The Big Interview

Lars Svendsen: A living legend

TTW catches up with Lars Svendsen, the man behind the now global giant: Svendsen Sport

FACT FILE

Name: Lars Svendsen

Position: The main man

Contact: Svendsen Sport A/S

Erhversparken 14

Gadstrup

4621

DENMARK

TTW: Can you give readers a little background on yourself and Svendsen Sport?

LS: I established Svendsen Sport back in 1977 during my MBA studies. During the first years we were a traditional national wholesaler working as the Danish agent for a number of international brands, including Mepps, Ryobi, Platil, Masterline, Scientific Anglers, VMC and House of Hardy (of these only Mepps is still one of our partners).

In 1987 we became the Okuma agent in Denmark – a relationship that turned out to be our most important ever.

In 1992 we started an export business with our Ron Thompson brand and in 1994 we were appointed European agent for Okuma Fishing Tackle. During the next 10 years we developed this business and today we are present in every single country of Europe.

Today the Svendsen Sport Group consists of Svendsen Sport A/S which is our main company with its headquarters in Denmark and subsidiaries and sales offices in Germany, France, Benelux, Norway, Sweden and Finland. In these countries we have our own sales forces and are dealing directly with more than 4,000 shops and chains.

In all other European countries, including eastern Europe and Russia, we are working with national distributors. In Great Britain – our single most important market – we established Svendsen Sports (UK) Ltd in 1999, which is based in Cardiff. We also started Svendsen Sports (NZ) Ltd in New Zealand in 2003.

In 2003 we bought the 130-year-old German DAM company, which runs separately from Svendsen Sport. DAM is today exporting to more than 50 countries all over the world.

Our latest move is opening our own office in Shanghai, China, supporting the whole group.

Over the years we have bought several tackle companies. Recently we acquired DD Bait, the leading Scandinavian bait company, and Hansen Grej a well-known Danish lure manufacturer.

TTW: The company has a reputation for producing outstanding fishing tackle at unfeasibly low prices. How is it possible?

LS: We believe in doing large volume and we believe in strong long-term relationships with some of the biggest factories in the Far East.

We control our own brands, we never use middlemen or agents, we supply shops directly in our “own areas” and in other countries our wholesale partners can have direct shipments from our Chinese partners.

Beside, we have a reputation of being very good at price negotiation. We are probably working with lower margins than most other companies but our organisation and total set-up is also extremely cost effective. However, only a few of our brands have a low-price strategy. Brands like Scierra, ProLogic and to a big extent Okuma, are sold on other parameters like patents, outstanding technology, design and quality.

TTW: Did you upset many people doing this?

LS: You cannot go from being a small, Danish wholesaler to having a worldwide presence in a few years and be a friend with everybody at the same time.

We have indeed been very aggressive. We have ‘stolen’ some of the best people from other companies, we have implemented total new marketing, price and discount structures, and in Denmark we have even faced a summons for unfair competition by a competitor.

However, if a company is facing problems we might well be blamed in the first instance but I dare to say that this company would have faced problems sooner or later.

TTW: In many countries, certainly in France and the UK, Svendsen Sport just seemed to appear almost overnight – certainly catching a lot of the competition unawares. What is the secret to this success? Why do so many companies find it difficult to comprehend the Svendsen Sport business model?

LS: Indeed we made a big jump overnight in France and the UK. It was down to a very well-prepared and researched plan. We came in with the best (local) people, with products specifically designed for these markets – with a heavy marketing plan as well. We then approached a carefully selected number of the best tackle shops. We offered these shops a far better profit than was usual at that time and this has been one of the keystones in our success around Europe.

In all fairness it would be much more difficult to do the same today and I think it would be impossible to pull the same stunt as we did seven years ago, especially in Britain – the market is far tougher and much more prepared today.

TTW: The company is renowned for creating brands for markets. There is Ron Thompson, Scierra, ProLogic, IMAX and Savage Gear. Why are your brands so successful?

LS: If we see a demand and want to get into a new market, there is for us only two ways: either buy a well-established brand/company or create your own brand.

Both ways are very expensive if you want success.

For Scierra (fly fishing), ProLogic (carp), Imax (sea fishing) and Savage Gear (predator fishing), we have employed full-time consultants and product developers for each brand and we have backed our clients with heavy marketing. There are no short-cuts to success today – it costs a lot of money and takes a lot of hard work and resources if you want to create a pan-European or international brand.

Our advertising in Tackle Trade World from its early days has certainly been a very important part of this success.

