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It
was the gloomiest March, economically, in two decades in Oregon, and in
the Portland area especially.
Oregon led the nation in unemployment, and was last in the nation in job
creation. Portland lost Willamette Industries, its only fortune 500 company...and
Delta Airlines International Service...and would soon lose Meier and Frank
corporate headquarters, and finally Consolidated Freightways.
Against this gloomy cloud overshadowing the usual gloomy weather, came
a very successful venture capitalist, Ralph Shaw, to deliver a speech
to the Commercial Association of Realtors. His March ‘02 speech
was aptly subtitled, “Does anyone here know how to play this game?”
The denouncement of Portland and Oregon’s economic situation had
all the subtlety of a furnace blast. Shaw excoriated Portland for its
past economic smugness, for its fanciful dreaming of our “quality
of life” advantages, for its lack of infrastructure, its educational
system, its lack of corporate headquarters and management drain, for its
failure to prepare for the high-tech recession, its romantic thinking
that bio-tech will save the day...for its lack of corporate clusters.
And after each denouncement on Portland’s non-competitive, international
economic positions, Shaw fired this refrain: “Does anyone here know
how to play this game?” The game of international competition.
Well, Mr. Shaw, somebody here does know how to play this game—to
develop the critical mass of an economic cluster. There’s one industry
where Oregon leads the world; where growth, despite March 2000 and 9/11,
is going gangbusters and steadily growing by 15 to 25 percent. There is
one industry leading the world and making Oregon, and Oregonians, lead
richer and fuller lives.
Biotechnology it is not.
Body technology it is.
It’s
as old as the caveman experimenting with the “fabrics” of
his surroundings to make a better boat, a spear, a hunting knife, a coat.
In Oregon, it’s as old as
the turn of the 20th century when flagship companies like Jantzen and
Pendleton put Oregon on the map with flourishing worldwide markets. Then
came the flashing White Stag...and finally, the Swoosh, the Trefoil,
Ma Boyle.
Fashion statements, all of them, with Hollywood stars like Ginger Rogers
modeling Jantzen’s red diving lady, or the Beach Boys sporting the
fashionable surfing shirt and dubbing themselves “The Pendletones.”
And who will forget swoosh-laden Tiger Woods?
It’s as new as SportHill’s super high-tech 3SP fabric and
Columbia Sportswear’s ad campaigns, and Salomon’s outside
the box adventure shoe, the XA-Pro. In a label-conscious enterprise it’s
officially known as the Outdoor Retail Industry. And Oregon leads the
world.
In an $18 billion U.S. industry, corporations based out
of Oregon account for not less than $13 billion of it—
over two-thirds. And that number only accounts for the big three—Nike
alone is a $10 billion corporation, Adidas America-Salomon North America
nearly $2 billion, Columbia Sportswear, nearly $1 billion. This number
doesn’t include undisclosed figures from all the private companies
who won’t share their secrets of success just yet.
These industry world-leaders in our hometown are pollinating a growing
field of blooming businesses—small, medium and sprouting players
in the outdoor retail market. It’s the old story of success breeds
success, and it’s new stories of how business in Oregon is blooming,
unfolding in ever-widening clusters.
Yes, some people do know how to play the game.
JUST
DOING IT
Jason Menninger is Executive Editor and President of Hooked On The Outdoors
Magazine in Atlanta, Georgia. He’s on the outside looking in at
Oregon’s epicenter of business activity in what is known as human-powered
outdoor recreation. “On the surface,”Menninger notes casually,
“it’s obvious that Oregon is a Mecca for outdoor recreation.
The state itself has so much to offer in terms of recreational opportunities.”
But Oregon, he notes, didn’t become a multi-billion dollar sporting
goods epicenter with collections of tiny fractures in the market’s
crust. This is a major fault-line here. “We think of this industry
as being a niche market, but it is actually a mass market. In America
alone, 189 million people participate in these non-motorized activities
and one-third of those, 50-60 million, are enthusiasts.”
Rain or shine. Good times and bad times. These people are doing it.
