This was West Marine’s first year back as an exhibitor at the Miami International Boat Show after being absent for several years. We spoke to Ken Seipel, West Marine’s new CEO, about the direction the retailer will take going forward.
Trade Only Today: Most people in the industry may not be familiar with your name. Can you talk about your background?
Ken Seipel: I think about my career in two big parts. I was with big company retailers for the first part — J.C. Penney in the early days in merchandising. I was also with Target through all of the 1990s. In 2000, I was with Old Navy for eight years as head of North America. In 2010, I switched to work with more midmarket companies and started to work with more private-equity-held organizations. It involved restructuring work and trying to optimize the businesses. Most recently, I was CEO of Gabriel Brothers, or Gabe’s, an off-price retailer based on the East Coast.
TOT: How did you come to West Marine?
KS: Monomoy Capital Partners was looking for an experienced retailer to lead West Marine. After researching the company, I knew this would be a great fit for my skill set.
TOT: Is this business different from others you’ve worked in?
KS: The are more similarities than differences. In the core of this business, we have a specific product and a dedicated and loyal consumer. Our opportunity is to ensure product is at the right price and available at the right time, dial in the value equation, and improve in-stocks. What is different is the technical aspect of the products.
The ability to move that product through to make sure it’s the right time at the right price, the value equation is dialed in and the in-stocks are correct. The speed to market is exactly the same that I’m used to. What is different is the technical aspect of the products.
TOT: West Marine had been moving more toward soft goods under CEO Matt Hyde. Has that changed?
KS: Everything we do going forward will be focused on the boater. I want us to be able to draw a direct line between the product and the application. We will do apparel. There will be less dependence on specific brands, but more focus on the technical aspect. We’re also planning to be more innovative and amplify our technical expertise in key categories like electronics and maintenance. We’re very good at those areas, but we could be a lot better. You’re going to see a lot of energy to make sure those categories are fully amplified.
TOT: In a way you’re going back to what West has always done, to cater to the basic boater, rather reach out to non-boaters.
KS: Boating is the core of the company and the core of the customer. One of the keys to success is staying true to your core. We’re absolutely going to do that. It’s one of the reasons over the last few years the company has been off track. It’s time to get it back on track. We’re going to do that in a more modern, innovative way.
TOT: Are you going to keep the same number of suppliers, or will we see rationalization?
KS: What we’re really interested in doing is implementing a new three-tiered merchandising system, and part of that is finding the right suppliers to fit into that mix. We have no desire to reduce vendors; if anything, we might be expanding our vendor base a bit. We have a good core base of vendors who have been doing a good job, and we have good relationships with them. There may be room for more, depending on our customer demand for product.
TOT: Have vendors generally been receptive to you as CEO?
KS: I’ve been pleasantly surprised about the receptivity of our vendors. We’re all in this together. We simply want to sell more products together. That means finding better ways to partner together. They recognize our importance in terms of how big we are in the industry, and we recognize that we need them. That’s been positive. I think many of the vendors are happy to see some stability, and getting back to the core basics has been well-received by them.
TOT: Did Gabe’s have a lot of SKUs, as well?
KS: Compared to the stores I’ve been involved with from management and product and assortment perspectives, West Marine is simpler and has a narrower SKU base. That means we can execute more thoroughly and accurately. You shouldn’t underestimate how difficult it can be to pick a product and get it on the shelf at the right time.
TOT: Are you going to keep the same number of stores?
KS: I don’t see any need to make major changes to the stores right now. We’re going to continue with the current real estate fleet to make sure they’re optimized to the right locations. We’ll be optimizing our business through the e-commerce channel and store channels, while looking for other ways to sell products.
TOT: West Marine sells the BOTE inflatable standup paddleboard that allows you to mount a 6-hp outboard on back. Will you be introducing more of those?
KS: We’ll try items like these to see how they work. Sometimes they will work, and sometimes not. But our main goal is to focus on four key customer groups: anglers, powerboaters, sailors and yacht owners. Those four segments are simple and will keep us focused on product. Once we understand that, we’ll continue to innovate with new products like this standup paddleboard. It fits the angling category. But servicing those four key groups is really what will drive the company going forward. We’ll focus on newness and innovation for those categories, along with the core service they really need.
TOT: Will you do more private-label products?
KS: Yes. We see a good opportunity to take our West Marine brand and do a much better job of adding more value. Our position is that our private-label brands will have really good price points with exceptional value. As we go throughout this year and into 2020, that brand will step up a lot.
TOT: It sounds like you’re not targeting the non-boating customer as result.
KS: Our priority is very specifically the boaters. Naturally there will be other customers that will buy our products, and that’s OK. But I’m not going to focus on getting a different type of customer. I want to focus on doing a great job for the customer we already have.
TOT: Do you see any opportunities outside the United States? I know you closed the stores in Canada.
KS: Long-range, we see opportunities for international expansion. We have to do a better job domestically first and then turn our attention to international.
TOT: Was the company in good shape when you took over?
KS: The brand is well-respected and well-known. What I’ve found to be our opportunities are what I call the fundamentals of a good retail operation. With all the change we’ve had in the past few years, we’ve lost some of our execution and discipline. We need to have good product and make sure we’re managing financials correctly. We need to execute details that are foundational for a good retail company.