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Western Power Sports focuses on long-term growth

Following the 2022 sale of Western Power Sports to Arrowhead Engineered Products (AEP), the challenging part was just beginning. After 38 years at the helm of this family-owned and operated distributor, former president and CEO Craig Shoemaker was out, and a new corporate mentality was installed with Arrowhead executives at the top.

When Travis Springsteen joined AEP as senior vice president of sales for North America, he had no idea he’d be tapped to lead the transformation and development efforts of a powersports juggernaut. He joined AEP in 2019, and by 2023, he was in Boise to take control of WPS and its many tentacles, including FLY Racing, Sedona Tire & Wheel, Open Trail, Shinko Tires, Fire Power, HardDrive, Highway 21, SP1, LC, GMAX, Rale, ScorpionEXO, Alpinestars, POD and more. It was a tall order, but Springsteen is pretty tall, so it was a good fit.

The Scorpion helmets’ brand managers gave us a walk-through of their new lids and a sneak peek at what is coming next year.

One of his first orders of business was to get his team in place. Having spent most of his career in the automotive market with Nissan and others, he needed an experienced group that he could count on to make the necessary changes—in the middle of a global pandemic, mind you.

“The big challenge for us was that we had a mentality of trying to do everything for every dealer and be everything to everybody,” says Springsteen. “We spent the last 12 months looking at our portfolio, we looked at customers from that perspective, we looked at SKUs from that perspective, we looked at brands from that perspective, we did an entire SKU rationalization. And through that process, I removed what I would call sludge, about 90,000 SKUs from the system where you would put an item in, and you would have 10 of them, and you’d sell one, meaning you’ve got ten years of inventory. We had some situations where we had these crazy tires that we got a great deal on. We had enough of that particular tire to last us until 2034,” he laughs.

Springsteen says that “sludge” affected WPS’s ability to service customers. “People questioned what we were doing when we consolidated our facilities from seven to four warehouses.”

He says they weren’t executing with seven facilities, and it’s easier to manage four and still meet customer needs. “Because our inventory was dispersed, and we had so much sludge in each facility, we couldn’t right-size inventory. With seven facilities, we were doing our customers a disservice.”

He says they will be able to service 97% of the United States in two days. Most of the west can be serviced out of Boise, and the east coast DC in Philadelphia will be up over 80%. Most orders will come from one facility; a customer will get one complete package instead of the goggles from Georgia and the pants from Texas. “That all gets consolidated down and will put us in a much better position to service our customers.”

We also spoke with the vice presidents of WPS, who are in charge of the roughly 160 field sales reps and several inside salespeople.

Ronnie Wehr says he changed titles after the acquisition, but he was the national sales manager for about five years before that. Now, he is the senior vice president of sales. He did both jobs for a while before Troy Ozias came on board. “It’s just too much for one person to focus on the long-term vision or bigger project-type stuff. And it’s nice to have somebody with sales experience (Troy) to say, ‘Hey, this is what I’m thinking. What do you think?’ I didn’t have that person to bounce things off of before.”

WPS Open Trail training
It’s a bird, it’s a plane, no, it’s the Open Trail training session in Boise for more than 150 WPS sales reps.

According to Wehr, many of their dealers are now facing softer demand (as of May). “Dealers are carrying some inventory, but not excessive levels [of PG&A],” he says. “It’s on our reps’ radar. And our job is to make sure we have inventory when they need it.”

However, during Covid and after the acquisition, they had an oversupply of products. Dealers were selling everything in sight at the time the order was placed. But then came a slowdown and a mild winter.

“You know when you turn off your faucet, and there’s still water in the hose, and water comes out? Well, that’s what it was like with production,” Wehr says. “Demand stopped, but we still had inventory coming. Dealers were heavy to the point they had to sell through some inventory before buying from us. It’s starting to go away. We will be in a good position next year as we have some more time to clean out the pipeline.”

The unique problems with Covid have not all gone away, but Wehr and Ozias believe they are starting to see signs that things are returning to seasonal norms.