The roots of Portland’s major players in the outdoor retail industry
read like a motivational seminar. From the Boyle family fleeing Nazi Germany
and building a family business, to a homegrown University of Oregon runner
and an Olympic track coach getting together to make a better running shoe,
to executives from Nike spinning off in 1993 to eventually reposition
the Adidas brand and form Adidas America; and, most recently, Adidas acquiring
French-born Salomon North America, which relocated to Portland in 1997
to form Adidas-Salomon in Portland.
“The collective horsepower of these three companies really is amazing,”
says Salomon’s Bryan Johnston, VP of Brand Marketing. With the talent
and energy the big three draw to Oregon, they are not only manufacturing
durable goods, they are spinning-off good people, with good ideas. And
they are attracting good people with good ideas.
In the equation of what attracts dozens of outdoor retail industries to
Oregon, Johnston has identified key variables. He says, “It’s
human capital. When we’re trying to find the right people, it really
is a huge benefit to be in a marketplace that has the lifestyle, physical
amenities, and city infrastructure of Portland.”
Why does the industry continue to grow when the economy is down? Menninger
points in particular at Oregon’s success. “In the huge survey
by the USDA revealing 189 million participants, the biggest constraint
on people’s activity level is not money; it is time. That goes back
to why Oregon has become a hub. You have so much to offer in skiing, paddling,
fishing, windsurfing, kite-boarding snowboarding, and on it goes. You
can pretty much do all of these things in a pretty small radius and thus
you answer one of the biggest constraints on the outdoor enthusiasts.
It is the time factor.”
But Oregon adds a multiplier affect. Take the Columbia River for example
where there’s more than participant accessibility in play.
“Look at the Columbia River,” says Menninger, noting
it’s recreational value for water sports, hiking and more.
“Look at the Columbia River,” says Adidas America’s
Sally Murdoch, Public Relations Manager. “Besides the living conditions
and accessibility to the outdoors,
other factors like the airlines and direct shipping lines
to the Far East make it a central hub for access to the global ring.”
“Look at the Columbia River,” says Bob Hrdlicka, a 20-plus
year veteran with the Port of Portland. On an exquisite September morning
he tours BrainstormNW around the six marine terminals operated by the
Port of Portland.
“I can’t speak to some reasons why these industries chose
to locate here. There’s a little bit of an Oregon mystique I suppose,”
says Hrdlicka with utmost confidence, “but I can speak to the location
here in
terms of distribution options and the transportation infrastructure. Portland
has two interstate freeways, two trans-carrier railroad lines, Burlington
Northern Santa Fe and Union Pacific. Portland offers tremendous airfreight
service and good distribution for air cargo. And our seaport facilitates
the importation of merchandise overseas.”
Standing in Terminal 6, we watch the container ship Han Jin Shang-Hai
pumping blood into Oregon businesses in the form of containers.
Terminal 6 is familiar territory to the big three. “The container
liner business imports for the three major sporting goods players amounts
to at least 15 percent
of total imports,” notes Hrdlicka. “In addition,
Terminal 6, on the Willamette River, serves most of
the manufactured goods producers that come from
our region.”
The transportation and distribution of the product is an important cost
component in the manufacturing of goods. Getting goods to where they’re
needed, when they’re needed, is paramount to these companies. It’s
one reason for success. Hard work is another one.
THEY
KNOW HOW TO PLAY THE GAME
Hard work defines the bust-your-butt world of Gert Boyle, the Mother of
all mother-approved sportswear, who at age 75 is still manning the exhibit
at the huge 2002 Outdoor Retailers’ Summer Market in Salt Lake City.
Oregons presence is noticeably prominent as nearly 900 exhibitors fill
the Salt Palace Convention Center and nearby Little Dell Lake for four
days to show and show-off their newest products to 5,500 buyers and some
media professionals.
It is the best outdoor exposition in the world for industry professionals,
featuring gear for every type of human-powered (non-motorized) recreation
including paddling, mountaineering, camping, climbing, hiking, adventure
travel, bouldering, skiing, snowboarding, windsurfing and running.
U.S. outdoor retail sales in 2000 were $17.8 billion with an estimated
total economic impact of over $40 billion, according to the Outdoor Industry
Association (OIA). Remember, Oregon’s presence is almost two-thirds
of
the equation.
