Some iconic companies end up changing the entire industry. For instance, would you really spend $4.50 on a cup of coffee in weren’t for Starbucks? Without the Apple iPhone, would smart phones be as sophisticated as they are today? Similarly, without MasterCraft, the world of boating, water sports, and the town of Vonore, TN. would not be what they are today.
Born In A Barn.
As an aerospace engineer with a passion for waterskiing, MasterCraft founder Rob Shirley wasn’t impressed with the wakes, power or pulls other boats delivered. So in 1968, Shirley decided to build a boat better suited to the popular sport of waterskiing. Inside a two-stall barn in Maryville, Tennessee Shirley, broke tradition by widening the boat’s hull and using flexible fiberglass materials—instead of wood or steel. The result was a lighter craft that delivered the smallest wake and smoothest pull for its time. At the National Water Skiing Championships in Canton, Ohio, Shirley introduced his new “PowerStar” to the world. By the end of the event, he had not only made his first sale — he made history.
A year later, Shirley was building 12 boats a year — all by hand — a tradition that continues at the Vonore plant to this day. By 1973, Rob Shirley’s new company, MasterCraft Boats was building 52 boats a year. Today, MasterCraft produces well over 2,000 boats annually and supports more than 400 employees and their families, along with dozens of vendors and suppliers throughout the area and country. While a lot as changed in the boating industry in the last 46 years, MasterCraft still builds every boat by hand using some of the most skilled crafts people in the world.
A blast from the past.
While MasterCraft is constantly innovating and reinventing itself to ensure they’re the first to introduce “the next big thing” to the luxury boat market, the company has a tremendous soft spot for its colorful, bold and nostalgic past.
“Recently, we tracked down and bought the very first MasterCraft ever built,” said Jay Povlin, VP of sales and marketing for MasterCraft. “Once we had it in our possession, it was completely restored. That boat represents the foundation and legacy of MasterCraft. The company has grown from that one boat to many different models. With our current product development strategy, boating enthusiasts will continue to see new models and redesigns on a regular basis. But it all started with that first boat.”
When the company moved from Maryville to Vonore in 1993, taking over an empty Sea Ray plant on the serene shores of Lake Tellico, it meant big changes for both the company and the community. As MasterCraft grow and achieved notoriety, other manufactures took notice of the area. As other players and skilled crafts people moved in to setup shop in Vonore, the area soon became known as the little “Detroit of boat building.”
After the storm, a sunny forecast.
Keeping Vonore from going the way of Detroit is another matter. Today, MasterCraft holds an enviable and growing prominence in the luxury boat market with a loyal base of lifetime customers, admirers, imitators and aspirants. But like many boat manufactures, the market was not kind to MasterCraft during the last recession. Discretionary spending on big-ticket items such as luxury boats took a steep dive. In response to the downturn in the fall of 2008, the company was forced to close the factory and layoff more than 600 workers, reducing its workforce to a mere 50 employees.
In order to survive the economic storm and remerge as a competitive force, MasterCraft turned to Wayzata Investment Partners, who purchased the company in 2009. With the support of Wayzata, MasterCraft has bolstered its investment in new products, facilities and personnel. In 2012, the company appointed Terry McNew as the new president and CEO. McNew and his team spearheaded a bold new product plan that has not only taken root, it’s now bearing fruit.
“Our production schedule continues to increase. Our employees are working overtime and we still can’t keep up with retail demand,” said Mr. Povlin. “Plus, we continue to launch new products that are selling at a remarkable pace.”
Mr. Shane Chittum, chief operating officer at MasterCraft, added “Given the growth of the market, we are forecasting production increases that will require us to hire quite a few people this year,” said . “With this increase in production, in addition to the new models we continue to introduce, we certainly expect to be hiring addition staff soon.”
While the company won’t reveal the exact hiring numbers for this year and next, officials are happy to report an expected 40 percent increase in production to keep up with growing demand and the introduction of new products.
Making (New) Waves.
We wish we could report that MasterCraft’s production increase is the beginning of a robust, industry-wide recovery for the overall boat market. Unfortunately, that does not seem to be the case.
According to industry market analysts, the traditional boating market that the majority of manufacturers serve continues to contract. Meanwhile, the luxury segment occupied by MasterCraft and several of their competitors grew by more than 20 percent last year, and is estimated to grow by roughly that same amount this year.
