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Cabela's dead animals worthy of a museum

A box in the print edition of the NY Times says of Cabela's: "Jerky tastings and taxidermy displays worthy of a natural history museum." Cabela's supports the Iditarod, bull riding, rodeo and killing animals. Their stores are filled with hundreds of dead animals.

See inside Cabela's disgusting stores: 

Cabela's store locations:*left*retail_stores 

Letters to the Editor: [email protected] , [email protected] 

November 30, 2005

Square Feet

Sporting Goods and Its Own Business Model


BUDA, Tex. - Since it opened in June 2005, it's been hard to find a parking space at the Cabela's in this tiny town, halfway between Austin and San Antonio.

A shuttle like those that ferry travelers between gates at airports zips around Cabela's stadium-size parking lot taking people from their cars to the outdoor equipment retailer's rough-hewn entrance. In their sensible shoes and fanny packs, looking like tourists instead of shoppers, many reach for their cameras to take pictures of the hundreds of mounted wild animals that greet them as they walk through the door.

It's the same scene at the 14 other Cabela's stores across the country, most of them built in the last five years. Typically perched on a hill overlooking a major Interstate, the stores look like giant stone hunting lodges and are essentially amusement parks for the hunting and fishing set.

Each store annually attracts close to four million visitors, many of them traveling more than 100 miles, according to company officials. Even with the substantial tax incentives required to entice the company to break ground, the stores are a boon to the mostly small towns where Cabela's has put retail outlets.

"Having Cabela's here has accelerated growth tremendously," said John Trube, mayor of Buda, which has a population of 4,000 and now has several restaurants, two hotels and a Wal-Mart under construction. "We're having businesses come in that would have never located here before."

More than mere megamarts, Cabela's stores, stocking more than 200,000 products, are tourist attractions featuring 50,000-gallon fresh water aquariums, taxidermy displays worthy of a natural history museum, fudge shops and laser shooting galleries. They are designed to invite crowds. The 185,000-square-foot showroom in Buda has so far drawn almost as many visitors each month as the Alamo, the most popular tourist destination in Texas.

But there would be no bustle in Buda, which has a municipal budget of $4.5 million, if the town had not secured a $40 million bond to make the infrastructure improvements Cabela's demanded. As it has done in other communities, the company then bought the debt in exchange for a sales tax exemption. The state of Texas also awarded Cabela's a $600,000 enterprise grant and made $19.5 million in Interstate and overpass improvements.

"We used to have two lanes going in and out of town and now we have five," said Warren Ketteman, the executive director of the Buda Economic Development Corporation. "The state got it done in a year. Otherwise, it would have been a traffic nightmare around here."

Cabela's, which is based in Sydney, Neb., negotiated a similarly favorable package of incentives from local and state officials before the September opening of its 150,000-square-foot store in Lehi, Utah, which is halfway between Provo and Salt Lake City. It is hard to quantify exactly how generous the deal was because it included an exemption from paying tax on catalog sales to Utah residents. (Founded in 1961, Cabela's started as a catalog company and its mail-order business still comprises more than half of its $1.6 billion annual sales, according to the company's annual report.)

Moreover, a developer gave Cabela's its 40-acre store site in Lehi, according to company and town officials. "We wanted them as an anchor tenant," said Stephen C. Christensen, the chief executive of Mountain Home Development, a planned community of 8,000 homes and four million square feet of retail space in Lehi. He would not discuss the terms of the land transaction.

Locating in small towns like Buda and Lehi, where locals are more likely to offer such sweetheart deals, is part of Cabela's strategy. The company's senior vice president for retail operations, Mike Callahan, said, "They are more eager to work with us because we are a huge driver for economic growth," not only because of the traffic the stores generate but the ancillary businesses like hotels and restaurants that tend to cluster around them.

For example, there was only one hotel and a biker bar in Dundee, Mich., 17 miles south of Ann Arbor, before a 225,000-square-foot Cabela's opened in 2000. Today there are four hotels with a fifth under construction and eight new restaurants. "We've been able to lower the village tax rate," said Dale W. Zorn, a county commissioner.

Cabela's, which went public last year in part to finance the growth of its retail business, prefers towns that are on major Interstates and less than a 30-minute drive from large metropolitan areas. The company maps out where it has the most catalog customers and how much they spend.

"I have a color-coded map of the U.S. on my wall with green representing the best areas for us to locate stores," said Mr. Callahan, adding that Cabela's has identified at least 50 green zones and plans to open four stores next year. Each store costs $50 million to $80 million to build.

As part of its site selection negotiations with city officials and developers, Cabela's typically requires that it be allowed to approve all nearby tenants. In some instances, as in Buda, the company will buy four times the property it needs so it can control who becomes its neighbors. "They are very picky about who builds next to them," said Mr. Ketteman of the Buda economic development corporation. Cabela's real estate covenants usually bar competing sporting goods retailers, liquor stores or used-car lots.

Retail analysts worry that Cabela could face a problem that afflicts many tourist attractions like the Alamo: people will go once and figure they've been there, done that. Another concern is rising fuel prices. "You've got to wonder with gas at $3 per gallon if people are still going to want to drive 200 miles to buy a fishing rod," said John Shanley, senior athletic and footwear analyst at the New York office of Susquehanna Financial Inc., which is based in Philadelphia and has a neutral rating on Cabela's stock.

But the parking lots at Cabela's stores that have been open for several years are still packed. "Amazingly enough, the people keep coming," said Marilyn Scheibel, director of the Convention and Visitors Bureau in Lenawee County, which is near Cabela's Dundee store. "The store has all sorts of fishing and hunting events, bird-calling classes and things like camper shows that bring people in." Other store events might include jerky tastings or workshops with titles like "The Secrets of Stalking" and "Cast Iron Cooking."

Another concern for analysts is that the stores will cannibalize the catalog sales. But Mr. Callahan said that although there was a regional dip of 8 percent to 10 percent in catalog orders in the first few months after opening a store, it rebounded within 18 months. He also noted that online sales continued to be robust.

"We're in an age of multichannel shopping," he said.

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