At the Outdoor Retailers Market this August in Salt Lake City dozens of
innovative and enterprising people mix their love of the outdoors with
some business sense and a go-for-broke work ethic to introduce new products
to the market and to carve out a profitable business niche.
At the Market are over three-dozen Oregon-based businesses that manufacture
clothing, shoes, sports and fitness electronics, knives and pocket tools,
paddles, board-related products, and rock-climbing walls and equipment.
They all hang together on this tree called Oregon. They all share a love
of the outdoors. You might call it cluster capitalism.
“Everybody wants clusters these days,” writes Russell Gold
in the Wall Street Journal in June 2001. “The problem is how to
get them.”
In his speech, Shaw quoted a study sponsored by the Council on Competitiveness
and led by the highly respected Harvard professor, Michael Porter. The
report on “Clusters of Innovations” reported, “In healthy
regions, competitiveness and innovation are concentrated in clusters,
or interrelated industries in which the region specializes... A region’s
ability to produce high-value products and services that support high-wage
jobs depends on the creation and strengthening of these regional hubs
of competitiveness and innovation.”
In 2001,
Outside Magazine voted Portland, Oregon one of the “10 Greatest
Places to Live.” According to Senior Editor, Stephanie Pearson,
“The reason that we love Oregon is that Oregon has got everything:
deserts, mountains, coasts, rivers. And you can ski, kayak, windsurf,
climb—you can do it all! That’s why we love Oregon.”
So despite concerns about Portland’s negative business environment,
it seems that some good news is in order. Oregon’s outdoor retail
industry already embodies much of what Ralph Shaw hopes and dreams for
Oregon’s business community. “It is the competitive spirit,”
he says, “that comes with jousting against the best managements
in the world that brightens one’s imagination and trains one to
take positive actions.” Those positive actions often result in the
birth of a new business.
Meet two high-performance athletic wear companies who have jousted with
Nike’s model in their own way to market innovative products and
carve out a profitable niche.
InSport International’s company motto is “following no one.”
But in Portland in the 1970’s, everyone was following the running
trail. It led to the phenomenal growth of Nike, and eventually the birth
of InSport.
Linda Reese, InSport Marketing Director, points back to 1977 as the year
that “two entrepreneurs in a small Portland suburb began making
nylon running shorts out of their garages.” Nike and Adidas bought
up all the product they could make and marketed the merchandise under
their own labels.
It didn’t take long for these entrepreneurs to take the label from
private to public and Sportco was born, which then acquired Boulder-based
International Sports, which then merged to become Portland’s InSport.
Jesuit High graduate Eric Merk, Jr. owns the company today.
Decidedly “following no one” led InSport to avoid direct competition
with Nike by following the path they knew best. InSport has become a $17
million company and a category leader in highly technical, high-performance
fitness, cycling and triathlon apparel. The InSport brand has become “a
symbol for serious athletes.”
In one big way, being smaller does have its advantages. Size has a lot
to do with the ability to keep production local. “One big point
of difference with other apparel companies in this town,” says Reese,
“which we are able to do well, is our commitment to keeping jobs
local.”
Looking
out her Beaverton window she says, “Over 95 percent of InSports
apparel is produced within 40 miles of our headquarters.”
About 100 miles south on I-5 is the University of Oregon’s running
track, the starting block for more than one athletic apparel entrepreneur.
While Phil Knight (with Bill Bowerman) launched his running shoe business
in the 60’s and 70’s, another runner’s entrepreneurial
spirit found a home in the 80’s when University of Oregon distance
runner and world-class PAC-10 champion Jim Hill launched “The Original
Pant.” As a high-school junior in 1979, Hill discovered this performance
level product while racing in the World Cross-Country Championships in
Europe. It was his favorite running pant, one he discovered at a shop
in England, and with the concept he started SportHill of Eugene after
graduating in the Business program.
“I started importing it in college as a business experiment to see
if this could sell in the U.S.,” says Hill—so obviously the
business student. “I then altered the fit in the American market
using a better fabric and started selling them anywhere I could—out
of my trunk, knocking on doors in San Francisco, making cold calls
to retailers. I started getting a 25 percent response on the spot to buy
the product. I took the other 75 percent back to the office and kept working
them over the phone.”
