Hogan Golf Lays Off All Employees

Orlimar1

And another golf company fails.

From MyGolfSpy - "We have confirmed that the Ben Hogan Equipment Company in Ft. Worth, Texas laid off 100% of its employees this morning. This effectively shuts down the business and would appear to end one of the best comeback stories of the last several years."

Release

No media coverage yet, surely it'll appear in the local and National News later on.

Kind of sad, although the current company only bears the familiar name. The Ben Hogan Company was represented by one person, and one person alone. The name is fading with the passing of the icon and washed by time.

Not a lot of new golfers knows nor cares about the passed era unless they took interest in learning the history of the game. when the new company decided to move in a posh office with the warehouse / manufacturing facility before they even have a base of revenue..... kind of setting up for failure from the beginning.

It'll be a cheap entry level opportunity for T.W. to look into. He could basically make any golf club to his own spec. Taylormade will have nothing but the down side from the peak level, and at probably much higher price tag.

PA-PLAYA

I'd never make it in the equipment business. I thought that Hogan had adjusted to the current economic situation rather reasonably... instead of assuming massive overhead expenses, make it a special-order brand and (although not raking in tens of millions in profit) at least position themselves to stay profitable enough to sustain the brand in the long term. It seemed like a very prudent business plan, at least looking at things from the outside.

The inside... niche sport as it is, with even more of a niche brand within the niche sport. Hogan has long been noted as more of a serious player's club. The problem, however, is that this younger generation isn't overly familiar with the quality and detail of what used to represent Hogan equipment. And by virtue of being special-order - it was quite expensive, because obviously their equipment wasn't mass-produced. Then you factor in that the brand (for years anyway) wasn't a brand known for game-improvement type equipment... but more for those select few who didn't need a sweet-spot the size of a grapefruit to enjoy acceptable results.

The Hogan mystique, as appreciative and alluring as it was to those of us who've been in the game for a while and can remember a time when the Hogan brand automatically endeared itself to a certain high quality of both craftsmanship and detailed performance for the better players, simply became a victim of economics, lack of marketing and lack of accessibility.

A few years ago I would've gambled on this company being able to sustain itself given the nature of how they adjusted their business plan. I guess I just assumed that the name and the quality behind the brand was enough to carry it forward.

That's why I don't gamble in the stock market. I would've lost big time here.

That said, it's a huge opportunity for someone else to bring the brand in under their umbrella and make something out of it. The problem however is that Hogan equipment, and everything it has meant to the older players who've remained loyal because of the quality craftsmanship, ultimately becomes bastardized in the process.

sdandrea1

Sounds more like they'r getting rid of a union......

Ben Hogan Golf Equipment Company announces reorganization and restructuring - maintains commitment to building highest quality and most precise golf equipment in the world

Fort Worth, Texas: The Ben Hogan Golf Equipment Company announced today that it is going through a period of re-tooling and right-sizing in an effort to become more nimble and profitable in the highly competitive golf equipment business.

The Company has voluntarily implemented a reorganization initiative to minimize expenses and streamline the operation. This included the reduction of a large percentage of the exempt and non-exempt workforce, some of whom will be rehired as contract employees. The company has not declared bankruptcy nor been foreclosed upon, and remains in the business of producing and selling the highest quality and most precise golf equipment in the world.

"Reports of our death have been greatly exaggerated", said Scott White, President and CEO of the Ben Hogan Golf Equipment Company. "While our organization does not look the same today as it did in 2016, we are confident that the changes we are making will make us a stronger and better company in the future".

About Ben Hogan Golf
The Ben Hogan Golf Equipment Company is based in Fort Worth, TX and manufactures premium golf clubs and golf bags. The company was started in 1953 by Ben Hogan himself, and is continuing Mr. Hogan's reputation of innovation, performance, and classical designs. For players who are serious about their games, and the game of golf, there is only one choice: Ben Hogan Golf Equipment

Twitter: @BenHoganGolf
Instagram: Ben Hogan Golf
Facebook: Ben Hogan Golf
More information: http://www.benhogangolf.com

PA-PLAYA

sdandrea1

While I don't blame them for assuming whatever austerity measures they need to implement to stay in business and somewhat profitable in the meantime, the writing is pretty much on the wall. My former private club assumed said measures, albeit too late in the game. In the end, the course closed and several months later was bought by someone who made it semi-private. Although the situation hasn't changed much in the past couple of years with regard to financial struggle, the club nevertheless remains open to the public for the short-term.

