- 8 months ago
Category
🛠️
LifestyleTranscript
00:00According to the Bureau of Economic Research, it came out last year and it said that snow activities in the economy for the U.S. was a $7.7 billion business in 2023, and that in Colorado, Utah, and California, it was the, quote, largest conventional activity.
00:16It's a big deal.
00:17It's a very big deal.
00:18Yeah.
00:19For more on the ski industry and how this season is looking, we welcome Bob Shea.
00:22He's founder and CEO of Surefoot.
00:24Surefoot is the biggest custom ski boot company in the world.
00:26They've got 29 locations in North America, Canada, and Europe.
00:29Bob joins us here in the Bloomberg Interactive Brokers Studio.
00:33Welcome.
00:33How are you?
00:34Good.
00:34I'm really good.
00:35So for people who aren't familiar or haven't stepped foot into a Surefoot, explain the process because I think people understand ski boots, but then Surefoot takes the shell and then customizes it.
00:44What do you guys do?
00:45I mean, basically, a person comes in the door and then there's some conversation with them to find out their history of skiing and how much they've skied, what level they're at, and everything, and then they're kind of evaluating.
00:55But then the technical part starts.
00:57We put your foot onto a 3D imaging machine, which makes an orthotic for underneath your foot, the first step in there.
01:05And then we put you onto another image that takes a scan of your foot.
01:10So it really, what we do at that scan is we match that to the shell.
01:15So we basically have a visual of your foot exactly, and we match it into, we find the right shell for you.
01:20So now that shell matches your ability, your history in skiing, what you enjoy about the sport.
01:27And then we put it together with a custom liner that we make.
01:31And we have numerous different ones, about five or six ones.
01:34So we, you know, looking at your foot, decide from there which one's going to work best for you in the sport.
01:40And that whole process, because we've sort of packaged it all together on the same roof, just takes about an hour where we can go from you walking in the door to walking out with a boot that's totally custom fit for your foot and ready to ski in.
01:54You've done this.
01:54Yeah, I did this back in 2021.
01:56I finally got my first pair of Surefoot boots.
01:58I mean, I've lived in places where Surefoot has had locations.
02:03And finally, I was like, you know what?
02:05I'm getting to my late 30s.
02:07I don't get ski boots very much.
02:09It's time for me to have like a really comfortable pair of boots.
02:12And I've wanted a pair of Surefoots.
02:13And they haven't always been comfortable.
02:14No, they haven't.
02:15And, you know, the thing is, is, and, you know, I had a scan done in like 2000, let's say 2007 maybe for a pair of orthotics for cycling shoes.
02:24And they were able to tell when I went to the store that my foot had actually changed.
02:28Yeah.
02:28Since that.
02:29So they had to make a, they had to re-scan it and do a new pair of orthotics based on the new scan, because I guess that's what happens when you age.
02:36Yeah.
02:36Well, I think it's, it's most feet do that.
02:38You know, if you have some flexibility, mobility in your foot.
02:41It's wear and tear too, right?
02:43Yeah.
02:43But go ahead.
02:43Yeah.
02:44Yeah.
02:44Over time, it really, you know, your foot's going to change a bit.
02:47And the scans are extremely precise.
02:49So it's, you know, we can be talking about a minute difference, but that minute difference is a big deal.
02:55It's a big deal in, in biking shoes, if you're really into it.
02:58And it's a big deal in ski boots.
02:59Bob, how did you get to this point?
03:01Because to me, it makes a lot of sense.
03:02And I'll be honest with you.
03:03I wear orthotics and just general, and it just makes such a difference in shoes and sneakers and what have you.
03:09How did you get to this point?
03:10You know, really, it started, I grew up skiing and ski racing and boots always just killed my feet.
03:16Like really, I have very wide forefoot and boots, you know, when you're trying to jam into a ski racing boot, it's just, there's a lot of pain.
03:24And I really, it took time off the slope.
03:26I couldn't stay out as long as I wanted to as a kid.
03:29And so over time, I just started developing ways to make it a little better.
03:34And then as I got done with ski racing in college, I was like, I don't want to leave this sport.
