Lucky Strike Bait Works Limited

LUCKY STRIKE BAIT WORKS LIMITED

Lucky Strike Bait Works Ltd. (Lucky Strike) is a leading manufacturer of fishing lures and landing nets. From its beginnings as one man’s hobby nearly 100 years ago, Lucky Strike has grown into an established business that supplies over 2,000 different products to retailers located all across Canada.

Lucky Strike was founded in 1929 by Frank Edgar in Peterborough, Ontario. As a fishing enthusiast, Edgar would craft his own fishing lures from the ends of wooden broom handles. The craftmanship and effectiveness of his lures quickly caught the attention of other fishermen. Originally selling his lures out of his tackle box, Edgar set up a sales display within the community’s local barbershop. Soon after, a representative from a Toronto-based wholesaler visited that same barbershop. Impressed with Edgar’s products, he issued a bulk order for 10,000 lures.

With the profit generated from that bulk order, Edgar was able to invest in equipment to expand Lucky Strike’s production capacity and product line. Over the years, sales continued to grow, and production eventually moved out of Edgar’s garage and into a dedicated production facility. The company expanded its product line further, adding plastic and metal lures and landing nets. In 1987, Lucky Strike moved into its current 22,000 square-foot facility, where it remains to this day. Leadership of the company has been handed down from generation to generation of the same family. The firm is now in its fourth generation with Edgar’s great-grandson, Dustin Rhodes, heading the company as president.

Today, Lucky Strike’s product line contains approximately 2,000 products, many of which are slight variations of one another in terms of colour and size. New products are constantly being introduced to meet changing market demands. However, Rhodes plans to start phasing out many outdated products to make the company’s product line leaner and more modern. Roughly half of Lucky Strike’s revenue is generated from lures, while the other half is generated from nets.

Notably, the popular lures that Lucky Strike creates cannot be patented, so the firm faces substantial international competition from nearly identical products. Lucky Strike works hard to promote itself as a high-quality and proudly North American company with a long history, which helps it remain successful. It always aims to source materials locally, and only a small subset of its specialty products are imported.

The firm’s production process is highly labour intensive, with many components still unable to be effectively automated. For example, although Lucky Strike owns a digital printing machine (useful for printing small details and customized designs), each lure must be painted by hand as the machine cannot print the required neon colours and is constrained by the curvature of the lures. Thus, the digital machine is mainly reserved for the creation of promotional and custom lures that trade effectiveness for novelty.

Lucky Strike generally works on bulk sets of products in a piecemeal process (e.g., metal lures are stamped from sheet metal on only one day per week). However, Rhodes is trying to shift the manufacturing process away from a “push” system towards a “pull” system, which implements more lean manufacturing practices. Rhodes believes that this change in production strategy will both improve the quality of the products and simplify the company’s resource management, which is an ongoing challenge given the number of products that the business supplies. In addition, from 2016 to 2018, Lucky Strike was able to take advantage of the Canada-Ontario Job Grant to train staff on effective lean manufacturing and supply management practices. So far, these changes have led to better order fulfillment times—a necessity as the firm strives to compete with foreign producers.

Typically, Lucky Strike sells through distributors, with the bulk of its business coming from large retail stores such as Canadian Tire, Walmart, and Bass Pro Shops. The company has also been developing its e-commerce capabilities over the past five years, allowing orders to be placed directly on its website. Currently, sales are primarily limited to Canada, with less than 1 percent of products being exported. Rhodes sees promising growth potential in expanding exports to the United States, as he feels that the Canadian market is almost at capacity. In order to achieve this expansion, Rhodes plans to attend more regional trade shows and build connections with U.S. retailers.

Lucky Strike is “recession-proof," suggests Rhodes, because “if you are laid off from your job, you have more time to go fishing.” This claim is bolstered by reporting and studies from the Great Recession which show that outdoor recreational sales surged during times of high unemployment.

At present, Lucky Strike has 17 employees, many of whom have been with the company for over 30 years and are avid fishermen themselves. By offering flexible hours and an outlet for workers to enjoy their hobby, management strives to make the company an interesting and fulfilling place to work. As a result, Lucky Strike has experienced very little employee turnover. As these workers begin to retire, however, Rhodes will begin looking for workers with new technical skills to help the firm adapt to changing equipment requirements as more technology is introduced.

With a strong and active presence in the fishing community, Lucky Strike is often a sponsor for contests and tournaments, of which there is one scheduled for every long weekend throughout the summer. The company also sponsors many children’s fishing events all over the country, hoping to appeal to the next generation of fishers.

Lucky Strike is also an active member of many local industry associations, including the Canadian Federation of Independent Business, Community Futures Peterborough, and Canadian Manufacturers & Exporters. In addition, Rhodes sits on the board of the Kawartha Manufacturers Association.

