A lesson from cutlery history: Getting knife buyers to buy

bluelightIn hard economic times what is the most common approach used by retailers and knife company dealers to sell more knives? You guessed it- cut the prices.

Today, there is no doubt everyone involved in selling goods and services is feeling the pinch of consumers pulling back. The tightening of the purse strings started back around October of last year. Since then it seems everyone is running a sale.

Got an email notice from a knife manufacturer just yesterday about a “One-half off for one day only” sale.

One Case dealer in North Carolina ran a special on all Case knives for 20% off. The business owner commented after the sale, “We actually made a few sales that day.”

But this phenomenon of running a sale to move merchandise- and in our case, knives is nothing new. In fact, it was such a problem in the 1930’s a cutlery publication tried to rein in the knife industry through a series of editorials and articles.

painescutjrnlmastheadOne  such example-  June 1932 edition of Paine’s Cutlery Journal reported, “It is suicide, of course, to merely slash prices in order to get business, and the business man who thinks he can beat a cost plus profit basis better give up now.”

In many cases, the answer, according the PCJ was more and continued advertising. If one subscribes to this theory, then today the approach would be broader than simply advertising- running ads- it’s having a strong market presence and brand awareness to help achieve what is called in the marketing world as “top of mind consciousness” among the targeted group. And in a highly fragmented market, like we have today, one of the best approaches knife companies and dealers have is to go where the knife collectors and buyers spend a great deal of time- online.

Times change and knife companies’ sales methods must too

I’m intrigued with knife company history, as you probably know. While I wasn’t much of a student of history back in school, now that I can relate it to something, I love it!

History is not everyone’s cup of tea and I recognize that, but today we need to take a bird’s-eye view back regarding knife companies and their sales methods to see how things have changed….and continue to.

Quick Look Back

Union Cutlery Co saleman's case

Union Cutlery Co saleman's case

In the mid to late 1800s knife companies used jobbers and traveling salesmen (drummers) to peddle their knives. Then large wholesalers and retailers came into the picture. These firms often promoted different knife brands in their catalogs- often boasting over a 1000 pages. Eventually, the traveling salesmen died out and then came the age of advertising & merchandising. Local hardware and general stores were also primary sales outlets for the knife companies.

Even today, you can still find the local general or hardware store scattered around the country. These retailers and dealers still represent, for several knife companies, their primary sales channel. Next time you travel and run through a small community stop in- you will often find several brands available, like Case, Old Timers, Buck and Gerber knives, to name a few.

Times changed

Wal-MartFor many of the knife companies gone are the day of having thousands or tens of thousands of local sales outlets. Today Big Box Stores- the Wal-Mart, KMart, Home Depot, Target and Lowe’s- monopolize sales. These national chains have tremendous buying power too, providing them significant leverage when negotiating with the knife companies.

The speciality knife stores, like Smokey Mountain Knife Works, are the exception rather than the rule. There are very few stand alone knife stores out there today.

Big Box vs. 20,000 dealers

With fewer mom and pop stores across American many knife companies are faced with the dilemma of courting these Big Box Stores

buckknifecLast week, we saw a revealing article about Buck Knives in the Wall Street Journal. C. J. Buck was interviewed about his decision to relocate their company in 2004. The bottom-line was Buck’s move was an effort to lower operating costs, and thus allowing them to maintain their pricing (in other words, they were faced with potentially needing to raise their prices due to their costs).

Mr. Buck points out- “We (had gone) from having over 20,000 small cutlery dealers like Don’s Hardware store and some chains to a few big accounts like KMart, Wal-Mart, JCPenny and Montgomery Ward. We saw tremendous volume increases… But price became a big factor and our margins began to get squeezed.”

Knife companies like Buck, who use the big accounts as a way to volume sales are directly impacted by lower margins, while the companies still relying on the small dealer network have higher overhead to facilitate thousands of accounts and these dealers are being directly impacted by customers pulling in their spending reins. Many of these stores are now struggling to stay in business.

Online Knife Sales

Today, the World Wide Web plays an important component in knife sales too. Most every small retail and hardware store at least promotes their store online. The majority of them have some aspect of e-commerce too- allowing their customers to order direct from their site. Their challenge is, however, in order to command any measurable web sales they either have to have a very loyal customer base or continued marketing. Moreover, these stores simply can’t get the page rankings to compete online against the big boys- Amazon, Wal-Mart, etc. And at times their online stores compete with their physical location.

mainstrsupplystore

Here’s an example- Main St. Supply Company–  a 100 year old general store. Its web site offers hundreds of products, in addition to knives from Case, Buck and Old Timer.