But nobody in their right mind expects it to stay open much longer. Golf is already several years into the process of going back to a time when only the privileged and affluent types could maintain the active, sustaining golf lifestyle. Hogan has attempted to make necessary adjustments, but there's no escaping the reality of the situation that the game is currently in, and will likely continue to be in, for a long while.

I certainly wish them the best. It's frustrating to see these once-great companies falling by the wayside.

Release

sdandrea1

That'll be too bad. Contractors or out sourcing or whatever they'll call it, it's the same. Where is Trump ?

glebert

sdandrea1 some of whom will be rehired as contract employees

This is the sad reality of our new economy. There is no longer even the pretense of loyalty to the employees, and therefore there is no loyalty the other way either. I got laid off last spring after 16 years with a Fortune 100 company. Only job opportunities available with other companies were as a contractor. Now my wife went to work at that Fortune 100 company as..wait for it..a contractor.

lambo

sdandrea1
Looks like a sensible plan of a company that is not making it, but would like to give hard working loyal skilled employees an opportunity to be paid for their skills and production. This also insures you don't end up in the poor house trying to keep afloat.

In reality out sourcing is the fruit of today's business environment - result of corporate raiders, politicians, wall street and lawyers. People who never produced anything or helped anyone unless it was to take from the effort of those who do work, rich or poor, these vultures don't discriminate. This spawned the modern attitude of entitlement. The only way for many companies to make it is simply redirect the responsibility for common sense, healthcare, retirement planning, professionalism and a work ethic back to the individual, ie. out sourcing or consulting.

I hope Hogan succeeds and those who have been skilled and productive in their organization prosper.

mainuh

glebert

Gle,
I grew up in a coprorate household.
My Dad had a top job with a Pharma company.
They were bought out, new company moves in their people.
He had just bought a piece of land, was building a new house, we all were in private schools.

You can imagine the turmoil at our house.
Luckily my Dad had enough major contacts that he "Godfathered" them.
Fire me, you have lost milions in sales.
They buy me, not you.

He not only stayed with the new Co. but negotiated a raise and wrote his job.

Unfortunately he is a one off.
Living through this, even with a college education I vowed never to let a company put me in that position.

So sorry to read of your circumstances - keep pushing, pushing, pushing.

rob
ps- take a contractor position. It keeps you in the game, keeps you busy, keeps your self regard up.

glebert

mainuh

Mainuh, thanks for the kind words. I'm actually enjoying staying home and homeschooling the kids (which my wife was doing before). Luckily my wife makes way more than I used to as a FTE (lawyer>>engineer) so having her jump back into the workforce actually works well for us. I'm doing a side business fixing guitar amps and designing effects pedals and such to keep the resume current-ish and for my self esteem. Way more fun than the work that I was doing!

glebert

I was sitting here playing guitar, and wondered why golf companies don't use a tiered model for their equipment similar to the way the guitar companies do? I was playing a Fender Squier Stratocaster guitar that is made in China and would cost $150 new at any music store (I got mine for $50 at a pawn shop 😉 ). Presumably Fender makes money on this guitar. If I go and buy the USA Stratocaster it would cost at least $1100. Presumably Fender makes even more money on this guitar. So Fender is making a product for the mass market and the bouitique(ish) market, but it is really the same product with different levels of quality, features, and cache. The Squier is kind of a gateway drug to the boutique product. There have actually been studies with people who buy knock-off designer goods (e.g. LV handbags) that show once they have a knock-off they are more likely to eventually buy the real deal. In the case of Fender they are essentially making their own knock-offs and profiting on both ends of the spectrum.

OK, how long until Almo chimes in and says "X company already tried it and it failed!" 🙂

Release

Your model of using the guitar comparing to golf clubs might work, if, the product cycle of golf clubs enjoy the same longevity of the guitar.
Plus, in golf it's mostly the arrows fault for not performing vs. in the music world it's likely the Indian's lack of talent.
You see, if say, Callaway has more offering than the current models of B.B. Fusion and XR16, XR16 Pro. with all the choices on the upgraded shafts. By the time come next Spring there should be new driver out and what will Callaway do with old inventory ? Way too many choices already with the current product cycle.

The market is already saturated as it is. To carry more product line is financial suicide.

glebert

Release

I think the assumption that the guitar would have a much longer product cycle than a golf club is part of the problem. I don't think anything can save the Callaway model that you described, and I think blaming the arrow is wrongheaded. I play as well with my 55 year old Wilson Staff irons in my "vacation set" (that I play a couple times a year) as I do with anything newer. If the golf industry is built on convincing people that their clubs are obsolete but offering them product that performs about the same, but maybe with some new gimmick, then it should fail. But if you take a legendary product like Hogan Apex irons and marketed them like a Stratocaster or Les Paul then maybe you create a profitable and stable (but maybe not huge) company.

