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Helmet House: Headed for new territory – January 22, 2007

January 22, 2007
Filed under Features

Helmet House’s enlarged showcase at the upcoming Dealer Expo will mirror the change in the California-based distributor’s business base.
Historically known for being the distributor of Shoei and HJC helmets, Helmet House in the past year added greater emphasis and depth to its apparel lines. The result: record annual sales that could hit $100 million this year.
“It has been a landmark year,” said Richard Kimes, national marketing manager for Helmet House.
The banner year comes from the company’s decision 18 months ago to launch a new and improved Tour Master line, the company’s apparel brand that is aimed at the touring, sport touring and the cruiser segments. Along with that line, Helmet House created a separate, performance-oriented brand with Cortech, a line of apparel that originated under the Tour Master brand.
“The Tour Master brand wasn’t a name that could go up against our competitors, like Icon and Alpinestars,” said Michael MacGregor, Helmet House’s product manager.
So, Cortech, aimed initially at the sport bike and sport touring segments, was given a separate identity along with a separate marketing plan.
“Between those two brands, we’re able to cover a wider segment of the market,” Kimes said.
And dealers, who already were ordering helmets from Helmet House, took notice, adding Tour Master, Cortech or both to their apparel lineup. As a result, Tour Master and Cortech sales earlier this year were up more than 500 percent compared to the previous year.
Part of that sales increase includes new
dealerships. Helmet House added roughly
200 new dealers this year, meaning the company now works with about 7,000 dealers and
online retailers.
“Word has gotten out that we’re serious about being a leader in the apparel business,” Kimes said.
Helmet House’s breakdown of sales reflect that. Kimes said historically, helmet sales have accounted for 75 to 80 percent of the company’s sales. After the company broadened the Tour Master line and created the separate Cortech brand, that helmet sales percentage total is closer to 60 percent.
Overall company sales were up more than 20 percent in ’06 compared to the previous year. That overall sales jump included some surprisingly big sellers, including the Tour Master Intake Jacket, a product that sports a mesh material and removable elbow and shoulder armor with a back protector.
“Every time we ordered more, we kept guessing, ‘OK, we’re going to go real big this time,’” Kimes said of the jacket that they couldn’t keep in stock, “ and every time we ordered it, it was just taken out of the warehouses as quick as we could get it. There was no (sales growth) model in place for that kind of jacket.
“This is a company that has been around since 1969. There are purchasing models that are in place. This (jacket) and a few other products in the apparel segment just blew that thinking out of the water.”
Anticipating growth, Helmet House conducted a nationwide search for the best location for what would be its third warehouse. The company currently has warehouses at its headquarters in Calabasas Hills, Calif., and in Memphis. Company officials recently settled on a 55,000-square-foot location in Newbury Park, Calif., which is not far from its headquarters. That warehouse was being stocked in mid-December and was expected to come online before the start of 2007.
“We are a relatively conservatively run company, and we’re very sensitive to absorbing growth and minimizing growing pains,” Kimes said, noting the company did have some growth pains in ’06 even with its warehouse staff working “harder than they’ve had to before.
“In terms of growth, we’re putting in all of the necessary systems to continue that growth pattern,” he said.
That includes boosting the number of outside and inside sales and support staff. Kimes said Helmet House increased its sales staff by
15 percent last year to boost its outside force to about 50 reps and its internal and online sales and support staff to 15.
“It’s up to the dealer how they work with us,” Kimes said. “Some of them are happy to work via phone. Some want the (sales rep) coming in and merchandising his store and polishing helmets.”
The latter has led Helmet House to open new territories for existing or new sales reps in states like Arizona, Utah and Idaho. The company also expanded its North American sales to include Canada this year. So far, sales there are being handled by internal staff.
Helmet House also has begun considering expanding overseas.
“We’re looking at it,” Kimes said. “We have some interest in certain parts of the world. We have looked at what it would take to grow there.”
There is no timetable on when an overseas warehouse could be opened, but Helmet House is “looking at developing relationships with key players in certain countries and doing the due diligence in order to do business” there, Kimes said.
“We’re just starting to do it, but it’s something we’re looking at very seriously for the coming year.”
A year that Helmet House has high hopes for.
“We’re very bullish about 2007,” Kimes said. “A few of our competitors have looked at sales as being flat for 2007, but we think that we can continue to grow. We’re very optimistic.”
So optimistic that the distributor doubled its booth space at the upcoming Dealer Expo. And as a sign of the times, the company will have one booth focused mainly on its well-known helmet lines and one on its increasingly popular apparel lines, Tour Master and Cortech.

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