Johnson Outdoors Inc. will try to boost sales by creating more products for big discount chains, starting with Eureka! tents at Wal-Mart stores this year.
“Channel shifts are moving away from specialty stores to mass retailers,” chairman Helen Johnson-Leipold told shareholders at the company’s annual meeting at its Racine headquarters Wednesday.
The outdoor recreational equipment manufacturer sells a variety of widely known brands in its four divisions: watercraft, motors, diving, and outdoor equipment. The latter includes Eureka!, CampTrails backpacks and accessories and Silva field compasses.
Until now, the tents have been sold through specialty stores and to the U.S. military under government contracts. Johnson Outdoors is a market leader in the $1 billion category with $106 million in sales last year.
The new line of Eureka! tents for Wal-Mart will be priced lower than the styles that are sold in specialty stores, said chief operating officer Jerry Perkins, who recently joined Johnson Outdoors from Brunswick.
“Our thinking here is Where do people shop? ” Perkins said.
In an interview, Perkins said specialty store operators were not overly upset by the upcoming Wal-Mart Eureka! rollout.
“They see it as a way to get more people into camping,” he said, adding that the company had been careful to create a different Eureka! line for Wal-Mart.
The decision by Johnson Outdoors to put more of its products into the discount chains follows a national trend that has seen apparel brands such as OshKosh BGosh and Columbia distributed in Kohl’s department stores and Target stores, and Schwinn bicycles sold in Wal-Mart and other national discounters.
Johnson Outdoors also is developing a new line of snorkel goggles and fins, to be called Snorkel Pro, for sale in big chain stores next year.
The key to placing a product in the large chain stores is that the items must require a minimum of instruction and service store personnel, Perkins said.
Johnson Outdoors continues to look for companies to acquire that will expand existing divisions either geographically or by segment. The company sold its Jack Wolfskin apparel division in September for $62.7 million and plans to use the proceeds for an acquisition.
The company earned $7.9 million in 2002 on sales of $342.5 million, compared to $5.5 million in earnings in the previous year on sales of $345.6 million. In the first quarter that ended Dec. 27, Johnson Outdoors lost $280,000 on sales of $54.9 million, compared to a loss of $396,000 on sales of $59.7 million in the first quarter a year ago.
The first quarter is typically the slowest part of the year for Johnson’s seasonal business.
