My son worked for GS up until a few days ago (left for a better job in sales), and we've talked about some of the changes he's seen. I think you'll see a much higher awareness of retail business metrics in the stores, and much more attention to improving operating efficiency. Possibly more commission based sales positions?
I don't think they have fully taken advantage of the power of the new accounting system they installed. My impression is that they are running things pretty much the way they always did, just using new software. I'll put on my consultant hat and make the comment that if you are going to install a new business software system, you should reengineer the business processes first, then design the software around the new processes. I recognize that given the sequence of events surrounding the software change, reengineering was out of the question...they barely got the software installed in time for Y2K, but based on my experience with Oracle financial systems, they could be doing a lot of things better. I worked with a company in Argentina that completely reengineered their financial processes, THEN wrote software to model it...they were able to do trial balances in 10 minutes, and monthly close in an hour, with 40% less staff. </sermon> Anyway....it looks like the new owners will be bringing in their folks to augment the current GS management rather than replacing them. I would compare it to bringing in consultants to improve your business processes, and the consultants are also part owners and therefore have a stake in the success of the venture. Let's face it...GS started out in the components business and added retail. It's difficult to do multiple things that are so different kinds of business. GS is the only company I can think of that is a major OEM as well as a major retailer. Two completely different kinds of business, two different mindsets. and OBTW...in preparation for going public, GS will be about the only golf retailer that publishes financial performance info. That will be interesting to see. Don't get me wrong...I have a tremendous amount of respect for GS and for Carl and Frank in particular. I think they are doing the right thing for all the right reasons, and I wish them every success. Golfsmith has been very, very good to me over the years, and I'll always be a loyal customer. Royce -----Original Message----- From: [EMAIL PROTECTED] [mailto:owner-shoptalk@;mail.msen.com]On Behalf Of [EMAIL PROTECTED] Sent: Friday, November 08, 2002 7:54 AM To: [EMAIL PROTECTED] Subject: RE: ShopTalk: Golfsmith component future Thanks for the post Dan. As others have mentioned I am glad they will be around for a while. One thing struck me as interesting as I read it. In one comment they mention the magnitude of the company has passed their level of skill/knowledge in finance, acct, ops etc. Then they say they didn't want to install a whole new management team. I just found that interesting. I understand that they would want to save as many existing positions as possible but if existing management doesn't have the knowledge to operate that size of business which led them to the decision to sell, then.... ??? It would be interesting to see how this new investor/owner plays out... if they are merely a majority shareholder and no real management changes, nothing has changed in the area(s) that they suggest they need the assistance with! Just struck me as interesting... Jen Original Message: ----------------- From: Dan Neubecker [EMAIL PROTECTED] Date: Fri, 8 Nov 2002 08:03:41 -0500 To: [EMAIL PROTECTED] Subject: ShopTalk: Golfsmith component future FYI, below is a message from GS regarding the change of ownership. It does not sound to me like they plan on closing the component division any time soon, and even mention adding "another established "brand" to custom clubmakers". Dan Neubecker A MESSAGE from Carl, Barbara and Frank About three years ago, we (Frank, Carl and Barbara) decided that the time had come to sell Golfsmith. On one hand, the magnitude of the company had simply passed us by in terms of our knowledge of finance, accounting, retail operations, catalog database management, etc. On the other hand, we owned an extremely valuable company thanks to the efforts of truly fine employees, and thanks to the support of many, many equally fine customers. If something happened to one of us (after all everyone knows that Carl is getting "really old") our heirs would be forced to sell the company in order to pay inheritance taxes -- as they would be substantial. And very frankly, we felt much better equipped to handle a sale than our children might be. At any rate, we quickly forgot about any plans for a sale as we all focused on getting through the difficulties of the systems conversion in 2000 (which I'm sure none of you remember!). Then, after we were back on track, we had a very good year in 2001 and again started entertaining thoughts of a sale. We started making presentations to prospective buyers in the spring of this year. We talked only to highly successful companies with impressive track records for running and growing companies. It was an eye-opening experience, having never gone through the process before. We never anticipated the excruciating level of detail that would be required. There were some prospective buyers who suggested that they could install a whole new management team. They didn't realize that that was the last thing we wanted. We did not want our terrific managers to lose their jobs. We also felt that these managers were the key to the success we've experienced, and to maintaining ongoing relationships with our customers. The whole process started to make some sense after we identified the company we felt would be the best company to assist in Golfsmith's future growth. We are writing to let you know that as of October 15, 2002, we have completed the transaction and sold a majority interest in Golfsmith to First Atlantic Capital, Ltd., a private equity investment firm from New York. First Atlantic Capital, Ltd. is a very progressive company that presently owns a number of very successful companies. They were a pleasure to work with through a somewhat difficult process, and exude the values that have always made Golfsmith special. These are very exciting times for Golfsmith, and we are pleased that we will be able to continue to be a part of it. We retain significant ownership in the company, are on the Board of Directors and will continue to work with the company, although our day-to-day roles will change. Our focus will be the components portion of the business - which we grew up in and is our passion. The biggest change for the 1,000 plus employees at Golfsmith (including Carl and Frank) is that we will all have a new boss. Jim Thompson, formerly the Senior Vice President of Stores and Merchandising, is the new President and Chief Executive Officer. He is very knowledgeable, and will be terrific in his new role. Ken Brugh, a Vice President and Golfsmith employee since 1981, will have ultimate responsibility for the component division, just as he has for many years. We mentioned that these are exciting times for the company. In 2001, the company experienced the most profitable year in its history, and this year has been very good (especially considering the slow economy, down stock market, terrorism, wild fires, etc.) Our Vice President of Research and Development, Jeff Sheets, and his team, have designed a number of the finest golf clubhead models we have ever seen in the components industry. Additionally, as we write this message, the details are being worked out so that Golfsmith can offer another established "brand" to custom clubmakers. Details will be released soon. First Atlantic Capital, Ltd. has a history of success and should be of great assistance to Golfsmith via their vast business acumen and experience. We have had the opportunity to meet the founder and the various principals at First Atlantic during this process, and they are the types of people that we (employees and customers) will all be proud to be associated with. All three of us are very grateful for the support that you, our customers, have given us, and we value the personal relationships we have developed with many of you over the years. We have always worked to make Golfsmith the very best supplier in the golf industry, and we look forward to continuing to work with all of you to make custom clubmaking more successful than ever. -------------------------------------------------------------------- mail2web - Check your email from the web at http://mail2web.com/ .
