Earlier this month, Rei Co-Op announced that it was finishing all its experience of experience, which included adventure trips along with daily classes and tours. In total, 180 full -time employees and 248 part -time guides are being fired, and reimbursements are issued.
President and CEO Eric Artz cited economic reasons for the decision. He revealed that Rei Experiences has fought to reach the equilibrium point since before the pandemic.
“When we observe the costs of all the costs of managing this business, including costs such as marketing and technology, we are losing millions of dollars every year and subsidizing experiences with profits from other parts of the business. Even in our peak in 2019, our best year for experiences, we do not generate profits,” Artz said in a statement.
Even so, despite an iconic name in the adventure that stops its travel business, other adventure tourist operators that TMR Speaking does not worry and that demand is still high for the segment. Instead of seeing Rei’s struggles as a sign of interest softening, these companies see Rei closing their 40 -year experiments business as a unique opportunity for growth in a solid industry.
Adventure tourism is thriving
Scott Cundy, co -founder and owner of Wildland Trekking, said TMR that the Adventure Tour segment is strengthening.
“Without a doubt, (adventure tourism) remains an incredibly rapid part of the travel segment, and definitely profitable,” he said.
Wildland Trekking is a small group of a small group adventure operator inside the Intrepid Travel brand portfolio. The travel company specializes in a travel style similar to what Rei Adventures offered, in fact, Wildland Trekking covers about 74% of Rei’s supply of products with them or similar travel packages.
“The adventure travel industry is still a really great place to be, (with) a lot of profit potential. It is a service that people want,” Cundy added.
Explore worldwide is seeing growth similarly in the segment.
Katy Rockett, regional director with headquarters at Toronto for the adventure travel company of small sustainable groups, told TMR that the company’s wildlife and trekking routes are sold incredibly well.
“The demand we have seen is huge. Our Trekking tours rose 48% year after year,” said Rockett.
Why Rei’s adventures close
If adventure tourism is over, why did I think the adventure was not profitable?
The answer is probably on how Rei structured your arm experiences. Artz indicated that the entire Rei experience business was not profitable, which included Rei adventure trips, as well as outdoor classes and one -day excursions.
It is possible that Rei Adventures has been profitable on its own. Anyway, the business had a disadvantage in the market: Rei is a massive brand, but its main business was retail trade, do not travel. To get engaged, this gives smaller travel companies an advantage when it comes to delivering tours.
“Rei is a really known brand, an outdoor retail company of $ 2 billion a year. But (travel) was not its main business, and there are many alternative companies that are really good,” Cundy said.
This feeling was repeated by Nicki Bruckmann, CEO and founder of Explorer Chick, a award -winning travel company that empowers women through adventure tours.
“Rei’s departure from space is not an indication of the segment, since they are re -suffocating their efforts in retail/DTC
Any disappointed trip whose trekking trip was canceled can find a similar offer elsewhere, with all the advantages of travel reserve with a niche specialist.
“We cannot match the size of Rei, but what we offer is something truly unique: deeply personal experience with artisanal itineraries with a small passionate team that feeds the experience,” Bruckmann said.
The end of Rei Experiences is undoubtedly a sad conclusion for a long -term business. For the industry, it is a bittersweet development: the departure of Rei Adventures will leave a space that can fill out other smaller companies that could not previously compete with giant marketing dollars and brand recognition.
“(The closing of Rei Adventures) presents an unexpected opportunity for the advisors and their clients to explore smaller and independent travel companies, companies that otherwise have not discovered,” Bruckmann said.