Release

glebert and I think blaming the arrow is wrongheaded. I play as well with my 55 year old Wilson Staff irons in my "vacation set" (that I play a couple times a year) as I do with anything newer.

Totally agreed.
Not saying the arrow is to blame for the golf equipment, but for golfers in general - it is easy to blame the equipment and everyone seemed to accept that. Always searching for the pot of gold at the end of the rainbow while spending a pot of gold in the process.
In Music, if someone could not play a guitar well - the general perception is.... need more practice.
I too, have been playing some vintage golf clubs from time to time, not the hickory shaft, because that requires a whole new shop to service it. My oldest set of iron is just under half a century old and I also bag persimmon woods in the Summer season. Needing to club up one because of the lofts in the older set is weaker and those persimmon drivers sure looks funny at address, some modern 3 woods appear larger than the persimmon driver.
I own no less than 4 sets of Ben Hogan irons all pre 1989 models, still play them. Worried about the wearing of the chrome finishing and losing it on 1 set , Not a big fan of refinishing remembering Hogan said one time that the re-chromed irons are not the same as the original. I do not see any younger player using the Ben Hogan products. Even in the 1990's there just aren't as popular as the other OEM. One comment from my fellow golfers was " Ben Hogan's irons are too difficult to play well" I brushed it off as they didn't have the time nor the inclination to practice.
The point is, the name and the logo of Ben Hogan was well known in it's time and the time had passed. In hope to use the name alone to represent an essentially brand new product and be successful is a tall order. Since the younger generation aren't familiar with the wee icemon.

PA-PLAYA

The one and only time I ever visited the USGA museum in NJ.... they have the "Hogan" room. It's all memorabilia... some of his scorecards, gloves, trophies, picture portraits and backstories, shoes, etc. and they also had every style of iron the Hogan company ever made while Ben was in charge. All these beautifully maintained, polished iron heads in this glass case were definitely eye candy for the seasoned ball striker, for sure.

They were beautiful, and the simplistic design made them all the more appealing.

Release

lambo In reality out sourcing is the fruit of today's business environment - result of corporate raiders, politicians, wall street and lawyers. People who never produced anything or helped anyone unless it was to take from the effort of those who do work, rich or poor, these vultures don't discriminate.

Yes, and also a product of Global Economics !
Businesses are more competitive these days than a few decades ago. A business not only have to compete within State, Region ,now with someone from off shore, whom might have lower cost and government subsidized advantage.
The cushion, or the buffer zone to allow growth is gone. It's into the hot water immediately and try to stay in before gets scorched . Global economics made the world smaller producing a more direct impact from potential conflicts.

The current Hogan company could survive if, they could stay low on the overhead and sunk cost. If might be the fault that they came into the market wanting to cause a larger impact than being frugal and start in a smaller and more specialized segment of the biz. Another thing is, I wonder if they are also pay the members on the board way too much before the balance sheet showed a profit.

PA-PLAYA

Release Imo... The real pressing issue with the Hogan company (in its current form) is that they're special-order. Which means they're not mass-produced, which means the buyer is not only going to pay more for their equipment, but have to travel across town to locate a dealer... Not to mention it's gonna take longer to get it, even if they locate a dealer.

Their marketing strategy is a throwback to an era when high-end clubs were only available via special-order... these days, especially with so much golf equipment being mass-produced and/or liquidated to make room for newer models, it's incredibly difficult to sustain that special-order only business strategy. Not to mention that the economic situation over the past decade has even the more avid players weighing cost-per-round averages and overall expenses.

Hogan basically hasn't had an active marketing footprint for years, and unfortunately we're long past the days when a only the niche following could help sustain a company's bottom line.

Release

If a golf equipment or any other non essential product or service need to survive, not only the product and/or the service has to be functional, it also has to have the "bling, bling" effect for showing off.
PXG has that, a well made Hogan golf club does not.

PA-PLAYA

Release

PXG will eventually succumb to the same fate as Hogan imo. Supply and demand, the most proven aspect of business vitality, ultimately prevails. Not enough accomplished players in the market for a montly mortgage-type investment for a set of irons.

But should they prove me wrong, good for them.

Release

PA-PLAYA

Right.
PXG has financial backing though. I suspect the price line could be lowered if the volume goes up to a certain level.