of traditional RVs, how does the industry differentiate full time RVing from full time, year round RV park trailer occupancy. Full time RVing has been an accepted use of an RV by tens of thousands of Americans who opt to downsize their lives and live fulltime in their RV. Now, if full timing is an acceptable practice, should full timing in an RV park trailer also be acceptable? To what degree does mobility of the unit regulate its use?
Another key question of concern in many areas around the US has to do with the treatment of RVs as personal property or real property.
Generally, the industry has long agreed that RVs of all kinds are personal property and therefore the owner of the property is responsible for taxes on that property. Some jurisdictions around the country have ruled that RVs left of a site for an extended period of time are real property as many cannot be moved and therefore the park owner is responsible for the tax on that property. The real issue now comes into play with RV park trailers that are legally RVs if the industry has its way, but are not easily moveable and are likely to be tied down to the ground either for protection against wind and hurricanes or for utility connections necessary to power residential size refrigerators, residential sized toilets and showers and sometimes add-a-room or screen room attachments. While technically an RV, have these units moved into a different class and are they now real property as opposed to personal property since they are at least semi-permanently attached to the ground?
What about RV park trailers that are used solely as rental units? Personal property or real property?
Should the industry work towards a definition of RV for personal property purposes and of RV for real property purposes? Are two categories necessary?
Another key question that needs to be considered has to do with the acceptable length of stay in an RV park. Some jurisdictions limit the period of time an RV may occupy a site; others limit the time that an occupied RV may remain on a site and some differentiate between an occupied and unoccupied RV on a site. And the time limits for any placement of an RV can vary based on the jurisdictions preference – 30, 60, 90, 120, 180 days or more or less.
Clearly, an RV park model generally has to be on a site for 365 days a year. Moving that unit into storage or to another site is probably not realistic on any regular schedule. So are RV park models regulated differently from other RVs?
Length of stay rules obviously impact the ability of a park to offer seasonal sites of varying lengths. And let’s say, town A has a 90 length of stay rule. Is a park in this town not permitted to accommodate RV park models? What about a full time RVer? Are they subject to that length of stay if they pay a daily or weekly rate rather than a 90 day seasonal rate?
And will it ever be possible to get jurisdictions in 50 states to ever agree to a national standard on length of stay?
ARVC and RVIA have a difficult road ahead to work out and resolve these and other regulatory questions that can sharply impact park operations. Hopefully, working cooperatively, and b ringing in the RV Dealers Association whose members probably have relationships in many jurisdictions around the US into the working group to address these issues some reasonable approaches to these issues can be achieved with at least some uniformity. Working together within the NFPA structure and perhaps through a renewed development of a national model code as a guide to local regulation, some semblance of national balance can be found that will work the advantage of all – consumers, campgrounds, RV manufacturers, RV dealers and local communities.
Best Parks in America
I’m deeply disappointed and saddened that the Best Parks in America brand and marketing group whose operations were suspended last winter, has not re-emerged, has not been re-tooled and is not yet ready to move forward with a new platform and program.
In today’s world, as the industry segmentation continues and as camping and RVing are showing rapid growth and expansion, the park industry still lacks a high end, premium brand that speaks to RVers and outdoor enthusiasts who seek that upscale premium experience.
I’m still hopeful that this situation may soon change and that Best Parks in America will re-emerge to serve that special market segment.
I hope that the summer camping season was terrific for those who serve that business. The early forecasts for winter travel and RVing in the southland seem quite encouraging.

Industry Insites – August 2014

Go RVing…..and Camping

In recent weeks, a series of meetings and articles have led me to now propose in all seriousness that it is time for the RV manufacturers, dealers and campgrounds to get together and broaden the focus of Go RVing to include camping. Imagine, a Go RVing…..and Camping campaign that stands as the industry’s national brand bringing together all the legs of the industry and wrapping Go RVing and Go Camping America into a single national effort.

The recession of 2008, 2009 and 2010 saw a dramatic decrease in the sale of RVs combined with a steady pace of RV park and campground business and a renewed interest in extended stay and seasonal camping. While RV sales have rocketed back to pre-recession levels, extended stay and seasonal camping has continued to capture the interest of Americans across the nation. And this strong consumer interest in this camping style has manifested itself in the RV manufacturing side in a couple of significant ways.