Then what about each knife company’s own website? I can’t think of a single knife company without an online presence today. They realize the benefits of online promotion of their firm and their knives and yet, they are faced with the decision of whether to have direct online sales from their websites or to remain loyal to their existing distribution network- their dealers and retailers- by not competing directly against them.

Interestingly, a quick review of 16 top knife companies, nine offer direct online sales. Of the seven that don’t, they point buyers to their dealers list provided from their site.

Business Model Changes?

Are the knife companies in the middle of a paradigm shift (sorry to use that worn out phrase) from the tried and true dealer network of physical locations to more web oriented sales? The majority can’t count on landing a big box account or national retailer.

Wouldn’t you be interested in seeing the total number of online knife sales compared to the total sold for the last few years?

I would guess that number is going to increase to a point over time. Does that fact, coupled with higher profit margins for direct to the pubic sales, influence knife companies to increase their direct online sales efforts? And if they do, is that move helping or hurting their dealer network? Only time will tell, but the majority of knife companies already do. The question then becomes, will they keep their dealer networks?

Closing Point to Ponder

Recently I asked one of the most popular knife companies about whether they would allow a dealer to only have an online store. The answer was “No. We require our dealers to have a physical location.” … sounds like a bit of 1980s thinking, now doesn’t it?

Photo Credits: Buck Knife – The Wall Street Journal; Main Street Supply Co.

Leading Knife Companies Hold Gigantic Knife Auctions

Now that it appears the immediate threat to the Knife Manufacturers is well in hand, these companies’ focus is back to the business. Yes, before the recent scare about the Customs and Border Patrol redefining a switchblade, the knife makers had a more pressing problem- very sluggish knife sales.

Knife companies, like other manufacturers, are trying to balance production against sales orders. Unfortunately, knife companies are out there with a high level of knives produced before the severity of this current economic slowdown was clear.

In the past, knife companies found themselves in a similar dilemma, that is a substantial inventory on hand and insufficient demand through their normal channels to absorb it within a reasonable period of time.

Knife inventory represents precious capital.

J P King Auction Did you know cutlery history provides us examples of knife companies actually cooperating together during tough economic times to sell off their respective knife inventory?

Knife companies joined forces to hold gigantic knife auctions.

gavelA large two day auction of pocket knives and other cutlery was held on February 13 & 14, 1877.  John Russell Cutlery Company, Meriden Cutlery Company, Lamson & Goodnow, Frary & Clark, Beaver Falls and Chicago Cutlery contributed inventory. The New York Times reported “..the prices obtained were extremely satisfactory, being well up to current market prices. There was a very large attendance, including representatives of the leading houses in Boston, Philadelphia, Cincinnati, Chicago, Baltimore, and even San Francisco.”

gavelAlso another very large 4 day sale conducted in New York that same year. The knife inventory was contributed directly from the manufacturers. Buyers came from all over the country, including 156 wholesale and dealer firms, as reported in the August 13th 1877 edition of The New York Times. The articles also notes, “Prices ran well, and the sale is said to indicate that there will be a good demand for cutlery this fall and that prices will be stiffly maintained.”

gavelThe next year another auction was held for “large quantities of hunting knives, pocket knives, skinning knives, sticking knives, and other similar articles.” The two day auction was held July 24 & 25, 1878 and was reported by The New York Times. The article states, “Bidding was spirited and fair prices realized.” And while a lot might contain a single knife or dozens of knives, in all 2481 lots were offered.

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With the advances in technology, compared to the late 1800s, the auction bidding could be simultaneously offered online and “live” right from the auction room. The firms with inventory in the auction would be allowed to set up booths outside the auction ballroom to promote their firm- much like a huge knife show- but the difference is the real purpose behind the event would be the auction, unlike today, where the auctions are but a side note to the knife shows.

Wouldn’t it be exciting to attend an auction of current production knives represented by all the top knife manufacturers?

It would be hotter than the Blade Show and the SHOT Show combined!

