Steamboat Pilot & Today

Steamboat Springs — A half-dozen of Steamboat's biggest companies are also among its smallest companies. And they refuse to be contained by four walls.

Local companies dedicated to making products for the outdoor recreation industry are delivering their goods to an international marketplace. And in some cases, their sleeping bags, kayaking and fishing accessories are manufactured overseas. But they also manage to prosper because they are so small at least four are literally two-man or three-man companies.

"We're a three-man operation. Our products are being made in three factories in China with 80 people working around the clock (in shifts)," Chris Timmerman said. "Cabela's is our biggest customer, but other large customers include Sam's Club and Kmart. We have 600 other customers and our business in Europe is huge."

Timmerman is one of the principals in Creek Company Ltd. They manufacture and distribute ingenious products for recreational fishermen. They include little gizmos like fancy "nail clippers" designed with the angler in mind. They come on retractable spools, and fishermen use them to cut their flies off the end of their line.

Creek Company is best known for its personal watercraft built just for fishermen. It all started with the industry standard "U-Boat" that elevated the float tube (picture a floating doughnut with a fisherman inside) to new levels.

Now, Timmerman and his partners have come out with a two-person pontoon raft the Outdoor Discovery Craft (ODC) 1220, capable of handling the Colorado, Yampa and Green rivers. It's priced at a modest (compared to other rafts of similar specifications) $1,000. It is available exclusively through Cabela's, the giant catalog retailer, and one other place at Steamboat Fishing Co. in downtown Steamboat.

Timmerman said he signed the exclusive agreement with Cabela's because they were willing to buy all the boats he could produce, allowing him to trim his profit margins and hit a retail price point nobody in the industry has previously offered for such a craft.

Creek Company is just one of a small boatload of outdoor companies who have found new models for success in a mountain town.

Among the companies based in Steamboat that are making products that help people get the most out of the outdoors are Fat Eddy's Threadworks (kayaking accessories), Big Agnes (sleeping bags), BOA Technology (innovative lacing systems for snowboard boots), Creek Company Ltd. (personal watercraft and accessories for anglers), Moots (high-end mountain and road bikes) and SmartWool (Merino wool socks and insulating undergarments).

Fat Eddy's shrank from three to two officers in its company last year and still managed to grow its sales by 60 percent.

Founder Edward Watson is still creating new products and marketing director John Cardillo is on the case, but Chief Financial Officer Jerry Baxter departed for a new career in Denver.

At the beginning of 2001, Watson said the company was aiming to hit new heights and focus to a greater extent on special products for the kayak and paddling industries. With 2000 sales of $250,000 under their belts, the three partners hoped to double that number in 2001.

"It went probably 40 percent of the way," Watson said last week. "A lot of it was our focus. We're trying to do two things."

Watson founded the company by sewing canvas and Cordura nylon products from watchbands to courier's satchels.

Those products remain hot sellers, and because the company runs on a cash basis, it's been hard to wean themselves from some of the old standby products, although they have little to do with whitewater paddling.

Watson and Cardillo aren't resisting the success of the non-paddling products in 2002. Watson has come up with a line of five sunglass cases and some Cordura gear bags lined with fleece.

"This year, we have some different marketing ideas," Watson said. They signed up with Nation's Best Sports Buying Group. NBS will present their products to 200 buyers representing between 4,000 and 5,000 buyers at an August trade show.

Last year, Fat Eddy's principals were proud to say that 95 percent of their products were sewn in the Yampa Valley by independent contract sewers working from their homes. Things have changed a little in that regard.

"We went offshore with four of our products," Watson said. "We just had to do it. Some of the other accessory companies just beat us down on price. Even thought our products are better made, we had to go to China."

Fat Eddy's Two-Timer bag allows kayakers to haul soggy gear and wetsuits home stashed safely in the cockpit of their boat. It's been so successful that two other companies have knocked it off.

"They haven't cut into sales yet," Watson said.

The challenge for Fat Eddy's remains access to capital.

"We don't have lines of credit. We run on cash," Watson said. "It's very hard to run a business without capital."

