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Diamond Powersports’
innovative new products have contributed to the increasing interest in sport bikes among
men and women
Consumer Goods
Auto Parts
(DPWS.OTCBB)
Diamond Powersports Inc.
5150 NW 109th Avenue
Sunrise, FL 33351
Phone: 954-749-8606
Pierre Elliott
Chairman, President and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
February 9, 2006
BIO:
Pierre Elliott - President/Owner
From racing mini bikes at age five to becoming a fierce competitor in street racing of
full size motorcycles at age 12, the "desire to win" has seemingly been a part
of Pierre Elliott's DNA from birth. Making a very good living from strictly street racing,
in 1992, at age 30 he decided to open his own company selling miscellaneous motorcycle
parts and building drag racing motorcycles from the ground up.
This redirection of passion and knowledge for racing gave birth to Diamond Powersports,
Inc. This newly founded company began with very humble beginnings serving only 50
customers from its local area in its first year of business. Continuing to press though
and overcome some difficult times, within only five years time Diamond Powersports entered
a new arena within the industry with the design, manufacturing and marketing its own
motorcycle parts and accessories.
Today, with his leadership skills and keen wisdom, Pierre has earned respect within all
aspects of the motorcycle industry.
CEOCFO: Mr. Elliot, what was your vision when you created
Diamond Powersports, and how has that played out?
Mr. Elliott: “My vision was to set out and create the
best aftermarket parts sport bike company in America. I thought there was a big void in
the industry, especially that area. This was a natural since I came from the motorcycle
drag race background and it was easy for me to fit that role. Diamond Powersports also fit
well with that too.”
CEOCFO: Will you tell us
more about Diamond Powersports?
Mr. Elliott: “I came from being a national champion drag
racer, to being an entrepreneur. We got into the drag racing industry early; I felt that
it was saturated with so many companies doing the same thing and I wanted to do something
different. The industry as a whole had a void in it as far as motorcycles sport bike parts
and I attacked that. I thought that it was good for us to focus in on one area and stay
out of the drag race area. I did that for a while and over the last few years, we got back
to our roots, which was drag racing. Nothing has really changed in the industry as far as
things new under the sun; it is just the way we approached it and it worked better for us.
Diamond Powersports is kind of the leader in this industry. Just about everything we do
now, everyone else in the industry copies. That has been a big problem of ours; when we
make a new part, we see it within the next few weeks, identical to what we did.”
CEOCFO: What are you
doing that is different?
Mr. Elliott: “There is the old adage; if you build it
they will come. Though this is many times the case, in our regard, I do not. We do not
just make the parts and sell to people who are going to buy it. I take the part, go out
into the community of motorcycle riders and I ask them what they like or do not like about
it; I ask a lot of questions. I ask them what to me is the most important question and
that is would you buy this and put it on your motorcycle? If the consensus is
“yes”, then we make the part and put it out on the market. If they tell me
“no”, I reconsider, make it better and come back and start the process over
again. That is what we do differently than everyone else and that is where all those guys
make their mistake; they just build them and believe people will buy them and that is not
the case. What we do is go out and stimulate the market with a nice product. This is
usually followed by our competition copying it.”
CEOCFO: Will you give us
an example of an innovative product that you’ve created?
Mr. Elliott: “We did so something that had never been
seen before; we created a product called ‘Flame Sliders’. There were a lot of
companies making a product called ‘Frame Slider’, which is a part that you put
on the side of your sport bike so that when it falls over, you do not damage your fairing.
It is made of plastic and it protects your bike. I took it a step further and found a
clear plastic, polycarbonate, and I designed it where we can put lights in it. Not only
can you use that as a Frame Slider and protect the motorcycle, but it also works as a turn
signal, so I took two products and combined them to make one good product.”
CEOCFO: How much of your
business is parts and how much is accessories? Does the mix make a difference for
you?
Mr. Elliott: “It does not really make a difference; they
are one and the same. Parts are things that you would buy at your store and put on your
motorcycle that were already on the motorcycle. Accessories are something to jazz it up
and a lot of people call that department the parts and accessories department. It is
really the same. When you put an accessory on your motorcycle, it is supposed to make your
motorcycle nicer than what you bought from the OEM manufacturer. That is where we fit into
the picture; we try to make everything we do, nicer than what you can buy at your OEM, and
we try to make it fit better, look better and work better. We try to do it in a
three-pronged way.”
CEOCFO: How do you sell?
Mr. Elliott: “We sell our products through several
distribution companies. We have one of the largest, if not the largest distribution
network in the sport bike industry. We sell to the number-one, number-two and then to
number-three largest motorcycle parts distributors in the world. That is how we sell our
parts. It is easy to sell the parts when people like them and when they ask for them by
name. We have different avenues to sell our parts but I tend to take the approach that the
distribution network is the best way for us because with distribution, you tend to move
many parts much faster than normal.”
