Innovation and Old-Fashioned Craftsmanship - A History of Starcraft

From humble beginnings more than 100 years ago, family-owned Smoker Craft Inc. thrives in our big box, corporate world by building well-made boats designed by spending as much time on the water as possible.

 

It’s hard to pinpoint exactly when the balance began to shift. Where the majority of boat manufacturers were once family-owned operations run by people who felt they could build something better than the other guy, somewhere along the way boating got big. As it is with so many other areas in life, a growing number of boat companies are now owned by multinational corporations and private equity firms, and driven by shareholders with a keen eye on the bottom line. In our big-box, mass consumption world, the family-owned business doing what it loves has become a bit of an anachronism. Perhaps that’s why we all seem to take a level of joy in seeing one defy the trend and not only survive, but thrive and lead their industry by competing on innovation and simple, old-fashioned craftsmanship.

Smoker Craft Inc. – the New Paris, Indiana-based company that builds Starcraft, Smoker Craft, Sylvan, SunChaser and Starweld boats – remains a family-owned and operated private company that manages to successfully compete head-on with the largest international conglomerates in the recreational boating industry. It is exactly the type of company that many business analysts wrote off as roadkill with the 2008 financial crisis, yet today its business model is one that other companies – both within and beyond the boating industry – are now eager to emulate. Having survived an economic crisis that took down banks and global giants, Smoker Craft has managed to thrive by carefully adhering to strategies and values that were established more than a century ago. And, by spending as much time as humanely possible on the water.

“At the end of the day we’re all boaters,” says Peter Barrett, Smoker Craft’s senior vice president of marketing and corporate development. It’s hard to argue, as we putt across northern Indiana’s Syracuse Lake in a new Starcraft SCX sport boat while Barrett, a passionate wake surfer, prepares to take a turn out back. “I like to surf and to water ski. Doug Smoker, our president, likes to fish. When we host our dealer meeting each year it’s all guys from the plant who are running the boats and taking dealers for demo rides. A lot of our design ideas come from staff who were out on the water and thought up a better way of doing something, or found a better place to locate some piece of equipment. A huge amount of the R&D results from the fact that so many people in our company are boaters themselves.”

It was Barrett’s great-grandfather, Arthur Schrock, who started it all. In 1903 Schrock went to work for the Star Tank Company in Middlebury, Indiana, manufacturing galvanized steel tanks for railroad and agricultural applications. After a short time, the company began making boats as well. The boats proved so successful that in due course the business was renamed Star Tank and Boat. Schrock bought a piece of the company and, when the original owner died in 1926, he bought the rest. Star Tank and Boat became Starcraft, focusing on boat production alone.

Son Harold Schrock soon joined the business, first working in sales, then as its general manager, then as Starcraft’s president.

While Starcraft built its boats, in nearby Goshen, Indiana, the Smoker Lumber Company had developed a strong business selling oars and paddles. So much so that in 1928 it renamed itself the Smoker Oar and Paddle Company. “We did a huge business in oars and paddles, and we stayed in that business till 1988,” says Doug Smoker, current president for Smoker Craft Inc. “We built wooden gunnels for Starcraft and a few other boat companies too, but paddles were the focus. It was a very profitable business to be in.”

Wartime contracts – Starcraft built wooden sculls while Smoker Oar and Paddle supplied the propulsion – proved lucrative but business for both Starcraft and Smoker Oar and Paddle really took off in post-war America, as consumer demand for recreational products exploded. Starcraft’s aluminum boats were significantly lighter in weight than their wooden contemporaries, and were better able to handle daily bumps and grinds. Competition was inevitable.

“In 1963 we got into the aluminum boat business ourselves,” smiles Doug Smoker. “Our family had been around boats for a long time through the paddle company, so it made a lot of sense and was a good extension of our oar and paddle business.”

Around the same time in nearby Wolcottville, Indiana, an entrepreneur named John Cripe had also entered the boat business by founding Sylvan Industries. Focusing on houseboats and pontoons, Sylvan quickly established a name for itself as a quality builder.

By 1966 Harold Schrock thought he had had enough. He sold the business to a conglomerate named Bangor Punta, where he remained as president of the company’s marine group till 1969. “I enjoyed running Starcraft,” he said in a 2011 interview. “When I sold it the only stipulation I asked for was to have a distributorship in Indiana. But then the people we had sold Starcraft to decided they didn’t want to use distributors any more, which put me and a lot of other people out of work. That made me very angry.”