BOA Technology

Gary Hammerslag is the driving force behind another self-financed Steamboat company that is breaking into the snowboard industry. But BOA isn't making snowboards or snowboard boots. They don't even make bindings. What Hammerslag and Director of Engineering Richard Florence are selling is a revolutionary new lacing system that affords snowboarders a better fit than they have ever experienced in their boots.

When the Steamboat Pilot & Today talked to Hammerslag in 2001, two well-known companies, K2 and Vans, had begun to slowly work the BOA system into their product lines. This year, four more companies have come on board. And tentative interest for 2003 is so strong, Hammerslag isn't actively seeking new snowboard boot customers he wants to make certain he can adequately serve the customer base he already has.

Unlike most Steamboat outdoor manufacturers, BOA isn't delivering a finished product that is ready for retail sale to consumers. Instead, they are selling a component they hope boot manufacturers will latch onto as a way to enhance their finished product.

The BOA lacing system replaces shoelaces with a very fine, yet very strong, stainless steel wire. The wire is threaded through lace guides positioned along the side of a snowboard boot. But the real genius of the system can be found in the way the wire, or "laces," is tightened.

Instead of the wearer tugging on laces, he or she simply turns a small crank or "reel" on the tongue of the boot. It's virtually effortless, but the mechanics of the reel it has a high gear ratio offers as tight a fit as anyone could ever want.

This year, Southern California's D.C. Shoe, Nitro, the Italian company North Wave and Deeluxe, which is big in Europe and Japan, will all use BOA products on some of their boots.

"It's a pretty small industry and some of our growth has come through people I knew. Other companies contacted me directly," Hammerslag said. Sales this year are already triple those of last year. Hammerslag plans to make three trips this year to visit the factory that produces BOA's lacing system in Guangdong Province, China.

He has developed an impressive Web site that allows industry customers to conveniently download text and a variety of BOA logos for use in their own promotions.

What's next? Hammerslag believes his boot tightening system could be applied to other sports, and he's in serious talks with a wakeboard company that has been testing a prototype for more than four months.

Big Agnes

Bill Gamber and Brad Johnson are the brains behind a new kind of sleeping bag named after a familiar peak in the Mount Zirkel wilderness north of Steamboat. Big Agnes sleeping bags are fitted with a sleeve designed to contain the self-inflating sleeping pads that have become must-haves for backpackers.

The marketing pitch to consumers is that they'll never roll off their sleeping pad in the middle of the night again. But another clear advantage is that the built-in pad sleeve means the Big Agnes bags provide just as much comfort with less insulation there's no need to place insulation in the portion of the bag devoted to the sleeping pad. That results in a very economically priced piece of technical outdoor gear.

Big Agnes achieved a breakthrough with a major new client this year.

"We opened up REI this year," Gamber said. "It's definitely pretty huge. One of the biggest benefits is the exposure you get with the total outdoor market."

REI is organized as a co-op but mails catalogs nationwide as well as operating a chain of specialty stores.

Big Agnes bags haven't made the catalog yet, but they are available form REI online and at seven key stores in test markets. The stores include Seattle, Salt Lake City, Berkeley, Calif., Denver, Boulder and Minnesota's Twin Cities.

Gamber is also excited that his company has managed to keep 30 percent of its sales in direct contact from its Web site. While there is no denying that direct sales improve Big Agnes' sales margin, that's not the main reason Gamber is so enthused.

He said serious outdoor enthusiasts have to travel an average of an hour to get to a really good outdoor store with the best technical gear. If they read about Big Agnes in an outdoor magazine, drive for that hour, only to find the store doesn't carry Big Agnes, it's a bummer.

The Internet represents a way for Big Agnes to reach the core of its target customer base directly and ensure no one is missed.

Big Agnes sold 1,700 sleeping bags last year and is looking for an incremental jump this year.

Gamber employs sewers in Steamboat to manufacture fleece outdoor garments for his other company, BAP. But in the case of Big Agnes, he and Johnson turned to China to achieve the price points they needed. Johnson was planning a trip to China late last year, but it was canceled after Sept. 11.

Gamber said e-mail works just fine as his connection to his Pacific Rim associates.

"It's awesome," Gamber said. "Everything you communicate is in writing." In addition, e-mail eliminates the need to play phone tag to bridge the gap across the Pacific and several time zones.

Some of Steamboat's smallest companies are flourishing in a global economy.