Consolidation in the Tackle Industry

[Gregoire]

Recently I have been researching the purchase of a new spinning reel. While I was browsing the Tackle Tour Forum I came across a reference to Pflueger and Abu Garcia being owned by the same company: Pure Fishing. They own, Abu Garcia, Pflueger, Penn, Mitchell and Shakespear. They also own Fenwick and All Star Rods. They own Stren, Spiderwire, Trilene and Fireline. They also own the Berkley line of products.

Is it me or those this sound a lot like GM before they went bankrupt?

I can understand having discount, quality and high end brands. I can also understand having different brands for different techniques, but why would you put one brand directly in competition with another brand that you own.

Other companies that own many brands are Normark who own Rapala, Storm, Lurhjensen, Gamakatsu, Bluefox, Cortland and Sufix, plus a few others that aren't mentioned on their website.

I know that Shimano recently purchased G. Loomis.

Zebco seems to own Quantum.

Is this ownership model good for the consumer? I think it is important to consider quality and the health of a brand if you are going to purchase their product, especially if it is going to be a higher end product. A lifetime warranty is only good for the lifetime of a company, and the lifetime of a product line for that matter. These are things that I consider now that I am spending more money on my gear.

[RudeBuoy]

Every brand that Pure Fishing owns fulfills a certain niche in the marketplace and at almost every price point. Pretty smart if you ask me.

- They won't be going anywhere.

[Grimace]

I wish they would ditch all the names and call everything Pure. Then there would only be one commercial.

 

"When you go fishing make sure you use Pure, oh wait a minute, you have no choice. Nevermind. Now back to your previously scheduled show. You will not be hearing us again."

 

Wouldn't that be great. lol

[okumasheffield]

It makes you think you have 'choices'.

[Billy Bob]

I have a Abu Garcia light spinning reel I use for crappie and walleye fishing....4 & 6 lb test line kept getting stuck in the bail roller guide and would nick or break the line...called them up and asked for advice...they said sent it in...but I said I didn't have a receipt...no problem, just send it in.....about week later I received a BRAND NEW REEL.....

 

If they keep up that kind of customer service I don't care how many names they want to operate under....

 

Bob

[irishfield]

You should check out all the companies a little billard and bowling company own..

[John]

You should check out all the companies a little billard and bowling company own..

 

That's a whole lot of balls if you ask me.....

[Gregoire]

That's a whole lot of balls if you ask me.....

 

 

I'll bite...what am I missing here?

[John]

I'll bite...what am I missing here?

 

Brunswick.......

[Bernie]

That was the first thought that crossed my mind when I read the opening post Wayne.

[Gregoire]

That is a fairly substantial list

[Grimace]

Brunswick

http://www.brunswick.com/brands/

 

Pure

http://www.purefishing.com/our-brands

 

Shimano. Just a few brands, but they are into alot of different stuff.

http://www.shimano.com/

[Grimace]

Pure fishing is just a small subsidiary of Jarden Corporation.

 

Jarden is massive and has a gazillion brands

 

http://www.jarden.com/phoenix.zhtml?c=72395&p=branded-consumables

http://www.jarden.com/phoenix.zhtml?c=72395&p=consumer-solutions

http://www.jarden.com/phoenix.zhtml?c=72395&p=process-solutions

 

 

Literally everything from Sunbeam, Oster, K2 skis, Coleman. You name it they own it.

[bigugli]

Of course there is also Genmar. Owner of some 20 odd brand names of boat.

It's the way of the corporate world. Whether your talking toys, appliances, clothes, food....

Buy into it or don't. Your choice...

[Roy]

Yup, I gnu dat. But Grimace, I wonder if it makes a big difference. We all want to deal with the first guy...I do anyway, but these dudes are all under the same umbrella. I don't know, just throwing it out there.

[pics]

And every time they buy another competitor to add to their corporation, they consolidate production......in China...but the prices don't seem to go down much.

[Grimace]

Yup, I gnu dat. But Grimace, I wonder if it makes a big difference. We all want to deal with the first guy...I do anyway, but these dudes are all under the same umbrella. I don't know, just throwing it out there.