CEOCFO: Do you need to
maintain a large inventory and how often do you rotate and change parts and accessories
and come up with new items?
Mr. Elliott: “We maintain a large inventory and every
part that we make and every new product that we put on the market, costs us 100-fold more
than it would have cost us just two years ago. This is because with the distribution
channel so large now, it is harder for us to make a part and just put it on the shelf.
Whereas, a few years ago, we could take that part and put it immediately into our pipeline
because our demand so much smaller. We now have to produce the current market demand and a
back-up inventory so we can quickly replenish them when they ran out. Instead of making
100 of a particular item, we now have to make 1000, and then we have to back that 1000 up
with another 500-1000 just to keep the distribution channel supply. It is harder now
because we so have to keep a larger inventory. But, I guess there are worse problems to
have.”
CEOCFO: Do customers ask
for your products by the Diamond PowerSports name?
Mr. Elliott: “Yes, customers do ask for our products and
that is fortunate for us. Our director of marketing and sales, Dave Lewis, Ph.D. has done
a great job at marketing our products and our products are now known all over the world.
These are products where when people walk in the stores; they are the first thing
customers ask for if they are looking for a sport bike product. We have changed the face
of motorcycle as a whole. In 2001, women represented 2% of the industry and as of last
year, they represented 17%. I would like to think it is due in a large part to Diamond
Powersports and our invention of the ‘Lowering Link’. This highly innovative
motorcycle accessory allows women that like sport bikes to have their feet reach the
ground. One woman said to me, ‘if you can make a part that would allow me allow my
feet to reach the ground, I would buy a sport bike. I went back and made the link, put
them on her bike at the store, and the lady bought the bike on the spot. We have been
making them for all different brands and models of sport bikes ever since and it has
changed the way women view motorcycling now.”
CEOCFO: Have you had to
add to your team as you increase and grow?Mr. Elliott:
“Yes. When I first started the company, it was my wife and I, and now there are
thirteen employees here. Every year we take on around three or four, people. We weed
through the good ones and the bad ones and we take the great ones that work for us. I tend
to try to do business with a lot of temp agencies, because they train the people before
they get to us, and they know who will do what and how they will work in this environment.
Springtime is when we need the most people working here. Now that our distribution network
is as large as it is, we are constantly adding more people. I anticipate adding two to
three people this year to stay permanently.”
CEOCFO: Will you tell us
how becoming public has changed the Diamond PowerSports.
Mr. Elliott: “When we first got into this, it was
different than it is today. It was easier and did not cost as much money. Now, the
publicly traded side of Diamond Powersports, has taken a lot of what we do best away from
us because we have to concentrate on that - staying current and compliant with the FCC and
doing the right things that are deemed of a public company. Some of the scandals that we
have seen in early 2000 have come to take a lot out of the company. From what I can see
with most publicly traded companies, money spent on CPA’s, attorneys and government
fees to stay compliant makes it harder to make a good profit.”
CEOCFO: Will you tell us
about the financial picture?
Mr. Elliott: “The company is just like any small
company, meaning that we run into financial difficulties sometimes. However, working
through these times always makes us stronger when we come out of them.”
CEOCFO: Do you focus on
reaching investors?
Mr. Elliott: “I talk to companies about it often. To me
it is better to focus on what you do best. What we do best around here, is make motorcycle
parts and sell motorcycle parts. Whenever we have done business with IR firms, we have had
some pretty bad experiences. This has made me tend to stay away from all of them. At this
point, I will not do anything major until we can get the right type of partner on our
side.”
CEOCFO: You let the
company speak for itself!
Mr. Elliott: “That is what we are doing now. There is no
doubt that we are going to have the greatest year we have had since we have been in
business. I think that we will let Diamond Powersports do its own talking.”
CEOCFO: What is ahead
two or three years down the road?
Mr. Elliott: “I see a bit larger company. I think it is
easier to manage a smaller company and grow one brick at a time. We have great people that
work here but until we find the proper people to grow it the proper way, we will grow one
brick at a time. Many times, I see companies that tend to grow too fast and outgrow
themselves. One of the things that worried me over the last couple of years is that the
company wanted to grow itself really fast and I was the one putting the breaks on. This is
because if you grow too fast, you can outgrow your pocket and that would have been worse
than to let it grow by itself and eat itself. I decided to err on the side of caution
instead of the side of ‘glutton-for-punishment’ money.”
CEOCFO: In closing, how much riding do you do these days?
Mr. Elliott: “I do not do as much as I used to because I
am a family man, a business owner and I do more meetings than I used to. If I had more
time, I would ride my motorcycle a lot more.”
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