Y2K Survival Goods Sellers Say Demand Is Slowing Down

After 15 years as a corporate executive and management consultant, Richard Bauly thought he had finally struck the mother lode with a tiny business that sold freeze-dried food--the perfect year 2000 survival product.

Starting at the beginning of the year, Bauly sold more than $100,000 worth of camping food--as much as the company usually sold in a year. He closed his consulting business, moved the company to Toronto and began gearing up for a great year of selling 20-pound cartons of BeReady survival packs.

But just as quickly as sales had spiked upward, they suddenly began to tail off last month.

“We’re around a little less than an order a day now,” Bauly said. “That’s about half the volume of February. We thought this would just keep on rolling.”

While there are still worries of a technological meltdown because of the so-called Y2K problem, Bauly Specialty Foods Inc. and other companies specializing in survival gear are beginning to sense that the fears of “doomsday” aren’t what they used to be.

“Right now there’s a lull,” Bauly said. “I still think people will panic toward the end of the year, but it’s certainly slowed down.”

Last year, the survival business, a once-obscure industry serving campers, survivalists, homesteaders and the Amish, launched into the mainstream, fueled by reports of suburban families fleeing for the hills or stockpiling loads of food and supplies because of the Y2K problem.

But in the last few months, progress in repairing the mischievous computer glitch, saturation of the market and a subtle shift in public perceptions about the dangers of the millennium bug have dampened sales from their once stratospheric levels.

At Lehman’s Hardware & Appliance Inc. in Kidron, Ohio, one of the nation’s biggest suppliers of nonelectrical appliances, not only have sales waned a bit, but the type of products being bought has changed as well.

Last year, the company sold a record number of large wood-burning cookstoves--a hard-core survival product for those expecting a long existence without gas or electricity.

“Anyone buying a wood-fired cookstove is preparing for a much simpler life,” said Galen Lehman, vice president of Lehman’s in the heart of Ohio’s Amish country.

But in the last few weeks, sales of the $850 to $4,000 stoves have tapered off. For the first time in six months, the store actually has a few in stock.

Lehman said that instead of wood-burning cookstoves, customers are now clamoring for propane stoves and kerosene lamps--products that are better suited for short-term emergencies, since they still require fuel. “It seems like people now are worried about a lesser type of problem,” he said.

The Y2K fears have bounced up and down over the last few years since it became a public issue. As recently as a year or two ago, there were people who openly scoffed at the idea that such a trivial technical issue could cause any problems. But by the beginning of this past winter, water purifiers, electric generators and survival food were selling at their hottest pace ever.

The Y2K problem stems from the widespread use in computer programs of two digits to represent years. The practice began in the earliest days of programming to conserve precious hard-disk space.

The use of two digits causes no problems as long as the dates are in the same century. But in the year 2000, many of the two-digit entries will become confusing to computers. For example, the year “00” could be interpreted as either “1900” or “2000,” leading to potential malfunctions and calculation errors.

In recent months, the flow of information from critical industries and government agencies has helped reduce the fear in this country that there will be any widespread disaster, although there are still concerns about the situation overseas and with smaller businesses.

The survival companies are a sensitive gauge of public perceptions about the Y2K problem.

Last year, when concerns about critical industries and government agencies ran high, freeze-dried chicken stew and cans of soy-based meat substitutes flew off the shelves. But as the concerns have eased, the chicken stew is sitting on the shelf a little longer.

At Safe-Trek Outfitters in Bozeman, Mont., one of the oldest names in survival food and equipment, a two-month backlog of orders has largely evaporated.

“I would say it’s different these days,” said Stephen Quayle, Safe-Trek’s chief executive. “People are just assuming that Y2K is going to be just a bump in the road.”

Quayle said that in the last three months of 1998 and again in January, sales were five to 10 times the usual volume. Things have slowed considerably, he said, but sales are still running about triple the usual rate.

Quayle said that last year one of the company’s hottest sellers was its “Gary North” pack--a 2,344-pound collection of dehydrated fruits, soup mixes and soy-based meat substitutes, named for one of the better-known Y2K alarmists. The $3,999 package can feed four people for a year.

More recently, sales have been picking up for the company’s “basic” package, designed to feed one person for a few months.

At other companies, emergency power generators remain in short supply. Many dealers report a backlog of orders and say the shortage could persist for several more months.

Art Kawaguchi, president of Kawaguchi Honda in Los Angeles, said his biggest backlog is in high-capacity generators costing between $3,500 and $6,500. These are typically used by construction companies, municipal agencies and small businesses.

“We’ve still got a pretty good inventory of some of the popular sizes, but I would like some more,” he said.

As for homeowner demand, Kawaguchi said that he just hasn’t seen that much, probably because the generators are fairly expensive, starting at $700 for a 1,000-watt model that would not quite power a home refrigerator.

The cool-down in the survival business is, in many ways, just as puzzling to store owners as the big boom last year.

Lehman said he thinks that a drop-off in sales of certain products is inevitable. A store, he said, can sell only so many $4,000 wood-burning cookstoves before everyone who wants one, has one.

Steve Portela, sales director at Walton Feed Inc. of Montpelier, Idaho, another large supplier of survival goods, said that with two record years of sales under his belt, he is not overly concerned by the slowdown.

Some store owners believe that the big sales rush is yet to come. As the year 2000 draws closer, they say, people who may have been thinking about buying a generator or laying in some emergency food and supplies, might finally start ordering.

“Those on the edge, when they hear a few reports of problems, they’ll go out and buy [supplies],” Bauly said.

“We’ll see what happens,” he said. “It’s already been a great year for us anyway, but we’re not building our future on this.”

* TESTING, TESTING: New York, Japan and Canada passed an early test of Y2K readiness. C3