Iconic outfitter U.S. Outdoor reopens in Pearl District
The U.S. Outdoor store has moved from its long time spot on Southwest Broadway between Mary's Club and the Benson Hotel to a long-vacant corner space in the Pearl District.
The owner, Ed Ariniello, says the new spot at Northwest 14th Avenue and Hoyt Street benefits from lower rent and a smaller footprint, is closer to other outdoor retailers, and is less troubled by homeless people.
A perfect storm of factors caused the snow sports and camping store's move: the COVID-19 recession, bankruptcy, homelessness, ailing brick and mortar retail — and the demise of downtown. Throw in declining snowfall, and Ariniello has a race against the clock in the downhill — as they say at the Winter Olympics.
He bought the business in 2017 from the Solomon family when it was in the building they own on Southwest Broadway. In 2020 Ariniello declared Chapter 11 bankruptcy, and on Sept. 11, he reopened half a mile north. (The U.S. Outdoor Store is not to be confused with the Portland Outdoor Store, which sells western workwear and cowboy clothes at downtown at 304 S.W. Third Ave.) According to bankruptcy filings, U.S. Outdoor Holdings owes Solomon Management $2.1 million. It received a $266,067 federal Paycheck Protection Program loan in August.
"The number one thing is it's a better location," Ariniello told the Business Tribune recently. "Customers will come here. They will find parking, and they'll feel safe. Employees will feel safe because we were feeling very threatened by the other location. Under these guidelines of COVID and the riots and the homeless situation that gives us our best opportunity (to survive). It's not perfect."
Ariniello lists some of the other businesses at the top end of Southwest Broadway that have shut down for good this summer: Bailey's Tap Room, Sauce Box, Paul Mitchell hair salon, as well as a massage shop and a boutique.
In the new space, the Dakine, Burton and North Face products are crammed in with more casual brands such as prAna. The shop fittings are fairly rudimentary: the racks and counters were trucked over from the Broadway store, and the back office doubles as a stock room, piled high with shoe boxes.
Brick and mortar tent camp
He finds it hard to tell whether his retail was in decline because of online sales. Some outdoor gear, such as ski and hiking boots, is highly dependent on fit, and a customer has to come in and try on lots of items and be heled by a specialist. Other items, such as light-up dog harnesses and thermal underwear, are more easily bought online.
The store was a key part of Portland's ski and snowboard community in the 1990s and 2000s. Staff used to bring in snow and build a snowboard ramp outside the Tug Boat pub, and sometimes they would screen Warren Miller ski films.
"The prior owner and management team put that together very successfully," Ariniello said. "We've been hoping to try and bring that back one day. We've had a few surf parties and demo days at Timberline."
There are streets off Northwest 14th Avenue that dead-end on to the 405 that could be used for parties. He likes the neighborhood because it is near Keen, REI, and Title Nine, as well as Whole Foods and Lizard Lounge.
Both he and the previous owners clashed with homeless people sleeping in the doorway and tents on the sidewalk. More aggressive homeless people have come that part of Broadway in the last few months.
"The vagrant homeless population has been growing in that particular area. It's somewhat abandoned by the city, but with the onslaught of COVID, and I believe the riots, the local homeless disappeared. And what's left is a group of people that we don't recognize. They have higher drug use, open alcohol drinking, bigger parties and more destruction than before. It wasn't uncommon to come to work and find somebody had defecated or urinated all over the front of the store."
He says what many downtown retailers say: customers are too scared to come.
Theft was also high. The store was hit by professional shoplifters who would fan out using hidden bags, stealing the high-end items, as well as petty thieves who went for batteries and knives. It was a losing battle.
He was warned about downtown's downward trend when he bought the business, but he didn't see 2020 coming.
For the owner, bankruptcy was do-or-die.
"In order to survive and execute our move, we had to file for restructuring under Chapter 11, subchapter five, which enables us to maintain ownership. It's unfortunate that it came to that, but with the lack of business and traffic and the downtown Portland area, it became absolutely necessary, or we would just have to close and cease to exist."
"We chose the harder road, we think, to restructure and make the best of everything. Over a period of years, we hope to re-establish ourselves as a mainstay in the economy."
Of the bankruptcy and relationship with Solomon, Ariniello said, "It's a very complex process that I'm not very familiar with. But I have to leave that to our attorneys. They manage the whole situation."
Of the new landlord on Northwest 14th Avenue, Ariniello said, "He really worked with us to make sure that it was equitable. And then as we increase our business, we'll increase our investment in the rent and hopefully expand. There are some other areas of the building we could expand to, but right now, it is about survival."
Peak season for the store is snow season — the middle of October to February. However, the last two years, late starts to the snow season impacted the sale of gear. They are now in a mad rush to catch up after the summer of COVID-19, bankruptcy and moving. Just to rub salt in the wound, the store was raided during the night before the move. The thieves hit the big items, like jackets, boots and boards. Insurance will cover it, although he says his insurance company will no longer cover retail in that building.
There's money to be made. In the last two decades, the snowboard and paddleboard categories have grown, as have sales of lightweight jackets and pants. Recent bestsellers include Airblaster ninja suits, which are $120 poly blend long johns. A serious skier buying good skis, boots and binding might spend $2,000 getting ready for the season.
"The customer is more knowledgeable than ever, and they need us to help hone them to what is most appropriate for them."
The U.S. Outdoor store was online early, and now does 40% of its sales online. They do their fulfillment and ship UPS and FedEx, but will use Uber to deliver something if they're in a big hurry. But the lack of office worker foot traffic compounded things during the COVID-19 pandemic.
"People have realized, 'I don't have to go to work anymore, I'm working remotely, I can shop more online.' So that's accelerating." One tactic is to ask in-store customers to use the website if they have to go home and think about a purchase.
"The two disruptions for our industry are one; the number of websites is huge. The mega websites that are well-financed can cause a challenge. The other piece is the manufacturers' stores and websites. There's a pressure on the customer from the brands to buy direct. The service that we provide is the knowledge and expertise because the manufacturer doesn't have our trained employees in the store."
It's a different world in 2020. Retail is in a state of shock. Whether it's competing with algorithms, homeless people, or declining disposable income, the U.S. Outdoor store has its work cut out this winter.
Reporter, The Business Tribune
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