Today, SportHill’s home office with 20 employees markets running
fitness apparel to over 1,000 retailers and athletic teams in 50 states
and 13 countries. Like InSport, SportHill boasts “Made in the USA”
production values with manufacturing in Eugene, Vancouver and Los Angeles.
And SportHill has recorded 30 percent growth over the last three years,
according to Marketing Manager Liz Wilson, an employee with Hill since
graduating from Oregon in ’91.
Thirty-percent growth even with an economic downturn and unemployment?
“These are the activities people will continue to do when their
stress levels go up!” answers Wilson.
WHEN IN NEED OF A JOB,
MAKE YOUR OWN
In Smith
Rock, Oregon in the 70s and 80s, climbers began to congregate, invent
new equipment and grow a new industry. They weren’t jousting against
world managements; they were starting them. Bend, Oregon, along with Boulder,
Colo. and Salt Lake City, Utah, today represents one of three major hubs
of industry for climbing related sports, now a multi-million dollar industry
with over 12 million participants nationwide.
“I started making a few pieces of my own gear and really just needed
a job,” jokes the soft-spoken Doug Phillips of Metolius Climbing
in Bend, the hub for indoor and outdoor rock climbing. He fiddles with
a camming device—his brainchild of almost 20 years. “I started
selling stuff at Smith Rock. It was always profitable from the start and
I just followed the market. What’s built our business is new and
innovative product. Our first big success was a camming device on a flexible
stem.”
Phillips climbs inside his newest innovation, the Bomb Shelter Porta-ledge
Tent, and gives it a swing. It is literally made for sleeping on the side
of a sheer face wall like Yosemite’s El Capitan. Warning: that first
step in the morning is a doozy.
Phillips has been rock climbing for 30 years and has achieved annual sales
of over $6 million since hanging his shingle in 1983. With a personal
introduction and photos of him using his own innovations, his full-line
climbing catalog speaks volumes about his passion for the sport and his
penchant for hard work. Like many others in cluster capitalism, he started
with an even bigger player in the climbing industry before launching out
on his own.
Phillips gives credit to his former association with Entre Prises (pronounced
Antra-pree) for being an industry leader in the manufacturing of indoor
and outdoor climbing walls.
Towering in the middle of the huge Salt Palace Convention Center are three
massive climbing walls, and one towering hulk of a guy named Eric Meade,
the CEO and President of Entre Prises USA, a worldwide business with divisions
in France, Germany and the UK.
Started by a French climber and industrial engineer, Francoise Savigny,
who came to Smith Rock over 20 years ago, Entre Prises now boasts five
successive years of 25 percent growth and $20 million in annual sales.
Since 1999, Entre Prises is wholly owned by Meade and two other partners
in Bend, where all of the manufacturing takes place.
“I
was a climber for 24 years and an architect, so I brought my two passions
together and bought the company,” says the muscle-bound Meade. He
grabs a pick and begins climbing the dry-ice wall. “Our growth is
through diversity of markets and new innovations.” Meade jumps down
and continues.
“What was started by climbers has diversified into a more mainstream
market these last 10 years,” he explains, noting that indoor climbing
started taking hold in climbing gyms in the 80s but took off in the early
to mid-90s to include clubs, Y’s, military training, universities,
schools and interactive displays at R.E.I. stores.
[ ]
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Entre
Prises started its own towering growth by installing climbing walls in
many REI stores and just recently completed the University of Idaho project.
In addition, they have the distinction of providing walls for all of ESPN’s
X-Games since 1995.
ELEMENTS
AT PLAY
Competitiveness. Innovation. Interrelated industries. Import/export distribution
advantage. All elements of the cluster capitalism at play in Oregon’s
outdoor
retail industry...but there’s even more.
Bob Applegate, Media Relations with the Port of Portland, looks out over
the Willamette River and sums it up: “Geography is Destiny.”
It has certainly defined the destiny of Portland and its neighboring hotbed
of outdoor activity, Hood River. For windsurfing, Hood River is the world
headquarters, not just of enthusiasts but also of a growing business and
manufacturing base for board and paddle-related products.
Chico Bukovansky, of Dakine boarding and windsurfing products, relocated
his business to Hood River from Maui. “It was impossible to run
a business in Maui and deal with shipping and warehousing, so we got the
idea to move to Hood River,” he says.
