NMPA
c/o Bridget Holloman, Exec. Secretary
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Magazine
Second Place

Thomas Pope, NASCAR Illustrated

Open For Business

Massive profits spawns industry featuring a band of nomads who man the mobile malls known as Souvenir Row

The crowd stands 10 deep in front of each of the half-dozen registers, every person ready to hand over a credit card or reams of $10 and $20 bills. The crush won’t ebb for hours, until almost race time, and that was at just one of three Dale Earnhardt Jr. souvenir rigs parked at Martinsville Speedway.

It is a microcosm of the NASCAR souvenir business, one frame in a picture that translates to more than $1 billion in annual sales. More than 110 souvenir trailers crisscross the country throughout the Nextel Cup season, each laden with tens of thousands of dollars in driver merchandise — from $3 window decals to $400 leather jackets.

Souvenir sales are the source of considerable income for the drivers, team owners, sponsors, NASCAR, and the tracks, and the business has grown with kudzu-like speed since 1982, when Richard Petty was the sole driver with his own souvenir rig. It’s more high tech than one might expect, with inventory reports and credit cards fed to suppliers and banks via satellite.

The rigs are staffed, for the most part, by married couples who enjoy the travel, the lifelong friendships with fans, and the connection it gives them to the sport. They are retired policemen, former route salesmen, carpenters, and truck drivers. They hail from every corner of the country and are, said one of the business’ key players, unique in the sports world.

“Only 300 people in the world do what you’re doing,” says Chris Williams, the director of trackside for Action Performance Companies, which has more drivers under contract than anyone. “Major League Baseball, the National Football League, there’s nobody else that does what we do. You do everything together. You eat together, you sleep in the same hotels in the same cities year after year. You cry together when there’s tragedy in someone’s family, and you celebrate good news together. These people are all one big family.”

In the NASCAR souvenir field, there are four major families. Action is headquartered in Tempe, Ariz., but its souvenir fleet restocks as often as necessary out of a warehouse within sight of Lowe’s Motor Speedway near Charlotte. TeamCaliber is owned by Roush Racing, but its clientele includes Penske driver Ryan Newman. There are also Sports Design, a branch of Speedway Motorsports Inc., and Racing Champions, whose lineup includes Nextel Cup automakers Ford, Chevrolet and Dodge.

Teammates don’t always march in lockstep the way Roush’s gang of Matt Kenseth, Mark Martin, Kurt Busch, Jeff Burton, Greg Biffle and Ricky Rudd do. At Hendrick Motorsports, for instance, Jeff Gordon is with Action, Terry Labonte is signed with Sports Design, while Jimmie Johnson casts his lot with Racing Champions. Newman’s teammates, Rusty Wallace and Brendan Gaughan, are aligned with Action. Teammates Kevin Harvick and Johnny Sauter are under contract with Action, but their Richard Childress Racing stablemate, Robby Gordon, handles his own but purchases his merchandise from Action.

Signing a driver to a licensing agreement is only part of the process of getting the product to trackside.

Each of the companies pays for an array of business licenses and permits, and each track’s policy towards the souvenir business differs depending on who operates the speedway. International Speedway Corporation tracks, for example, limit souvenir sales access to firms representing a driver or that are licensed to deal in corporate products. Speedway Motorsports, on the other hand, still permits a generic licensee, such as Race Girl, to market wares at its tracks. The remaining tracks all have their own policies.

In addition to ticket sales, sponsorship and parking revenues, tracks derive a portion of their income from fees paid by the souvenir companies. Some tracks require a percentage of gross sales — usually between 13 to 15 percent, a source said — because that method tends to generate a higher payout. Other tracks prefer to know exactly how much revenue to count on and make space available for a flat fee per trailer.

That’s just a portion of the overhead for the companies in the souvenir business. In addition to the sales representatives, there are artists, designers and suppliers to pay, as well as top brass to warehouse workers. Every time Ford, Chevy and Dodge changes the looks of their Nextel Cup cars, tens of thousands of dollars must be spent re-tooling parts for an entire line of die-cast cars, where authenticity is a must. There’s a fleet of trucks and trailers to maintain, and Action values its trackside vehicles at $11 million — rigs that saw $52.5 million pass over their counters as part of Action’s $125 million net profit in fiscal 2003.

