Brownie’s Marine Group, Inc. a leading developer, manufacturer and distributor of highly specialized dive and safety products, today released the following company update from its Chairman and CEO, Robert Carmichael:
“During 2011, we focused on cost-structure reductions, enhancing product value, targeting new product launches, and refining our top-dealer support focus. While the economic recession presented unprecedented challenges to every company in our industries, we continued focusing on product development and execution of our vertical and horizontal integration plans with the goal of sustainable profitability in the years ahead.
In 2011 we continued to streamline operations, simplified processes and controlled working capital while investing strategically in innovative products and programs. We pursued strategies specifically designed to re-capture lost market share and optimize profitability in depressed economic conditions.
The introduction of both the most advanced surface-supplied dive system in the world (VS series of variable speed diving systems) and the price category leader, Brownie’s F285-BE Third Lung hookah diving system, simultaneously assisted our brand position and signaled a return to prominence in the Surface Supplied Air industry. Our improved and active web site helped increase online and retail purchases in geographic areas where we lacked dealers, while social media programs helped build relationships with influential enthusiasts.
We believe that outdoor recreation markets have begun to stabilize, yet remain significantly below pre-recession levels. We will continue to emphasize working capital management and supply chain optimization as well as focused product development and the initiation of our plan to open company owned retail centers in strategic locations (Brownie Adventure Centers) to capitalize on the mass shift in consumer trends.
While the outdoor recreation industry is on the road to recovery, the economic recession has had a lasting impact on the marketplace. Consumers are more demanding and discerning with increasingly higher price/value expectations. We believe, traditional “SCUBA” stores focused on a single, narrow market channel are highly vulnerable when compared to our multi-sport concept store: Brownie’s Adventure Centers.
Brownie’s Adventure Centers (BAC) will attract outdoor enthusiasts from a much wider range of the general population. Single niche market retailers are limited in their profit center potential. The variety of sports and activities available at a BAC demand professional guidance, training and mentorship; a resource not easily found in any “Big Box” outlet, but very difficult to subsidize in a single product store such as a “SCUBA” or “SUP” (Stand Up Paddleboard) center. The initial concept BAC in Boca Raton, Florida will feature all types of industry leading dive equipment, training, activity coordination, and services along-side a world class SUP compliment. Free-diving,Surface Supplied Diving, Yacht-Diving, Technical Diving, Science and Exploration Diving equipment, training and practice are rarely featured at traditional “dive shops” but will be optimally presented in the BAC creating a much broader potential revenue base. By expanding the audience of outdoor enthusiasts, such as paddle boarders, we will have the opportunity to introduce our core products (surface supplied air) to a new and broader audience.
While the “SCUBA” industry struggles over a diminished market space, we will continue to innovate our historically gasoline powered product line of surface supplied air systems into a powerful new sport category device. Our vision is for the Brownie to do for diving what the snowboard did for snow skiing – bringing a new generation of enthusiasts into the sport. We believe that the vast majority of the population is aware of SCUBA diving and have made the decision whether or not to participate in it. Ultimately, Surface Supplied Diving is easier, safer, less intimidating, and more fun for shallow depth diving in a purely recreational mindset. Our goal is to create the ultimate product, training and exposure venue that will tap this emerging market space.
In conclusion, focused, disciplined execution of our strategic plan is essential to reach profitable growth in what will be another challenging year. We will continue to carefully manage inventories, keep working capital in check and implement the vertical integration strategy during 2012.”