“We gained more than we would have gained organically before Covid,” says Wehr. “But we didn’t keep everyone, and we plateaued at a high level but didn’t come back down to where we were. So I do think we got some extra lift there.”

Our goal in the company is to set ourselves up for success in the future and really for the long term,” he continues. “And that comes with realigning rep territories and getting them focused on the dealers that have the most opportunity for growth, whether that’s an outside rep or an inside rep, optimizing inventory, ensuring that we have the hottest items in the warehouse where we need them, focusing on fill rates, getting as much of the order in one shipment from one warehouse, trying to reduce the number of crops, and all those things. We’ve been working hard on that for the last several months, and as we continue through this year into ‘25, we can fine-tune the machine a bit more.”

With reps getting new territories and assignments, Hard Drive had to adjust its team.

“We decided to take that team and move them inside,” says Troy Ozias, director of field sales. “We had a team of 20 and consolidated it to a team of 10. But we expanded the number of dealers for whom they’re responsible. With this plan now, we expect to talk with dealers one to three times a month by increasing our sales calls and touchpoints. So, between our e-mail or social traffic and then our phone traffic, we expect that to elevate.”

Ozias understands that face-to-face communication has some advantages compared to over-the-phone communication. “But we also know we couldn’t reach those at that same level, so we’re going to increase our touch points.”

When Arrowhead first came into the mix, they wanted to do everything for everybody in every fashion. But that was not working as well as the executive team would like. So now AEP is enabling WPS to focus on being WPS again.

“Arrowhead was looking at more of a global structure where it’s under one umbrella,” says Springsteen. And the first thing the CEO did was put everyone in their own lane and then created accountability for each of those business groups. “For WPS to be successful, it has to stand on its own. It has to be operated on its own with parent company oversight. But everything we do is dealer-centered.”

Springsteen says WPS can’t make decisions from Boise. “We need to make decisions at the field level. And we do a much better job of understanding what our dealers are going through. What do they need? How can we help assist? Then, we pivot that to help them become successful businesses, making more money and prospering in the marketplace.”

Springsteen notes a lot of uncertainty even though the industry is starting to stabilize. “There’s a lot of pressure from the OEMs. There’s a lot of economic pressure on our end users. So our responsibility is to become better business partners and help them with profitability and their end users.”

Although Springsteen has only been immersed in powersports briefly, he was close to it for five years with All Balls Racing. “I think that the bubble is finally behind us. I talked to other industry folks; some are bullish, and some are a little bearish. My take is that this year will be in the middle (flat). It’s not going to be a hockey stick. I think what we have to do is focus on being a little selfish. It’s good for us because it allows us time to improve and be perfect. This business is reciprocal; it’s going to come back, and it will come back robust. We need to make sure that we’re prepared and ready to ride that with our customers.”

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3 Comments

  1. Sounds like a solid strategy! You can’t force into the dealers, what they cannot sell out the door! Patience builds relationships!

  2. “……former president and CEO Craig Shoemaker was out, and a new corporate mentality was installed with Arrowhead executives at the top.” This is problem Number 1. AEP is pretty much doing to WPS what they’ve done to every business they acquire and it isn’t good. I understand inventory management. I also understand that much of the “sludge” spoken of was invaluable. Since AEP stepped in, it’s taking longer to receive shipments, prices are up and quality/selection is down (unfortunately an AEP hallmark), and have less and less regard for the dealers who pay their bills. I don’t wish ill to WPS as there are still many good people there, but Lemans and Turn 14 need to press WPS hard.

  3. Sad to say that the rhetoric and sales pitch by Mr. Springsteen is indicative of a lot of what is wrong with AEP. He’s a high energy guy who uses charm on those who he can, but his lack of concern for talented team members and failure to even acknowledge key staff was a huge turn off to many who interacted with him. There were large swaths of customers and sales teams upset as he pushed policies which led to crazy channel conflicts and mass exodus of customers and talent. The rest who remain with WPS and a few of the other acquisitions, will survive due to some great products and people who can tolerate the era, and most will outlast his disastrous tenure. He’s a walking wrecking ball for businesses AEP acquires!

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