Today’s souvenir business is far removed from its humble beginnings. In 1982, Williams said, there were three souvenir trailers servicing the sport. In 1984, a businessman named Hank Jones signed to handle merchandise for two of the sport’s top drivers, Bobby Allison and Dale Earnhardt. By 1988, the number of souvenir trailers had swelled to nearly 40 strong. NASCAR’s spread to new markets and solid TV exposure made big stars out of drivers such as Davey Allison and Darrell Waltrip, with fans clamoring for their T-shirts, caps and other apparel.

Fifteen years later, the sport’s popularity has multiplied with such strength that

Action may send as many as six Dale Earnhardt Jr. rigs to a venue to handle the crush. He moves nearly twice as much merchandise as the No. 2 driver on the charts, Jeff Gordon, according to Williams.
Williams has seen the business explode from a unique perspective. His father, Orbreyn Williams, worked at Martinsville Speedway, and the Williams family lived near the top of the hill on the residential street that leads to the track. Chris Williams was so intrigued by the sport that he once walked to the track to see what was going on, and the speedway staff called home to inform his mother that her 5-year-old son was seated on the front row, taking in the action.

Williams would later work at the track as a flagman, pace car driver, concessionaire, program and concession salesman, and winner of an Allison Legacy Series race in 1999. “There isn’t anything I haven’t done at Martinsville Speedway,” he says.

It was at NASCAR’s smallest, oldest track that Williams made the contact that turned into a career. After having gone 11-plus years to school without missing a day, Williams was allowed to miss half a session to watch Dale Earnhardt test. Naturally, when Earnhardt was introduced to Williams, he prodded, “Why ain’t you in school, boy?”

Williams later met Hank Jones, the man who first handled Earnhardt’s souvenir sales. Williams, a prominent high school athlete, passed up college to go to work for Jones, then stayed on with Earnhardt after the driver bought back the rights to his souvenir business. When Action purchased Earnhardt’s souvenir license in 1996, Earnhardt asked Williams to stick around.

Earnhardt deserves more than his fair share of credit for taking the souvenir business across the billion-dollar threshold, Williams says. It was Earnhardt’s idea to bring a rig to a track that was exclusive to one driver rather than sharing billing with a half-dozen other drivers. It was also Earnhardt who conceived of sending a tractor-trailer filled with goods out to the souvenir rigs between races rather than having them return to their home base for a refill.

“He might have been an eighth-grade dropout, but he was probably one of the smartest men I’ve ever met,” Williams says. “We had a few problems early when we ran the business, and we had to think of ways to save the business money, and how souvenirs and collectibles would be affected by the future of the sport.

“We were doing things like sending a rig out of home in Charlotte to a race at Pocono, then hustle it back here to stock up, then turn right around and head out for Michigan for the next race and get there just in time. We realized it was almost physically impossible to stock 18 trailers full of orders in two days, so we came up with the idea of stock haulers that carried millions of dollars in product to the tracks for the rigs.

“Now we’re all computer equipped. We went to Microsoft and asked them to build a program we could use for satellite sales. We were the test people for them for that part of the business, and we’ve done two commercials for them for that product. We have a seven-second response to a credit card sale, and we have on-hand reports that tell us by the minute what products are selling and in what kind of numbers. It’s live-to-the-warehouse and we can watch those sales.”

They stay busy watching the numbers zip past with every transaction of Earnhardt Jr., who has overtaken his father as the No. 1 seller in the industry. Only in the last year has Jeff Gordon climbed into the No. 2 slot, as Earnhardt occupied that position for 2-1/2 years after his death in the 2001 Daytona 500.

“I ran his [Earnhardt’s] trailer for 13 or 14 years,” Williams says, “and I never thought the business he did could be duplicated. It’s unbelievable the impact he had on the sport. NASCAR continues to grow, but Dale Jr., being competitive and winning the Daytona 500 this year and having a shot at a championship, he gives fans an opportunity to say, ‘Another Earnhardt’s coming along and carrying on the family tradition.’ Junior’s got the best of both worlds. He’s got his daddy’s fans as well as all the new people that have been introduced to racing in recent years; and people love a winner.”

Earnhardt still has a souvenir rig following the tour — manned by Williams’ father — and camouflage versions of his apparel can be found on another trailer promoted by Realtree hunting gear. The Team Realtree rig also carries camo gear for Sterling Marlin, Rusty Wallace, Dale Jarrett, Jeff Gordon, Earnhardt Jr., Kevin Harvick, Bobby Labonte and Tony Stewart.

