After 18 years of letting Smith Optics operate autonomously, Safilo Group of Italy announced Tuesday plans to disperse its headquarters staff of 85 to Portland, OR., Salt Lake City and Parsippany, NJ in a quest to double the fast-growing brand’s sales over the next five years.
In a conference call Tuesday, Safilo CEO Luisa Delgado laid out how Safilo will relocate about 35 design, product development, marketing, artwork, and e-commerce positions from Smith’s Ketchum, ID headquarters to a new design center Safilo will establish in Portland, OR that will also create and develop future brands and products for Safilo’s Global Sports & Outdoor Lifestyle segment.
Another 20 positions related to manufacturing and dealer services will be relocated to Salt Lake City, where Smith manufactures it goggles and runs a customer service center. Safilo plans to transfer manufacturing of all 30 of its goggle brands to Salt Lake City in coming years.
The remaining 30 positions in information technology, human resources and finance will be moved to Safilo USA’s headquarters in Parsippany, NH. Safilo anticipates the large majority of Smith’s employees in Ketchum will accept offers to move to the new locations.
Safilo not yet worked out how it will manage Smith’s sales, which are overseen by four regional managers and about 75, mostly independent reps.
The new Portland design center will be run by Eric Carlson, Smith’s current creative and global marketing director, who will report to Thorsten Brandt. While Brandt has been working from Smith’s Ketchum headquarters for much of the past year, he will run the brand from Safilo’s global headquarters in Padua, Italy alongside the leaders of Safilo’s other proprietary brands, which include Carrera, Polaroid and Oxydo. Ron Hayes, formerly CFO for Smith Optics, will lead the three-year transition process. Because Smith is being integrated into Safilo, its long-time CEO Ned Post will not be replaced when he retires at the end of the year. Safilo announced Smith’s retirement in August.
Safilo will focus on expanding Smith’s distribution in Europe starting next year and then move on to the Far East and Latin American markets. While Carrera, which is Safilo’s largest proprietary brand, makes ski goggles, it is more of a lifestyle brand that lacks Smith’s heft in the outdoor and sports segment which is outgrowing the fashion and other segments of the eyewear business.
“Basically it’s the brand that has the biggest soul of any of our proprietary brands,” said Delgado, who said she came to know Smith as a skier in her native Switzerland and later as a motorcycling enthusiast. “We believe Smith has a very important, strategic and core place in Safilo’s portfolio that revolves around its snow heritage.”
The announcement culminates a year-long review of Safilo’s portfolio Delgado began when she took the reins as CEO Oct. 15, 2013.
Delgado, who spent two decades honing her consumer products and business skills at Proctor & Gamble, focused on the best way to growth the company’s five proprietary brands, which include Carrera, Polaroid, Oxydo, Smith and Safilo. From there, she quickly honed in on the outsized growth of Smith and other technical sports brands such as Oakley and Costa.
“We have largely seen Smith grow as a North American snow and sport brands,” Delgado said. “We never really enabled or supported Smith to grow globally and reach its full potential.”
Last year, Delgado asked Smith executives what would it take to do that. The review revealed that Smith was having trouble attracting top talent to Ketchum. In May, Delgado flew to Ketchum to discuss a strategy for doubling Smith’s sales in five years. In August, she returned to announced Safilo had hired the human resources consulting firm Mercer to survey Smith employees in Ketchum and identify and rank seven potential relocation sites: including Seattle, Denver, San Francisco, San Jose, Park City and Ketchum. The company chose Portland for the design center because it has a deep well of design talent and offers access to the outdoor lifestyle that inspired Smith and could inspire future outdoor and sport brands which Safilo expects to develop either under license or from scratch.
“There are a lot of brands that are seen in the mountains which you are now seeing on street,” said Delgado. “This is a whole new consumer segment and the data will show you it is growing very fast.”
Safilo will start scouting sites in Portland Wednesday and expects to transfers its first wave of employees to the city from Ketchum around Easter time. About 20 positions will move from Ketchum to Salt Lake City beginning in 2016. The company has not determined how many administrative positions will move to New Jersey. The transition is scheduled to be completed by 2018.
After unveiling the timeline to Smith employees in Ketchum Monday, Delgado met with local officials in Ketchum, where Smith was founded in 1965.
“We feel a great sense of responsibility to Ketchum and Sun Valley after nearly 50 years,” said Delgado, who was born a year after the Smith Optics was founded. “We are working with the municipality to see what form this would take, but we are determined to leave a legacy. We dont know exactly what this will look like, but have a work group focusing on how we could remain present here in spirit with some commemorative presence.”