03:39I love the sport.
03:40I can make a difference in it.
03:42So that was really the impetus for it, you know, thinking about it.
03:45And then, and then a lot of trial and error.
03:47I mean, crazy trial and error.
03:50What was the, what, tell us, like, what was some of the errors?
03:52I remember one of my first employees is that John Higgins was, you know, he was on the U.S. ski team.
03:59Collegiate Ski Racer.
04:00And we were together, we were trying to make a pair of boots for me with a new, this foam material that we had found.
04:07So we, we inject it into my foot and he gets it all over his hands, everything.
04:13And then I'm standing there and it feels like it's going to break the bones in my foot.
04:17I'm like, John, you, you got to get this off.
04:20You got to get this off my foot.
04:22It's breaking the bones.
04:23And a guy was walking by kind of through the back corner of the space that we were in.
04:27And he was a chemical engineer.
04:29And he looks at John and goes, if you don't get that off your hands in the next, like, 30 seconds, it's never coming off.
04:35So now John takes off to get that off his hands.
04:38Oh, my God.
04:38And I'm, I've got this on my foot.
04:40You're like, hey, hey.
04:42I think it's breaking the bones in my foot.
04:45And I'm like, but luckily it didn't.
04:47And he got it off his hand.
04:49And we probably took a step back for a couple of years from that.
04:52But that's really how it began.
04:53So we're going to talk more about the origin story in a few minutes.
04:56And before we get there, one of the reasons we wanted to talk to you is because you serve this higher end consumer.
05:01And we talk a lot about what the economy looks like right now.
05:04And just when you talk about skiing in general, you're already talking about a segment of the consumer that can afford to travel to a ski area, pay for an expensive lift ticket oftentimes, stay in an expensive area, and then do something that requires expensive equipment.
05:18Give us an idea.
05:19And you're a private company, so it's, you know, we don't have access to a ton of your own data.
05:24But how is the consumer you're dealing with right now?
05:27How are sales?
05:28What are some numbers you can give us?
05:29I mean, I think all of us are always a little, you know, you just kind of have this tendency when you're in business.
05:34You know, you're a little worried.
05:35But right now, things are actually going along pretty well.
05:40You know, business, we're up a little.
05:43But then, as you were talking about just before how we didn't have snow, we take a dip, you know, at that when it's early.
05:50But in general terms, we see the consumer is fairly strong, you know, coming in.
05:56And, you know, what's really happened, Tim, is I think that people, recreation is just a bigger part of our lives.
06:02We all, you know, we want to do that.
06:05We want to be out there.
06:06And luckily, we're in the sport that people really love.
06:10Bob, have you seen that coming off the pandemic of people even like kind of that?
06:15Obviously, after the pandemic, it was like, I got to get out in the world because I couldn't for so long.
06:19But do you see it kind of lasting?
06:21Yeah.
06:22I mean, honestly, I see it in my own company, how many people aren't in there.
06:27I think it became more important for everybody.
06:29You know, it's like you're out of the office a bit, you got outside, and it just, it seems healthy.
06:35And that's what, to me, it seems like happening in the mountains.
06:38We look at it like it's a healthy place to be, to exercise and stuff.
06:42And so I think it's good for the, it's good for my business, good for the sport, my life.
06:46Well, people in New York City know that you have a store in New York City, but it's kind of a unique store because it's not near a ski mountain.
06:52I think every other store that you have, maybe save for Vancouver or London, yeah, you know, is right at the base of a ski mountain.
07:02Is New York your, like, the biggest location in terms of what it does in sales?
07:06It was the first, it was the first city store.
07:08It's not our biggest volume store.
07:10You know, we have that in the mountains.
07:11But many of our stores are very similar in size.
07:14But really why we put them here is because, you know, there's just people who want to, there's different personalities.
07:19They want to get it done before they go to, you know, on their trip and those there.
07:24And now you can get the exact same thing.
07:27So really, early season, our city stores flourish.
07:31I mean, how busy are you right now?
07:33Is it crazy?
07:33Really?
07:34Yeah.
07:34You know, honestly, it's the most fun part of my job.
