SKI RESORTS IN THE USA

CASE STUDY

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TABLE OF CONTENTS:

1. Abstract……………………………………………………………………...3

3. Question 1…………………….……………………………………………4-6

4. Question 2……………….…………………………………………………6-8

5. Question 3…………………….……………………………………………8-9

6. Question 4….…………………………………….…………………..……9-10

7. Conclution…..………….………………………………………………….…10

8. References……..………………………………………………………….11-12

Abstract

This case study focuses on the problem of how management is becoming more and more important in many different fields of life. In this case, how good management can contribute to ski resorts. It observes and answers to the four important questions:
In the first part it is explained what are the mainly changes in the business environment that have occurred 30 years ago, and how they effected ski resorts.
The next part shows why management becomes more and more important for the survival and success of the ski resorts comparing it to 30 years ago.
How competition from Europe has influenced ski resorts in the USA, and the discussion about the competition between the Colorado resorts and the other resorts from the east is made.
In the last part the focus is on the predictions in the future, how will environment and future of the ski resorts change.

Question 1: What are the most important changes in the environment that have contributed to the drop in revenues?

From the period of 1970’s to 1980’s the Ski resorts and the ski industry in the USA was blooming, but suddenly in the mid 1980’s, all ski resorts were facing problems caused by the changes in the environment. Most ski resorts were having low profits.
The losing of the profits were caused because of the change of the average year of the skier. This happened because of the Boom age Generation. People who were born between the 1946 and 1964 were the people who had to somehow manage to raise their families on their own. Because of this, they didn’t have much spare time and money for wasting on winter-skiing holidays. For the reason mention in above, many of the resorts were also dealing with the problem of having more buildings than it was needed. Because of that, many smaller ski resorts disappeared. But on the other hand, the large resorts are growing from year to year. In the time being, the number of the resorts is poorer each year. Also one of the issues is the amount of money which is needed to stay in business, because of the great competition.
Additionally, from year to year the trends change rapidly. For example, children these days are more likely to play video games than to go skiing. Other thing is that, every coming year more people are likely to try the snowboard than to ski. But nevertheless the majority of snowboard riders are with the age under 24.
When we are talking about the reasons why there is a decrease of the revenues in the ski resorts, one of the problems could also be the effect of the Terrorist attach on September 11th. People have become more frightened to travel. This also led to a decrease of the profit in the tourism in the rest of the USA as well.
Maybe the biggest problem of the ski resorts is the change of the climate, global warming, caused by the effect of the Greenhouse gases. The thing which is most important to ski resorts is snow, with dealing with this problem it is almost impossible to start the ski season at the normal time. By being late for the startup of the ski season, ski resorts are having problems. The fact is, 20 record temperatures which are measured in the winter period are the temperatures measured in the years after 1980.

-As presented in the case in above, now we are aware of the changes in the environment which lead to drops in the revenues and how managing and solving this problems is important.

Question 2: why is management a more important success factor for ski resorts now, compared to 20-30 years ago?

For the period of past three decades, the ski industry has tremendously changed in the United States. As mentioned in the first part, from 1980’s ski resorts started losing profit, all caused by many changes in the environment. Starting from the period of expansion of the private ski resorts which were managed by big corporations, the competition had become greater as never before. And management became very important in order to stay in business. To be in good position, to stay on market, and to gain profit becomes impossible without good managing.
With the problem of increasing the age of the customers from 33,2 to 36,6 many ski resorts are now paying attention to this customers who mostly have families and children. For them, ski resorts are doing their best to attract the customers offering them special discounts just to make their staying as more comfortable as possible.
Continuing the research, we are informed about how ski resorts have struggled to answer to all needs of the customers. The popularity of snowboarding had made many managers to think hard and to try to figure out what will bring customers to their resorts. By building various snowboard ramps and special terrains for the snowboarders, many new people from this segment have gathered. With the newest data showing the increasing of this sport by 50% in the past 10 years, ensures the good future for this resorts.
The appetites of the customers have also influenced ski resorts to enrich their offer to customers by offering them special treatment. Apart from the usual that tourist wanted in the 1970’s when everything was about skiing, nowadays ski resorts offer cinemas, spa centers, massages, art galleries, pools, casinos… they will basically do everything to make the winter holiday unforgettable.
By technology getting advanced from day to day, obscene amount of money is being invested in building new ski lifts, which are faster more comfortable, expanding the capacity of the skiers etc. Another aspect is the widespread of the internet and its contribution to the resorts as well. With this technology, the on line reservation for accommodation is possible, advertisement as well.
Finally the greatest problem of ski resorts definitely is the weather and the changes of the climate. The worst snow enemy is global worming, and with this problem it is almost impossible to go skiing. But as we said, with new technology and making artificial snow and campaigns which are led by great resorts in order to save the mountains and continue healthy climate, it is, and it will be possible to ski in the future.
To sum up everything, giving the issues an above, it is realized how management is becoming key factor to the success of the ski resorts, compared to 20 and 30 years ago.

