Aug. 10, 2009 – OEM to debut new garment line

By Karin Gelschus
Associate Editor
Growth of Arctic Cat’s PG&A business in the past 3-4 years has outpaced their unit growth. PG&A this year will be between 20-23 percent of Arctic Cat’s total business.
The company plans to increase that percentage during the next few years and build a PG&A business that represents a bigger percentage of Arctic Cat.
“The one thing we’re really trying to do is get better alignment within our division, and get people working on the top opportunities for growth,” said Arctic Cat’s PG&A General Manager Mary Ellen Walker. “(We’re also working to) present interesting programs for dealers, and work with the dealers so they understand the profit opportunity for them too. The PG&A business is very profitable, especially for the dealers.”

Extending brands
While the company saw a 3 percent increase in PG&A for its first quarter, it’s expecting it to fall slightly for its fiscal year. Walker says Arctic Cat’s goal is to maintain sales until the economy turns around and eventually grow at double digit rates.
“Even though the powersports business is having a tough time, we’ve been able to maintain our sales over the last couple of years,” she said. “That’s pretty remarkable.
“Over time we expect to be a bigger percentage of the total company,” she continued. “We don’t have a specific percentage in mind, but we do want to be growing at a double-digit growth rate.”
A main reason Walker says they can reach those goals is because Arctic Cat has a good pipeline of new products.
“We came out with close to 300 at the recent snow show (in Las Vegas), and we’re just in the process of launching many for the whole ATV business,” she said. “We’re trying some different things. We have a whole new line of snowmobile garments we’re testing right now.”
The new clothing brand will be separate from its existing line Arctic Wear, and Walker says it’ll be sold at a lower price point. The line debuted at Arctic Cat’s snowmobile dealer meeting in Las Vegas last spring, and it’ll be in dealerships in September.
Walker adds the new line will be targeted at consumers who may ride more than one brand of snowmobile or just want to look like a snowmobile racer. The new clothing line came about through consumer surveys and dealer focus groups. “We were trying to find ways we could create more opportunities for both the dealers and us,” she said

A PG&A personality
“We want to get to a point where dealers have an opportunity with product lines from Arctic Cat to make good money even when that consumer isn’t buying a unit,” Walker said. “Historically dealers haven’t always thought that way.”
Arctic Cat’s PG&A department plans to continue to work with dealers so they can be more profitable.
“We want PG&A to have a personality of its own,” Walker noted. “By that I mean, when a consumer, especially during these tough economic times, doesn’t have the money for a new ATV or Prowler, maybe they will be interested in some garments or accessories.
“Some of the dealers are telling us they’re having a hard time with the big accessories,” she continued, “maybe there’s something smaller at a good price point they could sell to the consumer.”
The PG&A mindset might not be there yet for all dealers, and Walker says they’ll have to generate programs or incentives so dealers want to create more focus on selling PG&A products.
“It’s a combination of programs and education,” she said. “We haven’t figured out (what the programs look like), but we always have to make sure it’s worth it for everybody.”

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