07:37I was in the New York store this morning for, you know, and it's just, I love when it's just busy in there and everyone's talking about sport and skiing.
07:44And enjoying it.
07:46Very briefly, you bought a company back in 2012 that is not a winter company.
07:52Yeah.
07:52And now that's attached to the store in New York City in terms of running.
07:56How big of a growth area is running for you?
07:58You know, that's, I mean, the reason we got into running was because we were runners to stay in shape for skiing.
08:04I mean, you know, we all run and, you know, are part of it.
08:08And then because of the orthotics that we make, the custom, you know, the basis of the ski boot is used by so many athletes and runners like Boston Marathon winners and so many people.
08:18So we talked about your story of you starting this company with your brother.
08:21I mean, you've been doing this for more than 40 years at this point.
08:24Completely bootstrapped.
08:26No investors.
08:27You also don't franchise at all.
08:30I'm sure this has come up when people have come, hey, you should franchise this.
08:34Why not?
08:34You know, we get asked once a week about the franchising thing at least.
08:38But, you know, it's just that we wanted to have better quality control over it.
08:43And we want to give our employees opportunity.
08:45And that's what it really comes down to is that we, in order to open more stores, we train people.
08:50And when they're ready to go to store, like our most recent store we opened in Big Sky, Chris Chiardo, the manager there, worked for us a long, long time.
08:58And he wanted to move there.
08:59So we opened a store there.
09:02That's pretty cool.
09:03I think that's pretty cool.
09:04I mean, I'm also assuming that folks have reached out to either invest in you, buy you up.
09:10Like, yeah.
09:11And you just, you're, you want to continue to go it alone.
09:14Yeah, you know, I think it's, we've had, you know, we have had minority investors and stuff in there.
09:20But we've also had some hard knocks with those.
09:23And so as long as we control the business and we enjoy what we're doing and, you know, we have, my daughter is in the business.
09:30My, you know, we have family in the business.
09:32I want to do it for a long time.
09:34Yeah, go ahead, Gerald.
09:35What's your supply chain like?
09:36Is everything done in the U.S.?
09:38Do you have to, I wish it was all done in the U.S.
09:41You know, it's, I really wish that it was done here, but we're not able to.
09:46There's just things that are not.
09:47So, yeah, we've had challenges with the supply chain right now.
09:51We try to mitigate them and the costs and the tariff.
09:54But the costs have gone up.
09:55Yeah, yeah.
09:55I mean, it's a tough, it's been a tough thing, too.
09:58Yeah.
09:59And I really think I look back and think, wow, I'm glad this didn't happen when we were in business five years or something.
10:04And I don't, I don't know how a small business gets through it.
10:07You know, we're a little able to manage it a little better.
10:09But yeah.
10:10The biggest story in the ski industry, obviously, is snow and making sure that people can actually get on mountains.
10:18The second biggest story in pretty much any ski town that you go to is the cost of living.
10:23And I'm wondering, you are known for having these long-tenured employees who live in the communities where you have stores.
10:30And these are very transient communities because they're ski areas where people come for the season and then leave.
10:35How do you make sure that you can have employees that can actually live somewhere, like attracting and retaining a long-term employee in a place where truly nobody can afford to live?
10:46Yeah, it really has.
10:47I mean, you know, we talk about it being so hard right now, but, you know, there's been many points where it has been.
10:53But what we've always tried to do is make our employees really productive, the whole system that they do, and then pay them the best that we can in there.
11:02But it is a challenge, you know, in there.
11:04And you have to, yeah, we have to deal with that.
11:06I mean, look at some of these markets.
11:08They're crazy.
11:09They're crazy expensive now.
11:11So we have some employee housing.
11:13But the real thing is how we keep people.
11:15You do have employee housing.
11:15Yeah.
11:16Oh, interesting.
11:16We have employee housing in all the big markets.
11:19But that's more for new employees that are, you know, coming into the company.
11:26Like to help them get settled and so on.
11:27Yeah.
11:27You know, their first, second year.
11:29But all of our, you know, management and everything, we've always wanted the company.
11:33You know, I always say if we're not going up, we're going out.