As the strength of seasonal camping hit home with the RV manufacturers, they have responded by creating and marketing the largest travel trailers and 5th wheels as “residential” trailers, seasonal vacation homes, and similar terms focusing on extended stay use in a single location. These units, while legally towable down the highway, are designed and built for destination use – parked in a campground and used as a vacation home by the owners.

These new trailers and 5th wheels have blurred the lines between the traditional RV and the recreational park trailers or park models. With the merger of the Recreational Park Trailer Industry Association (RPTIA) and the RV Industry Association, the RV industry has moved to recognize the critical importance of campgrounds as the home to these extended stay units and the role that these units will play in the continuing growth and expansion of the RV market.

In the last 18 months, under the leadership of RVIA President Richard Coon, RVIA has created its own Camping Committee, a Destination Camping Committee and the RV Park Trailer Committee. These committees are moving towards expanding consumer interest in seasonal camping and campgrounds with new research now ongoing with the Richards Agency that handles the Go RVing program, and with the Park Trailer Committee studying new promotional campaigns under the Go RVing umbrella to promote those units.

On the other side of the industry – at the National Association of RV Parks & Campgrounds (ARVC) – in a recent article on the direction of the campground industry, ARVC President Paul Bambei noted that ARVC remains underfunded and unable to conduct the kind of consumer promotion campaigns under Go Camping America that many feel are necessary to grow the park side of the industry. Having a successful Go Camping America website that attracts a significant number of visitors without having the resources to market camping to the non-camping world and really build the value of Go Camping America as a place to go to for camping information as Go RVing provides for those interested in learning more about RVs, is not enough.

ARVC funding has most likely bumped up against the upper limits of potential dues revenue it can generate. Membership expansion has long proved elusive with ARVC membership in the 3000 range for many years. Even adding another 1000 members at an average of even $400/member would only bring in $400,000.

And ARVC’s income from other sources – convention and trade show income, commissions or royalties from companies providing member benefits , sale of publications, and Foundation fundraising – may also be approaching the upper limits. With few national companies serving as product or service suppliers to the park industry, revenue and support from suppliers is also somewhat capped.

So how to fund a campground promotional campaign to educate and inform Americans of the joys and pleasures of America’s campgrounds?

The source of funds for Go RVing are the manufacturers who pay a small amount of money each time they purchase a certification seal to place on a new RV. Each RV sold has an RVIA certification seal affixed to it indicating it is certified to be in compliance with certain construction standards. RVIA sells the seals to the manufacturers and the cost of the seal covers the cost of the RVIA certification and inspection program and includes a Go RVing fee based on the type of unit sold.

Spreading the costs over the tens of thousands of RVs manufactured each year is a far better option than trying to extract more money from commercial businesses whose bottom line is directly affected by association dues, education and training costs and other non-operational expenses.

About 15 or 16 years ago, the ARVC board held a workshop session to discuss the feasibility of adding a $ .10/night “camper promotion fee” to each camping party. It was thought that this fee might even substitute for regular association dues both on the state and national levels. The board agreed to conduct a pilot test at 6 or 8 campgrounds to see if and how consumers would respond to an additional ten cents per night added to their camping bill. Although the results of the pilot project showed no negative consumer response, the ARVC board voted to table the idea and it has never been brought back to the table.

The Go RVing program relates directly to the purchase of a new RV. I would suspect that not a single RV sale has been lost or even delayed by the $40 to $60 fee added to the cost of the rig. And as a result of this technique of building support, the Go RVing campaign has annual budgets as high as $18,000,000 or more.

I’d propose that RVIA add to the cost of a seal an additional $15 and earmark the funds for the “……and Camping” component of a new Go RVing….and Camping promotion program. The collection mechanism is already in place and as RV sales have shown, the slight increase in cost of the RV is in no way an obstacle to the sale.

And, dare I say, that if this were to happen, RVIA and RV manufacturers might have considerably more influence in creating, setting and enforcing some key guest service standards among the campgrounds. The RV industry would be pleased to see the quality of the campgrounds improve substantially, and perhaps by working cooperatively with the park industry, RVIA and others in the RV side of the business might be more successful in influencing the park industry to up its game to a higher level.

