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Activities like hiking, camping, and fishing are beloved American pastimes and continue to draw huge crowds. In 2021, 54% of people across the country participated in at least one outdoor activity.
These outdoor enthusiasts rely on gear and equipment that meets the demands of nature — including everything from durable backpacks and weather-resistant tents to specialized apparel and tools.
But as an outdoor retailer, you may wonder: Are outdoor stores profitable, and how can you ensure your store thrives year-round, even when demand slows in the off-season?
The rising demand for outdoor equipment makes these stores a tempting business opportunity, but challenges like seasonality and inventory management can make profitability a concern.
Whether you’re looking to open an outdoor store or currently operate one, discover valuable insights to grow your bottom line.
Are Outdoor Stores Profitable?
Outdoor stores can be profitable, with the industry’s average profit margin around 4.3%. However, achieving maximum profitability requires strategic management and multiple revenue streams.
For instance, equipment sales — like backpacks, tents, and fishing rods — can have profit margins between 25% and 40%. Offering rentals and repair services is another way to increase income, often with lower costs and the bonus of repeat business.
Seasonality also plays a big role in profitability. Demand spikes in spring and summer but slows during the off-season, so think carefully about your store’s location and product lineup. Stores near popular trails or national parks often enjoy steadier sales and can even set higher prices for their goods.
Because the outdoor retail industry is growing by 8.8% annually, the market will continue to become more saturated, potentially cutting into your profits. To remain competitive, you need to stand out through careful inventory management, pricing, and marketing strategies. You can simplify these tasks with an integrated, all-in-one point of sale (POS) system.
How To Increase Your Outdoor Store’s Profits
Although selling more gear might seem like a way to make your outdoor store profitable, the secret sauce lies in diversifying your revenue streams and fine-tuning your management strategies. From smart inventory choices to offering rental options, the following steps can make a real impact on your store’s bottom line.
Fine-Tune Your Product Selection
Refining your product selection means understanding what sells and what doesn’t — and that starts with looking into your sales data. Regularly analyzing this data lets you identify the bestsellers to keep stocked and the low-performers occupying valuable shelf space.
For instance, if you notice that hiking boots are high sellers in spring and fall, keep multiple styles and sizes on hand during those seasons. However, if a specific camping stove model isn’t moving, it may be time to scale back or replace it with a more popular option.
A dependable POS system simplifies this process by providing real-time sales insights across online and in-store channels. With these insights, you can adjust your inventory to align with seasonal trends and customer demand to increase your sales potential.
Expand Sales Channels
Expanding sales channels is an excellent way for small businesses to reach more customers and let them shop however they prefer. Adding an e-commerce option, for example, allows outdoor enthusiasts to browse and buy from your store wherever they are, whether they’re just down the road or preparing for a big adventure across the country.
Curbside pickup offers customers a convenient grab-and-go option, perfect for busy weekends or those who know exactly what they need. For shoppers interested in a more personalized experience, in-store appointments can be a great way to let them try out gear or get expert recommendations, especially for big-ticket items like tents or kayaks.
With an integrated POS system, you can seamlessly manage all these channels. The system syncs inventory across your online store, curbside orders, and in-store sales, so you always know what’s available and avoid overselling.
Build Customer Loyalty With Reward Programs
For outdoor stores to be profitable, they need to give customers reasons to keep coming back; loyalty programs are a fantastic way to do this. Rewards points, special discounts, or exclusive members-only events give customers extra motivation to choose your store over competitors.
For instance, you could offer points that shoppers can redeem for outdoor essentials or a discount after a set number of purchases, turning one-time visitors into loyal fans.
Managing these loyalty programs is simple with a POS system that tracks customer purchases and preferences. With access to detailed customer data, you can provide personalized service and targeted promotions, potentially increasing revenue by up to 15%.
Offer Equipment Rentals and Service Options
Offering equipment rentals and maintenance services is a strategic way to generate extra revenue and give customers more reasons to visit your store. Outdoor gear rentals typically have a higher profit margin than retail sales, at 35% to 40%.
Not everyone wants to buy gear they’ll only use a few times a year, so rentals of kayaks, paddleboards, backpacks, or skis appeal to occasional adventurers and those interested in testing out equipment before making a purchase. Maintenance services, like tuning up mountain bikes or repairing tents, add value and encourage repeat visits, helping you build lasting customer relationships.
With a POS system that tracks rentals and service details, you can streamline these options and avoid the paperwork hassle. You’ll know who rented what, see when it’s due back, and keep a history of each customer’s service visits. So the next time a customer brings in their bike, you’ll know exactly what was done last time, making it easy to provide exceptional service.
Start Growing Your Outdoor Store’s Profit Today
Outdoor stores have strong potential for profitability, especially for retailers who know their market and leverage multiple revenue streams. By stocking high-demand seasonal products, offering rentals, and implementing loyalty programs, specialty retailers can position themselves for long-term success in the outdoor industry.
To fully capitalize on these opportunities and answer the question, “Are outdoor stores profitable?” a system like Rain POS can be a game-changer. Rain POS offers real-time insights, integrates online and in-store inventory, and allows you to manage customer loyalty programs — all in one place.
Book a demo with Rain POS today to learn how it can help increase sales and grow your business.
