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Summer Camps Benefit From Economies of Scale
We Are Not Alone
By Amy Wu
Reprinted from the Westchester County Business Journal
May 19, 2003
Daniel Zenkel can already smell summer in the air. It's little surprise that the Scarsdale native has a sixth sense for the season. Since Zenkel started CampGroup L.L.C. in 1998, he has bought and runs eight summer camps in the Northeast.
The White Plains-based company founded by Zenkel and his father, Bruce, specializes in acquiring profitable camps that have a stable clientele. The camps with such names as Camp Mah-Kee-Nac and Camp Walt Whitman are in New Hampshire and Massachusetts. A day camp is in Rockland County.
CampGroup's business strategy is unique. Zenkel has adopted the concept that camps are no different than other commodities such as magazines, banks and coffee chains; they, too, can be acquired.
The plan is successful because each camp is allowed to run independently, Zenkel said. "We want to keep each camp unique and preserve its history but take on back-office functions so camp directors can focus on what they do best, such as recruiting campers and setting up staff," Zenkel said.
EXPANSION PLANS
The benefit for the camps is that Zenkel and his full-time staff of 12 do the bookkeeping, budgeting and strategizing for the camps. In return, each camp director and the estimated 50 full-time staff can focus on running the programs. The staff benefits from training programs, company meetings and mentor programs.
The company rents out the eight facilities at summer's end, and in February acquired a company that buys everything from food to art supplies for summer camps and other businesses. So far, the purchasing company has 30 clients.
At a time when the economy is weak and unemployment is on the rise, the camp industry has been little affected. "Generally, we find that summer camp is the last thing parents want to deprive their kids of," Zenkel said. "This is why CampGroup continues to grow."
Zenkel predicted the camps will see 4,200 children this summer, compared with 3,600 last year. And he plans to acquire at least two more camps this year. He said 2003 revenues will at least match the $25 million last year.
The company is also starting to look at camps to turn around, and is looking to expand in the Midwest and California.
FREE CAMP FOR 9/11 KIDS
Zenkel said summer camps are not easy to acquire. A typical acquisition takes anywhere from six to 18 months. CampGroup's eight camps are rooted in tradition, and several were founded in the 1920s. Zenkel said camp directors pride themselves on being independent and family-owned.
"A lot of directors do it because they love it, but they might want to sell to us because they want to diversify," he said.
Now going into its fifth summer, the company is increasing its charitable work. Last summer, it teamed up with the Twin Towers Fund to launch America's Camp, a one-week camp for children who lost a parent in the 9/11 terrorist attacks. The camp hosted 88 children at Camp Mah-Kee-Nac.
Recently, America's Camp Foundation was formed and has secured pledges of $1.5 million, including $385,000 from the Twin Towers Fund, and plans to host as many as 200 children this summer.
SAFETY PLAN
Zenkel, a father of three, said parents are increasingly concerned about their children's safety at camp. This year enrollments have been coming in later because some parents want to keep their children closer to home, he said. In addition, international enrollment has declined.
"There's certainly a lot of anxiety, and this year other things in the world are provoking the anxiety that there will there be another 9/11 in the world," Zenkel said.
In response, Zenkel established a basic safety plan that includes eliminating 15-passenger vans, which are prone to rollovers when fully loaded, and replacing them with safer 12-seat vans. Each camp has defibrillators, devices that help restart the hearts of people whose hearts have stopped beating.
The plan's emergency response includes stocking up on five-days worth of food, preparing phone messages to parents in the case of an emergency, renting satellite phones for backup communication, and making sure local police and fire departments have the camps in their emergency plans.
KEEPING PACE
To keep pace with other trends, the camps offer two-week sessions for children from two-parent households. And camp directors constantly brainstorm new activities to keep their edge.
According to the American Camping Association, the market is vast. As of 1998, the most recent association statistics, 10 million children attended the more than 12,000 camps - 4,000 of them day camps and about 6,200 of them operated by youth agencies and religious organizations. An estimated 2,300 camps are privately owned.
CampGroup's camps focus on traditional outdoor activities and sports such as water polo and tennis, outdoor living skills, arts and crafts and biking.