The Chain Store Gang Rides Again

By Sean O'Brien and John Stouffer

With Jaysport International's purchase of Division 23, Type A, and Atlantis and with Gen-X's purchase of Limited, Jay Joffe and Jamie Salter have purchased brands with a specialty-store cachet.

Even though Gen-X CEO Salter and Jaysport President Joffe started their careers in the snowboarding industry selling high-end snowboards to the specialty market, in the past few years their brands have primarily appealed to the mass-market retailer.

Both of them have also dealt extensively in the closeout market. As one industry veteran confided off the record, Jamie Salter's closeout business saved more companies than anyone is willing to admit.

Rightly or wrongly, however, this skews the way some retailers view Jaysport and Gen-X, and their respective owners.

But it appears as if both Joffe and Salter would like to return to their specialty roots. As new Jaysport Sale Manager Terry Deleo puts it, “They've proven they can sell closeouts, now they want to show that they can sell in-line products as well.”

So, will they keep intact the specialty roots of the brands? SNOWboarding Business caught up with each of them for the lowdown on what we can expect.

Jay Joffe

President of Jaysport

When did you decide that you were interested in buying some snowboard companies? It was probably around Vegas time. I took a look at what was out there, what the companies were doing, what the retailers were looking at, and I determined that there were some opportunities to take brands that were underperforming and give them the tools they needed to be successful. What is the state of the closeout market? The closeout market is relatively clean. There's not much of anything around. So, yes, that also prompted me to look at certain brands and to develop a more 'core base. The availability of certain key people also helped me make the decision.What was it about these three brands that attracted you? Each one of them carried a little weight within their own area or niche in the market. None of these brands have been exploited and none of them have any baggage. I also looked at the global positioning of the various brands. There really aren't too many brands available that met that criteria.Why did you bring Terry Deleo on? I need someone to take over sales and keep the focus on the niche each one of these brands. Plus, I've known him for a number of years and I know that he knows a lot of people and retailers. Where will the boards be built? The boards will be made in the U.S.A., but I won't say where.How will the Division 23 line change? We'll maintain the line as it was developed for this season, and we're in the process of finalizing the details for the following season.What about a Division 23 team? We are currently looking at reestablishing a team. We're working with a timetable of about 30 days by September 30. What type of marketing support will you give D-23? We'll offer our team, ads in trade magazines, reps in all the territories–a full program. We'll have full customer service and keep all the brands easily accessible. Retailers won't have to negotiate any long corporate veil to get things done. We'll be able to react quicker. How much did you pay for D-23? I won't give out any information about what we paid for the three brands.What is the distribution channel for D-23? We'll cover a little broader range than a Type A. Our niche 'core brands will be Atlantis and Type A. The next step down from that will be D-23. Kemper will go out to the masses.It's my impression that Type A had all but disappeared from the shelves of most retailers and that it wasn't profitable. What are you going to do to turn that around? We're revitalizing the and using the brand's old riders and pros. The reason the brand really faded was that there wasn't any management or cohesion to move forward. With the market changing like it is, you can't just take a name and put it out on the marketplace. You need to have a company behind it to turn it back to a 'core company. Where will the boards be built? In the same factory as the D-23 boards? No, in another factory in the United States.The former owners did not control the trademark in Japan and it was known as Atlantis World there. What is the status of the Atlantis trademark issues in Japan? The trademark is owned by Advanced Marketing. Moving forward we'll use the Atlantis name, not Atlantis World. What will be your distribution strategy for Atlantis? The brand will remain high-end and hardcore. We'll focus its distribution in the same channels its always had, but on a larger scale. People want a 'core brand and we'll cater to those people, but obviously we'll increase sales. With our resources, retailers will see that the name will be even better exposed and be more 'core than it's ever been. Where will the Atlantis boards be built? In the United States.Will you use the same factory as the other brands? Yes.Who is on the Atlantis team? What is the status of Ingemar Beckman? He's still on the Atlantis team. We're finalizing the details as we speak.How will your four snowboard brands be displayed at the SIA Vegas show? We're debating that now, but probably each brand will have a life of its own.How will you remain passionate about each of the four brands you now control? One of the big lessons I've learned about this business is never be in love with anything you own. Make it work, make it so it makes money, but never fall in love.

Jamie Salter

CEO Of Gen-X.

What are the different snowboard brands you have now? We have Limited, Lamar, Vision, Rage, and S brand. We're positioning each brand to hit a retailer and a consumer, we sell the brand to retailers, who then sell them to the consumers.