TTW: Svendsen Sport is well known in Europe as a distributor of the Okuma brand. What made you decide to push this relatively unknown brand as opposed to creating your own reel brand?

LS: Early on we realised that Okuma had a very high quality in relation to its price, but the company had a total lack of structure and management in its European sales in the early 1990s. The factory was a big-brands sub-supplier and was only selling 60,000 Okuma-branded reels in Europe per year at that time.

Over the years, Okuma has made some giant leaps in technology, innovation and product strategies and at the same time our company has also developed a lot. All in all we have created a very solid partnership, which today is selling more than one million reels in Europe per annum.

We have never had any plans to create our own reel brand. Today practically every European wholesaler – big or small – has their own reel brand. And what we are talking about are a few standard reels from the same Chinese factories with different labelling.

Some wholesalers have invested in their own moulds from these factories, giving some different designs, but real ‘engineered brands’ with their own R&D, patents and production facilities such as Shimano, Daiwa and Okuma, you can count on one hand.

TTW: You recently moved into the bait industry with the new DD Bait range. How is it going for you?

LS: We realised that carp fishing is the fastest-growing segment in the European market today. For the ‘hardware’ part we were quite happy with our ProLogic tackle and Okuma reels but for the huge bait market we saw no way to make our own brand. So much knowledge and experience is needed to create a strong and successful brand and this knowledge we just didn’t have. That is why we bought the DD Bait company, which held 15 years of experience and a lot of innovation.

One of the founders, Mads Grosell, joined us as a product manager and due to this move our ProLogic/DD division is the fastest growing in our company today.

TTW: Which markets are currently showing the biggest growth?

LS: While most western European markets are rather mature at best, and in many cases stagnating, we see our biggest growth potential in eastern Europe.

We have a strong presence here through some very good longtime partners and with a growing economy in these countries, combined with stronger products from our side including Okuma’s new programme, we have high expectations.

TTW: Svendsen Sport is already one of the biggest tackle companies in Europe. What’s next? Are we likely to see Svendsen Sport in the USA?

We did start a company recently in the USA. It is located in Montgomery, Illinois, and consists of an office and warehouse, with Stuart Green as our manager.

We have seen so many (successful) European companies break their necks in the USA so we have decided to take it step by step and learn the market well.

The main reason for setting up is actually due to the increasing distribution of Tackle Trade World in the USA, which started a few years ago.

We received so many requests from our advertising that we needed a US operation to handle this properly – dealing successfully with the USA from a European office and warehouse seems impossible.

TTW: You bought DAM in Germany, which used to be the biggest tackle company in Europe. What is the situation there today?

LS: DAM’s original owners were the Kuntze family, who ran the company for three generations before selling it in 1994.

The new owners, the Dutch-based Hagemeier Group, lost an incredible amount of money (approximately €30 million) over the next seven years running DAM under its Freetime company. It is a classic example of mismanagement but the brand was very strong in Europe and many other countries and that was the reason for buying the company.

We are, today, extremely proud to announce that DAM is again “back in the black” with a nice profit in 2005 – a turnaround made in less than 18 months.

TTW: How was it possible?

LS: We put in a new management team that understood fishing and the tackle trade, combined with a team of 100 per cent dedicated employees – some of which have worked for more than 20 years at DAM.

The old DAM spirit came alive again. The guys (and girls) down there worked like maniacs – some practically day and night to make a new future.

This, backed with the buying power and capital from the mother company, and suppliers who knew the potential and could see the future, all made this possible.

TTW: What is the biggest single change you have seen in the industry since you started?

The creation of the European Union and the open European market in the early 1990s. Without this we could never have expanded as we have, but on the other hand it created a situation where hundreds of national wholesalers today have their own brand with an ambition of being pan-European players.

Some of the old, established tackle brands and companies died in this process, while others – including Svendsen Sport – prospered.

The opening of China as a production country is important, but actually just a succession of the well-known production evolution: from Europe and USA to Japan, then to Korea and Taiwan and now China.

The opening of eastern Europe and Russia has still not shown its full effect.

TTW: And finally, the question that the tackle trade has been waiting years to ask… just who is Ron Thompson?

LS: Ron is a Pimpernel…  some claim to have met him but nobody really knows him. The legend says that he was an experienced fly fisherman working as an engineer for NASA. He combined his knowledge about space materials with his fishing experience and made some wonderful rods.

He invented ‘Ronthompsonite’ – the strongest construction material ever made – but it has never been released for civilian use. Maybe one day we will have the solution to all the carbon problems we are facing today…