Safilo has announced a thorough restructuring of its Smith Optics subsidiary in the U.S. with the objective of turning it into a global brand. The move will lead to further integration with the Safilo group and the closure of Smith's headquarters in Ketchum, Idaho, which has a staff of about 85. Its employees will be offered the possibility to be relocated to three other sites in Oregon, Utah and New Jersey.
Smith was founded in 1965 by Bob Smith, a dentist, who invented the first goggle featuring a sealed thermal lens and breathable vent foam. He sold the company in 1991 and Safilo eventually bought it in 1996. Luisa Delgado pointed out that at the time Safilo had plans do turn Smith into a global sports and outdoor brand but that goal was not achieved. Through its reorganization, she said, Smith could finally go global and more than double sales by 2020. Priority regions for expansion will be Europe, starting from next year, and then selected markets in the Far East and Latin America.
Safilo gave no figures for Smith. We understand that the brand's annual sales are above $100 million, and that they have grown briskly in recent times, thanks in part to the introduction of innovative, technical products. However, most of its sales are in North America. Sales in Europe are said to be below $10 million a year. Comparatively, sales are close to $1 billion at Oakley, which is a property of Luxottica, and are more evenly spread around the world.
Under Safilo's new restructuring plan, Smith will move design, product development, marketing, artwork and e-commerce activities to Portland, Oregon. The site will also become the Safilo group's global sports and outdoor lifestyle design center. It will be in charge of “creating and developing all potential future brands and products” in this segment.
The choice of Portland was made after a nearly two-month-long study by a consulting firm, Mercer Group, which compared the benefits of seven alternative locations in the western part of the U.S., including San Jose, Seattle and San Francisco. Safilo stressed the importance of the west of the U.S. in setting trends in outdoor activities. It noted that Portland offers access to a major airport, a skilled staff in the sporting goods sector, and marketing and consulting firms.
Meanwhile, Smith's existing manufacturing facility for ski goggles in Clearfield, Utah, will be bolstered. It will become the Italian group's central manufacturing and distribution hub for this product line, covering all its sports brands, including Carrera. Smith's information technology, human resources and finance functions will move in 2017-2018 from Ketchum to Parsippany, New Jersey, where Safilo has the headquarters of its U.S. business.
According to a local newspaper, some 35 employees will be relocated from Ketchum to Portland. The group has not yet secured a location there but the move is due to be completed around the summer of next year. The daily also said that 40 jobs currently at Ketchum would be split between Parsippany and Clearfield, when the move will be carried out between the end of 2015 and the beginning of 2016. A further 10 sales jobs could be split among the three locations.
In the reshuffle, Smith's long-time president, Ned Post, will retire on Dec. 31 and will not be replaced. Post, who previously worked for Benetton SportSystem, took the helm of the company in 1994. According to the summary on his LinkedIn account, Post claims that during his tenure at Smith he lifted annual revenues from $17 million “to well over” $100 million.
Thorsten Brandt, a German executive who has been acting lately as global marketing director for Safilo, will be the new global brand leader for Smith. He worked in the Ketchum office for the past year, but he will be based at the group's headquarters in Padua, Italy.
Eric Carlson, Smith's vice president of product and design, will head up the outdoor design center in Portland. Carlson, who started his professional career at Smith in May 1996 as promotions manager, will report to Brandt.
Smith's global business will be managed from Padua along with the group's other proprietary brands: Carrera, Polaroid Eyewear, Safilo and Oxydo. Smith will work more closely with Carrera, which also produces sunglasses, goggles and helmets. Along with ski goggles and sunglasses, Smith's and Carrera's products include ski and cycling helmets, bicycle goggles, apparel and sports bags. They generated sales of about €75 million last year.
To soften the blow for Ketchum, a community with a population of less than 3,000 inhabitants, the closure of the Smith office will be phased out between 2015 and 2018, even though the bulk of the move is due to be completed by early 2016. Safilo said that its chief executive, Luisa Delgado, is holding talks with local representatives to “discuss how to maintain a lasting heritage” for the brand in Ketchum and “recall the bond with the community and the outdoor environment that has been home to Smith for the past 50 years.” Ketchum is located near the skiing area of Sun Valley. It was a popular destination for celebrities.
