Chattanooga: Rock/Creek avoid credit-fueled growth

Chattanooga: Rock/Creek avoid credit-fueled growth

March 26th, 2009 by Amy Williams in Business

Marvin Webb and Dawson Wheeler founded Chattanooga-based outdoors retailer Rock/Creek more than 20 years ago. They talked about the company in a recent interview that has been shortened for space.

Q: How did Rock/Creek get started?

A: Marvin Webb: Rock/Creek really began "in concept" during a conversation between Dawson and myself when we were fifteen years old while sitting in our dorm room at Baylor School. We both expressed our interest in one day operating an outdoor store (camping, hiking, climbing, boating, etc.). It was not until after we were both out of college - both having pursued serious time in the outdoors (climbing, guiding, instructing, paddling, etc.) that we came back together to fulfill this childhood dream. I think it was 1986, Dawson had just purchased Canoeist Headquarters in Hixson. It was a small 1,800-square-foot shop selling boating, camping and climbing gear. A month or so later when I was in Chattanooga to rock climb for the weekend I went to visit Dawson at the shop. Within the hour we decided to pursue a partnership, months later we remembered our old conversation as kids!

Q: What types of outdoor activities does the store cater to?

A: Dawson Wheeler: Paddle sports and climbing are our heritage sports, along with climbing and hiking/backpacking and skiing. Trail running and travel has also become a strong focus in more recent years. We also cater to quite a few professionals who work in the outdoors: firefighters, EMT's, park rangers, foresters, architects, engineers and builders; people who are required to work in extreme conditions.

Q: Describe a typical customer and where they may live.

A:Wheeler: I'd just walk out on Walnut Street Bridge around lunchtime and look around. Those are our customers. Whether it's a lawyer who's slipped out of the office for a quick run on the Riverwalk, or a retired couple on a walk, that's our customer. The bike commuter who comes across with a Deuter pack on her back is our customer. If a kayaker goes by below, that's our customer. Just people who enjoy being outside and exercising.

Q: How has the store changed and grown over the years?

A: Webb: We are a much larger corporation now employing as many as 60+ employees. The first year we owned the shop (mid-80s), we were both married - Dawson had a new born and my wife was also expecting, house payments, etc. - and we paid for one full-time employee. Our gross sales were approximately $100,000 before expenses. We are now feeding a lot of mouths, have four locations, a sizeable Internet business, 20,000 square foot central warehouse and many expenses! Are we profitable, yes. Are we killing it, piling money in bank, absolutely not. We are just as concerned with our financial future as anyone!

How have we changed? I would say "philosophically" not at all. We are still focused on the individual customer who walks into our shop or places an order over the Internet. With so many staff we are not always in direct control of our customers' experiences as we once were when we both were on the sales floor but we are extremely proud of our staff and management team and their commitment to the customer. One upset customer can still rattle our whole organization before it gets resolved, this has not changed! Our time is now intensely focused on running the corporation and maintaining our focus.

Though we have a lot of soft goods (clothing) and an array of casual shoes, we are still gear heads and continue to scrutinize what we believe is the best equipment and technical gear for the committed user groups. This is our heritage but again, no change.

Really the only real change is that Dawson and I sit at a desk far more than we used to, and as a corporation, we are now able to contribute much more to our community and to the environment in dollars, community events and sheer human effort.

Q: What has been the key to the store's success?

A: Wheeler: Without question I can say the keys to our success have been the emotional support of our families as well as the high quality of our staff through the years. Our children have worked here on and off and you'll see my wife working in the warehouse as well. The family atmosphere carries through to the staff. We draw in talented, smart and fit people who may be between college and graduate school. We always have a few who love the work and stick around for years. In addition, since our dream started in a dorm room at Baylor, we would look back to the influences of Dr. Barks, Bill Cushman and Larry Roberts as role models and teachers who sparked our outdoor enthusiasm and taught the highest of ethical standards.

Other factors that have played into our success just have to do with our community commitment and our conservative business model. We give back to Chattanooga and I think people go out of their way to support local business because of that direct connection. We grow steadily and slowly, and we don't waste money. We want the business to continue another 21years and beyond.

Q: How has being in Chattanooga contributed to the store's growth?

A: Wheeler: We grew up here, went to high school here, raised our families here, so the community support I mentioned has been critical. In terms of the region's natural resources, we have a wide variety of recreation opportunities, many nationally recognized climbing areas, flat-water paddling on the Tennessee river, world-class white water, great hiking trails and camping. Our region is a gem!

