Lafuma hikes into Boulder market

Colorado’s outdoor gear and apparel industry is packed tighter than a small backpack on a month-long hike. So how does another entrant, namely Lafuma — a French outdoor clothing and gear wholesaler — expect to make a go of it?

?We know we have a big job ahead of us,? said Ed Ruzic, general manager of Lafuma. ?We are coming over here and wanting to take a significant slice of the outdoor pie. A lot of companies have tried and failed, so we’re realistic, but we’re also optimistic, and so far our strategy has worked.?

Last March, Lafuma bought Ruzic’s company, Madden Mountaineering, a longtime backpack manufacturer in Boulder. It converted the old Madden Mountaineering shop at Flatiron Industrial Park on Central Avenue into its research and development center. As part of the deal, Lafuma kept Ruzic to run operations in Boulder. The Boulder office serves as Lafuma’s United States headquarters.

The Lafuma Group specializes in what it calls sports and nature equipment. It has three types of products: hiking and camping under the Lafuma brand; technical mountaineering under the Millet brand; and hunting-fishing-riding under the Le Chameau brand.

Company officials said the Madden acquisition will allow Lafuma to reinforce its penetration rate in the North American market, expand its technical product offerings and broaden its expertise in design by drawing from American culture.

All that sounds good, but one Boulder retailer says the increased competition leaves a bumpy trail for the local outdoor apparel industry.

?I think all the competition has lead to a deflationary period, and that’s serious. You don’t hear a lot about it, but I think that’s what’s happening,? said Gary Neptune, owner of Neptune Mountaineering, a 19-year-old Boulder-based outdoor specialty store. ?The competition and the foreign labor that chains bring into play make it tough on stores like mine because my costs to run my business are staying the same or getting higher, like labor and rent and all that. But the price of my products has to stay low. It’s tough, I think, at all levels.?

Ruzic agreed with Neptune that competition does make it difficult at the retail level. ?Those guys are scratching their eyes out in retail, so it is tough there, but not at the wholesaler level,? he said. ?At the wholesaler level, we’re giving the retailers a lot of choices that help them in running their business.?

Indeed, the industry is overflowing with choices for the outdoor enthusiast. Too many choices, Neptune and others said.

?There really is too much selection out there. I mean, some companies offer 30 different kinds of sleeping bags. That’s too many, and it can become confusing to the customer,? Neptune said.

Mike Foley, spokesman with REI in Seattle, said one of REI’s goals is to not ?overwhelm our members with choices.

?We’re actually reducing the number of products in certain areas and trying to be selective and thoughtful in what we offer,? Foley said.

As many companies do, Lafuma started its roots in Boulder with people, key people with a lot of experience in the outdoor clothing and gear market. Besides Ruzic, the company also has hired former executives with Schwinn, The North Face and Lowe Alpine.

Company officials said that managerial competence and knowledge of the American outdoor market is an important key to development, and serves to reinforce Lafuma’s international dynamics.

The company put a lot of thought behind where it would locate in the United States. Ruzic said he sees Boulder as the ?center of outdoor activity in North America.

?Boulder, for us, was the place to do this because here we can find the best people and the inspiration we need.?

So far, Lafuma’s move to the United States is influencing the company’s bottom line. Ruzic said Lafuma’s outdoor gear sales are up 58 percent so far in 2002. The company’s target is more than 150 million euros ($142 million) by the end of September.

In April, the company announced that its sales for the first half of the fiscal year were 4.5 percent above goal. It also reported an increase of 7.3 percent over the second quarter, and a 9.4 percent rise in orders.

Business was particularly affected by three factors: the successful launching of footwear, with 90,000 pairs sold within Lafuma’s three brands; a 25 percent increase in clothing sales; and a 24 percent increase in international growth.

Another area where the company looks to be ahead of the curve is in market dynamics. ?Americans are working more now, and they only have time for shorter outings,? Ruzic said. ?That’s something the company has already seen and done in Europe, so we’re prepared for that trend.?

Ruzic said much of Lafuma’s backpack line is sleek and light to accommodate the trend for shorter trips.

Last spring, Lafuma acquired BIG PACK, a major player in the German outdoor market. Germany is Lafuma’s second-largest export market, after the United States.

The move, officials say, significantly strengthens Lafuma’s position internationally by not only giving it access to the German, Austrian and Swiss markets, but also to China, where BIG PACK has been operating since 1998.

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