Charlie and Emily Barber of Troutdale, Va., pick up a lot of Earnhardt Jr.’s overflow at the Team Realtree trailer. Charlie hauled furniture over the road as a trucker for 28 years, and during much of the time he was gone, Emily attended NASCAR races. She wanted to follow the sport more frequently, and asked her husband about teaming up on the road with a souvenir trailer.

“I told her, ‘You get us hooked up, we’ll do this for a couple of years,’ “ he says. “She called Petty’s PR people, and I think they gave us a job just to keep her from bothering them about it anymore.”

Their proposed two-year stint has turned into a 13-year run. The Barbers spent two years towing a Petty souvenir trailer, then worked with Davey Allison and Bill Elliott until moving to the Team Realtree rig.

Jim Sproul, a native of Goldsboro, N.C., worked for a Miller distributor for 18 years, a position that afford him contact with driver Rusty Wallace and others close to him. When Wallace’s souvenir crew bolted midway through a season, Sproul jumped at the opportunity. He was available, had sales knowledge and a commercial driver’s license. He’s been on the road for seven years now and is usually accompanied by his fiancé, Cindy Carlyle, who does most of the bookkeeping.

“I go down the highway and hear other trucks on the CB telling me I have the dream job,” Sproul says. “It certainly has its moments, like when fans at New Hampshire [International Speedway] invite you over for all the lobster you can eat, but it also has its not-so-fun moments.”

Sproul’s twice-a-week golf outings have been all but eliminated by the pace of the circuit. He’s open for business starting Friday morning when races are scheduled for Sunday, and even earlier if the schedule visits a track only once a year. For the Daytona 500, Sproul’s sales windows are open for a full two weeks.

By late summer, the grind of the road begins to take its toll.

“Daytona’s one place where you’re going to be there so long you can take your clothes out of the suitcase and put them in drawers,” says Sproul. “We hit the wall the latter part of July and early part of August. There’s a long stretch with no weeks off, and it’s a long while before we get back down south. You can see attitudes change. It’s a constant go, go, go, with no home-cooked meals and no sleeping on your own pillow.”

The best moments are when drivers visit the rigs for autograph sessions. Michael Waltrip, Sproul says, frequently will start at one end of his souvenir trailer and work his way down the counter, signing everything on which he can apply his autograph. The items don’t sell for any higher than unsigned merchandise, but it does raise the appreciation and value for the fans, according to Sproul.

There’s not much that can’t be found on the mobile showrooms. Computer mouse pads go for $5, and socks for a newborn are marked at $6. A 1/64th-scale die-cast has a $6 price tag, too, while a 1/24th- or 1/16th-scale car can bring up to $150. T-shirts run $18 for kids sizes, and $22 to $30 for adults, depending on the intricacy of the design. There are ticket holders, key chains, trinket boxes, headbands and shot glasses. A fully stocked trailer will weigh between 28,000 and 30,000 pounds, Sproul says.

The inventory doesn’t last long, especially for winning drivers.

“If Ryan wins the pole or the race, business really picks up,” says Connie Nichols, a native of Martinsville, Va., who operates Newman’s rig with her husband, Paul, a former police officer. “Everything we have is pretty much wiped out after every race.”

It’s an effect Williams calls “blow off” – the 90 minutes to two hours after a race.

“If you win,” he said, “you’re pretty much going to have an 8 to 10 percent increase in sales during the blow off and the following week. Rusty hadn’t won in three years when he won at Martinsville in April, and he wound up being up 3 1/2 percent for the weekend. The next weekend at Fontana [Calif.] he was about 8 percent ahead of where he’d been the first part of the season.

“There’s the old car dealer’s saying about racing: Win on Sunday, sell on Monday. In our business, you win on Sunday and you sell on Sunday and all throughout the next weekend, too.”

Winning is good for drivers, teams and sponsors, each of which receive a portion of the royalties from souvenir sales. Action’s 2003 annual report stated that it would fork over more than $20 million in guaranteed royalties. Some sources say that the payout between driver, owner and sponsor is evenly divided, but Williams said that’s not the case; the driver gets the largest slice because he has the most at stake.

