Shop Profile: Gold in Them Hills

It was Moots founder Kent Eriksen (no surprise there) who first turned a sawdust incinerator and a ski-lift tower into a bike shop. “Iconic” is an over-used word, but there’s no chance of confusing this store with any other. Locals just call it “the Cone.”

It was Moots founder Kent Eriksen (no surprise there) who first turned a sawdust incinerator and a ski-lift tower into a bike shop. “Iconic” is an over-used word, but there’s no chance of confusing this store with any other. Locals just call it “the Cone.”

A shop bets big on bikes in Ski Town, USA.

Words by Peter Koch

Even if you’ve never been there, you’ve probably heard of Steamboat Springs. Perched on the western slope of the Rockies in northwest Colorado, this tony little resort town is world-famous for its skiing—or, more accurately, for its snow. Every winter, northwesterly Pacific storms crash into the 12,000-foot peaks of the Park Range that overlook town, dumping 375-plus inches of bone-dry “champagne powder” (a term coined here) that attracts skiers from across the globe.

Marketing itself proudly as “Ski Town, USA,” Steamboat is the kind of place where locals skip work on powder days, dozens of Olympic skiers and snowboarders have cut their teeth and, understandably, every bike shop switches to ski sales, rentals and tuning when the white stuff flies.

Except, that is, for one—Orange Peel Bicycle Service is the sole bikes-only shop in town, and owner Brock Webster is convinced it’s what gives him his competitive edge.

“Even though we’re smaller than a couple of key competitors that are ski-and-bike shops, we have this year-round business, and people know us as the bike-specific people,” he says. “So, if they have a real bike problem, people will wait in line for our services.” And that suits this owner and former elite racer, who still gets grease under his nails almost every day, just fine. Service has always been his passion, after all, even as he’s grown Orange Peel from one man with a repair stand  to a thriving full-spectrum bike shop with 11 employees, an awesomely weird building and $1.5 million in annual sales.

And don’t look for snowboards and skis at Orange Peel. It’s all about bikes and, perhaps as a result, winter riding is on the increase in Steamboat Springs.

And don’t look for snowboards and skis at Orange Peel. It’s all about bikes and, perhaps as a result, winter riding is on the increase in Steamboat Springs.

Ski Town Bound
The funny thing about Webster owning Steamboat’s sole bikes-only shop is that he originally moved there to get away from bikes. A BMX and track racer back in his native state of Pennsylvania, he’d gone to Colorado State University to continue racing bikes. He rode for the collegiate team and, to put some money in his pocket, worked shop jobs—first at the campus shop and then four years at Lee’s Cyclery, where he really cut his teeth. “That’s where I learned the trade—everything from bike building to basic wrenching to retail sales to road fits and gluing tubulars.”

After graduating, he tried to make it as an elite racer, but he burned out on the scene after only a year. “I came to Steamboat, to the mountains, to get away from the roadie culture of arrogance,” Webster says, unapologetically. “There are some ‘choads’ who race road bikes, for sure, and I was never really down with that many of the personalities.” He’d always loved skiing, so he thought a ski town would make the perfect place to bum around for a winter and figure out what was next.

And then, well, life happened. He worked the kinds of odd jobs that people do to get by in mountain towns. He was a dishwasher and, later, an outdoor education instructor (“and general-purpose slave,” he jokes) for a local boarding school that develops Olympic skiers—a great gig because room and board was provided.

I knew how you could run a shop and do it well, and I didn’t think anyone in this town was doing that.
— Brock Webster

All the while, to make extra cash, Webster was working on bikes on the side. “Everyone was really psyched with my services,” he says, “which made me realize I was pretty good at it, and might be able to make a go of it.” Plus, having spent a lot of time around great shops, he wasn’t at all impressed with the main shop in town. “I knew how you could run a shop and do it well, and I didn’t think anyone in this town was doing that. I saw a niche, and it gave me the confidence to start.”

Around the same time, he received a $5,000 inheritance, and immediately set about spending it on a double-arm repair stand, his first pro-level truing stand and the rest of the tools he needed to become a legit repair service.

Getting Rolling
In early 1999, Webster incorporated and started working out of a milk house (“In the winter, it was 38 degrees, and in the summer it was 38 degrees”) on a rural farm 12 miles south of downtown. Orange Peel started out as a pick-up-and-delivery repair service that first year, with parts and accessories. “I could not believe, in that first year, how many people were calling,” Webster says.

It was encouraging to see a market for his services, but he wasn’t making any money. With no business plan, he found himself spending far too much time trucking around the county, picking up and dropping off far-flung bikes; and by the end of the season, it was evident he needed a better setup. “It was really good to get going,” he says, “let’s put it that way.”

His first storefront, funny enough, was in an alley. He was renting a cramped, 500-square-foot space at the back of the “Little Red House” in downtown Steamboat. Once a residential house dating back to the town’s early days, it had been converted into commercial use and was a hive of outdoor sports-related businesses. Besides Orange Peel, there was outdoor gear retailer and apparel maker BAP! (Bwear Action Products), a national paddle-sports magazine, the offices of Big Agnes and a nascent Honey Stinger.