In his shaggy hair and casual hipness he looks the consummate surfer dude.
But he knows how to run a smart business and have fun doing it. “We
can be on the mountain in the morning and back in the R & D office
in the afternoon,” says Bukovansky. “There’s not many
places you can do that and have a big city close by with a port—an
inbound port from Asia and everything. Seattle and Portland are the best
sources for that. California’s not the place.”
Both Dakine and neighboring North Shore Inc. operate and manufacture windsurfing,
kiteboarding, and board-related products out of Hood River with a huge
distribution advantage (the Port) just downstream on the Columbia. It’s
a geography with a very hip destiny for Hood River.
On a sunny day in September Greg Zullo fields a call from Santiago, Chile
for some mountaineering equipment. He and his partner, Joe Garland, ran
an import-export warehousing business called “Climb Axe” in
Bellingham, Washington. After struggling with importing and shipping issues
they began to look for a better location to do business.
They looked at Boulder, Boise, Reno, and Laramie, all good locations for
climbing-related purposes, but the major airport in Portland drew them
here. “I love Portland. It has worked out great for our business.
I wouldn’t go anywhere else,” said Zullo at the Outdoor Retail
Market in Salt Lake.
SAME
GAME; DIFFERENT NICHES
Growing a market for new products seems to be a sixth sense with many
of Oregon’s up and coming outdoor industry entrepreneurs. Growing
Oregon’s world—her sphere of influence, connection, and international
dialogue, is often the extraordinary benefit. When these people get busy,
they broaden many horizons, many lives.
Emily Kaplan’s world is growing. She interacts daily with world-class
executives and industry professionals who traverse Portland from markets
around the globe. Kaplan is the PR voice of Columbia. Ma Boyle, of course,
is the PR face. To meet Emily you have to get past Gert Boyle. Boyle’s
working the Columbia Exhibit at the outdoor retail market and offers bottled
water to passers-by. Actually, the label reads: “Thunderstorm in
a bottle: Created by mother earth. Bottled by mother Boyle.”
Kaplan is clear about how Columbia Sportswear has grown their market,
almost exponentially to $789.6 million. It is diversity of markets, service
and value. “Columbia is known as value,” says Kaplan. “From
Fred Meyer to G.I. Joe’s to JC Penney to REI. The large percentage
of our volume is value products. The communication and relationship we
have with our customers really differentiates our business. Our biggest
strategy is to listen to customers feedback and offer exactly what they
want.”
She boasts of very regular business unit meetings with their retailers
and their sourcing industries. They listen. They learn. They change. And
they grow.
Chris Johnson migrated from eight years at Nike to market sports and fitness
electronics for Oregon Scientific. “We’re known for innovation,
quality, and value built into the price...and we are so diverse that no
one market is going to make us or break us,”
says Johnson.
Besides marketing to mega-retailers, a recurrent strategy is to grow a
business through specialty retailers. Surprisingly, it is the smaller
specialty retail stores that have grown the most in ’01–’02
according to the OIA. While sales increased by 2.9 percent, sales through
chains fell 2.8 percent.
And Nike is paying attention.
According to Nate Tobeckson, with Nike’s ACG Outdoors division,
“Nike has returned to a specialty bent in product with the Oregon
Series, a line only offered to specialty shops so they don’t have
to compete with big stores.” They’ve differentiated the product
with longer two-year lifecycles, at once availability, and bite-size orders.
“Nike has grown the specialty business 25 percent in the last year,”
says Tobeckson.
Joe Rooper is a big kid, pulling all his toys off the shelf with great
enthusiasm and selling his posable magnetic sculptures and snap-watches
like drinks at a Kool Ade stand. Retailers come by his exhibit and snap
up his product for last-minute point-of-sale purchases. Rooper is VP of
Sales and Marketing for Hog Wild. His fun-friendly business card notes
that Global Hog-Quarters are in Porkland, Oregon. They come out with eight
to 12 new products every six months and he has invested long, not-so-fun
days and weeks into finding manufacturers, markets and buyers for his
innovations. “We grow our business in independent stores, no discount
retailers,” says Joe Rooper of Hog Wild. “It’s easier
to grow through diversified customers because if a big retailer goes out
of business—poof!”