11:35We have to go up to give employees opportunity to keep growing, keep growing.
11:40And that gives employees opportunity.
11:42Their stores keep growing, get bigger.
11:44They can be rewarded more for that and compensated.
11:47But no doubt, it's a big challenge.
11:50Where's the growth in your industry?
11:51Like, how do you think?
11:52I mean, 40 years you've been doing this.
11:53Like, it sounds like you still look for new opportunities.
11:56Constantly.
11:57I mean, really what it comes down to is we're still a small percentage.
12:00You know, we're probably somewhere around three or four percent of the dollar volume of ski boots sold in the world.
12:06And so we have a lot of room to grow in that.
12:08Would you ever consider making your own ski boot?
12:10Just to remind everybody, you buy the shell from a company that makes the ski boot and then you do the liner and kind of everything else.
12:17But would you ever make an actual sure-foot ski boot?
12:20Yeah.
12:20I mean, we have right now, we have 3D technology that we're working on with boots and everything.
12:25But I think as long as we can get the shell that we think is really great for a customer in the market, then we'll keep doing that.
12:32So what we really do is we buy the shell without the liner so it saves the consumer money.
12:38And then we have a great shell in the outside and the interior we've made.
12:42But we are always working on – so if I come up with a great idea about a shell, you'll see it.
12:49I like that.
12:50But in terms of growth, like, okay, no offense, but I'm like thinking, wait, I got orthotics, but these sound better.
12:54Like, can you – in terms of the medical market or people who go to foot doctors, what's the percentage, like, through your machine, like, that you have?
13:03The percentage even in that market is –
13:06Yeah, we're small.
13:07Even when – we're one of the largest makers of orthotics in the United States, but, like, actually kind of a long shot we are.
13:13But we make so many in our stores.
13:15If you combine what we do in our stores and what we do in our factory, we're by far the largest.
13:19But there's lots of room because a lot of people don't really know how beneficial they are to you.
13:24Right.
13:25So if something happens to you, if all of a sudden you have plantar fasciitis, your foot's hurting, you're aching from running, that's when you start seeking us out.
13:33So, Bob, if somebody comes in and gets an orthotic through you, I mean, is it covered by insurance?
13:39It is if a doctor – you know, if they have a prescription for it.
13:43The majority of what we sell are not – that's not really true.
13:47In our medical division, it's mostly prescription.
13:49And then in our consumer, it's not.
13:51But, you know, they are covered.
13:53And they're the same scan.
13:55So we can make – we can do anything with that, you know, with this scan.
13:58It just seems like a mass market.
13:59Like, it's major.
14:01It is a big market.
14:02Yeah.
14:02Well, the reason you have that market is because you bought this company Amphit, the orthotics company, based in Vancouver, Washington, back in 2023.
14:09You bought super runner shops back in 2012.
14:13Any more acquisitions on the horizon?
14:15You know, right now we're doing something really big that we're about to introduce, our own line of footwear.
14:20And the footwear is made specifically for orthotics to fit your orthotics in it.
14:25So you have a perfect platform.
14:27Like right now in ski boots, you have a perfect platform when we make the boot whole thing.
14:32So you're standing totally aligned.
14:34But a pair of shoes, you pull out the insole, the orthotics can be bigger than the insole.
14:37Yeah, it doesn't fit quite right.
14:39And you can't get it, you know, in there.
14:41So we are in late, in a few weeks, we're about to introduce a line of shoes that is just for that.
14:47So when you get a line scan, your body's put into alignment, you put it to our shoes, you're going to stand in a very balanced, comfortable position.
14:56You guys are doing this on your own or is it a collaboration?
14:58We're doing it on our own.
14:59I think we're breaking some news here.
15:01That's pretty cool.
15:01You know, I debated whether I should even say this on here, but it's a big deal.
15:07We've been working on it for years and it's really cool.
15:10We have some, I was just at the World Cup in Vail and I had on a pair of the winter boots and I had like four or five people ask me about them.
15:18What are those?
15:19Where are they?
15:19I'm like, oh, nice.
15:20We have a little, little luck here with the product.
Comments