Hardgoods- Skate, Surf, Snow- All the Same Pattern
I have no idea why it took me so long to recognize this. I'm sure you've all figured it out long ago and I'm wasting my time. Well, that's okay. It's a blog and it's my time to waste.
About 2000 they started making snowboards in China. About 2004 they started making skateboards in China. About 2005, they started making surfboards in China. Okay, I may have the dates wrong, but it doesn't matter. And it may be China, or it may be another country where stuff is cheap.
Anybody see a pattern here? Snow, skate, surf each went through their period of angst as sourcing for hard goods moved to other, less expensive countries. Lots of wailing, ringing of hands and gnashing of teeth by the industry.
And the result. Some companies got hammered. That's always what happens. Other companies figured out how to adjust and did okay.
Meanwhile, the consumer- you remember them- the people who actually buy our products at retail and without whom we ain't got no business- they got a better deal. They got a good product for a lower price. It costs them less to participate.
And we thought that was a bad thing. Or at least some of you did. I never did. I didn't look at it as good or bad. I looked at it as inevitable if skate, surf, snow were going to prosper. It's just how industries evolve.
Please don't confuse what's good for the industry for what's good for individual companies. The companies that succeed are always the ones who recognize that they can't sail into the wind. They figure out how to sail with the wind even if they have to make some uncomfortable and inconvenient changes in how they do business.
It's coming up with product improvements that are for real. It might be deciding that there's only so much you can do about price competition and that you have to change your distribution to give you more volume. It might be recognizing that your growth prospects are limited, but that you can keep your margins high by focusing on a customer group that's particularly loyal.
Isn't it amazing though? Snow, skate surf, each went through the same cycle with cheaper production and price competition and each time some people were surprised and tried to rally their industry to "fix" the problem.
There was no problem. There were only opportunities if you sailed with the wind.
About 2000 they started making snowboards in China. About 2004 they started making skateboards in China. About 2005, they started making surfboards in China. Okay, I may have the dates wrong, but it doesn't matter. And it may be China, or it may be another country where stuff is cheap.
Anybody see a pattern here? Snow, skate, surf each went through their period of angst as sourcing for hard goods moved to other, less expensive countries. Lots of wailing, ringing of hands and gnashing of teeth by the industry.
And the result. Some companies got hammered. That's always what happens. Other companies figured out how to adjust and did okay.
Meanwhile, the consumer- you remember them- the people who actually buy our products at retail and without whom we ain't got no business- they got a better deal. They got a good product for a lower price. It costs them less to participate.
And we thought that was a bad thing. Or at least some of you did. I never did. I didn't look at it as good or bad. I looked at it as inevitable if skate, surf, snow were going to prosper. It's just how industries evolve.
Please don't confuse what's good for the industry for what's good for individual companies. The companies that succeed are always the ones who recognize that they can't sail into the wind. They figure out how to sail with the wind even if they have to make some uncomfortable and inconvenient changes in how they do business.
It's coming up with product improvements that are for real. It might be deciding that there's only so much you can do about price competition and that you have to change your distribution to give you more volume. It might be recognizing that your growth prospects are limited, but that you can keep your margins high by focusing on a customer group that's particularly loyal.
Isn't it amazing though? Snow, skate surf, each went through the same cycle with cheaper production and price competition and each time some people were surprised and tried to rally their industry to "fix" the problem.
There was no problem. There were only opportunities if you sailed with the wind.
posted by Jeff Harbaugh at
8:21 PM
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