We don't think Chattanooga is unique when it comes to the outdoors, but we do see the city as a contemporary with other similarly-sized cities. No question Chattanooga and our surrounding counties have been gifted with amazing Natural Resources. Outdoor Chattanooga has certainly worked hard with very little budget to increase outdoor recreation opportunities. The Riverfront renaissance has been beneficial to us as well as all the businesses on the North Shore.

Q: How has the outdoor community in Chattanooga changed since the store opened?

A: Wheeler: More clubs and organizations have formed catering to outdoor enthusiasts. Just a couple years ago, we founded our nonprofit Wilderness Trail Running Association, commonly known as the Boonies. Before that we had no trail running club. Also there are many outdoor athletes i.e. kayakers, climbers and runners who have moved here to train and/or live closer to their passions.

We also have a wide variety of nonprofits in Chattanooga as well as local, state, and national agencies working to increase access to natural resources. Clearly cleaning up the air and making downtown a better place has increased people's inter-city recreational opportunities.

Q: Describe your roles in the business today.

A: Wheeler: The easiest way to describe our roles: I'm responsible for anything you can see, Marvin's responsible for anything you don't see. I'm working on marketing, advertising, merchandising, and customer experience. Marvin directs our distribution center and oversees our financial operations, buying, and inventory management. Marvin is the Wizard behind the curtain.

Q: How has Rock/Creek weathered the current economic crisis?

A: Webb: Sort of spooky even answering this question for we, the U.S. are not out of the woods yet, no pun intended. I can answer how have we survived thus far! We have always tempered Rock/Creek's growth with a pay-as-we-go philosophy. It is not the norm for us utilize lines of credit nor to seek loans for capital expenditures, for we much prefer to tighten our belts to cover our own financial needs. The temptation to maximize our selling potential and leverage our resources to accelerate our growth has really never been our focus. Our over-riding goal from day one was to be the best adventure sports stores, regionally and hopefully one day nationally recognized, and to always credibly serve our market. Our obsession has always been helping provide customers with a safe and positive experience in the out of doors, through the gear we select and the service our staff is able to provide. It has never been about how much was going in the bank. Just this focus alone has supported a more conservative fiscal policy which has served us well thus far.

It has also been said that our industry is somewhat recession-proof in nature and to a degree this has proven itself many times in our history. If folks can't afford a vacation to the beach, extensive travel, etc., then many turn back to the basics: family camping trips, hiking, boating, etc. There is really very little expense in pursuing outdoor recreation. For the most part there is no lodging expense, no cost to paddle a river nor climb a cliff, and you can cover days of trail requiring only your stomach to fill up!

Q: What role does Rock/Creek play in the community?

A: Wheeler: Rock/Creek's marketing budget goes in a large part to events. We'd rather spend our dollars on an event that raises money for a local green space than send catalogs to our customers. We estimate our total cash donations for 2008 at around $50,000.

Our biggest events of the year, the Rock/Creek StumpJump 50k and the Rock/Creek River Gorge Trail Race, are now in their 9th and 8th year, respectively. Building on this success, we stepped up our commitment last year and started the Rock/Creek Race Series. We added seven race dates for a total of nine. With trail running races throughout the year, we're out in the woods helping to maintain, build, and raise awareness about local trails throughout the calendar year. The races themselves raise funds for all the trail work and infrastructure costs necessary to keep Chattanooga's world-class trails in good shape. We also have been able to use these events to bring public and private landowners together. For example, for the Lookout Mountain 100k, over a half dozen public agencies, nonprofits, and private owners granted us access so that we could organize the longest trail race in Tennessee history. Special thanks goes to the Leadership of Lula Lake Land Trust for this trail system.

Prior to these races, we helped start the Triple Crown Bouldering Series, now one of the nation's premier climbing events. Chad Wykle, working at the time as a manager at our Tremont store, along with his partner Jim Horton, worked tirelessly to make the series a success and to secure access to Little Rock City, now known as The Stone Fort. This bouldering area, located at Montlake Golf Club, has become a model for responsible cooperation between a landowner and an outdoor user group.

Q: What are your future plans for the business?

A: Wheeler: Survival clearly is our number one goal until the economy corrects itself. But with that said, we have never wanted to be the biggest outdoor retailer; only serve our markets to the best of our ability. Our future plans on growth surround servicing our customer base better. For 2009 we have no expansion plans, only operational improvements. We were voted 2008 Online Retailer of the Year by Backpacker Magazine, so growing that side of our business to maintain our leadership and service will continue. We have our eyes on a few markets outside Chattanooga that we have watched for years, so we will see what opportunities present themselves into the future. Most importantly we want to continue our stewardship with our local non profits and working to improve our natural recourses.