Watermark Consolidates Operations, Shuts Dagger Facility

Effective January 2002, Watermark's boat division operations will be consolidated on the company's campus in Easley, South Carolina. In the process, Watermark is shutting down the larger of its two Harriman plants, the 30,000-square-foot Dagger facility. Dagger, part of the Harriman scene since 1988 when it started with an 8,000-square-foot building, will move Dagger canoe manufacturing to a smaller composite manufacturing facility where Dagger and Perception composite boats and Harmony helmets are currently made.
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Effective January 2002, Watermark's boat division operations will be
consolidated on the company's campus in Easley, South Carolina. In the
process, Watermark is shutting down the larger of its two Harriman
plants, the 30,000-square-foot Dagger facility. Dagger, part of the
Harriman scene since 1988 when it started with an 8,000-square-foot
building, will move Dagger canoe manufacturing to a smaller composite
manufacturing facility where Dagger and Perception composite boats and
Harmony helmets are currently made.

The balance of all roto-molding production, R & D, customer
service, and sales and marketing will also move to Easley. Among the
key management personnel making the move south are vice-president of
product design and development Joe Pulliam, R & D head Tony Lee,
marketing manager Mike Steck, and Dagger general manager Doug Ragan.
With the move, Ragan becomes vice-president of specialty sales for the
Watermark boat division.

According to Watermark vice president of marketing Mark Pate, "We will
build a state-of-the-art R & D facility in the old Harmony building
in Easley. It will be finished by January. Plans are to have a new
information technology system in place by mid-2002.

"The bottom line on the consolidation," Pate told SNEWS®, "is we can now
offer the retailer a single point of contact and a streamlined ordering
system. This will mean reduced freight costs among other benefits."

Pulliam told SNEWS® there will only be a handful of employees who will
not be offered positions in North Carolina.

"Every operations person and every manufacturing person has an
opportunity to fill a position in North Carolina," Pulliam said.

"Although there is certainly a personal cost in this, and that hurts
me, this move makes sense in terms of our ability to service our
dealers and utilize the resources that we already have in place," added
Pulliam. "We have so much duplication in what we do, which does not
make sense in such a competitive market. We are already making boats
for both companies in both locations.

"Perhaps we would have maintained multiple facilities if they were more
geographically distant, but we are only three and a half hours apart --
just far enough to be a pain in the butt."

SNEWS® View: The
consolidation makes sense and had to happen. These days few companies
in outdoor or paddlesports can afford to operate satellite operations
unless they are located time zones apart and serving different markets.
Indications from paddlesports insiders are that the lull in the current
paddling market is just that -- a lull. Confluence is already ramping
up its production of boats, and it looks as though Watermark is
preparing to do the same. The market has grown to the point where it is
now, we believe, chiefly on the backs of hard-working, hard-marketing
manufacturers and retailers. By consolidating operations and improving
efficiencies, Watermark is setting itself up well to handle a market
upturn, whenever it does come.



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