Former Olympic rower John Strotbeck dreams of employing thousands of people at his sports apparel factory in North Philadelphia. His firm is also opening five physical stores.
by Kathleen Nicholson Webber for the Inquirer
Dec 27, 2021
John Strotbeck estimates he’s outfitted millions of athletes through Philadelphia-based Boathouse Sports, selling a million units of outerwear and athletic gear to professional, college, and high school athletes annually for the last 20 years.
Now he is betting that some of those athletes, now in their 30s to 50s, will buy Boathouse apparel for nostalgia reasons, reminding them of the “best years of their lives.”
The pandemic torpedoed Boathouse’s business in 2020, as it did to many others. Between the state restrictions placed on nonessential businesses and the halt to team sports for longer than expected, Boathouse could no longer rely on its typical customers.
“COVID cost us 50% of our business over the course of about 18 months,” said Strotbeck, whose company adapted in part by making tens of thousands of masks for doctors, nurses, and Wawa workers.
And while business has now almost entirely recovered, Strotbeck saw big changes in consumer behavior and preferences and felt the firm had to diversify its sales and marketing channels.
The plan: continue outfitting teams but pivot to more consumer channels. Strotbeck recognized he needed help building a consumer brand from the company he launched in 1985, between his appearances for the U.S. Olympic rowing team at the 1984 and 1988 Games.
“I was smart enough to know what I didn’t know,” Strotbeck said. So, 13 months ago, he hired a CEO, Cindy DiPietrantonio, former chief operating officer of Sidney Kimmel’s Jones Apparel Group who managed seven acquisitions for the $4.5 billion company and a multitude of labels like Stuart Weitzman, Nine West, and Jones New York. She also led jewelry brand Alex and Ani.
The ambitious 90-day plan that DiPietrantonio started with had to be tossed out when COVID-19 lingered. The firm’s labor force fell off drastically, Strotbeck was sidelined with the virus, and a malware attack had the new CEO scribbling financials on the back of a napkin.
Big changes are coming
It took some time to steady the ship, but now its e-commerce consumer business is ramping up, currently 10% of sales — representing a 34% rise over last year. The company has set a goal of 30% for online’s share of total sales for next year.
“Our goal is to make it more accessible by selling in key retailers, Boathouse branded pop-ups as well as Boathouse.com and through collaborations,” DiPietrantonio said.
Nantucket was a natural because the firm has a strong customer base in Boston, a big rowing town. Boathouse sold to Nantucket’s TownPool, whose owner wore the product as a prep school and college athlete. And when inventory thinned there, it got a lift in sales on the website in the Boston area.
The CEO also beefed up her team and hired a director of e-commerce and marketing, directors of operations and finance, and merchandising and design associates. The firm uses an agency to help with search engine optimization (SEO) and pay-per-click advertising while in-house employees handle other digital marketing and social media.
DiPietrantonio also spent lots of time listening to consumers and learning the brand’s DNA.
“Our consumers have an emotional attachment to what they wore in high school or prep school, so we’ve made a few tweaks to styles and we have branded it with Boathouse,” she said.
There’s a new version of Strotbeck’s first rowing jacket, the Gore-tex Stevenson jacket ($108-$264), a refashioned long swim parka that just hit the site ($198), and in 2022, the restyled retro Coaches Only jacket ($168).
Top sellers include the “trou” compression (rowing shorts, $38 to $88) that customers wear to run, bike, or row in, the journey short ($52), and pants ($68), its version of a jogger.
Last spring the firm launched the Tailwind hoodie ($78-$88) and sold more than 1,000 units by repeatedly tweaking the product with new colors and patterns.
DiPietrantonio has worked with the design team to introduce new prints using a technology that Strotbeck invested in almost 15 years ago to compete with shoe brands called sublimation. It’s the process by which a digital image is fused to the performance fabric using a heat transfer process and expensive equipment.
The company added sublimation in 2007 to fend off the shoe brands like Nike, Under Armour, and Adidas that ate away at its college team business. It was a relatively unknown process but now accounts for 70% of uniforms. Strotbeck estimates he has invested $1 million in equipment alone to be able to customize apparel.
While the athletic apparel sector is wildly competitive, DiPietrantonio said there is room for more players. “Our competition is not the shoe brands and it’s not Lululemon, Athleta, or Outdoor Voices. I think there’s white space between those two categories for a quality, authentic outerwear and accessories brand. And that’s really where we fit.”
There are two groups the brand resonates with: the former athletes who wore Boathouse, and the 15- to 25-year-olds seeking an alternative to the large brands.
“They’re looking for companies that represent more than just making a buck,” said Strotbeck. “We make everything in the USA. That’s important to people. It should be. It’s more important now post-COVID than it was pre-, being a socially responsible company.”
DiPietrantonio said the firm pays at least $12 an hour for sewers — a rise from $10 pre-pandemic — along with health insurance and a 401(k). “We gave out [pay] increases in 2021 and will in 2022,” she said. “My goal is not to be competitive but to have some of the best wages in the industry.”
While many companies are dealing with far-off supply problems, Boathouse’s pain points have been closer to home: finding enough local factory workers and navigating the domestic trucker shortage.
Still, the firm has been lucky. “Where most companies are dealing with 14 to 19 weeks from order to customer delivery, we are dealing with five to seven,” DiPietrantonio said.
Pre-COVD Boathouse had 225 employees, 170 at the factory alone. After the pandemic drained the workforce, the firm now totals 170 and 80 at the factory.
“We are finding it very difficult to get people to come back or just hire new people,” Strotbeck said, despite the safety precautions in place.
The company is offering finder’s fees for new hires and training for new factory employees. Boathouse has had to find local factories to outsource work to fill orders or turn them down.
“This is a national issue; it might be an international issue,” he said.
Its current 100,000-square-foot facility was intentionally chosen where he could find apparel craftspeople. Boathouse was courted by officials in Tennessee, South Carolina, and Kentucky to move there in the late 1990s when the firm had outgrown its 20,000-square-foot Wissahickon Industrial Center facility.
“We made an educated guess that, while pay was lower in the South, it would be hard to find workers in a few years as the auto industry and data processing were investing heavily in the regions. We decided to stay in Philly.”
He took out a map and put pins on where all his employees lived. The company opened its Hunting Park Avenue facility in 2000, hoping eventually to quadruple the production capacity.
That hasn’t yet happened. But “I have this dream. I’d love to employ thousands of people in Philadelphia, and I think that is achievable.”
“I know product and she knows brands, consumers, and how to grow a business, particularly in the retail side,” said the founder, deferring to his new CEO. “ She’s definitely going to take us to very big places.”