A Visit with SMC Corporations CEO
Perlot is Back!
By Don Magary
Industry observers who have watched SMC Corporations Mat Perlot have learned one thing over the years expect the unexpected. Certainly few expected that he could take an idea and create a whole new market segment for the RV industry, but thats what he did. In the mid 1980s Perlot was marketing director for Beaver Coach. He urged the powers-to-be at Beaver to build a line of motorhomes in the $80,000 to $120,000 retail price range. When they declined, Perlot left and in 1988 started a company named Safari Motor Coaches, Inc. And as they say, the rest is history. Perlot has made his mark on the industry by giving the consumer a good value at a reasonable price. He has been a standard bearer of innovation. He acknowledges that the companys products have a lot of consumer appeal; however, he once confided in me that the real reason for Safaris success is giving the dealer a product that they can make a profit on.
Along the way, Perlot created several other companies to support the manufacture of motor-homes. Not satisfied with the chassis options available he started Magnum Manufacturing. Then he started Composite Technologies, the company that supplies fiberglass components. Another company is ED&A (electrical and electronic design, assembly and manufacturing) that develops electronics and wiring assemblies for motor-homes. In a controversial and highly public competition, he took over Beaver, a company that had fallen on tough times and filed bankruptcy. As an aside, he turned that company around in less than a year. When he wanted to get into Class C motorhomes SMC acquired Kansas-based El Dorado. When that didnt turn out to be a good move, Perlot formed yet another company, Harney Coach Works, in Burns, Oregon, to manufacture mini-motorhomes. Last year the Safari Class C was introduced and is enjoying a lot of success in the marketplace.
When RV News first featured Perlot in 1992, we dubbed him a "rebel," a badge he wears with a certain amount of pride. One of the issues that earned him that reputation was his decision not to affiliate SMC with the Recreation Vehicle Industry Association (RVIA). Seems he was stuck out in no-mans land at a Louisville show and was unhappy with the rules of RVIA that dealt with seniority in drawing for trade show space. Back in 1990 RVIA wasnt particularly concerned over a little company out in Oregon that didnt want to be a member, but that has changed. Since SMC has become a major manufacturer and acquired several other companies, RVIA doesnt think it looks good for RVIA when a company this size chooses not to be a member. They have actively recruited Perlot who remains aloof. RVIA even offered to let SMC have the 25-plus-year seniority of El Dorado, but he turned his nose up at the offer. He said RVIA still doesnt understand its the matter of principal. He told RV News if RVIAs seniority rules are changed, he will join immediately. In the meantime, SMC and RVIA remain at a stand-off.
RV News has watched Perlot over the years with a certain fascination, not only because of his success but the rather remarkable way he became successful. However, over the past year or so, we didnt see that same excitement and fire that he had exhibited during the previous years when he was building the company and taking it public. And even though he is still relatively young for an executive, we suspected he was probably going to retire soon.
But then we started hearing rumors that there was a major shake up taking place at SMC. We decided to visit Perlot and find out what was going on. We sat down with Mat in his office in Bend, Oregon, a few weeks ago and noticed a change. That fire was back and he looked as if he was having fun again.
What Perlot did was to completely restructure SMC Corporation. Basically, he cleaned house in a big way heads rolled.
He explained, "We have made some pretty major changes in the top and middle management of the company most of it by shrinking it.
"We are only in our tenth year of business and the company grew very rapidly. Most of that growth and most of the development was a lot of fun. Anytime you are running a fast race, I think you enjoy yourself. However, as we grew, we also built a lot of overhead and a lot of bureaucracy in the company. I found that when I went through the plants I didnt know peoples names anymore.
"And it had become less fun. I wanted to concentrate on the entrepreneurial areas of the business and get out of the organizational and bureaucratic ends."
Prior to the restructuring, six operating divisions reported directly to the corporation. They were: Safari Motor Coaches, Beaver Motor Coaches, Magnum Manufacturing, Harney Coach Works, Composite Technologies, and ED&A.
Perlot said he sat down with Jay Howard, SMC president and COO, and they took a hard look at what had happened. Perlot continued, "Jay had a vision for the company and I agreed with him. We needed to find a way to get rid of a lot of this bureaucracy and get our company back to a lean-mean machine.
"We have restructured our entire operation. And we have farmed-out more responsibility in the various divisions on a partnering basis. For instance, Harney Coach Works now is responsible for the management of Composite Technologies, and Gordon (Perlot) is running that.
"We promoted Steve Bettis to general manager of Beaver and gave him ED&A to run, essentially making it an operation of Beaver Coaches.
"And then we did the same thing at Safari.
"Now each of three major divisions are pretty much interdependent on each other for the supply operations the fiberglass with Harney Coach Works; the electronics and electrical with Beaver; and cabinet components and solid surfacing with Safari. So we feel that we get a lot more cooperation among the divisions with the interdependency. And in the process we cut the number of units that we were trying to manage in half."
One of the more surprising moves was for Mat to personally take over the marketing and sales functions. And while innovative product design has certainly been a trademark of SMC, Perlot is acknowledged in the RV industry as having one of the best marketing minds in the business. Thats the fun part of the business as far as he is concerned.
Mat said, "This restructuring allows me to concentrate in the areas that I have a lot of expertise, and hopefully talent, which is the marketing and sales and product development areas.
"We cut our corporate overhead from 50 people down to the low 20s, and we are probably not finished yet. Its giving us a chance to make the race fast again."
With the company restructured, Perlot is focusing on product development. And as we have seen in the past, when Perlot turns his attention to something, things change. The Safari line needed some of that attention. Continued