It was an exciting place for Webster to be, and gave him a unique perspective. During that first season, he kept plugging away, doing repairs and selling parts, accessories and tires. Come winter, though, when the shop slowed down, he picked up work from Honey Stinger, attending major tradeshows for the growing company, like Interbike and Outdoor Retailer. “It was pretty cool for me, as a bike shop owner, to wear the other hat and be at Interbike [trying to sell to] bike shop owners. I felt like I had this really cool perspective, and really learned a ton at that point.”

Then, in 2001, he brought in Ellsworth Bikes, his first bike line. “No one was really selling high-end mountain bikes in Steamboat at the time,” Webster says. That’s when things started to take off. Soon he was bringing in and building frames, which meant he needed to hire employees. “My shop was bursting at the seams,” he recalls.

At the same time, Big Agnes and Honey Stinger—both owned by BAP! founder Bill Gamber—were growing like crazy, and it was evident to Webster that he needed to find a new space. “Bill didn’t want to kick me out, but he clearly needed the room.”

( Orange Peel Bicycle Shop )

(Orange Peel Bicycle Shop)

Gambling on Growth
Today, Orange Peel has what seems like the perfect location. It’s in the heart of the lively commercial district on a highly visible corner, flanked by restaurants and quaint shops. Across one street is a popular town park and the library, and across the other is the Yampa River and a 7.5-mile bike path. It’s at the good end of town for road biking access and singletrack is less than a minute from the front door.

Most important, it’s housed inside one of Steamboat’s most iconic—and weird—buildings, a one-of-a-kind DIY job built by Moots founder Kent Eriksen around a 30-foot-tall, cone-shaped sawdust incinerator from a local lumber mill and a repurposed ski-lift tower. You’d never guess it, but moving here almost broke the business.

In the winter of 2004, Webster cleared Orange Peel out of the Little  Red House and things were looking a little bleak. “I was a homeless business owner looking for a place in a very expensive resort town,” he says, recalling the stressful time.

By a stroke of good luck, the other shop in town—Eriksen’s old shop, Sore Saddle Cyclery—was tanking under its new management. Webster knew there was a huge opportunity there, if he was patient. The waiting game paid off when, finally, its creditors foreclosed on the shop. Eriksen, who wanted another bike shop in the building, agreed to rent to Webster, and Orange Peel was in its new digs by early 2005. Crisis averted, right? Not exactly.

Remember that his first shop was tiny, basically a glorified closet where he did repairs and ordered in one or two high-end frame build kits a week. Now he had to stock an entire store. But this location was a dream one, and not the kind of opportunity you pass up. So he financed everything with his credit cards, maxing them out and juggling balances to maintain zero-percent interest rates whenever possible. Roughly three years later, he’d worked himself back from the brink of financial ruin.

“Somehow it all worked out,” he says today. “In hindsight, though, it was pretty risky the way I was leveraging everything to build the store to where it is now.”

Making It in the Mountains
In hindsight, too, it was totally worth it. He owns one of the most unusual bike shops in the country. Kent Eriksen’s Frankenstein project is a one-of-a-kind product of extreme thrift (he bought “the Cone,” as locals all it, for $1), imagination and adaptive reuse. In making it into a bike shop, he turned one of Steamboat’s worst polluters—the sawdust incinerator bellowed smoke over the town as it burned slag, chips, sawdust and bark left over from sawing operations—into a place dedicated to environmentally-friendly transportation.

Inside, the retail shop is, as you’d expect, round. A repurposed ski-lift tower from a local, defunct ski area runs down the middle of the building, and two upper floors are framed around it. “It’s an amazingly sturdy, yet totally sketchy building,” says Webster. The roof cranks open like the lid of a beer stein, via hydraulic lift. He only opens it once a year, when the U.S. Pro Cycling Challenge rolls through town. “It’s scary to do it,” he explains, “but it totally works, and doesn’t even kill you.”

It’s an iconic building that everyone in town knows, and it finally gave Webster the room he needed to give this mountain the bike shop he thought it deserved.

Despite all the challenges of operating in a mountain resort town—hard winters, high rent and more payroll costs being chief among them—he’s found there are some advantages to it. For one, Steamboat has literally every kind of cycling. There are loads of flowy forest singletrack in all directions, the ski area is investing heavily in its gravity-fed bike park (“Downhill, free ride and endure bike sales are off the charts!” Webster says), a new BMX track is just across the river from the shop, the dirt-jump park just added expert jump lines to its duo of pump tracks, and road riding, though past its peak, continues to extend the local season. “Really, you can do it all here, which is pretty amazing for a small town.”

Curving, inward-sloping walls were a challenge from a merchandising point of view, but also an opportunity to create a unique—and memorable—store. “One of the bigger improvements I’ve made,” Webster says, “is to make it efficient and cool and artsy—glorifying the weirdness of it, I guess.”

Curving, inward-sloping walls were a challenge from a merchandising point of view, but also an opportunity to create a unique—and memorable—store. “One of the bigger improvements I’ve made,” Webster says, “is to make it efficient and cool and artsy—glorifying the weirdness of it, I guess.”

