Souvenir Sales at TMS

[ChuckLicata]

TEXAS MOTOR SPEEDWAY TOP OF LIST FOR RACE SOUVENIR SALES

FORT WORTH-DALLAS (March 23, 2004) - Texas has a reputation for doing things in a big way. Texas Motor Speedway is no exception when it comes to souvenir sales on race weekend.

 

Action Performance, one of the largest manufacturers of race collectibles, and SMI Properties who produces merchandise for Speedway Motorsports tracks and several drivers, say the Samsung/RadioShack 500 race week is the one of the top three-day weekends of the year.

Action sends 32 to 34 souvenir trailers representing 12 different NASCAR NEXTEL Cup drivers to Texas each year. Action produces driver merchandise for many of the popular drivers including Jeff Gordon, Dale Earnhardt Jr., Rusty Wallace and Dale Jarrett.

 

"We bring the same thing to every track," said Action Performance president and chairman Fred Wagenhals. "No place do we sell as much in three days as we do in Texas. It closely rivals what we do in Daytona and we have 10 days to sell in Daytona.

 

"I remember when we first went to Texas after North Wilkesboro where I think we were doing $250,000 in sales. We did $1.9 million that inaugural year at Texas. Everyone said it was because it was the first year, but the second year we did over $2 million, the next year $3 million. So obviously, Texas is a big race for us."

 

In 2003, Action Performance did an estimated $55 million in trackside merchandise sales over he course of the NASCAR NEXTEL Cup season. And although die cast cars account for 60% of the company's $400 million of products sold on an annual basis, it only accounts for 15% of trackside sales. The overwhelming majority of the profit comes from T-shits, hats and jackets.

 

In addition to all SMI speedway branded merchandise, SMI Properties also

handles: Hendrick Motorsports drivers Terry Labonte, Brian Vickers and Kyle

Busch; Petty Enterprises; the US Army car and driver Joe Nemechek; all Toyota teams for the NASCAR Craftsman Truck Series; and Coca-Cola, both Coke branded and Coca-Cola Family merchandise. Jack Nipper, senior vice president of SMI Properties, agrees with Wagenhals on the importance of Texas.

 

"Texas is definitely one of our bigger races next to Daytona - in fact, it's

probably one of the biggest races," said Nipper. "The per cap at Texas, averaging all vendors, is a little more than $25 per person. That's exceptional for even motorsports which traditionally outperforms

other professional sports. Normally, at other professional sporting events, you have an average of $5-8 per cap so it's pretty amazing how motorsports excels above other sports."

 

Wagenhals attributes the continued success at Texas to the loyalty of the fans. "I think the Texas fans are loyal group of fans starved for racing. If you went to Texas the first race you could probably say there wasn't anybody who should've come with the weather problems - but you've never seen so many loyal fans, RVs, and all that. It's a just a great facility I think, besides being a great market. I think Texas has raised the bar for facilities with suites and amenities for the fans. Even the campers have first class facilities now days -- they're not parking in a corn field anymore!"

 

Wagenhals is also closely watching the current trend of taking NASCAR racing to larger metropolitan markets not traditionally associated with the sport. Larger markets mean potentially larger profits for Action, SMI Properties and others.

 

"I know there's a tradition associated with older tracks. But wouldn't you

rather go to a big market like Fort Worth, Chicago or Kansas City? I think so! I just think the sport is heading that way. If you really look at the sport, it reminds me of baseball in 1960's when they said we can't have three teams in New York City - we need to go to LA, San Francisco, etcetera. That's what's happening to our sport now."

 

And who are Action's top sellers? "The top five sellers are (Dale Earnhardt) Junior, (Jeff) Gordon, (Tony) Stewart, Rusty (Wallace) and Big E (Dale Earnhardt). Dale Earnhardt is still in the top five. Junior is definitely tops right now - and it didn't hurt when he won Daytona!"

 

"Texas is biggest in lots of things and the fans there are certainly among the biggest and the best," said Rusty Wallace. "The fans are starved for NEXTEL Cup racing because we only go there once. Hopefully that'll change one of these days. It's one of the biggest markets for Miller Lite, too. The deal is that we're only there officially for three days out of the year and the Texas fans damn sure make the best out of it."