It won't make much of a dent in the nation's trade deficit, but a Utah manufacturer has gotten his foot in the door of one of the world's more impenetrable export markets: Japan.
As you read these words, two $60,000 Starfire boats are on a ship headed for the Land of the Rising Sun and what Starfire President Gil Freedman hopes will be a rich new market for the West Jordan boat builder.The pair of 265 Westports - 26-foot inboard cruisers that are well-known at Lake Powell, Flaming Gorge and other Utah waters - have been bought by a Japanese conglomerate (whose name, for competitive reasons, Freedman does not want published at this time) for evaluation. If the buyers like what they see, it could be the start of something big for Starfire Industries.
Not that Freedman has any illusions of easy riches. He knows what most American manufacturers know who have lost much of their domestic market to Japan: the Japanese import/export door often swings only one way.
"It took a lot of doing to get into Japan," said Freedman. "Anyone who thinks they can fly to Japan with an order book and begin writing orders is crazy."
Donald A. Williamson, Starfire's executive vice president, agrees.
"You have to go through eight different levels before you get to the decisionmakers," said Williamson. "Everyone wants a piece of the action. Interpreters have to be hired and you have to pay them significant commissions to get to the right people."
Selling boats to Japan might sound like taking coals to Newcastle but Freedman says American pleasure boats are every bit the equal - or superior - of their Japanese competitors, the largest of which is Yamaha.
With increased discretionary income among the Japanese and, perhaps more importantly, an increase in their leisure time, off-shore boating is gaining in popularity.
"They may only use them once or twice a year," said Freedman, "but if their neighbor has a boat, they want a boat."
Whichever way the Japanese venture goes, Freedman and his 37 employees can take comfort in the fact that they have already beaten heavy odds just by staying in business for 23 years.
In an industry with competition dominated by a few big players - Brunswick, Outboard Marine Corp., Genmar, to name three - who build boats under a variety of brand names, Starfire is now among the oldest privately owned, continuously operating boat builders in the United States.
Freedman got started in the boat-building business in 1954 in Los Angeles, building wooden boats covered with fiberglass. In 1967 he launched Starfire and began building all fiberglass models. In 1969 he loaded up his molds and moved the entire company to Salt Lake City.
Why move a boat-building company away from the ocean and into the desert? Simple, said Freedman, Salt Lake City has a higher quality and more stable work force (many of his original employees are still with the company) and also has a more centralized location for transporting boats to dealers throughout the West (and later to expanding markets in the eastern United States).
"The independent boat builders who were our competitors (in California) have all since gone out of business since we left, so I guess we made the right decision," said Freedman.
Starfire's original location was at 619 S. 600 West where the company built boats up until two years ago. They might still be there today, says Freedman's wife, Laurie, who is also secretary/treasurer for the company, if it weren't for a rather comic (now, not then) incident in September, 1988. They had built their first 33-foot boat only to find they couldn't get it out the door. (A wall had to be "rearranged" to accomplish the task.)
After that, Freedman, who is sole owner of the company, began looking around for some new space. He found what he wanted at 5955 W. Wells Park Road, West Jordan, two buildings totaling 120,000 square feet on 25 acres formerly used by Boise Cascade's manufactured housing division.
The downtown location was retained as headquarters for Starfire's Marine Wholesale division, which includes another parts and accessories facility in Murray.
Freedman personally designs all of the molds for the various hulls and decks of Starfire boats and all but engines, windshields, galley appliances and a few other items are manufactured in-house. This makes the company surprisingly independent of outside suppliers considering the complexity of a modern cabin cruiser.
Starfire currently produces 22 models ranging from 18 feet in length to 33 feet and in price from $14,000 to $115,000 depending on equipment. Some 40 dealers currently handle Starfire across the United States with two, in the Lake Tahoe area and the Baltimore/Washington D.C. area, carrying the Starfire line exclusively.
Sales history over the past decade shows the company building from 300 to 500 boats per year, with the factory having a capacity, said Freedman, of 2,000 or more if demand warranted.
Williamson declined to reveal company sales figures but noted that in 1989 and in 1990 (the 1990 model year ends next month) sales were down 15-20 percent from 1988, the last "strong" year for domestic boat builders.
In that year, he said, the industry overbuilt, creating asurplus of inventory. That oversupply was gradually reduced in 1989-90 and he anticipates 1991 to show improvement.
Whether Starfire's current Japanese connection blossoms, Freedman and Williamson are not going to slow their attempts to move further into international markets. They currently are negotiating with importers in Europe and recently signed with an importer in Canada. Also, to cover their bet in Japan, they will be exhibiting at the Tokyo boat show this fall.
"That's why I have trouble projecting next year's volume," said Williamson. "Our company could easily double with international sales."