Second, Steamboat is a tourist town, which means Orange Peel makes a killing off of rentals. It’s not something Webster wanted to get into in the first place—would-be customers kept asking about rentals during his first year in “the Cone,” so he decided he had to provide them—but now he’s glad he did. As airlines have begun to charge more to ship bikes, more and more out-of-town vacationers are renting his mountain and road bikes for their entire visit.

It helps that the “basic” road bike is full-carbon with SRAM Apex or Shimano 105, and high-end bikes are Di2 Moots and the like. “People are pretty stoked by that,” he says.

The other curious thing about tourists? They love branded merchandise—hats, jerseys and water bottles with the Orange Peel logo. Webster primes the branding pump by putting store stickers, water bottles and handlebar grips on the rentals. Today, rentals/demos and merchandise sales are worth roughly $300,000 annually to the store.

Winter Wunderkind
And, anyway, nowadays those hard winters aren’t so hard. The shift came when Webster began implementing service specials in the winter. “The minute the ski area would close in April, we’d suddenly be two to three weeks out on our service,” Webster says. “It’s like everyone decides, at the same time, that they need to go biking out in the desert, and you’d have literally 100 bikes show up on the same day to tune.” So he started sending e-mail blasts out to locals in the middle of ski season, offering them service specials on big jobs like tune-ups and suspension work.

The fat-bike surge over the last five years has helped, too, though not just in fat-bike sales and rentals. Webster thinks that fat-bikes’ visibility has awakened locals to the fact that biking can be a year-round thing.

“Even the person who isn’t owning a fat bike, or renting a fat bike—or even riding, for that matter—sees people out riding, and realizes they should get their bike tuned,” he says. “Or they think about how much fun riding is, and they buy a mountain bike for spring.”

He has also seen more winter commuters along the town’s plowed bike path, who come to him for high-margin accessories like studded tires, fenders, winter riding boots and bike-packing packs. And Moots high-end custom builds, which he does a ton of, never slow down, no matter what the weather is doing. “It doesn’t take too many super-nice custom bikes to at least keep the doors open.”

Admittedly, winters are still much slower than the other three seasons, when Orange Peel earns nearly all of its profitability. The staff contracts from 11 to five, and there’s a lot more time for tinkering with capital improvements—installing new lighting and custom fixtures to work with the building’s round shape and inward-sloping walls. Every rack and shelf is made to fit a space. “One of the bigger improvements I’ve made,” Webster says, “is to make it efficient and cool and artsy—glorifying the weirdness of it, I guess.”

Orange Peel started with a $5,000 inheritance invested in shop tools and a repair stand, and service is still the heart of the business. “Every single ticket, it seems, is a $500 tune, and we’ll get eight of those a day.”

Orange Peel started with a $5,000 inheritance invested in shop tools and a repair stand, and service is still the heart of the business. “Every single ticket, it seems, is a $500 tune, and we’ll get eight of those a day.”

Service Above All
Since moving to its current location, Orange Peel’s retail side has blown up. Due to local market demand and local rent, the stock runs unapologetically high-end. Price points start around $2,000 for road bikes and full-suspension mountain bikes ($1,000 for hardtail), and cruise on up to the big-ticket custom builds for Moots and Pivot. “I just don’t have the space to stock cheap, campus-style bikes,” Webster explains. “We’re not a beginning rider’s bike shop. And it’s not because we’re scary—we have a really nice staff and attitude—but what we stock scares some beginning buyers away.”

Still, the shop’s focus and main profit center is service. “That’s why we’re still called Orange Peel Bicycle Service, and I think that distinction is important to our survival here.” During the April-through-September busy season, there’s so much service work that Webster says he really can’t handle any more. “Every single ticket, it seems, is a $500 tune, and we’ll get eight of those a day.”

What he doesn’t understand is how other shops don’t seem to care about the service angle, which he thinks is the key to LBS survival against mail-order companies and Amazon. “We do so much service that other shops turn away,” he says.

“It’s profitable, and we’re earning a living in an expensive resort town.” Not just squeaking by, either, but thriving.

SPECS
Orange Peel Bicycle Service
Steamboat Springs, Colorado
Locations: One
Square Feet: 3,300, plus 2,000 outside seasonal showroom and 2,000 storage
Years in Business: 20
Employees: 10 in summer (6 full-time), 5 in winter (4 full-time)
Average Bike Sale: $2,900
Annual Gross Revenue: $1.3M
Sales Breakdown: 55% repairs, tunes & parts; 20% bike sales; 5% rentals and 20% merchandise
Bike Brands: Kona, Moots, Pivot, Transition, Orbea, Salsa, KHS/Free agent
On the Web: OrangePeelBikes.com
Social: Facebook | Instagram | Twitter

 
 
 

This profile was originally published in Outspokin’ in March of 2015. We updated some of the numbers, and checked in with Webster, who says, “Not much has changed. We are surviving on our loyal local customers, high-end bike sales, summer rental and tourism dollars, and the Great Divide MTB riders who come through town. Really, service is still the main deal around the OP!