While there is no doubt that RVs are used in many ways outside of camping, there is also no doubt that without quality campgrounds to accommodate the RVs and RV park trailers RV sales could suffer. With the RV industry moving more closely to the campground industry in recognition of the role the campground plays in the RVing experience, the merger of Go RVing and Go Camping America seems a natural and the industry leaders should begin now to move towards that unification.

Industry InSites July 2014

Competition Heats Up

Over the years, independent park owners that comprised much of the industry prided themselves on their openness and willingness to share information and experiences with other owners or new comers. This spirit of cooperation was a hallmark of the industry for many years. A rising tide – better operated campgrounds – would raise all boats – and everyone would benefit. While this spirit of cooperation can still be found in the business, there’s no doubt that competition is heating up among parks in many parts of the country. Several factors are contributing to the emerging competitive environment within the park business.

First, on the heels of the recession of 2008-2009, many campers and RVers are staying closer to home and traveling far and wide less frequently. The local and regional markets are the primary source of business for many campgrounds and attracting local and regional business is increasing important and competitive.

Second, there are more large companies expanding their network of campgrounds by acquiring parks in many markets, promoting their brands with considerable financial resources and expertise, and providing real competition where it may not have existed previously. Companies such as ELS, Sun Communities, Carefree, RVC Outdoor Destinations, Yogi Bear Jellystone Parks and KOA are bringing new marketing energy to the industry and working hard to expand their market share.

The deep discount camping clubs – Freedom Resorts, Passport America, Escapees – continue to expand, adding a competitive factor into the marketing plans of many parks.
And of course Good Sam and the new Amerigo Camping Club have more than 1.5 million members combined that they are pushing to their affiliated parks.
And for the independent campgrounds and RV parks around the US, we can’t overlook the new competitive force of Kampgrounds of America. Always a force in the market with more than 500 franchised and corporate owned properties, the new KOA initiatives to re-brand their affiliates to better help the RVer and camper find a KOA that meets their needs and now their plan to launch major national television advertising, KOA is rapidly repositioning its brand to gain wider appeal to all segments of the RVer and camper market and to expand their markets into the non-camper segment by aggressively promoting their cabins. KOA has always been a powerhouse marketing engine within the industry, but now with these initiatives, they are changing the popular perceptions of KOAs as good but not great places to camp to great places to visit. Raising their standards and demanding that affiliates become better and better, they are likely to grab market share across the US.
Finally, the competitive field is being challenged by federal, state and county parks that are expanding campgrounds and upgrading to a higher and more developed standard in order to attract more business and raise rates to support public recreation and public parks. There is no doubt in my mind, that these facilities are going to increasingly challenge private, commercial parks for market share.

The future is clear for independent campgrounds – step up your game in all aspects of your business to compete successfully or risk being the victim of declining occupancy as others “eat your lunch” in your market.

With the growth of RV sales and the rising popularity of outdoor recreation and camping, it’s a new era for the park business, one that calls for everyone to be on their toes all the time.

Technology Comes to the Laundry Room

I remember being impressed when my kids were in college and they could use their credit cards or school-issued meal cards to pay for the washers and dryers in the dorm laundry. Great idea. But I was taken by surprise by the latest development in laundry technology that I saw recently at a campground.

Aside from the ability to charge your washing and drying on a credit card, there was a system that enabled a customer to receive a text on their phone when a washer or dryer became available and another text to alert when their washing or drying was finished. No more hanging around waiting for an open washer and wondering where the thoughtless person was whose wash was done, “why were’nt they here to take their clothes out so I can use the machine?”

A good step forward in delivering top notch customer service in today’s technology age.

Are Campground Game Rooms and Cable TV On Their Way Out?

I’m hearing that many parks are re-positioning their game rooms and arcades. As more and more kids and families are traveling with their own game devices, many of the formerly popular arcades are seeing the revenues decline, especially on video games. While there may still be a good market for pinball games, billiards or pool, air hockey and crane games, the old reliable video games are rapidly becoming a thing of the past.

What’s your experience?

Along the with the changes in the game room business, it would seem that offering cable tv may also be on the decline, or at least about to head in that direction. With rapidly expanding demand for quality internet service with sufficient bandwidth to enable streaming of movies and television programs, combined with rising costs of providing cable television, it seems that the time may be coming to do away with cable television and put the savings into providing the best internet access possible. There is significant cost associated with quality park-wide wireless internet, but the savings on eliminating cable tv may compensate for the cost of providing high quality wi fi.

