Confluence Now Patching Leaks Following Dec. Dealer Letter

Confluence management has been left scrambling to patch holes in a retail ship that sprang leaks faster than an air mattress lying on a carpet of thumbtacks following a now infamous dealer letter. In fact, the letter itself may go down as one of the most well intentioned, but most poorly conceived and executed letters in the industry's history.
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Confluence management has been left scrambling to patch holes in a retail ship that sprang leaks faster than an air mattress lying on a carpet of thumbtacks following a now infamous dealer letter. In fact, the letter itself may go down as one of the most well intentioned, but most poorly conceived and executed letters in the industry's history.

If you haven't already read it, please click here to view the text of the letter retyped from a widely faxed copy that made the rounds of incredulous dealers and manufacturers, eventually ending up on SNEWS® desks.

Confluence CEO, Bill Medlin, told SNEWS® that, "Kelley's (Woolsey) background with O'Neil is operative here, and while he was there the company made the decision to broaden distribution beyond purely specialty channels and make it more mainstream. And that is not entirely inconsistent with what our view is."

Medlin went on to tell us that the traditional specialty paddlesports store is the company's bread and butter and where the majority of business is conducted. But he also added that Confluence eyes two other categories of retailer: One, A middle-tier hybrid along the lines of REI and EMS where a few of the stores are specialty in nature and manage a real focus on paddlesports and, two, the more mainstream store that was meant by the letter Woolsey sent out -- the Galyan's, Dicks, Sunny's, West Marine, and GI Joes of the world.

"We have no desire to sell to big boxes or Jumbo sports or Wal-Mart or Kmart," says Medlin.

Medlin added that the company's goal is to create brand equity as well as model equity.

"It is all theory and we are still working it out, but essentially, we want to create a level of product that would be considered entry level -- be it Mad River or Wave Sport or Wilderness Systems -- that would be available to that mainstream store such as West Marine. And then, if the customer wants to upgrade that product with premium accessories or wants a higher-end product, they will have to go to the specialty dealer.

Intentions aside, Medlin doesn't disagree with the passionate and sometimes vitriolic response the dealer letter generated. "If I were in their shoes (the dealers) I can't say I wouldn't have felt the same way when I read the letter; however, many folks are making assumptions and drawing conclusions that are not fair."

When all the dust settles, Medlin told SNEWS® that Confluence wants to be known first and foremost for what the company sells through the specialty chain, with boats and add-on features that are -- and will only be -- available at specialty.

Did the company learn anything from this experience? "First of all, Kelley and I need to spend more time talking with each other before we head out and do things. Secondly, this industry is largely one based on relationships, and it is very clear we need to get out there even more to establish and re-establish relationships in the paddlesport community."

SNEWS® View: Confluence is definitely paddling furiously in some very stormy waters of its own making, and Woolsey needs to realize that. He created the storm with an ill-conceived letter that broke a cardinal rule in this industry -- don't surprise your key dealers. Many of those dealers, as well as SNEWS®, are still waiting for a return call from Woolsey. One key dealer, who sells Confluence boats in the hundreds, was promised a return call to explain the letter in December -- he's still waiting. We would firmly suggest to Woolsey that he consider calling each and every dealer quickly -- first, to apologize, and second, to listen.

We are particularly stunned at his pointing to the ski industry and the tennis industry as models upon which to build a distribution foundation. Please! Woolsey's logic that placing boats in a sporting goods store with a wider audience will encourage more buyers at the specialty level certainly hasn't been proven true in either the ski or tennis industries, and attempts by a few outdoor and paddlesports manufacturers to dabble in similar distribution schemes in the past have failed miserably. Perhaps he knows something we don't? If so, we'd certainly love to hear it.

Finally, to end the letter that is filled with wonderful words like "peace" and "partnership" and "prayers" with a statement with a meaning something like, if you don't sign the agreement Confluence has created (never mind the fact we never discussed it with you first) we will just cut off your access to our boats, is not only short-sighted, it is patently foolish.

Of course, there are a few companies in this industry -- and you know who you are -- that took unfair advantage of this situation too, and one in particular committed an act that we feel should be beneath the integrity and values of any legitimate business in this industry. Reprinting portions of Confluence's dealer letter as well as spreading a very one-sided view of the situation in your own letter to industry dealers is simply fanning flames and needs to stop. Now. We do agree with Woolsey on one point made in his letter: "We need to realize and understand that our greatest competition is not each other, but other sports in general." If you believe in the well-being and future of this industry, then work to build it up, not tear down pieces of it for others to take fleeting pleasure in stomping on.

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