In 1997, a fledgling Calgary business held court with the golf industry’s retail giants at Orlando’s PGA golf show. And – to mix sports metaphors – John Goetz and his partners hit a home run.

The Calgarians had designed a golf bag with a unique security system that allowed players to lock their golf clubs within their golf bag. Callaway Golf was so impressed it ordered 100,000 bags for the 1998 season.

“We thought we were on Easy Street,” recalls Goetz, president of Soe Sports. “But the Florida company we had contracted with to build the bags couldn’t fill the order that spring. Callaway cancelled the deal.”

It was a blow, but Goetz and company were convinced they had a great idea. They rewrote their business plan, decided to control their own manufacturing and marketing, raised nearly $2 million from family and private investors – and received an education in the process.

Mike Dempster photo, Business Edge
John Goetz of Soe Sports is working on potential new markets.

“I’d say we’ve earned our MBA in the sporting-goods business,” Goetz says. “We’ve had our highs and lows, yet we’ve learned so much in the process that it positions us to take new products to market. I think that is the asset we have built.”

Like so many entrepreneurs, the 40-year-old Regina native’s experiences are illuminating. A former lawyer in Calgary’s oil and gas industry, he left his law practice five years ago to run Soe (until recently, called Eos Sports) full-time.

But the golf bags, which he and some industry experts believe to be the best product on the market, have yet to become big sellers.

“I think when we started this eight years ago, we were way ahead of our time,” he says. “I think that’s still the case.”

The golf bags are unique. A sliding plate technology locks the shafts of the golf clubs in the golf bag. And a retractable cable can secure the golf bag to a fixed object.

“You have people dressed like golfers going into golf courses and stealing $600 drivers out of bags in the blink of an eye,” Goetz says. “I think one of our biggest problems is that 90 to 95 per cent of golfers don’t think about theft. I think, for example, that skiers would look at a product like this and understand the security need right away.”

In recent months, the golf bags have been featured in repeated daily advertisements on the popular Golf Channel. In March, Soe became the first golf bag (not affiliated with a major golf company) to be featured in the Edwin Watts catalogue and website. Watts is the largest golf retailer in the U.S.

“We are getting the exposure we’ve never had before, but we still haven’t seen the results in sales that we expected,” says Goetz. “It’s a lesson because we do believe that we have the best product. But even with that, you realize how important the marketing approach is, and the resources (required) to market.”

To adapt, the company now promotes the product as a great golf bag – not just focusing on its security niche. Soe is stressing other distinctive features that include a coolant pocket; a slash-proof valuables pocket; a composite rubberized material that doesn’t chip graphite shafts when clubs are set in the bag; and a nifty internal pocket that allows a person to reach into the bottom of the bag for a lost item (like keys or change) without having to turn the bag over and shake the contents out.

“It’s a lot of common-sense things,” says Goetz. “When we restructured the business, we had a lot of time to think about the design of the golf bag.”

Coinciding with the product changes, the Soe workplace continues to evolve.

Goetz is its sole employee, while other key people are now hired as consultants.

The company made mistakes, including hiring high-priced talent as full-time employees in the expectation of big sales that weren’t realized, he says.

“We explain to people (potential hires) that, yes, we look large, we have product all over the world, but when it boils down to the bottom line, we’re still a struggling start-up company, and we will be for the next little while.”

He explains that in order to bring product to North America from its Chinese manufacturing plant, the cost runs into the hundreds of thousands of dollars. Cash flow is tight at times, and Goetz concedes he has gone months without a paycheque. Sometimes his consultants aren’t paid on the required date, either.

Nevertheless, he has found people who believe in the company’s potential, and its ability to grab a slice of a market that is annually worth $500 million US wholesale. They’re employees who will work nights, weekends, and travel out of town when necessary, he says.

They also have the skills and ingenuity to help bring other products on line.

“We have a hockey bag on the development board that we’ll probably launch in 2004 that’s completely unique from anything that’s out there,” Goetz says.

“Within our group, we have some people who have a lot of experience in hockey. The challenge will be breaking into that market; it’s a different distribution channel. But if the product is good and we have a good track record in other industry, we feel we’ll be more readily accepted.”

Soft-spoken and thoughtful, Goetz reflects on the past five years and doesn’t regret giving up a solid living as a lawyer for the uncertainty of a startup business.

Thankfully, his wife Rosanne and three young children support him. They’ve made financial sacrifices, he acknowledges, and understand that sometimes, “Dad can be very preoccupied with the business.”

Goetz loves the idea of taking a concept, building a foundation and creating a team that moves forward and becomes a success. In Soe’s case, the biggest mistake the company made was not to build slowly and establish a good base.

When Goetz first began showing golf bag prototypes, people were pulling out their chequebooks to get on board. All indications were that the Calgary group had hit a home run.

“We never gave ourselves a chance to grow as a smaller company. We had to have large sales to break even, to pay our investors, and so on.”

The game plan today is to move forward on a slower-build basis, says Goetz.

“Then when the real demand comes, we’ll cope with it.”

Web watch:
www.soesports.com