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Angling into a compelling business


Start-up lesson number one, if experience is our guide, is to invest in a product unique to Oregon that is about to be the topic of a major motion picture. It worked fabulously for Oregon Pinot Noir following Sideways. But before that, it worked even better for those in the business of angling for fish with a rod, reel and fly.

The Pacific Northwest’s boutique fly fishing industry found its unexpected spokesman when Brad Pitt chased big fish against the incredible backdrop of Montana in A River Runs Through It. Talk about a visual marketing campaign.

“That movie kicked the fly fishing business in the tail,” Jon Bauer, founder of Bauer Fly Reels in Ashland, Ore. recalled recently. “That propelled the fly fishing industry for ten years. All these people saw the movie and fell in love with it and had to go do it.”

Bauer was one of those caught up in the momentum, which also grew because of a dramatic sweep of history. In addition to Pitt, another big name of that era – Ronald Reagan – had a little bit to do with it. The Cold War Era fell with the fall of the Soviet Union and the destruction of the Berlin Wall. Defense spending dropped. Back in places like California, machine shops bore the brunt. Many had to reinvent themselves just like a Bauer, a race car driver with a machinist background.

“Everybody and their brother who had a machine shop was trying to make a fly reel in the 1990s,” Bauer said.

Bauer beat them all to the punch and he did it by literally reinventing the wheel.

Re-inventing the wheel

Bauer, now 65, was in his early forties with a new family when he needed a new career. Being a race car driver doesn’t prepare you for much outside of racing. He said he considered a startup business within the field of racing that he knew well.

11043050_929517320414677_4805936100096403220_n“That was, for me, deep water,” he says. “You had to have a lot of money and I didn’t.”

What being a race car driver did prepare him for—combined with his machinist background from his youth—was to make things.

“In racing we were designing widgets all the time. That’s how you stay ahead and win,” he says.

So the next career move, he figured, would involve some type of new widget that he could put his name on and sell. Riding the aforementioned wave of interest in fly fishing and being an angler himself, he thought a lot about the reel.

“It’s a pretty simple device and they’ve been made in a certain manner for many, many, many years,” he says.

That lack of innovation created an opening. Also, coming from a different industry all together, he thought differently than those trying to improve the reel. He thought about truck winches and race car wheels and how both generate power and speed. He applied some basic physics, a larger wheel (called an arbor) and new clutch technology, all of which came together in a patented design that makes Bauer Reels one of the best reels on the globe still to this day.

“Large-arbor fly reels are the hottest thing in fly fishing since the introduction of graphite rods in the 1970s,” wrote Field and Stream magazine.

“It’s illogical to have it any other way,” Bauer says. “It was not only large arbor, but a one-way clutch that I designed. Eliminating the number of parts, better costs, less things can go wrong. It was a game- changer. It was totally different and that’s what made such a big splash. As a result, any reel company of any consequence today all make large arbor reels. We really changed the industry.”

Oregon made craftsmanship

So start-up lesson number two might just be this: if you expect to profit from a major motion picture and the glamorous star power of a Brad Pitt, your product better be good – industry-leading to be precise. Here, like Oregon Pinot Noir, fly fishing in environmentally protected free-flowing rivers and streams elevate the quality of the experience throughout the Pacific Northwest.

Bauer’s reel remains an industry leader.

10710554_844675922232151_5783647888767386693_nStill made by hand (often Bauer’s hand) in an Ashland shop, Bauer reels are an industry leader in a sport that dates back to second century Rome and the art of Tenkura in Japan. Fly fishing is above all, to those who enthusiastically defend and participate in the sport, an art form. Bauer is a foremost artisan, his supporters enthusiastically say.

“Passionate fly angler, precision fly reel designer and a champion race car driver, I personally don’t think Jon has it in him to do anything in life less than perfect,” blogged Greg Darling, internet sales manager for Gorge Fly Shop. “The first thing I took interest in was Jon’s workbench… clean, neat and all in order.”

From that workbench comes reels others rave about.

“The new RX5 performed flawlessly and this reel just might be Jon Bauer’s masterpiece,” wrote Dylan Rose of Fly Water Travel.

Dave McCoy, owner and guide of Emerald Water Anglers, says Bauer’s reels have served him well fishing in every part of the globe, from Alaska to New Zealand and virtually every continent in between.
“It is very smooth, and has wonderful sensitivity to the drag so it can be set perfectly,” McCoy says.

Business challenges

As it turned out, inventing a new reel system for centuries old technology was the easy part.

“We didn’t quite pull off that plan to retire up here,” Bauer says of his move to Ashland in 2005. “We did hit the peak when we moved out of California, which helped a bit I guess.”

The fly fishing industry had cooled. Again the sweep of history played a hand, this time not for the better. First came Sept. 11, 2001, which dramatically impacted travel. The next few years were bumpy, full of peaks and valleys not uncommon to a small business, even one with a globally recognized brand and industry leading patent.

Then, off-shore manufacturing provided stiff competition as quality increased.

“The whole model has changed because of the influence of what’s being made in China and Korea,” he says. “It hasn’t gotten any easier, but I think there is a little swing of manufacturing coming back into the states. But that takes a long time.”

The tough business climate was only going to get worse.

“2008 really put a stop to everything,” Bauer says. “Fly fishing is a small, tiny, miniscule industry. The recession hit the distribution hard. The larger companies with a broader product line gobbled up the retail side of it which takes us out of the equation.”

Bauer only makes reels. Not fishing poles, not waders, not even an inexpensive bulk manufactured knock-off reel made in China. Distribution networks are critical and most are on life support.

“A lot of fly shops couldn’t make it,” Bauer says. “We use independent sales reps, and of course a lot of them couldn’t make it either. It’s been difficult.”

10849946_872572852775791_3502392861608260093_nBut confidence in both Bauer quality and Bauer himself remains high as those within the industry appreciate Bauer’s contributions.

“Jon is a charismatic, knowledgeable and passionate purveyor of his product,” McCoy says. “In this sport, we need as much of this as possible to inspire and lead the next generation to carry that torch forward and Jon is doing an exemplary job of it.”

The obvious question begs to be asked, so I do. Will the brand be bought out?

“That’s a big topic right now. Because of the ups and downs of the economy we’ve been approached several times, but it’s never been completely done. We’ve built a good brand but there are fewer companies that can afford to buy up these brands.”

Personally, he says, he’d like see an independent like himself—another machinist looking to keep the machines running—buy him out. But he’s listening to offers. He’s considering the exit strategies and thinking seriously about the future of the sport he loves. He still has a place on the Williamson River in Southern Oregon, the place he bought to retire and fly fish that still beckons.

“I gotta figure out that puzzle,” he says, which is not altogether unlike the puzzle of the reel itself that he solved and launched himself into the history books of a historic sport.

For more information, visit Bauer Fly Reels or like Bauer on Facebook.