We’ve been in this industry since 1997. We’ve had our own brand of skateboards. Seen companies come and go. The same problem facing new board companies has always existed in this business.
There is too much supply.
People start skateboard companies because they want to. Not because there is a need to. Which is kind of cool actually, because they’re not doing it for some super-corporate business purpose. They’re doing it purely for the passion. But the need was basically met… oh….. I would say in 1998.
So for board company founders, after a couple of years of trying, the labor of love becomes a labor of anguish. They don’t make any money. They just break even. Moving decks to locals, friends, a few shops etc.
Here’s The Problem
That’s it. The barrier to entry is really easy.
There are plenty of woodshops out there that will slap your graphics on some decks and you’re in business. All you really need is $500 in starting capital and you’re good to go. So pretty much, in every town across the country, there is a dude who has started his own deck brand. He’ll get the local talent on board, they’ll film some bangers, get some shirts made and try to go all in.
But to really make a sustainable business out of it you got to move volume.
The Problem With The Board
If your business is really just about decks – you’re in a tough business. The cost of making a board has usually ranged anywhere from $10 to $20 per board. That means a deck with a printed graphic on it. Now you have to sell ’em to shops for say $25 to $38. The shop has to sell your unknown brand deck to their customers for $30 to sometimes $60. See how that’s a tough business for everyone involved (well if you’re doubling your money you’re in a good spot actually – but that’s rarely the case)?
And even if you get this going, you need to do massive volume to just afford a healthy salary for yourself. Which means you need capital to make more boards. The danger here of course is you start financing/borrowing money to get boards made….and they might not sell next month. You’re stuck with a ton of boards that now you have slang them anyway you can.
So How Do The Big Companies Get By?
The cool thing about skateboarding is that the big established companies aren’t out to squash the little competitors – say in a normal business environment. They’re not even conscious of you. The truth is they’re facing similar problems that you’re facing every quarter or so, so they’re always fighting to stay alive. But here’s how they manage to keep going:
1. Years Of Perfect Branding
One thing the whole world looks up to, that’s not even fully realized, is that everyone has learned branding from skateboarding. Skateboarding was one the first industry to really embrace the power branding and graphic design. I would say it’s even better than the big fashion brands.
Big skate companies have been pumping perfectly branded material out for decades. Reinforcing their brand message, tone and style year after year. This is what builds trust in their brand with customers and singes their logo on people’s brain.
Ironically, having pro skaters on your team isn’t a sure bet like most people think it is. I would say at any given time, there are only about 10 pro skaters that actually move decks. Meaning kids come into shops asking for a specific pro’s deck. But a good collection of pros can make a great video, awesome ads, and good interviews which gets talked about and helps to build up the brand. This secondary effect always helps.
3. Their Network
Big skate companies are in the good ole’ boys club. They all know each other. They can text anyone they need at any minute and ask questions, ask for help, go film together, party together. This has a huge advantage. They get sweet deals on ads in mags. They probably don’t even use this enough to their advantage. They also have the power to blacklist people. Oooooooh. Yep, if “the industry” doesn’t care for someone on your team or you’re associated with – that can be the most damaging thing to your brand. So be really careful who you bring on board. Pun intended.
Technology, as geeky as it sounds, is a way out or a way to separate yourself from the pack. For example, no one has been really big on Powell since 1989 – yet they’ve managed to stay around and keep selling to this very day. Everyone love their bearings (Bones), and their decks have always been legit as f*ck. I guarantee you if you skate a Powell deck, you’re not going to complain about the pop or feel of the deck. Dwindle, ironically, has probably beaten Powell at their own game – and make some of the best decks ever. 15 years ago, their board quality was a joke.
5. They Don’t JUST Sell Decks
A t-shirt has WAY better margins than a board. You can get shirts made for a few dollars and sell them for 300% more. But the difference is, people are into their brand. There is a demand for their threads.
And obviously there is others stuff. Enjoi sells jeans and sweaters. Some companies sell hardware and bearings. Consolidated used to have a rad blankets team :).
Finally, The Generation Cycle Problem
No one is immune to this really. Skating is really image oriented. What’s cool with kids one year, doesn’t mean shit three years later. Every company has dealt with this.
In the mid 90s, companies like Toy Machine and Zero were huge and everyone loved classic rock and punk rock stuff. Their pros went bigger than ever (leap of faith type stuff) and that’s all anyone cared about. By the late 90s, Shorty’s was big and so was the hip hop scene. By the early 2000s, artzy fartzy Indy Rock stuff became popular and Shorty’s and Zero were not relevant. So it’s a constant battle to say a float. Companies like Girl were really good at being skate relevant the entire time. I commend them on this – that was really hard to do. There is a lot of important decision making, saying no to things, just a real balancing act that they’ve had down the entire time.
The bottom line is: you’re going to get in the business of selling big wooden popsicle sticks. People have been doing the same thing for 25 years now. There isn’t much you can do to differentiate yourself. But if you really want to do this, you’ve got to be REALLY different (you’ve basically have to move to another dimension), make your brand about something (not just cool graphics on wood), and really stick to your guns. It’s a looooong road.