Written by SurfWriter Girls Sunny Magdaug and Patti Kishel
Quicksilver – like mercury, volatile and changeable
Like its namesake, well-known surfwear company Quiksilver is going through a volatile time now. In the past year it lost close to 80% of its value and recently filed for Chapter 11 bankruptcy. Some of its 800 stores are being closed and workers laid off, including 80 at its headquarters in Huntington Beach.
What happened? How did this surf industry leader reach this point in its 46-year run?
An innovative company that pioneered new fabrics, designs, Velcro/snap closures and neon colors, Quiksilver was always leading the pack, creating swimwear made by and for surfers.
Growing beyond anyone’s imagination, it went from a tiny Australian start-up to become a $2 billion-company listed on the New York Stock Exchange.
And it moved from its beach roots to encompass skateboarding (Tony Hawk), skiing (Rossignol), shoes (DC Shoes) and even golf (Cleveland Golf).
When SurfWriter Girls Sunny Magdaug and Patti Kishel first wrote about Quiksilver in 2011 there was a sense of excitement about its possibilities as it was positioning itself to compete in the post-recession environment.
But, the company had more than the economy to contend with. New competitors and changing consumer tastes were on the horizon. Youth fashion companies like H & M and Forever 21 began selling beachwear at lower prices.
So did mainstream retailers WalMart and Target. And new surfwear companies came on the scene, ready to paddle out. The playing field got more crowded as everyone wanted to jump on the same wave, making it harder for Quiksilver to stay afloat.
Inside the company it was crowded, too, with all the different brands and different cultures trying to forge their own identities.
Now, as Quiksilver tries to right itself through restructuring and a deal to receive a $175 million cash infusion from Oaktree Capital Management and Bank of America, it will need to chart a new course that builds on its brand and enables it to connect with the core customers that are loyal to it.
Instead of getting caught up in a riptide of fashion cycles and trying to compete in the mass market, it’s time for Quiksilver to go back to its surfing roots and original values.
A common expression in business is to “stick to the knitting.” It means not to lose sight of your key strengths and to do everything possible to improve upon them.
Starbucks understands this from its own experience in the early 2000s when it got sidetracked by all its expanded product offerings and let the quality of its coffee slip. Founder Howard Schultz had to step in and reinvigorate the brand and the troops.
As any surfer who has ever gotten slammed down by a wave knows, wipeouts are part of the sport. What makes a champion is the ability to paddle out again and get back in the lineup.
Now it’s up to Quiksilver to position itself to catch the next wave of success!
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