With a touch of a button, Gregory Liebrich of Portland’s ShedRain
Corporation, closes a golf size umbrella into a 7 ¼ inch packable
stem. Totally cool. You’ll want one of these.
ShedRain is a third-generation family run business in Portland. “We’re
not just producing umbrellas,” says Gregory Liebrich, National Merchandise
Manager, “we’re figuring out—what’s the maximum
way to sell our umbrella? How can we make the coolest umbrella ever made?
We have state of the art facilities, order processing and order fulfillment.
It’s about innovation.”
In August 2000, Laurie O’Brien was hanging onto her exhibit for
dear life as a tornado ripped through Salt Lake City and her exhibition
tent. When she returned to Portland, all she read in the paper was “Tornado
strikes Salt Lake City and Nike is inconvenienced.” “Hey what
about me? It was right over my head!” O’Brien thought.
But the real tornado came when O’Brien cleaned up the mess and started
marketing Montane’s brand new Mission Kitchen. “I was floored!”
she recalls. “We were this small business operating basically out
of the owner’s basement and we were talking with L.L. Bean, Norm
Thompson and the big boys. It was an incredible feeling to think that
we had ideas that were really making it.”
Outdoor retail industry growth in Oregon is like a surging river fed by
the steady streams of dozens of business owners, large and small, each
with unique niches, but common reasons for success: innovation, diversity,
geography, global access.
THE MOTHER OF INVENTION
When teenage surfer Peter Gibney rushed out to catch a few more waves
near a Lahaina pier in 1997, it was his last day in Hawaii before heading
home. He had no clue he was about to launch a new family business.
Gibney parked the rental car near the beach, tucked his keys under his
shirt near a rock and enjoyed the surf for an hour or more. He returned
to find his shirt where he had left it. His keys however, were gone. As
was everything of value inside the rental car: wallets, ID, plane tickets,
and of course, no keys to get home. Mom was waiting back at the condo
for Gibney to return in time to
jet home to Eugene, Oregon. Boy would she be p*****!
Five years later mom and her four kids, including Peter, are sitting at
the kitchen table in Eugene refining their prototype one more time for
Li & Fung Trading Co. in Hong Kong. Daughter Jen Houck is using her
marketing savvy on the phone trying to land a booth at the August Summer
Market. Five years of research, development and marketing are invested
into the full launching of their company, WaterBabies. They aren’t
making any money. Yet.
But they’re getting hundreds of requests to meet the need that Peter
Gibney had on that lazy Lahaina beach: the need for an ultra-secure, ultra-waterproof
pouch to keep keys, ID, and credit cards during active water sports. Basically,
it is a neoprene arm, wrist, or leg band with a transparent, waterproof,
zip-lock pocket. That’s the basic idea. In reality, says Mom, “over
two years of technology have gone into it. It is something extremely phenomenal
that looks really simple.”
She’s tan, she’s thin, she’s athletic, and moving so
fast that she can’t sit still. Mom is Kathy Jones, a vivacious,
40-something, mother of two girls and two boys, ages 15 to 28. She is
and always has been fully engaged in the active outdoor lifestyle with
her kids. “WaterBabies is the incredible story that necessity is
the mother of invention,” says Jones.
It’s a mom and kids operation with daughters Jen Houck and Casey
Parker, and sons Peter Gibney and Sean Gibney all involved in hours of
hard work and little pay to keep WaterBabies afloat and cruising to success.
The first
time they brought their product to the Outdoor Retailers Convention in
2000, over 300 retailers requested samples. Now WaterBabies’ three
lines of product are sold in Six Flags theme parks, and surf shops in
Florida, California, Hawaii, and Bermuda. They are in negotiations with
Target, Disney Theme Parks, and even military underwater dive teams. “We’re
not Nike yet,” laughs Jones. Shameless plug: WaterBabies products
are great for carrying ID in airports and on campuses.
Bryan
Johnston, spokesperson for Salomon at the Outdoor Market, points at the
hundreds of other vendors and looks to the future. “The good thing
is that, even though there’s all these companies in Portland, the
market is a pretty broad and diverse market. When I look at our competitors
in the Portland area I applaud all of them because we’ve all kind
of gravitated towards the things that we do best.”
