Feb. 11, 2008 – Happy days here again for aftermarket suppliers
February 11, 2008
Filed under Features
By Matt Bolch
If the snowmobile industry were a political convention, balloons would be in mid-flight as “Happy Days Are Here Again” rang out from the mountaintops and valleys coast to coast.
During what easily could be described as the best snowfall season of the millennium, snowmobile manufacturers and dealers have been clearing out older models and selling through current-year inventory. Aftermarket suppliers have been working long hours and weekends to keep pace with the demand. It’s been hard work, but they’re not complaining.
“Sales right now at this time of the year (late January) have exceeded sales for the last six years,” reports Ron Pattyn, president at Stud Boy Traction Products, Ravenna, Mich. “We’re up
40 percent over last year, and our year doesn’t close until the end of June.”
That hefty sales growth comes at a price, though, with employees working 10- and 11-hour days six days a week since Labor Day and many new hires to keep up with demand. Even before the snow started falling, Pattyn had an inkling that his company’s aftermarket traction and racing products would be in demand following good sales at Sno-Motion 2008, sponsored by Nelson’s Speed Shop in Greenville, Mich., and Hay Days Grass Drags in Columbus, Minn.
“I’ve gotta say, our distributors have been pretty understanding,” says Pattyn, taking a break from watching his son Zach compete in the Winter X Games in Aspen, Colo. “We probably reacted better than we thought we would, but it has been a lot of hard work, expediting materials and working smart.”
In addition to the good snow, Pattyn cites pent-up desire among snowmobilers to hit the trail and new product introductions from Ski-Doo and Yamaha this season and Arctic Cat last season for the increased level of excitement in the marketplace.
The production crew at Woody’s Traction Products in Hope, Mich., also has been working six days a week to fill every order as quickly as possible, reports Randy Oberson, vice president. Favorable snowfall across the United States and Canada “puts a big smile on our faces,” Oberson says. The last several years have been tough snow years, and snow last winter was particularly scarce, he says.
“Given the history coming into this year, everyone was cautious,” Oberson says. “We were cautious; consumers were cautious; dealers were cautious. It didn’t take long for our inventory buffer to be gone.” The company stockpiles raw materials and components, so production was ramped up quickly to meet this year’s demand for aftermarket products.
Being unable to supply products when they’re ordered can spell disaster for a manufacturer, but Oberson says Woody’s works with its distributors as best it can to fill their immediate needs. “Communication is the key,” Oberson says. “Our distributors know that we’re working as hard as we can to fill orders.”
A good snow year means not only new and used snowmobile sales but also an increase in service business, notes Jeremy Houle, general manager at Speedwerx Inc., Forest Lake, Minn. The company makes aftermarket pipes, exhaust systems, engine kits and other parts and accessories for Arctic Cat snowmobiles and ATVs and Polaris snowmobiles, ATVs and UTVs.
“Even in years with low snow in the Midwest, we’ve seen the market growing,” says Houle. “Mountain riding above 5,000 feet causes snowmobiles to lose 25 percent of their horsepower, and our products help with that. Our products also go on the pro circuit.” Snowmobilers who might not have ridden in recent years have been bringing their rides out of storage and often need new parts to get them back on the trail.
Houle says the company wasn’t necessarily caught off guard by the upbeat sales season, but he admits that the welding shop has been working hard to keep up with demand. “Our winter hours definitely have been crazy,” says Houle, who’s been working 60-hour weeks himself. “We want to build inventory but not outdo ourselves.”
Jerry Mathews says Starting Line Products is probably a bit more aggressive about stockpiling inventory than many aftermarket manufacturers, which makes it easier for the Idaho Fall, Idaho, manufacturer to adjust to such a good year. “If the good snow carries well into spring in the Midwest, it will be an off-the-charts (sales) year,” reports Mathews, operations manager. “Worst-case scenario, it’ll be a very good year.”
New snowmobile sales have helped OEMs and dealers clear a backlog of previous model year sleds, which benefits the entire industry. And since the majority of the company’s aftermarket products for Polaris, Ski-Doo, Arctic Cat and Yamaha sleds are sold at the time a new unit is purchased, Starting Line benefits, too. “Ski sales have been phenomenal this year,” Mathews says. “We planned for a good year but came up short in that area.”
Mathews says the company tries to anticipate good snow amounts every year, but it’s difficult to gauge demand accurately in an industry that’s directly impacted by the vagaries of Mother Nature.
“Aftermarket guys can only stick their necks out so far, committing cash flow to determine risk and reward,” says Pattyn from Stud Boy. The company stockpiles products that have not been brazed to increase flexibility and reduce costs. The brazing process is expensive and dedicates a product to a particular line, so leaving parts unbrazed allows last-minute changes. “When everything clicks together, you have to be prepared to react, and this has been one of those years.”
Following six years of declining sales among players in the snowmobile equipment and parts industry, it’ll be nice to see the sales bar moving back in a positive direction, says Oberson from Woody’s.
“We had a visitor by (recently) who said he hoped that it wouldn’t snow the next day,” Oberson says. “In all honesty, we hope it snows. We’re always hoping that it snows because it’s nice to see the trails being used, restaurants with snowmobiles in the parking lots and cars with snowmobile trailers on them.”