Anybody heading in this direction?

Digital Marketing for the Outdoor Recreation Industry

Industry digital marketing expert and RV Cooking Show hostess Evanne Schmarder is publishing a bi-weekly Digital Marketing Newsletter for the Outdoor Recreation Industry. The newsletter is available at no charge – drop Evanne a note at evanne@roadabode.com and ask her to add you to the subscriber list. If you agree that electronic marketing is the way to go for marketing your park, and even if you’ve got an expert social media marketer on your staff, you owe it to yourself to subscribe to this newsletter and keep up to date on the rapidly growing field of digital marketing.

Each issue is filled with ideas, tips, suggestions on how to improve your digital marketing and how to expand your reach.

And while you’re at it and contacting Evanne, ask her for a copy of her recently released Digital Marketing Benchmark Study, a valuable report on what your competitors are doing in the digital marketing era.

David Gorin Associates is a sponsor of both the Digital Marketing Newsletter and the Digital Marketing Benchmark Study. Digital is the wave of the future.

Industry InSites

Campground Management Myths
David Gorin

The other morning Marcus Lamonis joined me for my morning cup of coffee. Not literally, but with Matt Lauer of NBC’s Today show, there was Mr. Lamonis (ML) chatting with Matt and interviewing 2 small business owners both looking for capital to help build their businesses.

Business 1 was a couple with a new barbeque sauce they developed and are marketing. Business 2 was two men selling “crispy chick peas.”

Long story short, ML bought into the barbeque sauce business for $25,000 and to the chick pea business for $100,000. Wrote both companies checks on the spot.

As ML’s profile rises in the business and media world, and as he spreads his wealth around via the CNBC program The Profit and previously on Secret Millionaire, as well as on these segments of the Today Show, the question does come up – as ML is a key player in the camping industry, is this good for RV park and campground business? Other than being identified as the CEO of Camping World and Good Sam, is his rising image a positive factor, a negative factor or a neutral factor for our industry?

When KOA CEO Jim Rogers appeared on Undercover Boss, clearly the show created a positive image of KOA and camping. When Jim speaks at the RV industry’s power breakfast in Elkhart, at the RVIA annual meeting, at an ARVC annual meeting, he’s out there speaking about the industry, presenting new ideas, challenges, and views on how to make the industry better.

Two strong industry leaders, ML and JR, taking different approaches to becoming identifiable business leaders coming from the RV park, campground and RV industry.

How are these men playing to our industry? What are these men contributing to the industry that has launched them as media figures and raised their stature, wealth, and value to the companies they lead?

Although ML is apparently tied closely to NBC, I won’t be the least surprised to see him show up one of these days as one of the “sharks” on ABC’s Shark Tank. Wouldn’t it be interesting to see him go toe to toe with Mr. Wonderful, Mark Cuban or one of the sharp women on the show? Can’t imagine ML is going to stay in the financial area with CNBC when a show like Shark Tank is a highly-rated major network star show.

And I predict that Amazon and Barnes & Noble will soon be featuring ML’s good looking features on the cover of a book for entrepreneurs……Marcus Lamonis’s Keys to Entrepreneurial Success (or something like that). A book must be in the works.

And after Camping World and Good Sam, what can come next?

Personally I’d like to see ML be more of a spokesperson for and to the park industry a la Jim Rogers. He surely has a lot to share with small business people such as park owners. Be interesting to hear him as a keynote speaker at an ARVC convention. Be interesting to see him make some investments in parks that are among the advertisers in Good Sam. Be interesting to see him spend some time with park owners who provide the experiences that make owning an RV and camping so special. Maybe Just ML in an RV traveling in different parts of the country – no cameras, no press – just ML interacting with many of the people who are the foundation of the success of the Good Sam Club and Camping World.

Can the Private Sector Withstand the Growing Power of State Parks?

Anyone following the RV Daily Report published each day by Greg Gerber has to be struck by the amount of news coming from various state and county park systems around the country. Most of this news announces new or expanded campgrounds in state and county parks, talks about fees either being increased or decreased in these campgrounds, or announces new cabin camping opportunities, group activity options and even RV storage and enhanced guest services.

