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Last Update: Saturday February 23, 2019

Key Idea: Collect Up Front

Ping clubs are sold through golf professionals who measure their customers, generate the order and collect the full amount at the time the order is placed.

Key Question:

A: 

Collect as fast as you can.

Q:  Why doesn't everybody collect up front from end users?

A:  Good question! Typically, retailers purchase products, often using borrowed money, to stock their shelves. Many industries depend upon the good faith of customers meaning they don't collect fully until the customer is satisfied. Think hotels and restaurants.

Doug Hawken, president of Ping, explained that they collect up front at the time of the order because that's what they have always done. Therefore, they do it because they can. Customers don't balk. The lesson in this for everyone is: If you have an excellent product or service, you can demand full payment in advance. Period. We feel sorry for service providers who get stiffed or have poor cash-flow, but it is time to change your business practices. Be bold.

Think about it

What needs to change about your collection process that will increase your cash-flow?

Clip from: Ping Golf with John Solheim, Karsten Manufacturing

Made in the USA:  Ping putters. Manufacturing is coming back.

How do I keep quality high? 

Phoenix, Arizona:  Innovators, by their very nature, are constantly going up against existing systems. The establishment. Sometimes their insights do not come by small increments, but by large leaps and then the renegades become outlaws!

If you are a golfer, you know Ping. It ranks at the top with Titleist, Spaulding, Calloway, Taylor-made-Adidas...  Yet , this business is still privately-held; and though the patriarch (and father) has died, his son, John, continues to build on all the lessons he learned as his engineering apprentice when they started this business.

Meet the Solheim family.  Like so many who redefine an entire industry, they were outlawed within it. They broke the rules. They created something totally new. Some people thought they were just crazy, until they began winning within their game. These renegades persevered. They negotiated, and today they are leaders within their industry and on their way to becoming a billion dollar business.

They began in a California garage in 1959. The sound of success here is "Ping"   and today John Solheim continues a tradition for excellence that began with with his father, Karsten.  Together they invented and began manufacturing  the Ping Golf Clubs.

Here you will see how a business constantly strives for a higher perfection.

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Ping Golf of Karsten Manufacturing

John Solheim, Chairman & CEO

2201 West Desert Cove
Phoenix, AZ 85029
6026875000

Visit our web site: http://www.pinggolf.com

Office: 6026875000

Business Classification:
Manufacturing

Year Founded: 1959

Collect Up Front

HATTIE: (Voiceover) Doug Hawken is president of Karsten Manufacturing.

DOUG: As you grow as a small company and you get to each of these new plateaus, you need to make sure that you have the right people in place, that you've identified where you have some skill sets that are necessary, and then you have to have the courage to go outside or develop from inside those people. How do you identify, attract and retain the best minds in the business? That's what it's all about. That's how you get innovation. We have never discontinued a model, per se, like the rest of the industry does, so that you, as a consumer, buys a set of Eye2 irons this month. Six months from now, we don't discontinue that model, and you can now buy that same set of clubs you bought six months for half the price. We don't do that. We deliver clubs within 48 hours, custom-built, custom-fit golf clubs within 48 hours, because as a service to our accounts, where we do our retail sales, we don't require them to carry massive inventories.

HATTIE: Now something else about cash flow. It's my understanding that you don't make the product until you get the order...

DOUG: That's right.

HATTIE: ...which is brilliant. But I also have to pay for the order in advance when I place it. That's pretty darn smart.

DOUG: Yes.

HATTIE: So who thought of that?

DOUG: Well, that's just a common-sense method of doing business that Karsten's put in place since day one. And because we've done it for 40 years and that we've been consistent, people accept it as a way of doing business with Ping and they respect it as a way of doing business with Ping.

 
 

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