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tom woods
Gym climber
Bishop, CA
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May 10, 2010 - 01:47pm PT
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No- never tried to open one, but we did try to sub out some of our work to China. The quality was an issue, so we stopped with one company, and had better results with another.
Anyway, our experience was mixed, but had nothing to do with "communism" and everything to do with business, good old fashioned money based business.
The sad reality is that we pretty much had no choice but to move some production overseas. People can't/won't pay more here so it's tough to raise prices and labor is the biggest expense.
Skip- I'm probably reading more into your posts than you are actually saying, I just don't but the "communist" thing at all. They are businessmen to the core over there.
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HighTraverse
Trad climber
Bay Area
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May 10, 2010 - 02:53pm PT
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Last line of the SportsOneSource article, referring to Clarus:
Black Diamond and Gregory mark its first acquisitions.
Clarus is apparently two wealthy guys. A publicly traded shell company that's been looking for companies to buy. They already have controlling interest in Gregory.
This could go either way.
The North Farce/A5/REI/Sierra Designs/Kelty way or the "good" way.
We'd all like to see them continue with innovative and high quality products that are focused on What We Do.
BD is currently profitable.
There will be "economies of scale" as they merge management and infrastructure (think IT, supply chain, distribution and finance). Some middle management and infrastructure jobs will go.
They'll do their best to keep both companies profitable (assuming Gregory is profitable).
To do that, they could move to mass-market products (YUCK)
or stay true to their customers, or a mix.
More stuff will likely be made in China.
It's an odd union because BD has a strong line of packs competing with Gregory's only business. Who will get the pack business? Probably Gregory.
Stay tuned for more at 11.
On the China bashing:
It's all in how you manage it. Apple and Patagonia (among others) have very high quality suppliers. They also push/require their suppliers to reduce their environmental impact and improve working conditions. We get cheaper products at the same or better quality and the workers get better lives.
I once asked Chouinard about their use of Asian suppliers. He replied that their quality is often better than he could get here at any reasonable cost. Quality is Patagonia's #1 requirement. Then they will apply their own standards for working conditions and environmental responsibility. They require the entire package.
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stevep
Boulder climber
Salt Lake, UT
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May 10, 2010 - 03:25pm PT
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Aliens...made in America.
Chrysler...made in America.
Location is not a guarantee of quality. Not all Chinese manuafcturing is Six Sigma. Nor is all American.
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Hein
climber
San Francisco, CA
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May 10, 2010 - 03:38pm PT
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"Most recently, they built and operated Armor Holdings, a company that designed and built a wide variety of personal protection and safety equipment."
I wonder what coming from military equipment/being a defense contractor means for their ethics.
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Knuckles
Trad climber
Everett, Wa
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May 10, 2010 - 03:47pm PT
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A great deal of why China makes crappy product is because US consumers and companies continue to demand crappy product. China can make some very nice stuff, we're just not willing to pay for it.
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HighDesertDJ
Trad climber
Arid-zona
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May 10, 2010 - 04:17pm PT
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Wow. I better get some cams now.
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Gene
Social climber
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May 10, 2010 - 04:19pm PT
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As of 2010 we have achieved nearly every component of that approach other than the capital structure and the backstop for management, especially myself.
Other than that, Mrs. Lincoln, how did you enjoy the play?
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ncrockclimber
climber
NC
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May 10, 2010 - 04:20pm PT
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I see this news and I cringe! I am pushing up my timeline to purchase a few additional cams because I feel that there is a probability of a decine in quality.
Look at it this way - Currently, BD makes good stuff. BDs management / ownership are running the business in the best way they can, and have what they believe is an efficient cost and OH structure. Now Clarus comes in and buys the company. The price they paid is commensurate with the value of the company as it currently exists plus the value of future growth under the current plan. If they continue on the current path, Clarus will just break even. Clarus is buying BD and Gregory because they think that they can make the business more profitable. How? Well, Clarus really brings nothing to the table that will make better equipment. They don't know how to open up new markets or improve quality. The only way they can win is to cut costs. Think reduce staff, outsource, leverage spending dollars, expand brand into new market segments, etc. None of that sounds like anything that will benefit me since I just want good gear and the dollars they save are going to the pockets of the new owners.