For many years, the commercial campground industry has been quite concerned about the expansion and competition from public parks. The competition comes in many forms – lower camping fees, tax money used for expansion, the addition of full service RV sites a la the private sector, the addition of cabins, the use of volunteer workers, and similar benefits available to the public sector and unavailable to commercial park operators.

Since the recession of the last decade, the tightening of public budgets and the strong growth in the popularity of camping, state and local park systems seem to have stepped up their campground operations as they see this as a source of revenue to counter declining public tax dollar support.

In addition, state and county legislators are apparently subject to great pressure from local constituents who see parks and campgrounds in their backyards and supported by their tax dollars as very important services provided by government. And for legislators, a ribbon cutting ceremony at a new public campground or park makes for very good PR, especially around election time.

There’s no doubt in my mind that state and county parks are going to become a greater and greater force in providing campgrounds for both locals and visitors. The revenue is enticing and the economic impact of these parks on their local communities appears to be quite significant. Reports showing huge returns on investments in public campgrounds are hard to ignore and local tourist and recreation interests see them as a pot of gold.

The park industry needs to sharpen its game and face up to this growing challenge. Small local campgrounds catering to families and local and regional markets need to work longer, harder and smarter to hold on to their market share in light of what I see as stepped up public competition.

There are many dimensions to the relationship between public and private parks and while one dimension is competition, the cooperative dimension of the relationship can be beneficial to both sectors. Perhaps putting aside the difficult areas of the relationship and focusing on the areas where cooperation can help both parties is one way to approach the challenge. And perhaps the public sector needs to be open to a more moderate pace of development and compromise rather than moving aggressively into areas heretofore found only in the private sector.

I think this is an issue that will be moving up the ladder of issues to be addressed in the coming years.

Industry InSites

Campground Management Myths
David Gorin

As I write this column on February 10th, we’re slightly more than halfway through the winter. And a tough winter’s it’s been certainly for the middle and northern tiers of the country. For the southern tier across California, Arizona, Texas and Florida it’s been pretty good – not great but way more better than up north. So with an unusual winter weather-wise, what’s new in the park and RV business?

Class A’s Coming Off the Floor?

Sales of motorhomes of all types were decimated during the 2007 – 2010 recession. Class As hit the floor in 2009 with the sale of just 5,900 units. These units appear to be making a comeback sales slowly improving to 13,100 in 2010, dropping slightly to 12,700 in 2011, increasing to 14,582 in 2012, and to 19,054 units in 2013. This latest number amounts to approximate 6.7% of all RV sales falling into the Class A category, up from just 5.6% in 2012, 5.5% in 2011 and 6% in 2010.

Can Class As continue to make a comeback in 2014 and beyond? In 1999, the peak year for Class A unit sales, these motorhomes were 15.4% of the total RV market. Will the industry reach that class A penetration any time soon?

The impact of the decline of class A unit sales seemed for some time to have effected the site sales in class A motorcoach only resorts and the development of new Class A only resorts. Judging from anecdotal information gathered at the recent Tampa Super Show, the Class A only resorts seem to be making a comeback, at least as far as exhibiting at Tampa would indicate.

If RV sales continue their march upward in the next few years, sales of Class A will likely also continue to trend upward in terms of numbers if not in terms of a percentage of RV sales. Will the increase in sales lead to a further resurgence of Class A only resorts? From my point of view, I don’t see a need for many new motorcoach only resorts, at least until all of the current inventory is absorbed, and it appears there’s a way to go in that direction. And from a development point of view, going Class A only certainly narrows the consumer market. With new luxury Class C’s and 5th wheels, the luxury RV park market can continue to grow while serving the upscale luxury RV segment without limiting itself to just Class As.

Many RVers I talked to at Tampa and at various parks in Florida are interested in luxury and the cost of the rig is not critical. However, the size of many class As is intimidating or simply considered unnecessary for much of the sophisticated upscale RVer market. I want the best but in a small, luxurious package. I want it simple and easy. And most of all, I want it to be reliable. The bigger the rig, the greater the possibility for mishaps and breakdowns.

Reservation System Choices Expanding

Of late, I’ve noticed two trends around the park business…….more and more park owners wondering how to best select a property management and reservation system and more companies apparently entering the park property management and reservation software business. This comes as no surprise as the park industry generally seems to be in the midst of a growth spurt and when business increases, new entrants are expected at all levels and in all business segments.

