Johnson Outdoors’ paddlesports division is making a major push to give its brands more penetration in the paddlesports specialty channel. At the company’s recent dealer conference, dubbed “Set a New Course,” Johnson Outdoors set out its plans to help make independent paddlesports dealers more profitable and to help them compete more effectively in today’s market.


A major component of this strategy will be re-positioning the Necky brand as a specialty-only boat company. This means that Necky will no longer be available from larger outdoor chains like EMS, and REI or from sporting goods retailers. In addition, Ocean Kayak and Old Town Canoe will implement a tiered distribution system in which all models will available to specialty retailers, while only certain models will be available to outdoor chains and big box retailers. This move will give specialty retailers exclusivity on the higher-end, higher price-point models featured in the product lines for these two brands. All three brands will also be offering special color-ups to specialty paddlesports shops during the pre-season on a first-come first-serve basis.

Retailers at the conference were universally pleased with the new strategy.  One retailer told The B.O.S.S. Report that his shop will definitely be moving dollars and dedicating more floor space to the Necky brand as a result.


Another retailer felt that it gave her more freedom to choose her shop’s competition, “Now, if I want to compete with some of the big box retailers, I can choose to buy the boats that they can carry. If I want to avoid competing on price, I can buy from the specialty-only assortment,” she said.


In addition to the tiered distribution model, Johnson Outdoor has shifted its pricing strategy to take full advantage of Minimum Advertised Pricing (MAP) regulations and Minimum Retail Pricing Regulations (MRP). Nearly all of the models that will be distributed exclusively through specialty retailers will be protected with MAP pricing. At the same time, the vast majority of the outdoor chain and big box product will also be under MAP pricing with some key models under MRP pricing regulations.


Both of these pricing strategies are designed to help specialty retailers compete more effectively with other channels of distribution.


Johnson Outdoors will be aggressive in enforcing these new MAP and MRP regulations. If a retailer is in violation of either policy, the company has vowed to suspend shipments immediately. The company is also taking into account online retail pricing and will be watching this channel closely – especially discounting that is applied to products after they are added into online “shopping carts.”


The final aspect of their new focus on specialty dealers is a more strategic approach with their Special Make Up (SMU) program and will be working more with the specialty retail community to develop exclusive products for this channel.


Regarding Johnson Outdoors’ recent manufacturing consolidation into a single facility in Old Town, ME, the company stated that the project is now complete -ahead of schedule and under budget.  While all manufacturing is now in Old Town, marketing and product design are still located on the West Coast, near Bellingham, WA. Johnson Outdoors just opened a new office there with state of the art CAD machines and a prototyping facility.


These moves have resulted in faster go-to-market times and considerable cost savings in the production process. At the same time quality control has been vastly improved.


With all of these new upgrades on the manufacturing side, Johnson Outdoor is also upgrading customer service and support operations going forward to ensure retailers will be able to rely on the company for product and service.


While the changes Johnson Outdoors is implementing should have a major impact on its relationship with retailers, the company is not expecting immediate results. Executives described the 2011 season as a transition year as retailers acclimate to this shift. The majority of the benefits should be realized in 2012 and beyond. Johnson Outdoors will be reporting fiscal third quarter results next week.