 

 

I am not all gung ho either way, but I will say this.

 

Competition down - They do not have to advance product because they have no competitors. Self regulated pricing.

 

Lots of medium to larger family run business have been bought up. So you have managers at levels you would have once had an owner. Essentially you have a world of employees where we all work for a corporation. Hard to start a small business and be your own boss under this system. The Phil Smokers of the world are a dieing breed and the Richard Peddies of the world are a dime a dozen.

 

I believe General Electric is the biggest corporation in the world (I could be wrong). They own NBC and a bunch of broadcasting companies as well as just about anything you can think of.

 

I am not some kind of conspiricy theorist loony. These are just facts that we are seeing occur as the world progresses and it is a bit worrying to see so much power in so few hands. They also lobby governments hard to get what they want, and as George Carlin so eloquently put it. "We all know what they want. More for them and less for us."

[JohnF]

I'm no business expert but I suspect this is the result of a variety of motivations:

 

1. Buying up a strong competitor to regain market share

2. Offering choice for the consumer without actually surrendering market share

3. Cost savings thru maxing out production capacity of company owned facilites or thru volume discounting from suppliers

4. Getting greater share of product into individual retail outlets. i.e. a retailer may set a limit of 100 units or dollars for one brand but by adding brand names under the corporate umbrella the parent could get 200 units onto a retailer's shelves, hopefully at the expense of the competition.

5. Some parts and service interchangeability for corportate cost effectiveness

 

JF

[Gregoire]

I guess I'm concerned about how this consolidation affects the consumer. I have had nothing but great customer service with Rapala. Stopped by the Normark factory in Oshawa and had a reel and rod replaced. I've also dealt with pure fishing. It took a while for me to get in contact with someone, but when push came to shove I had the reel replaced and sent to me free of charge. I guess large companies owning almost everything is the way of the world. In some ways I knew this, but it doesn't really hammer home until you look at the products that you use and who provides them. Gone are the days when buying fishing products from people who are passionate about fishing was the norm. Do far my experiences have been good, so not much effect on me. Just wondering what people think may come in the future.

I am thinking less brands, as the promotion and cost to create different brands is high. I also think brands may become divided according to cost/quality.

For example with Pure Fishing I see the current divide in terms of reels:

Abu Garcia: Higher end Freshwater

Pflueger: Mid Range Freshwater

Mithchel: Low end Freshwater

Penn: High end Saltwater

Shakespeare: Low end Saltwater

 

I think the issue with making these distinctions for the company is that some people who have brand loyalty might see their favourite product removed from production. For example a lot of people like the Abu Cardinal, but this is a low to mid ranged reel. Also in terms to Shakespeare, some people swear by the Ugly stick. It is one of the most reliable fishing brands out there. When I was younger I thought these were the best rods money could buy. Brand loyalty is one of things a company values the most. So how do companies evolve while keeping their loyal customers.

 

One such example that I don't understand is Shimano. They bought G Loomis, a very high end rod manufacturer, but are also expanding their rod brand into the higher end market (the Cumulus for example). Would it not make sense for them to release their higher end products under the G Loomis brand? Also they did not seem to keep the exclusive rights to the Loomis name, as I saw the founder of the company is making rods again under his own name. (My information on this last point may nit be accurate, please correct me if I am wrong).

 

Anyway that is all my ramblings for now. Thanks for reading. I don't know why this topic interests me, but it does. I need to find something better to do with my time...like go fishing.

[Gregoire]

I am not all gung ho either way, but I will say this.

 

Competition down - They do not have to advance product because they have no competitors. Self regulated pricing.

 

Lots of medium to larger family run business have been bought up. So you have managers at levels you would have once had an owner. Essentially you have a world of employees where we all work for a corporation. Hard to start a small business and be your own boss under this system. The Phil Smokers of the world are a dieing breed and the Richard Peddies of the world are a dime a dozen.

 

I believe General Electric is the biggest corporation in the world (I could be wrong). They own NBC and a bunch of broadcasting companies as well as just about anything you can think of.