Photo credit: J P King Auction Company

Young people don’t need knives anymore

Hang around the knife industry for very long and you’ll no doubt hear a conversation about how boys today aren’t into pocket knives anymore. In fact, we here at CNJ have reported on more than one occasion that sentiment as well.

Yes, while it is true times have changed and we can quickly come up with a list of reasons, as we have, why this is the case. Young people don’t need knives they way they did last century, right?

painescutjrnlmastheadwoutdateWell, hold on to your horses there just a minute. This problem is not new to our society, nor our time. Listen to this statement as reported in the December 1930 edition of Paine’s Cutlery Journal.

“One of the leading publications in the advertising profession puts for the question ‘Why in the world don’t the cutlery manufacturers get together and bring back the pocket knife with a smashing advertising campaign to prove to the younger generation that a good knife has innumerable uses besides sharpening pencils?'”

So, there is hope because pocket knives became a rite of passage for most every boy up until the mid-1970’s.

On the other hand, there are lots of younger collectors out there- most of them just don’t carry the traditional pocket knife anymore, but they are definitely into knives just the same.

PS: Check out “Knife Collections” on YouTube to find over 6000 vids. Many of these collections are owned by the younger generation too.


Famous Knife Factory Fires

If you have been collecting knives for any time you have probably heard stories of the most famous knife company fires. There are quite a few, actually.

I’m sure you have heard about the Case Brothers fire that destroyed their Little Valley, New York factory on February 10th, 1912. But did you know this was actually their second factory to have burned to the ground?

Case Smethport Cutlery 6.11.1910

Case Smethport Cutlery ruins 1910

Two years earlier their Smethport, Pa factory burned. It had only been in operation since Dec. 1909 when they, along with W. R. & Russ Case, and H. N. Platts, purchased the Smethport Cutlery Company. Then on June 11th, 1910,  fire destroyed the entire plant.

Not to digress, but I found the entire set of circumstances of this fire very interesting- almost comical.

  • When the Night Watchman discovered the fire, he reportedly tried to extinguish it by grabbing a pail of water and throwing it on the fire, only to see the flames increase- he had thrown a pail of oil, instead of water.
  • smethport-pa-fire-depart-historyWhen the fire department and hose carts arrived and opened the hydrant, there was no water pressure.
  • “No team (horses) was handy to then haul the fire engine, so a number of firemen started out with it by hand, but the progress was slow and before it was on the ground and in operation this large building was completely enveloped in flames and all possibility of saving any part of it was gone.” Quote from McKean County Miner- June 16, 1910
  • One of the reasons the site was selected for the cutlery plant in the beginning was the location of the hydrant, which was immediately next to the building.

List of Knife Factory Fires

Throughout American cutlery history fire has been a big problem. It is not unusual to discover a knife company didn’t rebuild, instead they went out of business. Other times, I found factories that burned to the ground more than once and rebuilt each time.

Overall I was surprised with what I found. Before I show you, let me ask-

Can you history buffs name one or two other cutlery factory fires?

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American Cutlery History Trivia 2

 

Knife Company History Trivia

Knife Company History Trivia

It’s that time again. Time to test your remembrance of American Cutlery History.

This week, we are looking into old- I mean really old-  knife companies here in the States. To get your pump primed….think back to the 1800s. Think about the firms you are familiar with and their locations.  

What firm laid claim to be the oldest cutlery company in America?

Hint: It isn’t Buck Bros. or Russell

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Published in: on February 27, 2009 at 6:28 am  Comments (3)  
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Steps to Economic Recovery outlined in a Cutlery Publication

painescutjrnlmastheadwoutdate

 “Recovery from a business depression involves a readjustment in the basic factors of our industrial structure. This process requires time and leadership. It can be hastened or retarded by what business men do. The period required to get back to a normal rate of activity varies with each separate cycle, and the experiences of former times do not furnish an infallible guide as to what will happen now.”  