Question 3: How is competitive environment of the resorts on the east coast different from that in Colorado? What should the east coast resorts pay particular attention to?

In both east and Colorado ski resorts, there are differences. Both attract many tourists. These resorts are well known and there is great competition between them. Colorado is well known in the whole world as a ski country; nevertheless it has more than 26 world-class ski resorts from which 6 are in the top 10 in the United States. Colorado is well known of its long ski season, which last almost 10 months; this is what attracts many tourists from round the world. The point is that both resorts in Colorado and those in the east can make their clientele do whatever they like. Besides skiing, there are many services available to tourists who make competition even tougher between the east and Colorado. The majorities of the ski resorts in Colorado offer top class skiing, and also provide various non skiing services, combining this and the long winter season puts Colorado in advantage.

The other differences between the two resorts are that the ski resorts in the East are smaller than those in Colorado, so they concentrate to low the prices and to make family holidays pleasant. East resorts are also dealing with the problem of having less snow each year, having shorter season and having competition in Europe makes it even harder for them. Comparing the prices of the ski tickets in the Colorado which are close to 100$ and in Europe up to 50$, most of the people from USA decide to go skiing in European famous ski centers in Austria, France, Switzerland etc.

This is why resorts from the East coast keep trying to low the prices as much as possible so that they can attract customers and stay in business.

Question 4: What are possible changes in the environment do you believe will take place in the next few years?

By answering the questions in above, knowing about the changes in the environment and the competition, some predictions about the future of the ski resorts and the future of the ski industry are possible. The number of ski resorts has decreased from 845 in the 1980 to less than 500 nowadays. With having great ski resorts in Europe as competition, the battle between them will be even tougher as it used to be. The other thing is that managing those resorts will have important role in the future as well. It is also expected to have some new snow sports in future, moreover improving the technology, even providing even more exclusive services for non skiers. Also the big problem caused by the global warming should bear in mind. By improving the new technology and having artificial snow will slightly solve the problems. Furthermore, it is also expected to concentrate of having more youth in ski resorts, also bringing the people who are somehow neglected like women and older generations as well. But the most important thing about what will take place in the future is definitely keeping mountains cleaner, whiter, and healthier. All in sake of having snow, because snow is something what is a must have in order to run the ski business and to have tourists.

Conclusion:

Summing up the analysis made in above, it is quite sure about some things. Firstly, nowadays it is much more difficult to run the ski resorts than comparing it to the past. The resorts have changed dramatically from the past 30 years, the environment, the competition, trends. In the past, everything was about skiing, and it was much easier to run the ski resort, and nowadays with new technology, the appetites of the tourist which are increasing from day to day it is obvious that managerial skills have a great role in the business.

Next, the problems with having milder winters and lack of snow each year, will be concentrate on. Existence of the competition in Europe will also lead to a fight between the resorts worldwide, loosing profits in some resorts and even disappearing some of them.

By having all in mind, the managerial skills and the new ideas which will bring people to resorts will be crucial for the resorts in order to survive the big battle between them.

References:

✓ Chrzan, K.(2002) Market Research: Using statistical power to set sample sizes. Marketing News, p.11

✓ Folmer, F.(2005) Niche Travel: Skiing with the kids. Questix Media Group, p. 56-59

✓ Folmer, F.(2004) Focus on ski the West, Extreme Makeover: Vail plans a major overhaul to its base areas. Advanstar Communications Inc. p.47

✓ George, A. A.(2003) Managing ski resorts: perceptions from the fields regarding the sustainable slopes charter. Managing leisure 8,p.41-46

✓ George, A. A.(2004) Managing ski resorts: The National Ski Areas Association (NSAA) of the United States' 2001 and 2002 Annual Progress Reports on the environmental Charter and the reaction from conservations groups. Managing leisure 9,p.59-67

✓ McGinn, D. (2005) KING of the HILL. Newsweek, 145(8), p. 12-18.

✓ Randall, L. (1996) Shakeout in skiing. Forbes, 157(9), p.56-60.

✓ Palmeri, C. (2005) AN UPHILL BATTLE ON THE SLIPPERY SLOPES. Business week, 3815, p.44.

✓ Rothbaum, N. (2005) Hold the Skis. Smart Money, 14(12), p. 114-117.

✓ Weiss, E. (2002) Ski West: Colorado Ski's New Voice. Travel Agent, p.115-116

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