 

I am not some kind of conspiricy theorist loony. These are just facts that we are seeing occur as the world progresses and it is a bit worrying to see so much power in so few hands. They also lobby governments hard to get what they want, and as George Carlin so eloquently put it. "We all know what they want. More for them and less for us."

 

Well stated. I guess I'm worried that eventually we will be put in a position where the companies will say..."You will take what we give you, and you will like it"

[Whitemikeca]

One such example that I don't understand is Shimano. They bought G Loomis, a very high end rod manufacturer, but are also expanding their rod brand into the higher end market (the Cumulus for example). Would it not make sense for them to release their higher end products under the G Loomis brand? Also they did not seem to keep the exclusive rights to the Loomis name, as I saw the founder of the company is making rods again under his own name. (My information on this last point may nit be accurate, please correct me if I am wrong).

 

Anyway that is all my ramblings for now. Thanks for reading. I don't know why this topic interests me, but it does. I need to find something better to do with my time...like go fishing.

 

Shimano bought G Loomis in 1997. They had a non-compete agreement with Gary Loomis so that he was not allowed to sell rods for 10 years. Now that the non-compete has expired they can no longer stop him from entering the rod business, hence Northfork rods. Gary cannot use the name "G Loomis" on his new rods since that brand name is owned by Shimano but they could never stop someone from using their full name on rod. No court order can steal your given name.

 

As for why a company would produce a product to compete against its own product the reason is market share. Would you rather own 1 of 4 brands in a given market or 2 of 4? Also they can save costs by using the same technologies and factories. If both brands are popular like in this example then its a huge win for the parent company. Cross brand competition happens in almost every industry in the world but in most cases the consumer doesn't know or care that the brands are owned by the same ultimate parent company. Small companies have a hard time competing in the global economy. The distribution chain of the major players is too wide spread to compete against. Thus why you see the small "homegrown" brands like G Loomis being bought up by a major like Shimano. This is the direction the economy has been going for the last 20 years and it likely won't change anytime soon.

[OhioFisherman]

It`s simple, big fish eat little fish.

[craigdritchie]

Consolidation is hardly new. Bigger companies have been swallowing smaller companies since the beginning (not just the last 20 years, Whitemikeca). If you dig into the history of fishing brands like Heddon, South Bend, Eagle Claw, Shakespeare and Johnson, you'll find each has had multiple owners over the last 100 years - each one swallowed up by a bigger rival.

 

Consolidation provides manufacturing, supply chain, sales and distribution efficiencies that cannot be matched by independents, which is why it's been the way things work in every industry from fishing tackle to kitchen appliances to automobiles to computer software.

 

On a separate note - Bigugli, if you aren't aware, Genmar went belly up almost two years ago. Some of their boat brands have been shut down, but most have been sold off to rivals .... Brunswick Corp and Platinum Equity Corp bought the majority of them. All of the fishing boats remain in production, just now owned by someone else.

Edited January 22, 2011 by Craig_Ritchie

[Guest blairwelsh]

*SMILES*

Edited February 1, 2011 by SecretSpot

[Gregoire]

Shimano bought G Loomis in 1997. They had a non-compete agreement with Gary Loomis so that he was not allowed to sell rods for 10 years. Now that the non-compete has expired they can no longer stop him from entering the rod business, hence Northfork rods. Gary cannot use the name "G Loomis" on his new rods since that brand name is owned by Shimano but they could never stop someone from using their full name on rod. No court order can steal your given name.

 

As for why a company would produce a product to compete against its own product the reason is market share. Would you rather own 1 of 4 brands in a given market or 2 of 4? Also they can save costs by using the same technologies and factories. If both brands are popular like in this example then its a huge win for the parent company. Cross brand competition happens in almost every industry in the world but in most cases the consumer doesn't know or care that the brands are owned by the same ultimate parent company. Small companies have a hard time competing in the global economy. The distribution chain of the major players is too wide spread to compete against. Thus why you see the small "homegrown" brands like G Loomis being bought up by a major like Shimano. This is the direction the economy has been going for the last 20 years and it likely won't change anytime soon.

 

Thank you for clearing that up for me. Some very good information there.