How Reno netted the big one, Cabela's

Pinnacle Entertainment had a lot of tire kickers on its 40 acres of land next-door to Boomtown, says Jack Fisher, general manager at the resort.

And most of them initiated the contact, he adds.

But with Cabela's, Boomtown made the initial phone call that set the land sale in motion.

As the negotiations moved forward, Cabela's desire to purchase the land and build a 150,000-square-foot destination retail store became the worst-kept secret around Reno since Wal-Mart's attempt to keep its 890,000- square-foot distribution center east of Sparks hush-hush.

Still, Cabela's announcement last week of its intent to build created a flurry of excitement.

The store is expected to attract more than 4 million customers a year and, according to Reno City Manager Charles McNeely, will generate about $3.6 million in new sales tax revenues the first year.

Seven other areas around the country are going through similar ecstacies of anticipation this year.

Cabela's is on an aggressive growth curve,with four stores under construction for 2005 opening, three more slated for 2006, and another on the books for 2007.

As recently as 1998, the 44-year-old outdoor equipment and clothing retailer had just two destination retail stores.And its catalog business was the backbone of its marketing strategy.

Now, Cabela's is implementing a retail store growth strategy.

The company went public in June,with an initial public offering that raised $114.3 million.

The sporting goods giant committed about $210.2 million to construction and development of new stores.

And it has the data to determine which areas house its best customers.

It gathers regional information via its catalog such as which area buys camping equipment, which spends most on hunting, on fishing, on bird-watching.

"To find customers," says David Draper, Cabela's communication specialist,"we can look right down to the Zip Code."

In just this way, Cabela's has gathered information about its future northern Nevada customers.

And the data says that the store built here needs to include a gigantic,walkthrough aquarium stocked with native fish, a world-class gun library, a shooting gallery, and an indoor archery range, among other features.

The Reno Cabela's will be the company's westernmost outpost.

But probably not for long, says Draper, and certainly not forever.

Back at Cabela's headquarters in Sidney,Neb., in the company "war room," he says, there's a map.

And pins all over the map, from Florida to Washington, indicate possible store locations.

How many of those pinned areas will become store locations is unknown.

The company is increasing its brand presence, but, says Draper, it also does not want to dilute the special quality of the destination store.

So,what did it take to attract Cabela's to its new digs on the I-80? Some upfront costs are unknown as yet.

But, says McNeely,"We need to provide assistance," and that assistance was critical to Cabela's decision to locate a store in Reno.

The city is exploring financial incentives such as use of Sales Tax Anticipated Revenue STAR Bonds to pay for roads and infrastructure.

It might also seek federal funding to help pay for improvements to the I-80 interchanges.

In addition, it is contemplating a special assessment district, as well as studying the possibility of including the area in a redevelopment area.

When up and running, the Reno Cabela's will support a payroll of more than $8 million and employ about 400 people.According to city estimates, 184 of them will be fulltime workers.

Area hotels, restaurants, casinos and sports venues are all expected to benefit from the retail tourists attracted by Cabela's.And what about other retailers in the area? Sportsman's Warehouse's Reno store will be in competition with the newcomer, says Stu Utgaard, chairman and chief executive officer of the 30-store chain.

Cabela's is formidable competition, but what's amazing, he adds,"is that cities give them $20 million to build a store.We never ask customers to pay with taxes to build our business." Sportsman's Warehouse is near Cabela's in markets other than Reno and surviving."We have been the fastest growing company in our industry," says Utgaard.

Sportsman's Warehouse, also in a growth phase and planning to open 13 to 15 stores this year,will be in 23 states by the end of this year, says Utgaard.