Even so, Kenseth’s 2003 Winston Cup championship meant “a nice check” for his sponsor, DeWalt Power Tools, says Geoff Smith, president of Roush Racing. “It’s not a huge number compared to what they spend, but it’s a nice give-back.”

Roush, through its TeamCaliber arm, began licensing its drivers’ souvenirs in part to keep Action from dominating the souvenir business, according to Smith.

“We thought monopolization was extremely dangerous to the sport and its sponsors,” he says. “If one company decided your driver wasn’t worth a souvenir trailer, what recourse did you have? We took the economic risk to operate one trailer at the outset and have some die-casts made. It wasn’t about profit, it was that we got to participate in the souvenir business and not be subject to outside forces.

“I think other owners see the same type of potential aggregation of licensing power and the importance of trying to keep it in balanced hands. Every driver gets full, even treatment [with TeamCaliber] so they don’t lack for their share of the revenue.”

The business has created numerous long-term relationships. Action has Jeff Gordon, and DEI drivers Earnhardt Jr. and Michael Waltrip signed through 2005, with Chip Ganassi Racing and the late Dale Earnhardt inked through 2011. Richard Childress Racing and Evernham Motorsports are tied to Action through 2012, and Robert Yates Racing is with the company through 2017.

That means plenty of work for couples such as the Nicholses and Barbers, as well as Butch and Karen Fogg, natives of Scotia, N.Y., who relocated to the Charlotte area to try the souvenir trade. They’re the folks behind the Sports Design counter for Army-sponsored Cup driver Joe Nemechek, whose apparel carries a unique “G.I. Joe” theme. The military theme is a special fit for Butch Fogg, who served with the Army in Vietnam.

“I was a general contractor for 17 years,” Butch says, “and I was so tired of the business. The hours were terrible. My son was interested and took over the business, and we had a friend of ours who had moved down from upstate New York and was selling scanners trackside. He said, ‘You guys should come interview with these people.’ Sports Design ended up calling us, and Daytona 2003 was our first race. When you first look out and see hundreds of people walking by, it does kind of drop your jaw.

“It takes a while to get used to this kind of life. We spend probably 150 to 200 nights in motel rooms. We travel so much that everything looks familiar. You find yourself asking, ‘What city are we in today?’ – especially when you’re going from one track straight to another. We did a stretch of about eight weeks last year before we were able to ‘get back to the shop.’ You learn to pack your clothes accordingly.”

It means having family back home paying bills when they’re gone, which one of the Nichols’ sons handles, or seeing that the bills are forwarded to them on the road. It means seeing the Foggs catching up on laundry in motels or Laundromats. It means considering getting married when it’s convenient, which Sproul and Carlyle attempted to do last November in Homestead, Fla., only to find they couldn’t fit a visit to the justice of the pace into their schedule – and they’re still waiting.

Besides personal contacts and recommendations, souvenir rig workers are often rustled up using a more high-tech method. Williams placed an ad for workers on Monster.com last year and received 2,000 resumes as a result. He hired 14 people, 10 of whom “have worked out really well.

“Finding people who are cut out for this is the hardest part of the job,” Williams says. “All of these people want to be associated with racing, period. They definitely don’t do it for the money. We have people who want to get into it because they enjoy the travel, or for something to do after they’ve retired from another career. They’ve got to have computer knowledge, and a CDL helps.

“Not everybody is cut out for it. We’ve had people turn around after a couple of weekends on the job and say, ’You all are crazy,’ which is why I’d rather have couples. Number one, they’re going to make a commitment that a single person won’t, and they realize they’re dealing with two people’s paychecks, so they’re less likely to jump ship. Number two, from a simple business standpoint, it keeps our expenses down.”

Temporaries help flesh out the sales staff on the road via word of mouth or flyers placed on college campuses. Sproul prefers to limit the number folks behind the counter, as more salespeople than sales registers slows the flurry of business.

The pace of the souvenir business can be as tough as that faced by the race teams. Race teams will, for instance, be airborne a few hours after a race in California and be home by midnight. For Sproul and the others who drive their rigs, it’s a four-day cross-country pull back to home base. There are even off-season events where the souvenir rig is needed to meet the fans’ need, but the crews are generally idle from early December until mid-January.

“Then it’s time to get product ready, stock the trucks and get set for Daytona,” Sproul says. “And do it all over again.”