Skiing resort owners optimistic about this winter

  • 2011-01-13
  • By Alina Lisina

TAKE YOUR PICK: With plenty of snow already this season, resort operators expect a good year.

RIGA - Latvia is the biggest skiing destination in the Baltics. This year’s season started very early and skiing resorts are working at full capacity, offering their slopes to the local and growing number of foreign skiers and snowboarders.
The season this year started in November, and by Dec. 1 almost all the skiing resorts were fully opened, which is very important for their business. A mild winter is an even bigger threat to their business than an economic downturn.

Despite of economic crisis, last year skiing resorts had an increase in the numbers of visitors, though prices were down, so in general the results were at the level of the previous year. Thanks to a good, snowy winter last year the visitors could enjoy the slopes even till the beginning of April. A year ago they had the same skiing conditions, say owners in the business, and with sadness remember the season of 2008/2009, when warm weather forced them to use snow guns even in February and prevented many clients from skiing. Usage of snow guns is a normal thing all over the world, but it adds to the costs – to blanket snow on one slope costs about 1,000-2,000 lats (1,425 – 2,850 euros). But if the weather is warm, the snow guns are useless – artificial snow melts with the same speed as the real stuff.

This year skiing resort owners are optimistic about the season and forecast it will be better than previous ones, and the number of visitors will grow. They even are making some investments into resort development. As CEO and co-owner of Ozolkalns, Girts Kalkis told The Baltic Times that they bought all new skiing and snowboarding equipment, which was a 40,000 lat investment, as well as opened an additional cafe at the resort.

“We had around 40,000 visitors last season and plan to have more this year. We will also host the European Snowboard Bordercross Championship Cub this February. For us it’s recognition from the worldwide snowboard society, but it also asks for an additional investment of about 40,000 lats to organize this high level event,” he says.
One of the opportunities for development at local skiing resorts is the attraction of more visitors from abroad. Already now the number of skiers and snowboarders throughout the Baltics is growing.

The owner of Zviedru Cepure skiing resort, Edvins Balodis, said to The Baltic Times that one-third of their customers last year were Lithuanians. The number of Estonian tourists is growing from year to year, too.
“This December we had about 25 percent more foreigners than in the previous year. We are developing our resorts to get even more customers from abroad. We planned to open several camping houses at our resort, but an early winter prevented us from finishing the construction work. So the camping will be available for summer activities we have at our resort, and next winter skiers and snowboarders can stay here,” says Kalkis.

The fastest growing segment for Latvia’s skiing resorts are guests from Lithuania. “Lithuanians have been coming to our ski slopes since when we opened our resort. We placed advertisements in Lithuania’s media and, as a result, 25 percent of our guests are from Lithuania,” said the director of Milzkalns, Viesturs Osnieks to the Diena.lv.
Also, the Riekstukalns complex attracts visitors from Lithuania. “About 15 percent of our guests are Lithuanians. They come to ski here mainly on Saturdays and Sundays, because it’s close to Lithuania’s border; also, service is high and prices are affordable,” said the director, Ervins Kisuro, to Diena.lv.

Zane Lukina, the head of Zagarkalns, points out that the mountains are better and service level is higher in Latvia. She says that now, they have Lithuanian guests not only on weekends but during working days, too.

Skiing resort owners point to the infrastructure that attracts even more visitors from abroad. Only a few resorts, the Lido complex for example, have not only slopes and a cafe, but also a hotel where people can stay for a night and other attractions.
One more trend is that small resorts cannot survive the competition and economic conditions, and have been forced to stop their business. According to the winter attraction Web site slalom.lv, there are about 30 skiing resorts in Latvia. Only half of them have more than 2 slopes and a snowboard park. Those that are smaller face the biggest threat in surviving the crisis.

“It doesn’t matter how big you are, you must have the equipment to maintain the resort. You need tractors, ski guns, etc., so the costs are almost the same for big and small skiing resorts, but the number of visitors is different. Ski lift capacity is vital for the business. Half of the profit is made during snowy and not very cold weekends; we can serve about 400 visitors skiing at the same time without them having to stand in line. Small skiing resorts cannot provide such service, so as far as I know some of them are already closed and some will not survive in the future,” predicts Kalkis.

The competition among skiing resorts has remained the same during the last years. The entry barrier is high and new players are not coming onto the market. The only exception is Lido Mountain, opened a few years ago near Madona in eastern Latvia.
“The initial investments are huge. You need to build infrastructure in a forest – road, parking, slopes, bring electricity in, etc. This won’t pay for itself fast,” says Kalkis.

This business is seasonal, and less that 10 resorts are open year-round. Ramkalni, Ozolkalns, Zviedru Cepure and others during the summer offer different kinds of activities, from mountain biking to adventure parks. “We are open during the summer, but not to make a profit, as this is just to have our staff be paid and not to stop the business,” says Balodis.
Kalkis agrees that the main income from the business is during the winter, but they want to change this situation and make this business profitable year-round. “The infrastructure is already there, so no big investments are needed to offer attractions during the summer season,” he says.