Focus: Dealer Expo 2004
April 12, 2004
Filed under Features
Ogio, the premium bag maker that entered the powersports market in 2002, has found success with an independent rep force using the same methods it’s used in the sporting goods industry for years.
“Our niche, says Ted Wright, OGIO’s national sales manager, “is sports specific bags for each sport.” In OGIO’s case, that means everything from motocross and gym bags to golf bags and backpacks for school kids.
So, why independent reps instead of going with one of the large national distributors?
“We looked at that,” said Wright during a recent interview with Powersports Business, “but decided not to (use that method), even though others have had great success with distributors.
“Depending upon who you talk to, they credit their success 100% to distribuors, while others are the opposite. Oakley has had a lot of success with independents.”
Wright ticks off a list of reasons why independent reps work for OGIO in the powersports market:
– It’s worked for OGIO in other industries. They have 20 to 30 reps who call on sporting goods retailers, for example, to promote OGIO’s golf bag and other sports bags.
– This approach provides better margins to dealers.
– OGIO Has a premium product that it feels is different from the competition, one that has to be explained properly to both dealers and customers.
“Our product,” says Wright, “is a premium product that carries a premium price, and it has to be sold that way. It has to be presented that way to dealers, and dealers have to sell it that way. It can’t be sold, if it’s sitting in a pile with other bags.”
Today, OGIO has about two dozen independent reps, each with his own territory. “They have relationships with key dealers,” ways Wright, “and they can go in and help merchandise our products. They have the confidence and trust of dealers that they can make (the display) look the way we want it to look.”
OGIO has picked up about 400 dealers since last year’s Dealer Expo and now sells through about 500 dealers in the U.S.
Margins for powersports dealers are about 50% across the OGIO line, according to Wright.
Last year, OGIO provided incentives for new dealers by selling new merchandise to them almost at close out prices. “We didn’t clear out anything,” notes Wright, “but we wanted them to have a good fourth quarter.”
That’s why they pushed backpacks in August and other bags that made good gifts during the Christmas selling season.
OGIO bags retail from about $35 for a small daypack to about $175 for a 9900 cubic inch motocross bag.
OGIO generated about $900,000 in sales at wholesale level in the powersports industry last year, Wright said, and it sold close to 25,000 motobags alone last year.
What is the ideal dealership for OGIO products? Size doesn’t matter as much as business philosophy, says Wright.
“The guy who has a nice emphasis on accessories and who can do a nice presentation of aftermarket accessories, especially soft goods,” can do well with OGIO, says Wright.
Even a dealer who only does about $1 million in annual revenue can be successful with OGIO bags, says Wright, if he sells soft goods and emphasizes accessories.
“But they guy who does 95% units and is small in accessories wouldn’t work,” he notes.
OGIO is easy to sell, maintains Wright, for the same reason that Oakley is easy to sell, or the same reason that Arai or Shoei helmets sell: Upsale buyers will buy premium products — and pay premium prices for them — because they see the value in the products.
“It’s easy (for some people) to spend an extra $20 for an OGIO bag with premium quality and a lifetime warranty,” says Wright. “You can buy a $60 pair of glasses or you can by $150 Oakleys.”
Wright says that OGIO’s premium quality comes, in part, from the fact that bags are the only thing the Bluffdale, Utah produces. “We’re a bag company,” he says, “that’s all our company does. “But, for many other companies, bags are just an afterthought”
New this year will be the updated 9900 gear bag with separate compartments for helmet, boots and gear, the Chad Reed and Travis Pastrana signature series backpacks and the new F-1850 backpack.
Special Expo pricing also is available.
For more information, see OGIO at Booth #6027 during the Expo, or visit its Web site at www.ogio.com.