Lucky Strike has been able to benefit from select targeted funding initiatives, including the Canadian Manufacturers and Exporters’ SMART program and the above-mentioned Canada-Ontario Job Grant. However, Rhodes has found that approval criteria for many funding programs are often obscure and ambiguous, and that application denials usually lack an explanation. He believes that this uncertainty and arbitrary rejection discourage many manufacturers from applying to programs that they would otherwise qualify for.

Rhodes hopes that in the future, Lucky Strike is able to continue to promote itself as a strong North American brand. If metal stamped lures fall out of favour or the firm’s suppliers close operations, Lucky Strike will have to adapt by importing more goods and materials from foreign countries—a move which could negatively impact its “proudly North American” image. Regardless, Lucky Strike is sure to reel in additional sales through improving its supply management techniques and by casting a wider net into the U.S. market.

Learn more on Lucky Strike’s website at www.luckystrikebaitworks.com

Published on September 23, 2019

Company Profile

Company Description

Overview

Lucky Strike is a leading manufacturer of fishing lures and landing nets. The firm has a rich backstory and long history of producing high-quality products, making it a well-known brand in the Canadian recreational fishing market.

Key Facts

  • Headquarters: 2287 Whittington Drive, Peterborough, Ontario K9J6X4
  • Executives:
    • President: Dustin Rhodes
  • Year established: 1929
  • Number of employees: 17
  • Production Facility Size: 22,000 sq. ft. 
  • Website: www.luckystrikebaitworks.com

Line of Business

NAICS: 33922 - Sporting and athletic goods manufacturing

Products

Lucky Strike sells over 2,000 products, most of which are lures and nets

  • Fishing Lures:
    • Diverse product line of lures including spinners, spoons, trolls, and wobblers, each with many variations in size and colour
    • Most lures are stamped metal
    • Specialty “Live Series” lures are imported
  • Fishing Nets
    • Wide range of nets for specific situations, including bait nets, basket nets, cradle nets, and minnow nets

Lucky Strike also offers a small selection of accessories, custom printed lures, and fishing apparel

Markets

Customers/Applications:

  • Lucky Strike targets both novice and pro fishermen
  • 27 million anglers fish in Ontario each year, spending $2.2 billion in the province. This compares to 3.2 million anglers nationally, spending $7.9 billion

Exports:

  • Less than 1 percent of products are exported
  • The products that do get exported tend to go to the U.S., Great Britain, and Scandinavia

R&D and Education

  • R&D: Lucky Strike is experimenting with new techniques for plating its metal lures
    • Few other firms have the need to plate small items in such high quantities
  • Education: High-school education generally sufficient for production staff

History

Lucky Strike was founded in 1929 by Frank Edgar as a side hobby for crafting wooden fishing lures. Edgar began by selling lures from his own tacklebox to nearby fishermen. His lures quickly spread throughout the community. A visiting wholesaler from Toronto came across a collection of Edgar’s products and eventually issued a bulk order of 10,000 lures. Investing the profits into production equipment, Edgar was able to expand the business’s product line and capacity. Production was eventually moved out of Edgar’s garage and into a dedicated production facility. In 1987, Lucky Strike built a larger facility where it remains to this day. Leadership of the company has been handed down from generation to generation, with Edgar’s great-grandson currently heading the company as President.

Competitive Environment

Competitors

  • Most competing products are imported and simply painted and packaged by Canadian companies
  • While Lucky Strike generates most of its sales from large box stores, it often must also compete with that store’s own line of imported products

Partnerships

Member of various industry associations including:

  • Canadian Federation of Independent Business
  • Community Futures Peterborough
  • Kawartha Manufacturers Association
  • Kawartha Family Business Association
  • Canadian Manufacturers & Exporters
  • Received funding for a digital production printer through Canadian Manufacturers & Exporters’ SMART program

Government Programs

Took advantage of the Canada-Ontario Job Grant to train its employees on lean-manufacturing practices (in 2016, 2017, and 2018

SWOT Analysis

Strengths:

  • Lucky Strike is one of North America’s oldest and largest tackle and net manufacturers with a strong, high-quality brand
  • One of the few Canadian firms that stamps and plates its own products
  • Experienced and flexible workforce
  • Able to brand itself as a proud North American business, taking advantage of its customers’ preference to buy local

Weaknesses:

  • An overly-extensive product line makes resource planning difficult
  • Many components of the production process are still unable to be effectively automated

Opportunities:

  • The outdoor recreation industry tends to do well in times of recession and high unemployment, which means a low downside risk for Lucky Strike

Threats:

  • Growth of the freshwater fishing market across North America has been flat over the past 10 years and Rhodes believes the Canadian market is almost at capacity
  • Sales are subject to significant seasonality fluctuations

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