“Some people are more price-point oriented with reasonable performance
features;”
says Johnston, “others are more mass distribution. We have a different
direction,” he says. “As long as we all remain pure to
our own direction, I think that we will continue to be successful.”
And did we mention that southern Oregon is the Paddling Industry capital
of the West? And then there’s the hiking exhibit, and rafting...and...we
didn’t even start on the winter sports.
But maybe another time. Because business is humming, and those who know
how to play the game, and Oregon’s outdoor retailers surely do,
have already packed up their exhibits and gotten back to business.
SIDEBAR: THE CUTTING EDGE
“A little known fact about Portland, Oregon is that it is the knife
capital of the world,” says Paul Gillespie of Columbia River Knife
and Tool. His partner, Rod Bremer, remembers the day, about 2 ½
years ago, that knifemakers as a group met with Congresswoman Darlene
Hooley. They estimated that the knifemaking industry in Portland provided
about 3,000 jobs both directly and in sub-contracting industries including
tool and dye makers, machine shops, injection-mold tooling and laser cutting
industries.
“She was so surprised,” said Bremer, “and eager to hear
more about our industry. Outside of Solingen, Germany and Saga, Japan,
Portland is the place.”
Gillespie recounts, “All of us knifemakers in Portland have interesting
stories but it really all started with Gerber knives.” He is eager
to share the story. According to Gillespie, an advertising man by the
name of Joseph Gerber in 1939 hired David Murphy to build his first carving
knives. They gained popularity quickly and Gerber developed into a very
large knife company.
In the 70s Gerber had two employees, Pete Kershaw in sales, and Al Mar
the designer. Kershaw left to start Kershaw Knives and Mar started his
own business. Paul Gillespie and Rod Bremer both worked for Pete Kershaw
for 10 years before leaving to start their own company.
“If you ask me why,” says Bremer, “I’d say it’s
the same old American dream of thinking you have a good idea and you want
to exploit it on your own, so off we went.”
Columbia River Knife and Tool almost didn’t make it. After four
years of financing a company from scratch and struggling with sourcing,
quality, and delivery, they needed a breakthrough. They showed up at their
first trade-show in 1998 with a custom design called the KISS knife (for
Keep It Super Simple). Hoping to sell a few thousand and get on their
feet in the next year they sold more product in the first day of the show
than either could remember selling during their career in knife sales.
The KISS knife has literally sold in the hundreds of thousands in just
four years.
In a mini sub-category of knives is the multi-tool world of Tim Leatherman,
now an industry standard in its category with a 50 percent U.S. market
share and 70 percent globally. Gerber captures most of the remainder of
the market in multi-tools.
Mark Baker is PR manager for Leatherman, who describes his business as
“not a knife company,” but admits, “we make use of suppliers
for the industry here. It helps from a hiring standpoint to have a base
of workers who have a high level of experience in design and similar activities.”
Few people know that Tim Leatherman was one of the few people in his generation
to pay his own way to Vietnam. The mechanical engineer fell in love with
a Vietnamese woman and followed her to Vietnam in the early 70s. He worked
repairing helicopters and soon married his sweetheart. The couple returned
to Oregon a week before the fall of Saigon.
While traveling in Europe Leatherman dreamed of the perfect pocket tool
then worked on production and marketing of it for several years. During
the prototype phase he explored every avenue imaginable to market his
product, approaching 21 government agencies and utilities with no luck.
Finally, in December 1983, he approached a catalog called Early Winters
and placed the Pocket Survival Tool on the back cover for $39. Hoping
to sell 5,000 in the first year, they were astonished with sales of 30,000
tools in 1984. Today 30,000 represents 2 or 3 days production and Tim
Leatherman still walks the factory with his apron on, ready to help when
needed.
PROMINENT
KNIFE MAKERS
IN THE PORTLAND AREA:
Benchmade Knife Co., Oregon City
Columbia River Knife and Tool
Gerber Legendary Blades/Fiskars, Wilsonville
Kershaw Knives, Wilsonville
Leatherman Tool Group, Portland
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