OILA making play for industry dollars

Outdoor industry companies may soon, if they have not already, be receiving a sales call from an organization dubbing itself as OILA (Outdoor Industry Logistics Alliance).

GearTrends® (SNEWS’ sister publication) received a call in late October from Brian Cole, assistant to OILA Vice President Jeff Ellis, pitching us on the virtues of an alliance and encouraging us to join — that is until we pointed out we were journalists, not a company in need of shipping or logistics support.

What is OILA? First off, OILA is NOT associated with the Outdoor Industry Association (OIA) in any way, despite the curiously similar acronym and name.

Though Cole was somewhat vague in his initial contact with us, a follow-up email from him and a subsequent visit to the company’s website — www.go-oila.com — reveal that OILA seeks to bring together a coalition of dealers and suppliers with the goal of reducing costs in transportation and logistics.

Or, as Ellis put it when we asked him, “We basically leverage the overall consolidated purchasing power of our clients designed to save our clients money. We only make money when we save them money.”

In other words, OILA is simply one of many companies already serving as broker between shippers and suppliers.

Looking deeper, SNEWS learned that OILA is actually a newly established arm of Mihlfeld & Associates and that company’s affiliate, Global Transportation Systems. A Springfield, Mo.-based company, Mihlfeld has been in business since 1993. Current clients of OILA include Bass Pro Shops, Glock firearms and Mossy Oak, according to Ellis.

OIA President Frank Hugelmeyer told us that he has not heard of OILA, although he said OIA staff has had discussions about whether the association should endorse a broker such as OILA. To date, it has not.

That’s “simply because the programs OIA has looked at so far are not fiscally in the best interests of our members,” Hugelmeyer said.

David Ingemie, president of SIA (SnowSports Industries America), said he hadn’t heard of OILA either when SNEWS contacted him, but he also expressed concern regarding OILA’s sudden and very public marketing moves.

“I would consider them to be in competition with us,” said Ingemie. “I suppose if a member could save tens of thousands of dollars by going with a consolidator, it makes sense, but if you’re only going to save a few hundred to a thousand, it is more important to support your industry associations.”

His is a sentiment with which Hugelmeyer enthusiastically agreed.

“When we deal with shipping companies and freight programs, we have two interests: To save our members as much money as possible on freight costs and to design the program so the freight company puts money back into the industry which then goes to supporting industry programs,” Hugelmeyer said.

A quick glimpse of discounts for OIA members reveals savings of up to 41 percent off FedEx rates as well as 56 percent off Yellow Freight and Roadway less-than-truckload shipping rates. SIA member rates are similar offering up to 40 percent off FedEx rates and 61 percent off Yellow Freight less-than-truckload shipping. All discounts are off base-rate pricing.

Ellis told SNEWS that OILA guarantees its members at least a 5 percent savings on their shipping expenditures, although he said many clients receive more than 10 percent to 30 percent.

When we pointed out to Ellis that SIA and OIA members already save significantly on shipping costs, Ellis stated, “We can always do better than association discounted rates. In addition, you end up cutting a check back to the association for up to 1.5 percent as a royalty. We say if you join our organization, you save more and then if you want to make a cash contribution to the associations, great.”

SNEWS View: A name curiously similar to OIA certainly caused us to raise our eyebrows just a tad higher than usual. Checking the database for website registration we see Mihlfeld created the Go-OILA.com website in January 2003. At this time, no registrations are pending for Go-SILA (Snowsports Industry Logistics Alliance), but it wouldn’t surprise us if that popped up before long. When we interviewed Ellis, he told us he would “love to work with OIA and SIA” as it was on OILA’s agenda to begin building alliances with associations. We gave him phone numbers and emails for both Frank Hugelmeyer and David Ingemie. That was over a week ago, and to date, neither Hugelmeyer nor Ingemie has heard anything. Bottom line here, unless OILA is a miracle worker, it is very unlikely it can save small companies any more than OIA or SIA can, and since it’s not supporting the associations, we’d recommend you stick with the association solution. If you are the size of a Bass Pro Shop or a Columbia, chances are you already work with a shipping consolidator or an internal shipping solution that saves money so it then becomes a matter of seeing if OILA can beat the deal you have currently. It says it can, but we wouldn’t expect it to say anything else.