Local gear shop owners Marc Sherman and Mike Donohue areinvesting in the future of Outdoor Gear Exchange (OGE) by purchasing thebuilding currently occupied by their store on the corner of Church and CherryStreets in downtown Burlington. What’s different about this real estatetransaction is they are rewarding customers for their help with theinvestment.OGE designed a tiered program (think Kickstarter) that allows customers toparticipate while being rewarded up to 130% with merchandise, discounts,quarterly certificates. “More or less participating customers will prepayfor future OGE purchases and get a discount. For us and many of our customersit’s a win-win,” said store founder Marc Sherman. The program has severaltiers of support that allow customers to participate at a level they canafford, ranging from $100 to $25,000, at which the reward includes amulti-day hike, bike, climb or paddle adventure with the OGE owners.
“We’re fortunate to have fiercely loyal customers to come to us for alltheir gear – some spend thousands each year in our store outfittingthemselves with the equipment clothing and accessories they need foradventure and safety. We know them and they know us. We feel this is a way todeepen those relationships and share the return on our investment.”
At a retail store where gear purchases can quickly add up, the program makes
sense. For example, someone thinking to purchase a kayaking outfit in the
next year would spend at least $1,250 on a new boat, paddle and PFD. By
contributing at the $1,000 “Mt. Katahdin” level, that customer will get
back $1,250 in store credit over two years – a savings of 20 percent.
Similarly, the store welcomes familiar faces season after season to tune-up
equipment, replace worn-out wares or upgrade to the latest in technical
accessories. Shop owners had these customers in mind, who easily spend
$100-300 each season on new gear, when they created the “Mt. Marcy” level
(each tier is named after a significant local summit). The investment repays
$2,500 with $275 in store credit each quarter over 3 years for a total return
of $3,300.
The program was inspired by popular crowdfunding websites like Kickstarter
and Indiegogo, OGE’s owners decided to keep it local. “Those platforms
are a great stage for start-ups that need structure and broad-reaching
visibility to garner trust and attention. The OGE is a healthy, established
business heading into our 20th year as Burlington’s local gear shop. I’ve
watched customers follow us from our first store on Main Street to Bank
Street, then to our former Cherry Street location and now they shop our store
on Church Street. With our last move we were pleased to get a lot of positive
feedback about how excited our customers were to see us growing. Purchasing
the building only further ensures that we will continue for another 20
years.”
Sherman and Donohue plan to move forward with the building purchase
regardless of funds raised, though they are prepared to return $100,000 in
community investments with up to 130 percent in store credit through the
program. Store credit will be issued quarterly beginningMarch 1, 2015and
will be valid on all goods and services the same as cash, including gift
cards, consigned items, tune-ups and repairs. By designing and hosting its
own program, OGE maintains a locally-focused fundraising campaign, ensures
that all money invested supports the OGE and foregoes fees taken by online
platforms. All funds will be applied to the building down payment. “This
program reduces our debt burden with traditional lenders and allows us to
extend the return on investment directly to our customers,” said co-owner
Mike Donohue. In addition to quarterly benefits these “partner” customers
will also receive regular updates of business achievements and future plans.
Just as with Kickstarter or any investment, the program requires an element
of trust. “We’ve built a successful business by making customer-first
decisions and will continue to put our customers ahead of personal interests.
We are invested in the Burlington community and a reputable employer of over
90 people.” Sherman and Donohue will honor all contributions with a
personal agreement and guarantee that the initial support amount (less any
already used credit) be returned should the real estate deal be unable to
close.
Always envisioning new possibilities, Sherman looks forward to the autonomy
of building ownership and ability to manage the building’s “destiny”
for which he plans future environmental and efficiency improvements that will
enhance the space and increase the vibrancy of Church street, including a
rooftop solar array and natural light through new skylights and windows.
Details about the program are posted online atgearx.com/future. OGE will
extend this reward program for customer investments through November 15,
2014. Sherman and Donohue aim to complete the purchase of 37 Church Street by
the end of 2014. More information about the OGE and the OGE Future Program
can be found atgearx.com/future.
Founded in 1995, OGE’s mission is to provide the best quality gear – both
new and used – at affordable prices within a customer-focused shopping
environment, maintain a sustainable and happy work environment, and be
actively involved in the outdoor and local communities OGE is locally owned
and operated, and employs more than 90 people between its retail store and
online fulfillment website,gearx.com. All aspects of Outdoor Gear Exchange
are located at 37 Church Street in Burlington, Vermont.
Source: OGE 9.26.2014