An interesting read from a proshop forum i am subscribed to.......
I received this from one of my distributors in Reference to the take over.
The Distributor was upset over the cancellation of the Columbia Bonus
Rewards Program. This letter is From Bob Reid and will probably be published
in the next edition of Pro Shop Insider.
A MISSION OF MASSIVE PROPORTION
Quite obviously, the asset purchase of Columbia Industries changed what I
was going to write about in this column of PRO SHOP INSIDER. As Ebonite
International, Inc. CEO Bill Scheid, mentioned in a letter that went out to
all pro shops earlier this month (see page 24) we are committed to keeping
pro shops as informed as possible. As I write this, we are just under 2
weeks into our brand integration process. We have some answers but certainly
not all the answers that you need. We are all working as hard as we can to
fit the pieces into the puzzle.
WHAT WAS INCLUDED IN THE TRANSACTION?
Ebonite International, Inc. and Columbia Industries entered into an asset
purchase transaction. Though I am not a lawyer, this particular kind of
transaction was not a "takeover" of the company. In a conventional sense.
Ebonite International, Inc. purchased certain assets, including:
* Brand Names
* Inventory
* Manufacturing Equipment
WHAT BRAND NAMES WERE INCLUDED?
* Columbia
* Track
* Dyno-Thane
* Circle
WHAT PRODUCTS WERE INCLUDED?
Ebonite International's purchase included balls, bags and accessories.
Though we own the Circle and Dyno-Thane brand names, we have no plans to
compete in the bowling shoe market. As a result, Columbia Industries or its
designatees, will be responsible for the sale of the existing inventories
of Dyno-Thane and Circle shoes. If Columbia Industries or its designates
elect to stay in the bowling shoe business after the current inventory is
sold, new brand names will have to be found. We have no plans to license or
sell the brand names to someone else. We also have no plans to develop more
Circle-branded products at this time.
WHAT ABOUT THE PRO SHOP PROGRAMS THAT COLUMBIA INDUSTRIES HAD?
Because this was an asset purchase, the programs that Columbia Industries
had in place, as well as the obligations that accompanied those programs,
are an obligation of Columbia Industries. In simplest terms, the "old"
Columbia benefited from the sales and profits of those programs. They are,
therefore, liable for the obligations. We have, nonetheless, spent
considerable time attempting to understand those programs so we can make the
transition as smooth as possible for pro shops. Below are some of our
findings:
Columbia Elite Pro Shop Program
It is our understanding that all obligations of this program were fulfilled
by Columbia prior to our acquisition. Pro shops paid Columbia $599 and
received their 8 balls and related products.
Track FastTrack Pro Shop Program
It is our understanding that 3 new Track balls are still owed pro shops
under this programs. Pro shops paid Track $599 and, during the course of the
program, had only received 5 balls Despite the fact that this was a program
from the "old" Track, we have committed to sending the 3 balls still owed to
Fast Track members. Since these are supposed to be new balls, this may not
happen until our new '07/'08 Track product line is introduced, however.
FastTrack members will be notified of this in a letter from me. What we ask
now is your patience. We definitely want those 3 balls to be great ones
before we ship them to you and ball development for any brand takes time.
4:1 Ball Redemptions
Columbia Industries had two 4:1 redemption programs that got caught
"mid-stream" in this transaction. The first was their "Better Than 4:1"
program launched in December. The other was a 4:1 promotion involving the
introduction of the new Columbia Big Shot. We have committed to work with
Columbia Industries to ensure that these 4:1 redemptions are honored.
Ebonite International, Inc.'s marketing and customer service departments are
working hand in glove with Columbia Industries' marketing and customer
service departments to make sure this happens.
Columbia Big Shot $10 Consumer Rebate
Ebonite International, Inc. will honor these consumer rebates, per the terms
and conditions established by the "old" Columbia.
Clumbia Industries' "Bonus Rewards" Program
It is our understanding that Columbia Industries announced to the pro shop
community that the program had been terminated (i.e., they stopped accepting
"proof of purchase" documentation) on the day of transaction. It is also our
understanding that points accumulated by pro shops that were already in the
system would be redeemable through March 15. All questions and
correspondence regarding this program should be directed to Columbia
Industries.
