Bob Gaylord, President, Agio International
Adapting Agio through 20 years
By Kristine Ellis -- Casual Living, 1/1/2009 12:00:00 AM
Once you've met Bob Gaylord, it is hard to imagine he could manage to stay under any radar for very long. His bullish attitude about the casual industry combines with his willingness to share his knowledge and his track record of success to shine a light on this 37-year industry veteran.
And yet, staying out of the limelight was Gaylord's successfully accomplished strategy during Agio's early years. Launched in 1988, the company was Gaylord's and his long-time business partner Oliver Wang's first venture into prime manufacturing. The two started the business after selling Omni Products, their PVC and aluminum outdoor furniture company some credit — or blame — for popularizing the category at the mass level. By the late 1980s, mass market price points for outdoor furniture had plummeted.
Gaylord was determined to keep Agio out of the low-cost fray and on its own path.
"Our goal and mission was to bring higher-end outdoor casual furniture back to the mass side of the business," Gaylord said. "We stayed under the radar for a number of years, slowly and surely proving that our marketing concept made sense and that the general public wanted more than what they could buy for $199.99."
As Agio quietly began to transform the category at the mass level, specialty dealers took notice and started pushing to buy from Agio. Gaylord was reluctant at first, fearing production for specialty would suffer while the demands of the larger mass customers were met. Eventually, he had to say yes.
"We sold our first specialty product in 1994, and lo and behold, our factory delivered and shipped all of the specialty orders on time," he said. That success became a milestone for Agio and Gaylord alike.
"The specialty business is the most satisfying part of the business," he said.
A vibrant specialty segment
"It would have been easy for us to have ignored the specialty segment, but we believe that, for our industry overall to be successful, there has to be a vibrant, successful specialty retail segment," Gaylord said.
The need for vibrancy within the industry is a theme that gets Gaylord's opinions flowing. He's one of the industry's most optimistic advocates, but he also believes specialty dealers and outdoor furniture manufacturers have to be willing to change with the times.
"Specialty retailers have to get creative and innovative, and offer more goods and services," Gaylord said. "Most of all, they have to get competitive. Consumers have to stop getting sticker shock when they walk into the store."
The current economy exacerbates the problem as consumers change their spending habits. Having run successful businesses through many economic downturns over the years, Gaylord believes specialty dealers can remain profitable in today's market — if they are willing to change their approach or even go so far as to reinvent themselves to do what it takes to survive.
"Most of the mass merchants are working on 50% margins, approximately what specialty retailers would like to get and there's no reason why they can't," Gaylord said. "Now, 99% of mass products come from overseas. So do you have to start buying from overseas? You probably do. Do you have to start buying direct containers? You probably do. If you are not going to do something like that, then you are probably going to see your market share drop each and every year."
Gaylord acknowledges the casual industry as a whole doesn't have the financial backing other specialty industries have, but he doesn't accept that challenge as an excuse for manufacturers and dealers not to do everything they can to increase the industry's visibility.
"More disposable income is being spent each year preparing outside spaces for casual furniture," Gaylord said, "but consumers are still spending no more on outdoor furniture each year than they do for clocks. Why is this? So I keep asking the question: Where is the investment in outdoor specialty retailing?"
More to do
Gaylord made his first venture into the outdoor furniture market in 1971, when he started a small manufacturing company that built various steel tubular frames that lumber yards would combine with lumber and sell as picnic table, deck, bench and other do-it-yourself kits.
"That business taught me the market for outdoor living was real, growing and insatiable," Gaylord said.
With the exception of a short detour into the hearth industry, Gaylord has been pushing to meet the expectations of the outdoor living market ever since.
He credits his parents, Everett and Margaret, for his work ethic. His mother, in particular, showed him how to take advantage of every opportunity available after his father died when Gaylord was 12.
"She is 95 years old now and has witnessed all of my successes and failures with a very even response," he said. "And although she acknowledged my accomplishments, she certainly never went overboard with praise but rather always expected more of me because she knew I could do it.
"I basically bring that same philosophy to my management style. If our people are clear on our mission and know their responsibilities, I try to stay out of their way so they can get the job done."
Now a more than $400 million company, Agio has more than 8 million square feet of manufacturing and warehousing space and thousands of employees.
Gaylord, who still remembers when he personally was doing the vast majority of the design, prototypes and customer service, remains very hands-on as he travels to China many times a year, staying anywhere from a few days to a month.
One of his most recent projects has been working with John Oppenheimer, Agio executive vice president, and Disney executives to further their partnership, which debuted at the Chicago Casual Market. Agio began offering specialty dealers two outdoor furniture collections featuring the Disney brand.
"We were shocked by the success we had with the collections at the Casual Show," Gaylord said. "Disney was surprised too. I think specialty retailers are eager to grasp onto something new or big, and there is almost no name bigger than Disney."
Given the success of that partnership, Agio is now pursuing another new brand relationship for the 2010 season that Gaylord believes will be just as exciting.
Meanwhile, he looks forward to what he thinks will be an unexpectedly strong spring for outdoor furniture sales. If gas prices continue to stay as low as late last year, "that puts at least $200 a month in each family's pocket, which calculates out to be billions that they will eventually spend on other things," Gaylord said. "And God love the American consumer. They can only keep their hands in their pockets for so long. So I expect the spring season to be surprisingly good."
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