How do they do it?

[Columbia Craw]

I’m trying to figure out where the profitability is for Bagley  Baits.  How can there be a meaningful margin for them and or even Tackle Warehouse when they ( various models) are on sale at a discount of 42 percent?

 

I can’t figure out how anyone can produce a balsa bait with the number of steps it takes from raw material to packaging and distribution of a balsa crankbait .  Anyone have an answer for this one?

 

[papajoe222]

Manufactures will normally suggest a retail price of 150%-200%+ over what they sell an item for to their distributors.

Retailers will 'slash' prices 50% and still make a profit.  The manufacture even offers small discounts to them if they order a certain quantity or pay withing a set time period.

Personally, I, too, can't figure out how Bagley can produce a balsa bait that is as affordable as theirs are.

[J Francho]

For one, the process how they're made is completely different from the originals. Also, I'm pretty sure they are made in the Dominican. Being a part of Rapala, they also benefit from economy of scale. 

[volzfan59]

37 minutes ago, J Francho said:

Being a part of Rapala, they also benefit from economy of scale. 

I try to keep up with fishing, on the business side of things. I hadn't heard anything about that. I checked Rapala/Normark and they aren't listing Bagley as one of the companies under their umbrella. I did find that Northland Tackle either owns Bagley or is in some sort of an alliance with them.

Is the Rapala purchase of Bagley new?

 

To the question, it also helps when retailers purchase in bulk. 

[J Francho]

It's on their site: https://www.bagleybait.com/history-of-bagley-bait/

[OkobojiEagle]

I thought Jarmo left Rapala to re-build the Bagley company.

 

 

oe

[casts_by_fly]

2 minutes ago, OkobojiEagle said:

I thought Jarmo left Rapala to re-build the Bagley company.

 

 

oe

 

That's what Bagley's site reads as.  Rapala VMC didn't buy bagley.  The former execs and team joined bagley to revamp it.

[Deleted account]

14 hours ago, Columbia Craw said:

I can’t figure out how anyone can produce a balsa bait with the number of steps it takes from raw material to packaging and distribution of a balsa crankbait .  Anyone have an answer for this one?

 

From a manufacturing point of view, they are press molding balsa in the 3rd world, and have introduced plastic baits, which cuts cost, and speeds up production. From a sales point of view, most times the consumer can't see who is "eating" the margin when items go on sale. Most times it's the retailer, sometimes it's the manufacturer, and sometimes it's both (fishing distributors are leeches). In this case, my guess would be that they are pushing poor selling inventory. The sales at MSRP or constructed MSRP is what determines profitability (on the revenue side), not discounted sales.

13 minutes ago, casts_by_fly said:

That's what Bagley's site reads as.  Rapala VMC didn't buy bagley.  The former execs and team joined bagley to revamp it.

That's just on paper for regulatory and tax purposes.

[casts_by_fly]

2 hours ago, Deleted account said:

That's just on paper for regulatory and tax purposes.

 

That may be so and I'm sure there is some element of that as well as shared interests between the two companies.  Nevertheless, if you or I were so fortunate to be in a position to buy Rapala VMC, we would not be getting Bagley along with it.

[MN Fisher]

20 minutes ago, casts_by_fly said:

Nevertheless, if you or I were so fortunate to be in a position to buy Rapala VMC

Good luck getting the investors - Rapala VMC also owns Sufix, Blue Fox, Storm, Luhr Jensen, Terminator, Strike Master (Ice fishing tools including augers) and Williamson (salt water lures)

 

They're probably the second biggest next to Pure Fishing.

[J Francho]

You guys have to stop thinking of these entities as businesses with an "owner."  It doesn't work that way.  Jarden acquired Pure Fishing, and also is invested in Rapala VMC.  Then, Newell acquired Jarden. So, there's that.  Clear as mud, right?

 

[haggard]

55 minutes ago, J Francho said:

You guys have to stop thinking of these entities as businesses with an "owner."  It doesn't work that way.  Jarden acquired Pure Fishing, and also is invested in Rapala VMC.  Then, Newell acquired Jarden. So, there's that.  Clear as mud, right?

 

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