The Bass Pro Shops store in Rancho Cucamonga, Calif., is little more than an hour’s drive from Santa Monica, a West Coast enclave known for its anti-gun rallies and vegetarian cafés.
It might as well be on another planet. In this 180,000-square-foot, cathedral-like structure, shoppers can buy a Remington Varmint Rifle – $569.99 with a $50 rebate – grab a National Rifle Association flier by the door vilifying the state’s Sen. Dianne Feinstein for her effort to ban assault weapons, or order a 12-ounce New York strip steak from the adjoining restaurant.
The architect of this shooter’s paradise is Johnny Morris, a media-shy Missourian who became a billionaire stitching together shopping outlets for multiple outdoor sports and adding a touch of entertainment to the mix, often using local taxpayer funds to expand his empire.
It had been a very fragmented market, with a lot of independent retail shops catering to firearms, hunting and fishing, said Sean Naughton, a vice president and senior research analyst who covers the consumer sector for Minneapolis-based Piper Jaffray Cos. All these categories that consumers like to do, but there wasn’t a national chain.
Since founding Bass Pro Shops in 1972 in his father’s Springfield, Mo., liquor store, Morris has expanded to 58 superstores, with 20 more on the horizon. The company makes a variety of fishing boats and house apparel brands, and it controls a chain of full-service restaurants inside the stores.
He broadened the entertainment offerings with Uncle Buck’s Fishbowl & Grill ocean-themed bowling alleys, named after a beloved uncle whose moniker also adorns a house brand of candy and jerky scattered along the aisles.
According to a November 2012 report by Moody’s Investors Service, Bass Pro has annual sales of at least $2.6 billion. Morris, 65, owns the majority of the closely held company, according to Securities and Exchange Commission filings, after buying back a 28.5 percent stake from private equity firm J.W. Childs Associates in 2004 and a 13 percent stake from Gaylord Entertainment Co. three years later.
Bass Pro Shops is worth at least $2.6 billion, according to data compiled by Bloomberg, based on the average enterprise value-to-earnings before interest, taxes, depreciation and amortization, and enterprise value-to-sales multiples of two publicly traded peers: Cabela’s Inc., which offers an almost identical selection and store format, and Dick’s Sporting Goods Inc., which is entering the fishing and hunting business with Field & Stream branded stores.
Enterprise value is defined as market capitalization plus total debt minus cash. Morris has never appeared on an international wealth ranking and has a net worth of at least $2.8 billion, according to the Bloomberg Billionaires Index.
Bass Pro Shops could only have happened in America – the home of the free enterprise system that rewards things like hard work, value, innovation and genuine friendly service, the billionaire said in a hand-written note sent to Bloomberg News. Being included on your list is not my favorite thing, but then again things could be worse.
In written responses to questions, the company reiterated that its financial information has always been private.
Any valuation of the company by outsiders is nothing more than speculation from people with no first-hand knowledge of Bass Pro Shops.
Bass Pro’s critics complain about the company’s practice of accepting municipal subsidies to build megastores in their communities, often with the understanding they would create jobs or increase tax revenue.
The Public Accountability Initiative, a research group based in Buffalo, N.Y., estimated in a 2010 report that Bass Pro-anchored retail projects had won more than $500 million in taxpayer subsidies.
Another watchdog group, the Franklin Center for Government & Public Integrity, based in Alexandria, Va., estimated in August 2012 that Bass Pro and its closest competitor, Cabela’s, based in Sidney, Neb., received or were promised more than $2.2 billion from taxpayers over the prior 15 years.
Far from being surefire, Disney World-type attractions, Bass Pro stores often fail to spur growth and do not produce outsize economic advantages for the cities that subsidize their arrival, the Public Accountability Initiative said in its report.
In a statement sent by Dan McGinn, a company spokesman, Morris said, For more than 40 years, Bass Pro and our team members have worked in partnership with the communities where we have stores to create jobs, grow the tax base, increase tourism and support local charitable causes.
We believe in old fashioned values and we work hard to be good community partners.
Morris has attracted critics since at least 2002, when municipalities, taking note of Bass Pro’s value as a destination and source of sales-tax revenue, began offering him – or the developers building his stores – incentives to locate in their area. In 2006, a smaller competitor, St. Paul, Minn.-based Gander Mountain Co., initiated a public campaign against the subsidies used to lure Bass Pro and Cabela’s.
In Buffalo, Bass Pro was poised to receive subsidies of $35 million to build a store in Canal Side, a 20-acre historic area, according to the Erie Canal Harbor Development Corp.
After nine years of talks, the company pulled out in July 2010, following the Public Accountability Initiative report and a lawsuit filed against the company and municipal agencies by a group of citizens complaining about the subsidies.
Bass Pro said in its statement to Bloomberg News that because of development challenges, it gave up after spending $1 million in a good faith effort to locate in Buffalo.