The latest entrants……..The Flybook, Front Desk Anywhere, RV Spotfinder, Go USA Camping, RMS North America

The latest entrants are best characterized by their new market approach, their background in related markets such as hotels, b & b’s, outdoor activities, their younger cutting edge team, and their stretch into the outdoor hospitality business. Expect you’ll hear a lot about these companies in the coming months.

The industry stalwarts……Campground Manager/Bookyoursite.com; Campground Automation/Sunrise; Digital Res International; Leisure Interactive/Hercules; Reserve America; Cottonwood Software/Campground Master; Vestivo RV/Reservation Management Solutions Inc.

These companies generally have a solid footprint in the park industry by virtue of their longevity in the market. These are well respected companies that have a long record of supporting the park industry and ARVC and are in to both the public and private campground sectors.

The up & comers…….Campground Connections; Open Book; Webrez Pro; Campworks, Centrum Systems.

These are generally new comers to the park business but have strong backgrounds and roots in technology and hospitality. Expect these folks to make noise in the coming years.

How to select a system for your park?

Selecting a system is a time consuming and tedious job that starts with park ownership and management doing an honest and deep assessment of what they want a technology system to provide. This entails carefully analyzing the park’s current business strategies, marketing, advertising, pricing, reservation practices and policies, activities, retail and rental operations, accounting practices, and information needs. And then, easier said than done, matching this analysis to the available systems.

Cost is always a factor and the systems vary widely in how they charge for services. The more bells and whistles, the higher the cost is likely to be. The more basic the system, the more basic the cost will be.

If you are just starting out in the process of selecting a Property Management System (PMS) or Reservation System or both, this might be an area where a consultant might be helpful, depending on your own level of knowledge and comfort with technology and park business. If you are thinking of switching from one system to another, here too a consultant may be helpful in working through the options and screening the park management from some very capable sales people. You don’t necessarily want to be sold on a system; you want to make your judgements based on needs and your assessment and not on a friendly salesperson.

Feel free to use the list of companies mentioned above to start your search on the internet. Each has a website and that’s always a good place to start to familiarize yourself with the products and services. And as with everything else these days, remember to check consumer reviews, talk to colleague park owners and seek out testimonials.

Good luck in your search.

Build New vs. Buy Old

Campground Management Myths
David Gorin

For some time, I’ve been on my soap box talking about the need for new product in the campground and RV park business. Why are there so few new parks being built? What’s the attraction to buying older parks and trying to modernize them to meet today’s consumer desires?

Well, the last two weeks or so, I’ve been hit between the eyes with two real life opportunities that have challenged and tested my ideas on new development vs. buying existing. Here are the two scenarios. What road is the best to pursue – developing new in an A location or buying existing in a B or C location.

Scenario One

The property is a 12 acre parcel located on a primary 4 lane highway less than a mile off an interstate highway exit in southwest Florida. The property is about 9 miles from the Gulf of Mexico beaches in a very prominent tourist area. I’d consider the location to be an A or an A-.

The land is approved for 109 sites including RV sites and cabins and no length of stay restrictions. The site is served by municipal water and sewer. Directly across the highway is a major high end residential and golf club and about 2 miles down the highway is the entrance to a very large and very successful residential, retail and recreational community. The curb appeal of the property is very good to excellent.

10 years ago the property owner and his son began building an RV park. 49 sites were developed, all with 50 amp electric and about 40’ x 70’ dimensions. An attractive entry road was completed and all the internal roads were asphalt. Individual sites were not paved. The park has never operated.

The owner’s son was the developer. Unfortunately, the son passed away suddenly at 44 years old. His father was devastated and for 10 years he could not bring himself to either finish the project or sell the property. The park was not completed and has never operated.

The seller is asking $2 million for the property and the improvements and is not interested in providing any financing. It is estimated that it will cost about $3 million to complete the remaining approved sites and rehabilitate the existing 49 sites. The existing roads need to be re-surfaced and the pedestals probably need to be replaced and electric meters added. The site also needs a swimming pool, restrooms, laundry and a clubhouse of some kind.

Because of the quality of the location, there is considerable demand for affordable RV sites. A review of the area indicates that monthly rental in the $500/month range is reasonable and annual leases could go for $4500 to $5000 annually. It is assumed that the park could be fully rented to RVs and park models within 24 to 36 months.

