Manufacturing & Distribution
Industry and Channels
The golf grip market is a mature industry and, therefore, manufacturing methods have become fairly standardized. Golf grips manufacturers typically have facilities located in China, Taiwan, or Mexico and produce rubber and elastomeric products for a wide variety of industrial uses. While the production of grips is not particularly complex, usually involving some injection or extrusion molding process, it is important that they can be manufactured in large batches and with a high degree of consistency. It is also necessary to have the flexibility to manufacture grips of a variety of materials, qualities, sizes, and even colors to meet the myriad tastes of golfers of differing sexes, ages, and skill levels. The company will become a supplier to golf equipment retailers and, eventually, to several major golf club OEMs. Most major OEMs demand high standards of quality and service from all suppliers and require reliable second sources for most components, including grips. The company's success with OEMs will be dependent upon its ability to supply high quality grips and provide a high level of service.
Strategy
ProGrip will outsource all phases of production and distribution for the foreseeable future. This strategy eliminates the need for extensive fixed assets while maintaining flexibility in design and production. In addition, this strategy allows the company to best meet the needs of its OEM customers, which are projected to collectively account for 20 percent of sales by year five. It will also allow the company to better establish initial market acceptance by focusing its attention on product development, marketing, and sales. Sourced products will be manufactured according to ProGrip's strict quality control specifications. To assure the quality of its sourced products, the company will work closely with third-party manufacturers, emphasizing product reliability, performance standards, and strict quality controls to which all producers must adhere. ProGrip will monitor its sourced products to improve quality. We will establish product specifications, select the materials to be used to produce the grips, and test the specifications of all grips received by the company. In addition, ProGrip will maintain redundant sources of supply for each of its grips.
ProGrip is currently negotiating with Freightliners to provide for all of the company's warehousing and distribution needs and with Calypso, one of the leading manufacturers in Indonesia, to supply the company's initial products. In addition, ProGrip is in discussions with Advance Elastic Corporation, a wholly owned subsidiary of Dow Chemical, to provide the company with premium materials to use in the manufacture of the Impress grip.
