The global market is fraught with barriers to economic success. Cheap labour overseas can make manufacturing a difficult endeavour. Tie-down strap producer Erickson Manufacturing has struggled due to imports from China but found a way to embrace the situation and thrive. We spoke with President Brent Erickson and Marketing Director Tyler Daly about the current state of the industry and what projections there are for its future.
1977 was the year that Brent opened a welding repair shop. He had a background in metal stamping and worked in a big stamping factory in Chatham. He started making agricultural products before developing a kit for carrying motorcycles on trailers. This was the first opportunity in this industry, and Brent took a little box with him to Canadian Tire in Toronto.
“That meeting went very well, and the representative liked it. He suggested putting straps in the kit to upgrade from a bracket to a kit. That marked my first foray into the tie-down business. I started with a few cam straps and hit the ground running,” says Brent.
Brent made rubber coated storage hooks to be screwed into walls. He had about ten models and they were selling well. He got them into Canadian Tire and built the tie down program in their stores. After a successful relationship for 20 years, competition from China came into play and Brent lost the business.
Back in those days, the Ontario Development Corporation (ODC) was trying to grow jobs in Ontario, so Brent contacted them, and the ODC came to see his operation. He was making a few straps, and he told the ODC that he could also make a cam-buckle. They had $15,000 available if the receiver started making payments within a year.
“What it enabled me to do was get the tooling built and some samples made, made some sales calls, and – hopefully – by the time payment is required, you had some income,” says Brent.
Success followed, and the ODC then gave Brent a loan of $35,000. A ratchet strap was developed next, but, once again, competition from China made it difficult. Brent had a host of good ideas, but not the cheap labour to back them up.
Still, Brent managed to expand all over Canada, and twenty years ago, got involved in a Michigan-based initiative with St. Clair Development. It attempted to develop relationships between Canadians and Americans trying to lure Canadian companies to set up shop in the U.S. Fifteen people were hired, a new building was constructed, and all the straps were made there.
“Once again, due to Chinese influence, we had to stop producing and began importing, ensuring that all products meet our strict specs to ensure quality. This has been the way of things over the last twenty years, and we are very successful,” says Tyler.
Farmers require its products daily, and the company focuses its efforts on the retailers that supply agricultural customers. One distinguishing factor for Erickson is in how it helps the retailers it partners with in merchandising and promoting all its products individually because retailers are in different areas of the country and require different products based on customer needs.
“We provide a service and come up with innovative products all to help those retailers sell as many tie-down and towing products they can,” says Tyler.
Eight years ago, Erickson came out with a retractable ratchet strap, which is like a tape measure where you push a button and the webbing quickly and easily retracts. It is one of the company’s top sellers, with multiple versions available.
This past year, Erickson came out with a new ratchet that slides to move the strap wherever needed. These innovative items draw people into Erickson’s booth at trade shows. In 2017, Erickson came out with a wheel chock kit, and at the National Hardware Show last year in Las Vegas, that won the award for most innovative item. Many of the products innovations are not brand new ideas but rather modified existing products that make life easier for the consumer.
“I have a fabricating shop, as I am a metalworker by trade. We had some blunders to begin with, but finally got it working. We are doing quite well with that item. We have it in some performance race car shops presently, but like anything it will take three to four years before it really gets going,” says Brent.
Erickson does not deal with the end consumer, so marketing efforts are mainly to retailers. Forty years of brand recognition helps. Most of the marketing takes place at trade shows, such as the Automotive Aftermarket Products Expo (AAPEX) in Las Vegas. It is the largest of its kind in the world and is hosted by the Specialty Equipment Market Association (SEMA).
Over the last few years, the way items are sold has changed. Online retailers are growing in size and scope within this industry. “Customers now have access to these products, not just at a retail store, but also online. A lot of our growth over the last few years is a direct result of online sales,” says Brent.
Erickson won the ‘Vendor of the Year,’ award from Princess Auto, a Canadian retail chain as well as from a buying group made up of some of the largest farm and ranch retailers in the U.S. Other awards come from Do It Best of Fort Wayne, Indiana which is partnered with Home Hardware in Canada.
“Do It Best has 4,000 stores in the U.S. compared to approximately 1000 Home Hardware stores in Canada. The award is given to a company that provides good service with timely shipping. A company that follows the rules and grows their business. It’s quite an honour, and it’s hard to win as there is a lot of competition,” says Tyler.
This is a successful industry, but there are big issues to deal with. Over the last forty years, many of the larger retailers that have the volume want to go direct to China and eliminate the middle man in North America. But, Erickson provides a service and brand recognition that retailers cannot get from the factories in China.
“This is where we have to be innovative and keep them wanting to buy from us, whether it’s domestically or we feed them from China,” says Brent.
As for other means of expansion, Erickson is working to gain new retail partners. Tyler states that, to a certain extent, the company has the flexibility to try anything. “There are a lot of different levels involved in trying to get a decision made. In larger corporations that can take time, whereas if we get a customer that wants to open a new store and they need a discount or want to promote something, I can go down the hall, talk to Brent or the pricing department and have an answer within twenty minutes,” says Tyler.