Interestingly this quote is from an article in Paine’s Cutlery Journal dated January 1931. The article continues by pointing out the required steps to “readjust” from the economic period of that time-

  1. Prices, especially raw materials, must come down until they are more in accord with supply and demand factors and at levels more favorable for purchasers.
  2. Inventories of raw materials and finished goods have to be reduced and in many cases even below normal amounts.
  3. Money rates must be lowered and supply of funds available for businesses must be ample. Businesses need to have no fear of being handicapped by lack of credit facilities or high rates of interest in the near future.
  4. Production must be adjusted to consumption.
  5. Purchasing power must be built through savings and strict economy.
  6. Excess liabilities as represented by items such as large broker’s loans, installment payments outstanding, borrowing by member banks from the Federal Reserve Banks have to be liquidated and brought down to a more nearly normal basis.
  7. A saner attitude of adjusting operations and policies to facts rather than relying on unjustified and unfounded hopes must be adopted.
  8. A determination to act aggressively in remedying bad or unwholesome conditions have to be replace a policy of letting affairs drift in hopes that they will right themselves.

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Published in: on February 6, 2009 at 8:20 am  Leave a Comment  
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Pocket Knives and Tool Knives in the Early 1900s


cutlerymakersofamer1919headingContinuing our series on knife names and classifications in the early 1900s. For you into the history of our knives and knife manufacturers, looking back reveals a highly competitive and, yet, diversified cutlery market. We began this series with All the types of knives and the firms that made them.

Next, we looked at kitchen knives and the tremendous variety produced. Today, we are looking at the classification list of Pocket knives and Tool knives, as set out in the official directory of the cutlery trade published as The Cutlery Makers of America in 1919.

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Knives used around the Kitchen in 1919

kitchen2What is the most important tool used in the kitchen?

We here at Cutlery News Journal vote: The Knife, of course.

If you agree, then let’s be more specific- What knife, or better yet, which knife?

I think you will be surprised by all the different kinds of kitchen knives that have been made.

As a side note here- have you ever thought about the names given to knives? Why certain names were given and what they mean? And when they were first used?

Off the top of head, I would say that the majority, if not all, knife companies assigned numbers to identify knives and patterns. Some knife companies had very sophisticated systems, like Case, where the handle material, number of blades, pattern number, etc. were used.

But, what about the names? Where did they come from and why were certain names used, as opposed to others?

You may be surprised to know that back in 1919 an Official Directory of the Cutlery Trade of the United States was published. It classified the kind of knives and blades made. This list was published in The Cutlery Makers of America.

Today, I’ll will show the names of all the knives identified by this official directory used in and around the kitchen. You will find these interesting. Some of these knives are still known by these names, but for others, we would be hard pressed to identify them today.

My favorite is the Chicken-Killing Knife (more…)

Knife Company History- There is nothing new under the sun

Antique knife collectors are some of the most enthusiastic knife fans. We can squeeze significance from every discovered factoid about an old knife company or pattern. We appreciate and embrace knife history, as if it were our own family’s heritage. We are simply crazy about old knives and the older the better too.

Yet, antique knives have one inherent problem and we collectors can get down in the mouth about it- claiming it to be a byproduct of the modern-era we now live in with folks having access to high-tech equipment and modern knife making methods.

A Bit of Counterfeiting History

The problem I am talking about is counterfeiting- monkeying with knives in order to cause buyers to believe they are something they are not.

Contrary to what most collectors believe, counterfeiting knives is not a modern-day phenomenon. As a matter of fact, it started before many of the knives we now collect were even made.

“So who are these old time counterfeiters?”  Well, would it surprise you if some of the early culprits were actually American knife companies? Shocking assertion, isn’t it?

American Brands on Foreign Knives

The problem got so bad, in fact, the manager of Oakman Bros. Co. of New York, a large distributor of Lamson & Goodnow, wrote a letter to the editor of The American Cutler dated March 12, 1909.

He reports, “Some American manufacturers are buying goods from Germany, and, upon receipt of same, erasing brands and re-branding with American marks.”

Then he adds, “I picked up a knife the other day with an American trademark on it, and found that the foreign mark had not been thoroughly ground off, leaving part of the word ‘Germany’ on it.  By using a magnifying glass you could detect the whole brand.”

So, if this report is accurate then, counterfeiting has been with for a long time. Longer, in fact, than folks have been collecting the knives themselves.

Now for a twist-

Who is to say one of the knives we now call a counterfeit wasn’t “counterfeited” by the very firm we thought a modern-day counterfeiter was trying to make us believe actually made it.  How ’bout that for a twist? 

The point here is cutlery history, albeit it dark, and also to remind us- There is nothing new under the sun.

Published in: on October 14, 2008 at 6:03 am  Comments (2)  
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