If you’ve a business in any outdoor industry, Thule’s relentless evolution won’t have escaped your attention. With more product debuts than ever this year, BikeBiz speaks to Thule CEO Magnus Welander about conquering Everest, investing in talent and the wider business…
How’s business for Thule?
Business is good and has been growing steadily since we became a publically listed company. Our recently released quarter one report showed a sales growth of 11.5 per cent and bottom line growth of 30 per cent, so I’m very happy.
The company must have grown its staff and facilities in recent years then?
We’ve grown the product development, sales and merchandising teams globally. These new staff additions are largely focused on driving growth in our new product categories, of which we have a few. In terms of facilities, we opened a Polish distribution centre, costing seven million Euro, that will serve the Eastern European market. We have also doubled the size of our global test centre with a 2.5 million Euro investment. The testing and development process is extensive and we go through climate, quality and user testing both pre and post-production.
How many countries are carrying Thule nowadays and which are the largest markets?
We sell in 136 markets worldwide and in terms of size it’s roughly as to be expected, with the US top, followed by Germany, France and UK. Sweden, our homeland makes up just three per cent of sales. The rest of Europe makes up around 51 per cent, while North America counts for 37 per cent and the remainder comes from the rest of the world. It’s encouraging to see strong growth across all markets, but Europe is developing particularly well.
Cycling is our biggest category, with the core of trade coming from bike carriers. As a sector we invest heavily in the bike world. On the back of the Chariot takeover, active with kids is another key area of development for us, particularly in recent times. Sport and travel technical packs provide outdoor retailers with some overlap with bike industry too.
In recent years the brand has drastically expanded its product catalogue and direction – what provoked this?
I got the chance to take on some new challenges when I joined Thule five years ago. At the time we had been growing well with carriers, with by far the highest market share. Product that further helps people expand their horizons was a logical expansion. Our philosophy now is to create goods that make it easier for people to bring their lives with them when they travel.
With some of your product now boasting to be capable of conquering Everest, have you had to bring in fresh expertise to manage technical fabrics and design challenges?
As always, we start with product competence. We do not make cheap copy products. If we are to invest our time into creating a product it will be because we think we can improve the market’s current offering. In order to progress into tech backpacks, we started over three years ago by employing new designers from the industries now served. We combined those hires with our own expertise and as a result have been able to attack these new categories. We’ve had great reviews in the likes of Backpacker magazine and other outdoor titles, but it’s still early days.
We’ve been around for 73 years, so we’re in it for the long term and will launch a lot of new product in future to expand our commitment.
Will the expansion continue beyond luggage – what’s next in the pipeline?
I like expansion as most do, but at the same time 15/16 will be crucial. We’ve never shown so many new products as we did last year. We’re keeping a keen eye trained on this year’s launches, including child carriers and GoPro camera bags as we’re expecting a good level of success. This year’s focus is to gain traction in these new territories. It’s a very exciting time to work here, we all love our own products.
In the past few years what segments of the portfolio have you been particularly pleased with? Are there any standout products for you?
I would say if you look at the classical bike carrier area, we are still the most excited by these new products. We are undisputed number one for a reason here. I love the innovation, my own family uses the VeloCompact product regularly.
The carrier category is still growing for Thule as electric bikes and downhill bikes are prompting us to design for heavier and more complex bikes. Fresh ideas on how to distribute weight and secure the bikes have been required.
With Chariot now part of the Thule range, how much business has come from the active parent market?
It’s still relatively small, but again is a rapidly growing segment. We think we have the best solution on the market for the type of active customer we’re targeting. It has a high potential growth rate and a lot of crossover between outdoor markets. We will continue to invest here. I will say that I wish some of these products were around when I was younger, it would have made life much easier.
The traditional car racking product seems to be stronger than ever – what challenges have new bike industry standards posed to designers?
We actually love the bike industry. There’s a constant focus on design and innovation. Who would have guessed a few years ago when Surly introduced the fat bikes we’d be designing in big tyres on the drawing board. As a global brand we are more capable than most to make sure we have a solution to new trends. Without these innovations the market for us would be less exciting.
We’ve noticed a GoPro collaboration backpack line now available – how has the action sports market responded to these products?
We’ve had a great response to the Legend series. It’s a nifty product that GoPro themselves love, as well as our sponsored athletes. We often heard of athletes criticising their bags and so the project was born.
YouTube sensation and GoPro athlete Matthias Giraud sat down with our design team and helped deliver his perfect product. With such first-hand input we’ve been able to develop what we consider an accessory that will sell very well and to a variety of customers. With all the GoPro accessories available it’s surprising better cases aren’t on the market.
Anything in particular that you’d recommend UK cycle retailers take stock of this year?
In the UK, as with Nordic regions, the ongoing trend of e-bikes in all formats is emerging, so I’d say be prepared for that. The different demands that these put on racks is important. It’s been slow in the UK, but all of a sudden it’s now picking up in Scandanavia. I think that will be a winning trend in 2015 and onwards.