Friday, March 13, 2009

Vanishing ski equipment manufacturers

On March 11, 2009, a reader wrote the following comment:

The Ski industry has been through several recessions and bad snow years, It would be great to get your industry insider's view on the consolidation, disappearances and revival of the various famous ski and boot brand names. What happened to Kaestle, Kneissl, Dynamic, Lacroix, Authier, and Spalding ski brands? In boots we know Caber went to Rossignol, what about Dachstein, Koflach, Kastinger, San Marco, Henke, Dynafit, Trappeur, Henke, Dolomite, and Raichle brands?


These are all interesting questions that I will address in this and the two following blogs.
The reasons for all these “fatalities” are as simple as the ski industry is a very challenging environment. First, the ski season is very, very short (in fact, there’s only one winter season; the south hemisphere snow season remains negligible and probably costs more to develop and run than it can generate). With only two or three months of peak selling activity, a manufacturer or distributor must line up its working capital for an entire year and this where the business model starts to be lopsided. Then there are the variables of the weather (good or bad snow cover) and the economy (this year, for instance.) Snow sports are a discretionary, albeit expensive activity and can be cut from someone’s budget in a moment’s notice. Finally there’s the company, with its management, its business model, its common sense or lack thereof, its size and its product. As I have written before, a ski company’s chief executive needs to strike a good balance between passion, vision, pragmatism and good business practices (i.e. Georges Salomon.) Unlike a Rossignol, a Salomon or even an Atomic, all the companies listed by the reader had the following problems. Many a ski equipment supplier didn’t understand advertising and marketing properly, sunk money into unaffordable foreign subsidiaries, couldn’t place themselves in the consumer’s shoes and failed to understand that retailers were controlling the business.

Tomorrow we’ll take a look at the ski makers that have “vanished…”

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