I have seen this to many times before. Usually, the business goes downhill. In the majority of these transactions there is value destruction due to an exodus of qualified people and a decrease in quality and efficiency.
Some of the above is a little simplistic, and opens the door for a lot of "but, if…" and "you forgot to mention…" arguments. However, I did business development for a Fortune 100 company for 3 years and have seen first-hand numerous examples of how private equity and corporate acquisitions work. Although there are exceptions to the rule, almost 90% of these things fail to create shareholder value over a 10 year horizon, and I have NEVER personally seen one that really worked in the short term.
Like I said, I am buying my C4s today...
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HighTraverse
Trad climber
Bay Area
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May 10, 2010 - 04:37pm PT
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look for a bump in BD sales for about the next 6 months
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Oplopanax
Mountain climber
The Deep Woods
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May 10, 2010 - 05:16pm PT
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The computer I am posting this from was made in China...
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Binks
climber
Uranus
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May 10, 2010 - 05:23pm PT
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Buy DMM dragons, not C4's. BD is sold out. Not interested in their stuff anymore.
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tom woods
Gym climber
Bishop, CA
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May 10, 2010 - 06:20pm PT
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We're all worried about the cams, but didn't black diamond already offshore the hardware?
I bet the climbing hardware market isn't a huge part of the profit of the company.
How about the soft goods, and the skis? Maybe that's where the company plans to grow, because as stated above, that is the goal of the buyer especially of a public buyer.
Maybe the worry about the cams is overstated?
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mucci
Trad climber
The pitch of Bagalaar above you
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May 10, 2010 - 06:34pm PT
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Dmm Cams will never come close to the versatility of a c4. Very poor design.
I have never and will never worry about any of my 3 different generations of BD cams.
Never heard of any BD cams breaking, never.
I am happy about Bliss, purchase some cams from them recently.
Where is the safety issue with new BD cams?
Is the "SCARE" justified?
Have the "chinalots" failed?
BD is the workhorse on almost everyone's rack I have ever seen.
Mucci
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Mighty Hiker
climber
Vancouver, B.C.
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May 10, 2010 - 06:37pm PT
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donini's going to be really pissed to hear that they're going to change the blue camalot to mauve. Marketing experts have advised the new owners to go to a pastel palette for all profit centres.
Silliness aside, isn't it great that there are all these companies making amazing gear for us, always coming up with new ideas? The "any colour, as long as it's black" days in the world of climbing aren't that long ago. I hope that Black Diamond makes a smooth transition, and continues what is now about 50 years of service to our community.
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Binks
climber
Uranus
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May 10, 2010 - 06:39pm PT
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Dmm Cams will never come close to the versatility of a c4. Very poor design.
Please substantiate.
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Slakkey
Big Wall climber
From Back to Big Wall Baby
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May 10, 2010 - 06:48pm PT
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Tom makes a very valid point and to be honest if if it were possible other climbing gear companies would more than likely do the same thing. The climbing gear market is pretty well oversaturated. From an innovation standpoint there is not a whole lot of room to grow when it comes to just climbing gear. How many cams can the market really support or the same with biners, nuts etc? As noted it appears the Metolius would like to expand too and all this about companies with green technology, climber friendly etc. may have a bit of truth to it but think about it. It also is another way of creative marketing to attract your dollars.
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SteveW
Trad climber
The state of confusion
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May 10, 2010 - 06:52pm PT
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Let's hope Peter Metcalf will still be involved with
BD. Hopefully he will keep the quality as it has been.
(excepting their Nforce ascenders). . .
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mucci
Trad climber
The pitch of Bagalaar above you
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May 10, 2010 - 06:57pm PT
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Binks-
"Please substantiate. "
Short stem which is not conducive to "Deep" placements.
No "Thumb loop" or any way of clipping in close to the unit.
Thin Dyneema sling, which is by far the most awkward sling I have ever used on a cam. Not the same rigging as the regular DMM cams.
I have used this cam now on 3 occasions. I own the #3 Dragon, tried tons of placements, it walked on me in placed a BD never had.
These are my experiences and I understand that others may have a different take.
Not for aid climbing, where they are totally worthless.
.02cents
Mucci
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Slakkey
Big Wall climber
From Back to Big Wall Baby
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May 10, 2010 - 07:04pm PT
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I like a number of things that DMM puts out but am with Mucci on the Dragons. POS IMO.
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