Economics of a Ski Resort
The economics of a ski resorts in Colorado will vary depending on a number of factors, such as the location of the resort, the size and quality of the resort’s facilities, and the overall state of the economy. However, there are some general principles that apply to most ski resorts.
First, a ski resort relies heavily on winter tourism, so its economic performance is largely tied to the weather. If the winter is mild and there is little snow, the resort may not be able to attract as many visitors and may not be able to generate as much revenue. On the other hand, if the winter is cold and snowy, the resort may be able to attract more visitors and generate more revenue. The Wolf Creek ski resort typically gets the most snow and can average over 430 inches a year. We are currently ahead of pace for the 22/23 season.
Second, a ski resort typically generates revenue from a variety of sources, including lift ticket sales, rental fees for equipment such as skis and snowboards, food and beverage sales, and lodging. In order to maximize revenue, a ski resort must carefully manage these different sources of income and ensure that they are operating efficiently.
We have all seen ticket prices over the years have skyrocket with season Ikon & Epic passes now reaching over $1,000. Vail Resorts is the largest ski resort company in the world and had revenue in 2021 of 1.91 billion. Ticket and pass sales accounted for over 45% of those sales. See the full breakdown below:
Third, a ski resort must also carefully manage its costs in order to remain profitable. This can include costs related to maintaining and operating the resort’s facilities, such as chairlifts and ski runs, as well as costs related to staffing and other overhead expenses.
Resort companies like Vail have been under increased scrutiny as employees often cant afford to live near where they work. Affordable housing or employee housing options are often slim or nonexistent. This housing problem is in part driving their increased labor costs. See Below:
Overall, the economics of a ski resort involve balancing the need to attract visitors and generate revenue with the need to manage costs and remain profitable. It’s a tricky business but one that’s sure to thrive for years to come in Colorado.
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