Scenario Two

This property is a 12 acre parcel located on a just off a primary 4 lane highway about 15 miles from a major interstate highway exit in central Florida. The property is located in a mid-size city and is along a commercial stretch of highway. While the area is known for its equestrian farms and there are many large equestrian estates in the general area, the park is not located in that area. Due to the commercial nature of the adjacent property and the uncertainty of future uses for the undeveloped land across from the park, I’d consider the location to be an B- or a C.

A road passing along the rear of the park is now being expanded from 2 to 4 lanes. How this will impact on traffic and noise along that part of the park is uncertain.

This is an existing and operating RV parks with 104 RV sites and 2 park model sites. There are no restrictions on adding more park models and there is no length of stay restrictions. The site is served by municipal water. Waste is handled with a septic system.

This park was developed in 1998 by an RV dealership that is located adjoining the RV park. The park was developed as a sales and marketing tool for the dealership. The dealership has used sites in the park for their customers taking delivery on a new RV or coming for service. They provide up to 3 nights for buyers of units and provide driving and RV maintenance lessons during that time.

The RV park is accessed down a road that runs a long side the dealership. The land opposite the dealership along this road is vacant. There is also direct access from the park into the dealership.

The internal roads are asphalt as are all of the sites. There is a 4000 sq ft combination office, store, clubhouse, restrooms, and laundry. This building is in good condition. There is a small fenced in swimming pool with a nice sun deck next to the clubhouse.

The seller is asking $2.1 million, and is offering to finance about $1.5 million at 5.5%, 30 year s amortization with a ten year balloon. In 2012, the park grossed approximate $330,000 including store sales (amount unknown) and about $84,000 in rent from the RV dealership for the use of the sites. Revenue was about $3000 per site. Occupancy from December to April runs about 85% and rental rates are in keeping with the surrounding area parks. There are 10 sites that are occupied on an annual basis. It is estimated that there is about $350,000 in deferred maintenance including upgrading the restrooms, resurfacing the roads and sites and adding electric meters to each site. The park is rated 9/8/8 by Good Sam.

Based on the above and assuming that financing was available for each scenario, which route would you take? Buy and develop the A property in a solid location but no current cash flow, or buy and upgrade the B/C property in a marginal location but with existing cash flow?

Thoughts? Comments? Please drop me an email with your ideas…..david@davidgorinassociates.com

Campground Management Myths Debunked – Part 2

Campground Management Myths
David Gorin

Last month’s column featured 5 popular campground management myths and this month we continue that conversation with 5 other myths that seem to be particularly popular these days.  And once again, my thanks to colleague Evanne Schmarder for sharing some of her campground management myths.

As always, reader contributions are encouraged.  Are there other campground management myths you’ve come across that you would like to share?  Leave a reply below so we can share them with our colleagues.

Myth 6 (we left off last month at Myth 5)

 Work Campers are Free Help. Or at least they are inexpensive help.

 Nothing could be further from the truth but it’s this campground  management myth that makes the concept of having RVers work in a park so attractive to many park owners.  Everyone who works in a park carries some cost equal to at least the federal or state minimum wage.  Federal law requires businesses to pay their employees and generally volunteers are not permitted.  Every worker must be compensated in some form, either cash or a combination of cash, living expenses and other benefits to which a cost is clearly assigned (electricity, use of a company car, etc.).

As an aside here, if you are hiring minimum wage staff, there’s a good chance you’re getting minimum quality people.

Myth 7

 ADA compliance isn’t terribly important; in all the years I’ve owned this park, I’ve had only one or two persons with disabilities as guests.

 Assuring that your park is compliant (or working towards compliance) with the various provisions of the Americans with Disabilities Act is important for several reasons.  First, the ADA is a federal law and your business must be complying with federal laws.  Failure to comply can open you up to federal lawsuits brought by the US Department of Justice if a guest files a complaint with the Justice Department.  Second, parks that offer ADA compliant facilities and services and welcome persons with disabilities will find that niche market to be a profitable addition to their business.  Approximately 8% of all Americans have a disability that is covered by the ADA – and that’s a market that is as large as the RV market – about 8% of all American households own an RV.

Compliance with ADA not only makes your park accessible to people with disabilities, it also makes your park more attractive to senior citizens and to families with young children, both of whom share the benefits of ADA compliant facilities and amenities.

