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July 2005

Would You Like Fries With That?

The pros and cons of letting franchises into the mountain community.
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Taking a cue from the No Spin Zone, several ski areas are touting a No Franchise Zone. In the Mad River Valley, Vt., the website of the Sugarbush Chamber of Commerce says that "there are no traffic lights, chain hotels, fast food restaurants or factory outlets here." Not far away, Mount Snow, which celebrated its 50th anniversary last season, chimes in with, "You will not find chain fast-food outlets or mini-malls here. Most businesses in the Mount Snow Valley are family owned and operated, which explains the friendly, down-home atmosphere." Are franchise retail outlets really so despised that areas can market against them?

Throughout the mountain regions of Vermont, a state that jealously guards its independence from all things mass-produced, the welcome mat is not exactly out for Starbucks, the Golden Arches or Wal-Mart. Some rural communities view such corporate titans as inconsistent with New England's reputation for quaint hamlets, mom-and-pop knick-knack stores and bowls of homemade chowder.

But Vermont ski areas aren't the only ones that want to keep out what they see as the riffraff of retailing. Telluride asserts on its website that its shops are oriented to "the sophisticated world traveler," with "no chains, fast food outlets or strip malls." And in Banff, Canada, one Internet article points out that "aside from a McDonald's and a Subway, the town is free from franchised chains."

As ski areas embark on building new base villages or revitalizing old ones, the issue of whether or not to admit national brands looms large in how they will be perceived by travelers.

On one hand, retail managers look at the convenience of seeding new shopping areas with franchises that have instant consumer loyalty, which in turn stimulates investor confidence and attracts more businesses. Starbucks alone has become such a powerhouse that it is now considered an anchor tenant in many commercial projects, and the Seattle-based company clearly knows the value of its brand.

But resorts have to deal with an increasing public hostility toward big box stores-embodied in the coast-to-coast Wal-Mart rebellion-and the growing health concerns that are causing former fast-food junkies to shake their habits. Lately, market analysts have charted the downward fortunes of companies that range from Krispy Kreme Donuts to KFC. The infusion of salads and low-carb pizzas notwithstanding, there is little question that the fast-food industry is facing the biggest challenge of its existence.

Love/Hate Relationship
And ski resorts are not immune to the public's love/hate
relationship with these industries. In fact, while several Vermont areas are doing everything they can to distance themselves from fast-food purveyors, a number of California areas compete fiercely with each other to strike promotional deals with Taco Bell and McDonald's, and to sell lift tickets through major supermarket chains. Apparently, the idea of leveraging these outlets to generate business from the cities and suburbs is not seen as inconsistent with promoting a physically healthy sport in a franchise-free zone-just good marketing. And it's hard to deny the critical mass of customers who are brand-conscious.

That magic occasionally migrates to the mountains. At South Lake Tahoe in California, the new Heavenly Village is full of familiar names: Quiznos Subs, Cold Stone Creamery, Wolf Gang Puck Express and Nestle Toll House Cafe. Heavenly Village is within walking distance of a mountain gondola and 5,000 hotel and motel rooms, and is situated on busy Highway 50.

Rather than shunning national chains for locally-owned and -operated restaurants, skiers and other visitors have made them hugely successful. "There are times when our Quiznos and Cold Stone Creamery outlets are among the top-10 performers in the country within their respective franchises," says Village general manager Gary Casteel. "And our Nestle Toll House Caf