On March 25, members of the Wolverine Outdoor Group began a journey that was said to be one of the hardest things the team had ever done. Seth Cobb, vice president and general manager of Merrell USA, and others began traveling to visit with existing Chaco reps to tell them, face-to-face, Wolverine’s Outdoor Group, which includes Merrell, Chaco and Patagonia Footwear brands, was assigning Chaco selling responsibilities to the Merrell rep force.
In other words, Chaco reps, including veterans like Dave Egan of Egan and Associates, who had been living and breathing the Chaco fire since 1993, were being told they would no longer be selling Chaco – a change implemented barely two months after Merrell acquired the brand.
“It’s hard to understand on one hand,” Egan told SNEWS. “To have to walk away from a brand that has been really good for us, and that I love so much is difficult. But, I also want to be sure my friends over at Yukon Trading, who are really, really good reps, are set up to continue to be successful. So I am going to do everything I can to make the transition as easy as possible for them and for our Chaco retailers.”
Cobb told us that every Chaco rep has been classy and gracious, making the job even harder. “We recognize that Chaco reps are some of the best in the outdoor business. You can’t deny their commitment to the brand and to their retailers as they helped build Chaco into the leader in the outdoor sandal category.”
In all, nine agencies were let go. Those include: Manitou Trading and Allan Fici in the Great Lakes territory, Up East Sales and Judd Feingold in the New England territory, Mansback and Associates and Lisa Mansback in the Mid-Atlantic territory, Great Plains Mountain Stuff and Tom Gordon in the Rocky Mountains territory, Roaddogs and Paul Marsh in the Southeast territory, Egan & Associates and Dave Egan in the Northwest territory, Harrison Walls & Associates and Harrison Walls in the West Coast territory, The Ascentials and Troy Kattreh in the Midwest territory, and The Horton Company and Jerry and Lois Horton in the South Central territory.
We were told that Chaco reps were encouraged to apply for the six available Merrell Apparel sales jobs and, as of March 27, one rep had already been rehired although Cobb could not reveal his name until a contract was signed.
In all cases, the Wolverine Outdoor Group is allowing the Chaco reps to continue selling the brand until May 15 to give them time to collect additional orders and bolster commissions. In addition, Cobb told us, the company would continue to expedite production and air-ship products to the United States to also assist with increasing commission opportunities.
If the existing rep force was so good, as Cobb acknowledges, then why the change we asked?
“It’s about service. The ultimate goal is to deliver the best service in the industry, period, to Chaco’s retail partners,” Cobb said. “This re-structuring puts Chaco in a position to accomplish that objective better than any other format.”
He explained further with the following information:
- Outdoor specialty retailers consistently rank Merrell No. 1 or No. 2 in the “Best Sales Reps” category among outdoor footwear brands per data from Sports Marketing Surveys.
- The Merrell sales team outnumbers the existing Chaco team by almost 2 to 1. Sheer numbers will allow the company, per Cobb, to smother outdoor specialty retailers with service.
- Most Merrell reps don’t sell other lines, while Chaco reps are independent agents, so by definition they can only concentrate on Chaco part-time. He said retailers will benefit from a full-time effort.
- Most Merrell/Chaco reps will no longer have Merrell Apparel selling responsibilities, a move designed to enhance their focus on servicing Merrell Footwear and Chaco retailers.
- The move enables the company to involve its 13 tech reps in the servicing effort, as well, since Cobb said this group can’t be expected to simultaneously support two sales forces. He said the company thinks outdoor specialty retailers will benefit from the additional Chaco clinics and consumer events that Merrell/Chaco tech reps will provide.
- Customer service reps should deliver better service to Chaco retailers if they only have one group of reps to manage.
Making a change in sales reps is only one step in ensuring the Chaco brand can continue to grow and prosper according to Cobb, and just one way Merrell is working to ensure specialty retailers are well served.
“A new sales structure is just one of the ways in which we’ll improve service to Chaco retailers in the years ahead,” said Cobb. “We’ve also retained Wes Allen as the sales manager for Chaco. He will live and breathe the Chaco brand and be spending a lot of time on the road gaining face time with our Chaco specialty retailers.”
Lest retailers start to worry that Merrell is making a quantum shift in distribution strategy as a result of the rep change, Cobb sought to assuage fears. “Merrell and Chaco will not have the same distribution strategy simply because they employ the same sales team. The Chaco brand requires personalized service and will only succeed in a ‘sit and fit’ environment. We understand and applaud that difference. Our goal is to grow Chaco by increasing sales to the outdoor and independent footwear channels in the United States – really just a continuation of Chaco’s existing strategy – and by plugging the brand into our established global network.
“Ultimately though, all of our plans have a single objective: to make Chaco retailers more money,” Cobb added.
SNEWS® View: Now, who can argue with all of that? For those Chaco reps who opt not to take up Merrell on the offer to become Merrell Apparel reps, there will be some seriously good rep talent out there hunting for footwear lines we suspect. Let the trickle-down effect begin, because this may mean some more rep shifts at other footwear lines are coming, though nowhere as sweeping as this one.
Though the decision was difficult, it is understandable, and we applaud Cobb and his team for seeking to announce the changes in direction face-to-face. That is classy. We hear too often that reps and even employees are notified their services are no longer needed by phone or, even worse, email.
Knowing, as we do, the state of Chaco prior to Merrell’s rescue of the brand (click here to read our Jan. 22, 2009 story, “Chaco now part of Wolverine Outdoor Group alongside Patagonia Footwear, Merrell”) we suspect this move is also not just a service issue.
We know that Wolverine basically saved the 2009 production run when, as we learned in December 2008, the factory in China had stopped making Chaco footwear since payments had not been received. Once Wolverine acquired Chaco, it worked with the factory to expedite production, and as Cobb detailed above, the company has even been regularly air-shipping footwear to the United States to ensure retailers have product to sell. That’s quite an investment.
Along with all the natural grumbling with a change such as this that affects relationships and lives, let’s not forget that it is quite likely Chaco would not have survived had a company such as Wolverine not stepped in and acquired it. Yes, things were that bad. And had that not occurred, we’d be writing a different kind of story now, about layoffs, financial impacts of unpaid bills and unshipped orders, and a tragic collapse of a venerable brand. Thank goodness that scenario never played out. --SNEWS® Editors