Page 4 --FLEETWOOD
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Was the incredible success of the Bounder a surprise? "No, it really wasn’t," Smith said. "The Bounder, at the time of introduction, had so many unique things to talk about that made the product exactly what we strive to do with product all the time. It made the product more functional, more usable, more reliable, more user-friendly, and at the same time did not increase the cost. That gave the consumer a significant, additional value. So, it wasn’t a surprise. That was a product where Mr. Crean was significantly involved and it was an example of what he calls a product that is ‘a good house’. "The Bounder gave us a product that revolutionized the Class A motorhome business. I think it is probably one of the best examples that we have had of how focusing on making something more functional and more usable will probably give you a real home run in this industry." But even with Fleetwood’s commitment to new product development, Smith admits that some of the best ideas come from smaller companies. He said, "As we look around, one of the tremendous strengths about the RV industry is that it is extremely entrepreneurial. There are a lot of companies, a lot of very good companies and a lot of very good people, and they are very creative. They’re working long hours every day to find new and unique ways to do things. The best ideas are not always sitting here. The best ideas are often out there on the dealer’s lots and very often will come from one of the smaller, out-of-the-way places in this industry. Why? Because somebody has laid awake nights looking for a better way, a different way to compete. "And so, we spend as much time looking outside of our organization, at what others are doing, as we do working inside the organization to improve. We have a tremendous amount of talent here and a lot of ability. And we can bring things to market, I believe, as quickly and as effectively as anybody. But we have no corner on unique and good ideas." Even though Fleetwood has, as Smith puts it, hit its share of “home runs,” occasionally Fleetwood stands in the batters box and gets a “called strike.” “We don’t always hit the mark,” Smith said.” Smith points to the popularity of the slideout market as an example. He said, “We miss-judged the strength of the slide-out market, anticipating that the move to the 102-inch wide-body motor home was where most of the strength of the market was going to be. We focused on that and failed to recognize how strong the slideout market was becoming. So until the latter part of last year, we were missing out on about 30 percent of the Class A motorhome market. “At the same time, we recognized that slideouts were going to be a part of the market; however, we didn’t believe that conventional slideouts being used in the industry were the best way for a motorhome slideout to be built. We were working on the engineering and development of a unique system that we thought would be more reliable and more solid than those currently being offered. That all culminated in the introduction at Louisville of our new slide room system and we now offer slideouts throughout our product line. "We are organized in such a way that if we do miss the mark, we can respond fairly quickly to the changes in the market place. The strength of Fleetwood’s position in the marketplace has not made the company complacent. Smith looks toward the future with great anticipation. He said, "We feel very good about not only our future, but the industry’s future. We believe that the market is sizable; we think that it offers tremendous potential if we understand the consumers who are in the market and what they’re looking for. At the same time, I agree with those who believe that there is a tremendous amount of competition for the leisure dollars -- competition outside of our business; competition from the cruise lines, destination resorts, airlines, the home entertainment system business—industries that are competing with us for those dollars. "So we need to make sure that we show them the value in what we do. I think that we are a specialty product manufacturer and we need to recognize that we’re not for everybody. There are a lot of very positive "motherhood and apple pie" reasons to believe in and love the RV lifestyle, but there are still a lot of things about the RV lifestyle that do not fit the lifestyles of many people in this country. Being realistic about those limitations and where our market truly is, is going to be key to how we most effectively bring those customers in and sell them. That’s one of the reasons that we spend as much time, effort and dollars as we do understanding the people that we sell to - by individual product type, who they are, where they are, what their motivations are, what do they like most about the product. Is it the price? Is it the floor plan? Is it the size? Is it the dealer they bought it from? "After that, our thrust is to make sure that we are represented by the best dealers in the industry. When our customers shop, they’re going to get multiple exposure to Fleetwood products. And we have got to come out with the best value. Value is certainly all relative - from lower priced product to higher priced product. But there is a relative value in every segment of the market place and it is a significant challenge to make sure that year in and year out over a long period of time that you continue to stay in touch with the market and are familiar with the needs and desires of the people that are purchasing our products. I think for the most part, we do that. "However, we’ve got a ways to go because there are still 70 to 75 percent of the buyers out there choosing somebody else’s product."
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