I've always been curious about how it works when a co-op runs a ski area. Some of the questions I've had:
1) What is the typical up front investment from each member? Depends on the number of members, I guess. How many members are there at a place like MRG?
2) Once you have made your initial investment, what are expected costs on a year-to-year basis? Are things like infrastructure improvements and employee raises expected to be financed through lift ticket sales, or are the co-op members expected to contribute additional funds each year?
3) How do things work from a liability standpoint? If someone sues the ski area, are the indvidual co-op members liable?
Not necessarily saying that any local resorts should be run as a co-op - just curious about how it would actually work.
wgo wrote:
I've always been curious about how it works when a co-op runs a ski area. Some of the questions I've had:
Not necessarily saying that any local resorts should be run as a co-op - just curious about how it would actually work.
The Mad River Coop Site may give you some basic info on how it works .....
Blue Don 1982 wrote:
The Mad River Coop Site may give you some basic info on how it works .....
Thanks - the faq pretty much answered all my questions. Sounds like the liability question is state-dependent.
On the liability point, while the MRG site refers to Vermont state law (because that's where they are, of course), the answer is the same pretty much anywhere, assuming the legal form of the co-op is a corporation. That really shouldn't be an issue. I think the issue with making a ski area in the Mid-Atlantic work as a co-op would be (1) having enough shareholder members buy in, and (2) getting enough non-shareholder business to break even.
Raise enough capital to buy the assets, and for operating cost, fixed salaries, liability and other insurance for a full season then hope you make enough money to do it again to start next season.
Raising the required capitol is the first ingredient. The second one is to look at the books and determine what the day to day associated costs are and then develop a revenue picture to determine if the ski are can be operated on expected income. Needless to say, mother nature can have a serious impact on the latter. One wouldn't invest blindly in a ski area. Very risky. However, with appropriate marketing, good service, and product, it can happen. It all depends on the first ingredient for starters.
I'd love to sit down and run the numbers sometime just for grins and giggles. Howerver you would need accurate operation costs to really determine if grinning and giggling is worth it.
Speaking about 'co-ops', the latest happenings, or struggles, at Magic. A cool old school place in the shadow of Stratton, if you've never been. Further underlines the tenuous position of any hill that isn't mainstream and corporate in today's world...
http://www.powder.com/stories/magic-mountain-changes-ownership/
