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March 13, 2006 – Perception change leads to a hot market for heated clothing

March 13, 2006
Filed under Features

Televisions, cell phones, wireless Internet: all were once perceived luxuries. Today, they’re commonplace in American society.
The powersports world has seen its own slate of items change from luxuries to standard accessories, including heated clothing in the motorcycle rider segment.
That change in perception has led to massive growth for Gerbing’s Heated Clothing, the market share leader in the expanding field. In 2002, sales of one of the manufacturer’s most popular items, heated gloves, were just more than 4,000 pairs. This year, the company’s heated glove sales are set to exceed 15,000 pairs. The company had 60 full inventory stocking dealers in 2002 and will have more than 150 this year.
The company’s beginnings
Gerbing’s Heated Clothing started 30 years ago with the observations of Gordon Gerbing, father of Jeff Gerbing, current CEO of the company. Gordon Gerbing ran a machine shop for Boeing airplanes. He noticed that, even in the dead of a Washington state winter, his employees would ride their motorcycles to work. He wanted to find a way to keep them warm so he devised clothes with heating elements that connected to a motorcycle’s electrical system.
In the mid-1970s, when Gordon Gerbing was first developing his product line, only the rich and the early adapters among the motorcycling community would buy into the idea of heated clothing.
Fast forward to 2006 and riders of all varieties are buying heated products.
“People aren’t too macho anymore to wear heated clothing,” said Chris Haffly, business development manager at Gerbing’s.
Those at Gerbing’s can barely believe just how quickly things have escalated after modest growth in the 1990s. The company didn’t really start to take off until 1999, when Gerbing’s initiated a dealer program and began making private-label heated clothing for Harley-Davidson.
In 2005, the company’s sales revenue grew 62 percent. Over the past three years, sales revenue has gone up by more than 50 percent each year. While exciting, growing in such leaps and bounds has proven a little difficult.
“We forecast 25 percent growth (for 2005)” Jeff Gerbing said. “No one expects (62 percent) growth. It’s just phenomenal. You can’t plan for that. We’ve definitely had growing pains.”
The company has had to hire more personnel and is looking into a location for a new facility as demand has outgrown the capabilities of Gerbings’ original location in Union, Wash. Manufacturing is done in Washington as well as overseas.
More frustrating to Jeff Gerbing is products have sold out before they are even shipped. Gerbings’ G3 glove has sold out twice, leaving customers with temporarily unfilled orders.
“I do not like people to have to wait for clothing,” Jeff Gerbing said. “That’s one of my issues that I will not tolerate.”
Competition in the heated clothing market doesn’t faze him. In fact, Jeff Gerbing believes competitors open up the market for heated clothing because the concept is so new to people. Widder Enterprises is among what Jeff Gerbing estimates to be nine or 10 competitors. Still, Gerbing’s controls as much as 70 percent of the heated clothing marketplace, Jeff Gerbing said.
Partnerships with companies such as Harley-Davidson and Victory have “legitimized” heated clothing, Jeff Gerbing said.
The company has been working with Harley-Davidson since 1998. Victory joined Gerbing’s in 2004.
A sign that heated clothing is truly catching on comes from the motorcycling manufacturers themselves. Some companies have changed the size of their vehicle’s alternators to address heated clothing.
Company challenges
While there have been some misses, a number of factors have contributed to the company’s rush of success in recent years, Jeff Gerbing said. Consciously creating a brand has helped.
“We really tried to get our packaging and corporate image and colors into one so people can recognize that it’s Gerbing’s,” Jeff Gerbing said. “That really does help.”
Gerbing’s also has been working on slowly expanding its dealer network, Jeff Gerbing said. The company works with about 125 dealers and makes an effort to attend open houses and other events to meet its customers. The company doesn’t use distributors, but sells directly to dealers and customers.
The company also has diversified, thanks to customer input.
For many years, Gerbing’s made heated clothing that only worked with motorcycle alternators. While motorcycle-compatible clothing remains the company’s base, it has branched into heated clothing for hunting, fishing and spectator sports, among other areas. The company also started working with the U.S. military last fall.
“Find out what people want,” Jeff Gerbing said. “I think that’s the best way to build a market. Find out what the people want. You get it right the first time that way.”
Reaching out
Despite the rapid growth of his company, Jeff Gerbing remains focused on his roots and reaching out to those who have reached out to him.
Jeff Gerbing holds dear many of the principles his father instilled in him as he was growing up in the company. Being accessible was one of them.
He enjoys going out and meeting customers whenever possible. There’s also an area on the company’s Web site where people can e-mail Jeff Gerbing directly. He said he likes to answer within 20 minutes, if possible. But he said he does answer all of them eventually. It’s something that makes a big difference to customers, Jeff Gerbing said.
The company’s decision to stand behinds its products is another key.
When one of his father’s early one-piece products was brought in for repair and couldn’t be fixed, Jeff Gerbing said he offered the owner a new two-piece suit in exchange so he could keep the old one for display.
“We’ll always take care of the customer at no cost,” Jeff Gerbing said, noting all of the company’s products come with lifetime warranties. “That’s just unheard of in today’s world. It’s such a simple key for today’s success.”
The future
The possibilities for heated clothing are nearly endless, Jeff Gerbing said.
This year, Gerbing’s will be introducing an armored suit and anticipates making strides in gloves and other products and growing in other divisions.
“We’re going to have tremendous growth again,” Jeff Gerbing said. “Money doesn’t drive the company. We’re always going to be focused on the customer. We’re always going to keep that family value in there.” psb

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