Great Lakes small businesses and ski areas pivot following a record warm winter

Chicago (CNN) — This winter, every morning that hotel owner Kelli Doyen looked outside her window, she hoped to see the Gwinn Model Towne Inn’s snowmobile caked in snow.

“We are one of only four properties that has a snowmobile trail right off the property,” said Doyen, who co-owns the hotel on Michigan’s Upper Peninsula with her husband. In past seasons, that competitive advantage lured roughly 800 snowmobilers – it’s a top winter sport in northern states – to the hotel in Gwinn, Michigan, roughly 20 miles from Marquette.

This year, instead of fresh powder, too often Doyen said she saw a muddy path.

Now, as the season draws to a close, “We are down 70% over sales from last winter,” she said. “We have had a pretty tough go of it.”

The 2023-2024 season marked the warmest winter on record for the lower 48 states, according to NOAA’s National Center for Environmental Information. The change in the weather has had an outsize impact on the festivals, events and tourism that define the Great Lakes identity and produce the income of those living and working there. All told, eight states experienced a record-warm season, including Wisconsin, Michigan, New York and Minnesota, plus North Dakota, Iowa, Vermont and New Hampshire.

Instead of a winter wonderland, the past several months have offered tourists less snow, less ice aind less opportunity for some outdoor activities. Small businesses owners and regional industries scrambled to adapt. Less outdoor ice skating might mean more indoor ice-skating. Less snow-shoeing meant more pickleball in some places.

Doyen said the loss of income amounts to roughly $70,000. She’s one of several business owners in the midwest whose winter sales keep them afloat until the summer tourism season begins. Since purchasing the property in 2020 – just before Covid hit – Doyen said she has invested a bulk of her profit into renovations. Operating expenses total $15,000 per month. With the drop in bookings, her husband has pulled from his 401(k) to stay open.

“The last six months, I’ve spent every night here because I can’t afford to pay somebody to be here,” Doyen said. “We’re down to our last $20,000 and we have to make it to June.”

“It’s depressing. It’s exhausting.”

Event and revenue meltdowns

With less snowfall, severe drought expanded over portions of Wisconsin and Michigan and increased in Iowa during the winter months, according to the US Drought Monitor. The situation grew so dire that governors in Michigan, Minnesota, and Wisconsin announced businesses impacted by drought may be eligible for loans from the Small Business Administration.

“From skiing and snowshoeing to winter festivals, snowy winters are part of our way of life in Minnesota,” Gov. Tim Waltz said in a news release in March 7. “The low precipitation we’ve experienced this winter has had a real economic impact on small businesses that rely on snow and winter tourism to grow and survive.”

Susan Estler, CEO of Travel Marquette in Marquette, Michigan, told CNN hotel bookings between Christmas and March are down 16% this year.

“We are dependent on the snow for outdoor activities,” Estler said. “Reservations are down. Businesses are down.”

Estler estimates roughly 30% of tourism dollars are spent on hotels. That means the other 70% supports the local economy -– from gas stations to grocery stores to restaurants.

“All of those things have been impacted,” she said.

Data from the Bureau of Economic Analysis highlights the significance of climate, and of snow in particular, on business owners’ bottom line. According to the BEA, snow activities in states clustered around the Great Lakes add hundreds of millions of dollars to the region’s economy. For example, Wisconsin snow activities added $83.6 million in 2022, according to the BEA, and roughly $130 million in Michigan the same year.

Adapting business plans

Some events that normally bring throngs of tourists to Marquette were forced to cancel this year. That includes the UP200, a sled-dog race and qualifier for the famous Iditarod race in Alaska.

“Safety is our top priority and given the lack of snow and the warm temperatures, we cannot offer a safe race,” said Darlene Welch, UP200 President, in a statement on the UP200 website in February.

Estler noted the UP200 still held an outdoor festival instead of a race, an example of businesses quickly adapting to what may become a new normal.

“The time for adjustment is really now,” she said. “Hopefully we will be getting an early spring and an early summer so [businesses] can start recouping some of the money that they lost during the winter.”

Christopher Germain, CEO of Lake Superior Community Partnership, said some ski areas have been offering summertime kayaking packages and outdoor space for special events and weddings to offset the loss in wintertime revenue. Germain added “Some of our small businesses are pairing up with each other to do special dining events.”

Partnerships and discounts

Germain, Estler, and Doyen are all transplants who moved to northern Michigan enchanted by the majesty of Upper Peninsula winters.

“I actually interviewed during the winter, toward the end of January, and it was just breathtakingly beautiful,” Estler said. “The identity of the UP and especially Marquette is very much tied to the winter season and always has been. So, it is quite unusual to have this.”

Doyen said one of the most difficult parts of her hotel’s emptiness is her inability to deliver more visitors, activities and, therefore, ancillary revenue for her neighbors.

“The fact that we have been empty has hurt our community too,” Doyen said

Despite the challenges, Doyen still loves running the Inn, and plans to keep her doors open as long as possible.

“We actually care about our guests and care about our community.”

Doyen told CNN she also plans to offer a 20 percent discount through the spring months in hopes of bringing in more visitors.

Going forward, “You can’t plan around one season anymore,” Germain said.

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