Longtime exec turns acquisition into opportunity
It was a well-kept secret. Geared Up Powersports, owned by longtime LeoVince USA executive vice president Tim Calhoun, quietly bought Fusetta LLC, the U.S. marketing and sales organization that sold and managed the LeoVince brand in the U.S. and Canada, on June 28.
It was news that stayed relatively quiet until early October, when LeoVince USA announced the purchase. Calhoun now takes the role of CEO and president of the new LeoVince USA and retains an exclusive distribution agreement with Sito Gruppo Industriale, the parent company of the LeoVince family of brands.
The reason for the secrecy? Calhoun wanted to show LeoVince USA’s dealer partners, customers, race teams and fans that there would be no interruption in service.
“We purposely didn’t say much about it for a couple months because we wanted people to realize nothing is really going to change in the business they do with LeoVince,” Calhoun told Powersports Business.
Sito is in the process of streamlining its business, moving back to a manufacturing focus and partnering with third party vendors for distribution. When the company approached Calhoun with an offer, he jumped at it, as the acquisition was ideal for him personally and professionally.
About a year ago, Calhoun began thinking about the future of his career, and he knew partial or full ownership in a company was his goal. He was willing to start a new company, but preferred to continue building on the business he had already established in his nine years at the helm of LeoVince USA. Calhoun had talked partial ownership with Sito, so when the opportunity to purchase the entire American arm of the company came up, he was glad to take it.
“The opportunity was there. It worked for them; it worked for me,” Calhoun said.
Now Calhoun is focused on growing his company and expanding on a distributorship that began about a year ago. BMC Filters became the first LeoVince USA-distributed brand in 2012. From then until this October, the now LeoVince USA Specialized Product Distribution, has picked up six other brands: Airoh Helmet, USWE Hydration Packs, Vortex Products, GPR Stabilizers, Dion Devices and Bridgestone Racing Tires.
Three more LeoVince USA-distributed brands were announced at AIMExpo, including TechSpec and VARTA Powersports, a new brand of batteries from Johnson Controls. The batteries, which were featured in the Oct. 7 issue of Powersports Business, are spill-proof and are delivered to dealerships fully charged.
“We think it’s going to be, quite frankly, the best battery on the market, as far as motorcycle and ATV and UTV,” Calhoun said.
VARTA’s 16 SKUs cover 80-90 percent of motorcycles on the market, and LeoVince USA will allow dealers to carry the full spectrum of VARTA batteries with a minimal investment. Calhoun said the VARTA partnership, backed by $42 billion Johnson Controls, sends a good message about how other companies see LeoVince USA. The company has a close working relationship with all of the manufacturers for which it distributes, which is unique because of the size of LeoVince USA.
“We offer a full partnership with the manufacturers. We’ll discuss what we’re selling, how we’re selling, who we’re selling to,” Calhoun said.
The brands LeoVince USA has lured so far include those that the company turns to itself, whether it’s the company’s employees or race teams. Many of those brands have been underrepresented in the past.
“We wanted to better serve our dealers with brands we like, that we use,” Calhoun said.
Adding brands other than LeoVince exhausts and carbon fiber protective pieces has allowed LeoVince USA to expand into new markets. The company is now playing in the automotive and bicycle industries due to partnerships with its manufacturers. Though diversifying is a goal of LeoVince USA, Calhoun is cognizant of not picking up brands just because they can help the company expand into other markets.
“I don’t want to go after a brand just because I want to do something else in auto or bicycle. I just want to go after brands because they’re great brands,” Calhoun said.
Though powersports remains at the heart of LeoVince, expanding into other segments allows the company to offset some of the more volatile turns of a need-based market.
“We’re just looking to build a little bit broader foundation to make sure we build a very, very stable base for this company,” Calhoun explained.
LeoVince USA now has 10 brands under its distribution. One or two more manufacturers might be added before the company’s first distributor catalog is released later this year. Calhoun hasn’t capped how many manufacturers LeoVince USA will work with in the future, but he’s confident that the 2013 partnerships will be capped at around a dozen.
“I know we’ve got enough under our belt right now that we have a lot that we have to digest,” Calhoun said.
Looking into the future
Because Calhoun has led LeoVince USA since the company launched in California nine years ago, the transition to ownership has been seamless. Many proven processes are already in place, so big changes don’t need to be made in the immediate future, but some are coming down the pike.
Shortly after revealing the sale in early October, LeoVince announced it had hired four new employees and promoted five others. The company is also looking to hire a new vice president of sales and to make changes in how its products are sold to dealers.
“We are driving toward adding outside reps for the first time, so we are looking at what is going to be the most intelligent way to expand our company,” Calhoun said. “We’re being very, very methodical.”
Though Calhoun’s Geared Up Powersports is keeping the LeoVince USA name on the distribution company for now, that could change in the future. A play on the Specialized Product Distribution portion of the name and LeoVince USA’s SpeedMob racer affiliation could factor into the new name. But for now, the LeoVince USA name will stay to appease dealers, customers and fans.
“There’s value to that name, and I really didn’t want to shake the tree too hard,” Calhoun said.
The company made a big public presence with its new ownership and distribution model at AIMExpo in mid-October. Its goal was to present the new LeoVince USA to the industry, encourage more dealerships to distribute its products and introduce its new manufacturer partners.
The message for the show is a message LeoVince USA wants to send going forward.
“We’re going to meet your needs; we offer excellent customer service, and we’re good at what we do; we want to help your business,” Calhoun said.