WHAT ABOUT COLUMBIA INDUSTRIES' PRO STAFF AND ADVISORY STAFF CONTRACTS?
Out of necessity, Columbia Industries cancelled all pro staff (national,
regional and amateur) and advisory staff contracts shortly after
transaction. Particularly at the national pro staff level, this left some
players in a precarious position. We moved quickly to get these players back
on track. The following is a summary of what has happened thus far:
National Pro Staff
I personally me with all Columbia, Track and Dyno-Thane national pro staff
members in Dallas 4 days after transaction. We offered "new" contracts to
all players that we met with, representing their respective brands on the
PBA Tour. Chris Barnes, Wes Malott, Bill O'Neal, Steve Jaros and Mike Wolfe
agreed to our offer. Jim Pratt and Michael Haugen, Jr. declined. For the
record, Ebonite International, Inc. has not, and will not disclose the terms
of any of those contracts. We believe this is a privacy issue, between
player and company. We have also asked members of the bowling press to find
drama elsewhere.
Regional and Amateur Staffers and Advisory Staff members
Columbia Industries has cancelled these agreements as well. We have the
names of all players but we are stuck for a while. Simple reason.we don't
have a brand manager for any of the new brands in place yet, nor do we have
programs in place yet. We are working diligently on both but this will take
some time. Please be patient.
WHAT ABOUT EXISTING ORDERS?
Here again, Ebonite International, Inc.'s customer service team and Columbia
Industries' customer service team are working hard together to get a handle
on this situation. Our original plan was to ship all ball, bag, and
accessory inventory to Hopkinsville before shipping orders. We are now drop
shipping some orders from San Antonio. Believe me when I tell you, this
process is far more complex than it seems. Part numbers must be entered into
our system and there are many, many part numbers involved. Our team has been
working 'round the clock to make the process as seamless as possible but it
hasn't been easy.
WHAT ABOUT THE TRACK PHOENIX?
We realize that this ball was introduced just prior to transaction. As you
might expect, we are committed to only introducing GREAT product under any
of our brand names. We are testing the Phoenix ball now. I don't have an
answer as of this writing but I am confident that you will have an answer
before you receive this issue of PRO SHOP INSIDER.
HOW LONG WILL COLUMBIA INDUSTRIES CONTINUE TO PRODUCE BALLS IN SAN ANTONIO?
Right-click here to download pictures. To help protect your privacy, Outlook
prevented automatic download of this picture from the Internet.
Columbia Industries is producing some balls that they had contract
commitments to complete before moving manufacturing equipment to
Hopkinsville. Those contracts were with Storm, Lane 1 and AMF. We expect
this to take approximately 60 days from the date of transaction.
WHAT ABOUT COLUMBIA'S MARKETING AND SALES PEOPLE?
At this point, I can only speak for the sales and marketing teams. Ebonite
International, Inc. will obviously need more sales and marketing people to
successfully and effectively continue to "Build the Best Brands In Bowling".
We made a commitment to the owners of Columbia Industries,. to speak with
any Columbia Industries employee who may be interested in joining our
company to help us accomplish our mission. As you know, there are some
really great people in that company. We have spoken with most who were
interested already. We have made no decisions at this point but effective
staffing is one of our top priorities.
WHAT IS EBONITE INTERNATIONAL. INC.'S "TAKE" ON ALL OF THIS?
Once upon a time, Ebonite International, Inc's only brand in the consumer
product business was Ebonite. Then, along came Robby's. Then came Hammer.
Ebonite International, Inc. developed a philosophy that we were really in
the business of "Building The Best Brands In Bowling." There has been no
question that industry consolidation was going to be inevitable. Despite
manufacturing consolidation, there has never been a doubt in our mind that
Columbia, Track and Dyno-Thane are great brands with unbelievable consumer
and pro shop followings in a bowler and pro shop market that needs
choice.choice in both brands and products. What's our "take"? Our "take" is
that we have both a responsibility and an obligation to the bowling
community to build these brands to the greatness that they once had. This
will require huge investments in product development, manufacturing
capability, human resources and time. It is a mission of massive proportion.
It is a mission that we accept with all humility. It is a mission that must
be successful, for the sake of the industry.
With your patience and help, it is a mission that can be accomplished.
CHEERS!
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