Unemployed and thoroughly steamed, Schrock went right back to doing what he knew best. He promptly bought Sylvan Marine and got back into the boat business.

Although Smoker Craft’s aluminum boat business was doing well – the company had landed a lucrative contract with catalogue retailer Montgomery Ward in 1975 – its owners also began looking further afield at other opportunities. “By that point my father and my uncle were ready to retire, while Harold Shrock wanted back into the boat business,” says Doug Smoker. “So he bought a controlling interest in the company. We consolidated the Sylvan name with Smoker Craft, and assumed the pontoon business. We subsequently built a name for Sylvan aluminum boats, which followed a similar construction and distribution model that Starcraft had previously used.”

In 1995 the Smoker Craft company received a fateful call from Brunswick Marine, which had acquired the Starcraft brand some years earlier and now wanted to sell. “Starcraft changed hands a few times since my grandfather originally sold it, and we were very interested in bringing that brand back into the family,” says Barrett. “Buying it back from Brunswick was very much a family heritage type of purchase.”

The acquisition of Starcraft may have closed a family circle, but presented some management challenges to the company. “Starcraft had been fierce competitors with Smoker Craft and Sylvan for many years,” says Barrett. “It would have been easy to bring these hugely competing brands together and have it fail, for any of a number of reasons. But because people here are all genuinely proud of what they do, they have that ability to make it work.”

“I truly do believe that the reason the company has been successful, as a family-run business competing in an industry full of big corporations, is because everyone here is personally invested in what they do,” says Doug Smoker. “I think the evidence of that is that we don’t have employees leave. We always joke that the only way for someone to move up the org chart is for someone else to die. But it amazes me that I still see people in the plant who started with us in the 1960s and they’re still there, every day. They have so much experience and knowledge, and that goes right into the quality of the product we sell. On a management level, many of those people who run the company have a personal ownership stake so the decision making process is faster. There isn’t the corporate red tape that can freeze a company in its tracks. This provides the agility you need to be able to satisfy niche markets and move quickly to provide what your customers are asking for.”

That agility quite likely saved the company in 2008 when the US economy flatlined. “We had begun planning to further consolidate these businesses in 2006, and the financial crisis of 2008 expedited things,” says Barrett. “We took a plan that was to be implemented over two years and completed it in just six months. If you can imagine the challenge of bringing four plants into one central location that rapidly, you can appreciate what an achievement that was.” Even more impressive is the fact this happened while the company was abandoned by its bank, despite owning all of its assets and having no real debt. Simultaneously, some dealers had their loans called, leaving Smoker Craft on the hook for the repossessed inventory. It was a chapter of the company’s history Barrett says he will never forget.

In spite of the obstacles thrown in its path, the company survived. Today, Smoker Craft Inc. has around 500 employees and manufactures a diverse product offering within three distinct product segments – aluminum, pontoon and fibreglass. As an independent boat manufacturer, Smoker Craft works with no less than six engine suppliers – Honda, Mercury, Suzuki, Evinrude, Yamaha and Volvo Penta – along with numerous suppliers of components from steering wheels to gauges to electronics to trailers. The company’s agility allows for a level of mass semi-customization that many buyers find highly appealing in a one-size-fits-all world.

“Our customers are tremendously important and we go to enormous lengths to make sure that they’re happy and that they know they’re part of the family” says Doug Smoker. “We believe that, we believe that personal relationships are critically important. It isn’t ‘us and them.’ It’s the manufacturer and the dealer and the end user, and we’re all in this together.”

That situation isn’t about to change, as the next generation of family members – all boaters themselves – enter the business. Sales are up. A brand-new extension that effectively doubled the size of the company’s pontoon plant just opened last year, and is already running at near capacity. And as our North American demographic profile begins to shift, with boomers reaching retirement age and Gen Y starting families, the demand for affordable, well-made boats is projected to grow. With a 113-year heritage of making family memories, Smoker Craft Inc. looks to build on that incredible legacy by doing what it always has – competing on innovation and simple, old-fashioned craftsmanship.

 

This article originally appeared in Lakeland Boating magazine.