Each brand has a separate mission statement, and a different marketing campaign as well. Why did you add Limited to your selection? Limited was a fair deal. It made sense to us. It's a strong brand in Canada and it does okay in Japan. We needed help in Canada. We have a handle on things it needed and looked at distribution, and it was more specialty than what we have. It made sense.It seems like you have a brand for every segment of the market now. Is Limited the last piece? It's not necessarily the last piece. There are more companies out there that need help and can get consolidated. If we see something for the right price, and we can buy it for a fair value, we will.

We go after companies in trouble and we'd rather fix something. We have great distribution, great financing, operations, a great staff, and some great brands. Limited needed these things.

Hey, the multibrand strategy isn't bad. We've been doing it now for a while. Now it seems like other companies are trying to do it as well. K2 is moving that way with Morrow and now Ride. You seemed to have carved out your niche with the large format retailers, selling brands like Vision and Rage. Other snowboard companies haven't really seemed to move into those areas much because they have to protect their brand image in the specialty shops. You on the other hand, seem to be moving into their territory with Limited. Is this true? It's a tit for a tat. Different snowboard companies have definitely begun to sell the large format stores, so we can play that game and can go after the specialty market.

But dealing with the large-format retailers is a lot more than offering them the lowest price and a hot board. We've been working with the large format retailers for a few years now and understand them and how to do it.

It's not easy. It's easy to sell them, but hard to deliver to them. Many of these people don't understand UPC and case codes, hooking and tagging.What are the challenges you face moving into the specialty retailer business? It's not a hard thing. Hey, I was the CEO of Ride when it had 75-million in sales and we weren't selling to large format stores.

We just hired Mark Brazier former Ride executive to be vice president of sales and marketing, so it's his job to position the brands in the right format stores. He and Corrine Griffiths will be handling running the different brands.Some people seem to forget you're even in the market. We're an important player in the marketplace. We sell a lot of snowboards. If you look at my numbers, we're probably the number two company behind Burton. Now with K2 and Ride merging, maybe they're bigger than us, but that still puts us at number three.

We're not usually recognized as a top brand. But we're going to be here a long time. We're well financed and we're going to stay alive. We're not as cool as Ride or other brands, but we make money and retailers and consumers are happy with us and our products and services at the end of the day.

You know, I'm going to spend 1.2-million dollars on advertising around the country in newspapers like the L.A. Times, Denver Post, the Toronto paper, and other places promoting our brands this fall. In addition, retailers are going to spend more than we are promoting our brands.How are you going to impact the industry? It's about having fun and going snowboarding. My consumer can only go a couple of times a year because he doesn't have the money to afford it. We've done a lot of research about who's buying our product and know this about them.

We're not just trying to sell the cheapest product, but we're trying to target these consumers. Without us selling to these customers, snowboarding wouldn't be a growing business. It'd be like the ski business–just flat. We package the deals and provide people something fun to do. We're selling that fun. And then a year or two later those consumers go and upgrade by buying new Burtons and Rides.een working with the large format retailers for a few years now and understand them and how to do it.

It's not easy. It's easy to sell them, but hard to deliver to them. Many of these people don't understand UPC and case codes, hooking and tagging.What are the challenges you face moving into the specialty retailer business? It's not a hard thing. Hey, I was the CEO of Ride when it had 75-million in sales and we weren't selling to large format stores.

We just hired Mark Brazier former Ride executive to be vice president of sales and marketing, so it's his job to position the brands in the right format stores. He and Corrine Griffiths will be handling running the different brands.Some people seem to forget you're even in the market. We're an important player in the marketplace. We sell a lot of snowboards. If you look at my numbers, we're probably the number two company behind Burton. Now with K2 and Ride merging, maybe they're bigger than us, but that still puts us at number three.

We're not usually recognized as a top brand. But we're going to be here a long time. We're well financed and we're going to stay alive. We're not as cool as Ride or other brands, but we make money and retailers and consumers are happy with us and our products and services at the end of the day.

You know, I'm going to spend 1.2-million dollars on advertising around the country in newspapers like the L.A. Times, Denver Post, the Toronto paper, and other places promoting our brands this fall. In addition, retailers are going to spend more than we are promoting our brands.How are you going to impact the industry? It's about having fun and going snowboarding. My consumer can only go a couple of times a year because he doesn't have the money to afford it. We've done a lot of research about who's buying our product and know this about them.

We're not just trying to sell the cheapest product, but we're trying to target these consumers. Without us selling to these customers, snowboarding wouldn't be a growing business. It'd be like the ski business–just flat. We package the deals and provide people something fun to do. We're selling that fun. And then a year or two later those consumers go and upgrade by buying new Burtons and Rides.