The kayak and canoe market boomed after COVID drove recreation outdoors in 2020, but it hit two rocky shoals last year: inflation and changing habits.
Sales have leveled off at pre-pandemic levels, and independent Arkansas outdoor retailers say they face challenges selling all kinds of big-ticket gear.
“We went months without having anybody walk in the door and say the word ‘kayak’ in the latter part of 2022 through 2023,” said Jim Frank, owner of Ozark Outdoor Supply in Little Rock. “And it’s still really, really depressed.”
Frank’s 2,000-SF store has operated from a vintage 1900 house on Kavanaugh Boulevard since 1972. The business climate holds a lot of room for improvement, he said. “It’s not great. The bottom line is we’re fine, but it’s been a struggle pretty much all year.”
Kevin Fendley, a co-owner of Pack Rat Outdoor Center in Fayetteville, is his 15,000-SF store’s boat buyer.
“We sold a lot of [canoes and kayaks] back in 2020 and 2021, and some of 2022,” he said. “It’s tapered off since then, and is back to roughly about 2019 levels.”
Nationally, the outdoor gear market was off 3% in 2023, down to $27.5 billion from $28.3 billion in 2022, according to the Outdoor Industry Association’s 2024 Outdoor Retail Trends Report. And independent outdoor specialty retailers had an even worse year, with sales declining 9.7%. Total independent sales were $4.2 billion in 2023, down from $4.65 billion.
And more than half of the country’s independent outdoor specialty retailers saw double-digit declines in total dollars of merchandise sold.
A Boom, Then a Glut
Frank said that outdoor sales “went bonkers” in late April and May of 2020. “The bike industries, the outdoor industry, canoes, kayaks, off-road stuff and vans, all that just exploded. It was beyond what anybody had really ever seen, at least from our perspective.”
But the boom set the stage for inventory problems, he said, a viewpoint that Gearhead Outfitters owner Ted Herget seconded. Herget considers himself an independent outdoor retailer, but the scale of his Jonesboro-based company is different. He and his wife own 22 stores in several states, including Arkansas, Missouri, Illinois, Tennessee and Colorado.
“Every space in the outdoor business sold out of everything,” Herget said in a telephone interview. “It’s basic business, supply and demand. The less you have, the more people want it. The supply line was disrupted. Retailers overbought, manufacturers overbuilt, and then there was a glut.”
The same phenomenon overtook other segments. “Power sports, motorcycles, tractors, it’s like everybody overbought and thought that trend was going to last. Then inflation kicked in early, and a $600 bike went to $800. Now it’s at $600 again. So the correction is always going to come.”
After remote work surged during the pandemic, many employees eventually returned to the office, by choice or necessity.
“People figured out, hell, if I can’t work at work, I can work away from work,” Fendley said. “I can rent an Airbnb somewhere in Colorado, Wyoming, California, anywhere. I can set up camp and work and have fun. And that’s what people did.”
But when workers returned to the office and had less free time, used outdoor gear flooded the market.
Used Kayaks for Sale
Fendley noted that stimulus money disbursed during the COVID crisis fueled some of the outdoor equipment boom. “A lot of people just decided to recreate outdoors. People bought kayaks, backpacks, hiking boots and fishing rods. Outdoor activity increased in that time period, and national parks were overflowing with people.”
But when the stimulus checks ran out, inflation fears overwhelmed discretionary spending.
“In a span of six months, the industry went from completely under inventory to an over-inventory situation, and demand had cratered,” Frank said. “We get to the fall of ’22 with too much inventory on the market, and consumers are winning because they’re getting a great deal on products.” Used equipment was everywhere. “Used kayaks, used canoes, bikes, RVs, four-wheelers, all that stuff. The used market just exploded.”
When 2023 arrived, outdoor retailers faced real headwinds, and inflation remained high.
Outdoor equipment sales slipped 6.2% in 2023, according to the Outdoor Industry Association’s report, which was conducted by Chicago-based market research firm Circana Inc.
Outdoor apparel was off 3% and footwear sales declined 2%. Bag sales led a surge in the accessories category, a rare bright spot with sales up 4.2%.
Gearhead Outfitters found itself well positioned to weather those market trends; footwear and accessories are some of its big sellers.
“We sell bikes out of just three of our stores,” Herget said. “The rest of them are like active lifestyle stores. It’s still specialty, but we don’t emphasize hard goods per se. They just don’t turn that well, compared to a pair of running shoes. You don’t buy a tent every six months, so we devote less square feet to those things.”
Looking Ahead
Fendley said that people who deeply explore the outdoor lifestyle are usually loath to bail out. “Once you get into it, you kind of stay with it,” he said.
And that may point to a brighter future.
Overall, the 2024 trends report said, “the outdoor market has experienced significant growth in both sales and participation” since 2020. “The retail market has gained more than $5.3 billion in sales and 15 million new participants,” the report said, citing strong sales of running shoes, insulated mugs, casual pants and non-technical bags.
But it found that spending on bigger ticket products like boats, snow skis, camping equipment, sleeping bags and climbing gear “has slowed significantly.”
Positive economic trends like rising wages and low employment “should lead to modest growth in the outdoor market over the next two years,” the report concluded.
Herget said Gearhead’s 250 employees will continue their commitment to brick-and-mortar, face-to-face commerce, qualities he said have helped his company boost its revenue by 10%-12% a year.
“I’m a brick-and-mortar guy,” Herget said. “You can buy everything I sell online, but all of our stores are working warehouses. I’m not a big fan of keeping products back there that nobody can see or touch.”
Retailers should try to avoid fretting about things they can’t control, Herget said.
“You can’t force it, just as you cannot force a relationship. I can’t force my customers to buy [stuff] from me. All I can do is show up every day with the best people and the best products in the best place. If they buy, cool. But if they don’t, we’ll figure something else out.”
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