According to MasterCraft, there are several key factors at work allowing them to grow and increase valuable market share while other boat manufactures are struggling to stay afloat.
“The consumer has totally embraced wake surfing – and the market is heading in that direction. Boaters are impressed by what they see people doing on the wake behind a MasterCraft. They want to do that — and you can’t surf behind a stern-drive boat — as you could cause yourself serious harm,” said Povlin.
Another area driving sales is an aging marketplace that wants more choice. While water sports used to be primarily a youth, family and sports market, today’s water sports are truly becoming an intergenerational activity. From behind wake boats, Baby Boomers, Gen Xers and kids who can’t handle the more physically demanding sports, now have a wider range of options, including wakeboarding, wakesurfing, waterskiing, kneeboarding and tubing.
Finally, according to Mr. Povlin, MasterCraft boats get noticed more where other, more traditional recreational boats simply blend in. “If a customer is spending the amount of money some of our boats cost, it had better be cool. We purposely design them to stand out above the crowd.”
Besides offering the ultimate in power, precision and prestige, MasterCraft has always been determined to be the best looking boat on the water. Whether it’s integrating high-end comforts and styling found in luxury cars to seeking out cutting-edge artists, creative thinkers and trendsetters from every industry, MasterCraft has never been afraid to push the envelope on making a first and lasting impression on boaters.
Working the core.
MasterCraft is concentrating their efforts on the core recreational tow-sports enthusiast, along with two models for the hardcore enthusiast, including the XStar for wake board and newly redesigned ProStar for water ski, jump and trick skiers and wake boarders. Additionally, MasterCraft has just revealed the soon to be released NXT, which has a retail base price of $50,000. While that is less than many of their boats, this new entry-level vessel puts the possibility of owning a MasterCraft well within reach for many boating enthusiasts.
“It’s a chance for those who aspire to own a MasterCraft to do just that,” said Mr. Terry McNew, president and CEO of MasterCraft. “We know that once they buy a MasterCraft, they will become loyal, lifetime MasterCraft enthusiasts.”
Does that mean MasterCraft is forsaking the pro market? Not at all.
“Having tow certifications and being the official towboat for big events gives us instant credibility,” said Mr. McNew. “When top drivers and athletes certify that our boats are top shelf, customers know they can trust it.”
Built by the greatest tool known to man: The Hand.
The name “MasterCraft” identifies the brand as much as it speaks to the company’s relentless commitment to quality that goes into every boat that bears its name.
“Our boats are literally hand built, that’s the only way to do it. It’s our mission to ‘be the best boat on the water.’ Not just the best tournament ski boat, not the best in-board V-drive boat, but the best boat on the water, period.” said Mr. Shane Chittum, chief operating officer for MasterCraft.
This is more than marketing hype and company has the independent validation to prove it. Within their 250,000 sq. ft. facility, MasterCraft adheres to the disciplines of Six Sigma to create a safe, clean and controlled environment. While MasterCraft boats may be hand built, they are constructed under very precise conditions, as evidenced by MasterCraft being award three ISO certifications in the past three months.
“MasterCraft is the only boat manufacturer in the world to have earned 9001, 14001 and 18001 ISO certification, and we have the efforts of all our employees to thank for that distinction. To say we are proud of this achievement is an understatement. This represents the combined efforts of the entire organization,” said Mr. Chittum.
According to Mr. McNew, if an employee from another boat manufacturer were to walk through the Vonore facility, they would immediately notice differences, both in production, operating principles, accountability, and even the general enthusiasm of the employees. “MasterCraft employees are boating enthusiasts themselves. They have a great deal of pride in the brand and possess a high-level of personal accountability, not just for their job, but also to each other and the brand,” said Mr. McNew.
Last year, the company tracked more than 3,500 employee suggestions through the Vonore facility. According to MasterCraft executives, the employees they have a lot of good ideas and they are actively engaged in helping make the company and their products better.
In fact, the employees even help sell boats—as they are being built. When customers tour the plant to see firsthand the birthplace of the boat they love, the line workers and staff are excited to greet them—personally—by name. The company has a process where employees not only know the name of a visitor touring the facility, but they even know which boats they’ve owned in the past and those they aspire to purchase in the future. This level of true customer personalization amazes visitors and has resulted in more than a few sales for dealers at the end of the tour.
“I believe our employees have pride in the product and a connection to our customers that few other brands possess,” said Mr. McNew. “They believe in what they build.”