Myth 8

 A large majority of my guests come from more than 50-75 miles away.  There’s really no reason for me to advertise locally or be very involved or concerned about my community.

 When they review the geographic distribution of their guests, many park owners are quite surprised to see how many guests come from 25 miles or less from their park.  Local folks who own RVs are always looking for places to go and even just 25 miles from home can feel like a real vacation – even for just a day or two.

Being known locally, being involved in local civic, business and other groups will surely lead to referrals from people in your community who may have friends, relatives, friends of friends and so on.  Just 25 camper nights resulting from local referrals at $40/night is an extra $1000 in revenue this year and over the next 10 years as fees rise and your reputation grows locally you could be looking at way more than $10,000 in revenue as a result of local involvement.

One other thing.  You never know when you will have an emergency need that someone locally can help address.  People help people they know and like and that will help them when needed.  Buying locally, supporting community and being an active player in addressing community needs will put you in a position to where others will want to help you in times of need or trouble.

Myth 9

 I’ve owned and run many successful small businesses – a restaurant, a HVAC company, and a self storage facility.  And I own some rental vacation properties.  Running a campground is a piece of cake and I really don’t need to go to industry meetings and conventions.  Not much more I can learn.

 Like any business, while running a campground may not be rocket science, an RV park or campground has many unique characteristics and aspects not found in most other businesses.

There are very few businesses where the customer is in the “store” for 24 hours at a time, where you have to provide for their basic needs like water and heat or a/c, and take care of their hygienic and bodily needs.

There are very few businesses where the customers are in such close quarters with each other for long periods of time, where they are sleeping, eating and doing whatever else they do in a small box maybe just 15 feet from their neighbor, where they often share bathrooms with strangers, and where their conversation, music, television, and kids can be heard by surrounding neighbors.

And how many businesses are there where the owner or manager has to be a store keeper, a utility operator, a recreation director, a swimming pool operator, a social worker (to deal with difficult people and seasonal campers), personnel specialist, maintenance expert, and do all of this not just with the guest looking over their shoulder, but often their spouse and kids watching and commenting on every move.

Fortunately, there are numerous ways for the new park owner to gain the knowledge necessary to transfer from former businesses to owning and operating a campground.  Trying to build a successful campground business based on your previous business experience could be a fatal mistake.

Myth 10

Walmart is killing my site nights and taking my business.

 If you are simply providing amenity-free, no hook up, parking lot camping and charging for it, yes, you may be losing site nights to Walmart to those campers looking for that type of overnight camping.    Walmart (and other parking lots) offer amenity-free, no hook up, parking lot camping for free so if you are offering a similar experience and charging for it, you will probably lose some business.

However, if you are a full service RV park and are priced appropriately for your market you will attract those RVers who seek a full service RV park experience.  You and Walmart are competition with each other the way a Motel 6 is in competition with a Hilton. Both levels of accommodations will attract a specific market each night.  Motel 6 customers will always go to a Motel 6; Hilton customers will go to Hiltons.  Only rarely will a Hilton customer go to Motel 6 or a Motel 6 customer go to a Hilton.

Yes, sometime Hilton guests will stay at a Motel 6, but that’s generally when no Hilton is nearby.  And yes, some campers will stay some nights at Walmart, but generally that’s when there is either no full service campground nearby, or it is difficult to get to, or the price is out of the ballpark.

How to compete with Walmart for campers?

Here are some ideas:   Add value to your overnight experience – offer a complimentary continental breakfast each morning; provide a discount coupon for use in your park on a return trip; charge non-overnight RVers full price to use your dump station; offer a travel rate for arrivals after 7 pm and departure by 8 am; offer complimentary shuttle service from your park to Walmart for guest shopping, etc.

I don’t mean to minimize the damage a Walmart parking lot can cause to a nearby campground.  But Walmart’s focus is on retail sales.  Your focus is on overnight camping.  Walmart knows more about retail then you do – and you know more about RV parks and RVers than Walmart.  Focus on your strengths and think out of the box.  Rather than wasting time and energy on Walmart, put that time and energy into attracting more guests to your park.  It’s not always about the money.

Campground Management Myths – We Want to Hear from You!

Comments?  Criticisms? Suggestions?  Weigh in on the campground management myths discussion by leaving a reply below.