Hogan Files Chapter 11

[null]

Website is gone

 

As is there twitter account

 

Fin

[NCST8golf]

I guess registering my new clubs is out of the question! I would be curious to know how close my set was to being the last one built. This is pretty depressing news. The clubs are outstanding and, though I have never been very brand loyal with my golf stuff, I could see myself sticking with the Hogan brand for a long time. I don't know enough about corporate finance to speculate, but I hope they find a way to survive this.

 

 

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[Bags]

This just in -- Fort Worth Star-Telegram is reporting Hogan filed for bankruptcy over the weekend.

 

A source called me just a few minutes ago to give me a heads up - he's a creditor so he's trying to get some of the money he's owed.

 

Here's the newspaper story, filed a little over an hour ago...

 

Ben Hogan Golf Equipment Co. filed for bankruptcy over the weekend, less than a month after it laid off the bulk of its workforce in Fort Worth.

The Chapter 11 petition, filed with the U.S. Bankruptcy Court in Fort Worth on Saturday, lists both assets and liabilities between $1 million and $10 million. Among its top creditors are Perry Ellis International, which licensed the Hogan name to the company, owed $267,500, and Conti Edgecliff-Sias LLC, its landlord in south Fort Worth, owed $77,256.74.

The Fort Worth maker of premium golf clubs, backed by Corbett Capital in Fort Worth, brought the revered Hogan name back to the marketplace two years ago under the leadership of industry veteran Terry Koehler. The company introduced its first set of irons, the Fort Worth 15, in 2015, and a second set, called PTx, a year ago.

Introduced at a time when the golf business has been in the rough, the new Hogan clubs took the novel approach of numbering irons by loft — anywhere from 20 degrees to 63 — instead of the traditional 2-9 plus wedges.

Last August, Koehler was replaced as president and CEO by Scott White, who previously worked as an executive at both Callaway Golf and TaylorMade. In November, the company said it would add the traditional 2-9 numbers on the hosels of the clubs.

On Jan. 3, about 30 workers were laid off, leaving less than 10 employees at its facility near Interstate 35 and Interstate 20 in south Fort Worth. In a statement at the time, Hogan called the action “re-tooling and right-sizing in an effort to become more nimble and profitable.

 

Read more here: http://www.star-telegram.com/news/business/article129589759.html#storylink=cpy

What do they do with all inventory?

 

 

Bags

[JAGolfore]

This is very disappointing. I guess I'll be looking hard at the Srixon line. Almost the same sole as the Hogan Irons.

 

 

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[GolfSpy Barbajo]

Have a few calls in to CEO Scott White this week - haven't heard back, which isn't like him. Also hearing from sources that they're literally out of cash on hand. 

 

To quote Captain Obvious, "I fear the worst..."

[McaseyM]

Damn, i was pulling for them. they still have their IG account.

I think the local Golf Galaxy carried their line, but online GG only has the wedges for $150 and hybrid for $250, may be hitting the clearance rack soon. 

[jayjay0808]

Have a few calls in to CEO Scott White this week - haven't heard back, which isn't like him. Also hearing from sources that they're literally out of cash on hand. 

 

To quote Captain Obvious, "I fear the worst..."

That is very sad to hear. But as I said before they were in a tough category to survive 

[Jmikecpa]

What do they do with all inventory?

 

 

Bags

If they go through liquidation then normally a third party steps in on behalf of the creditors and sells to a retailer at the best price they can get. If it stays as a reorg then Ben Hogan will remain debtor in possession of all assets and can operate their business in the ordinary course.

 

Now considering they sell primarily through their website and that has been taken down I am thinking the reorg concept may be over and liquidation is looming. It is normally better for the creditors to allow a company in BK to operate and generate revenue than take a break. My read is the company filed for Chapter 11 and the creditors may have pushed liquidation as they don't believe in the business. From the filing I was able to see it looks like their "parent" is the largest creditor and may have just pulled the plug on the name. At any rate very disappointing.

 

 

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[Bags]

If they go through liquidation then normally a third party steps in on behalf of the creditors and sells to a retailer at the best price they can get. If it stays as a reorg then Ben Hogan will remain debtor in possession of all assets and can operate their business in the ordinary course.

 

Now considering they sell primarily through their website and that has been taken down I am thinking the reorg concept may be over and liquidation is looming. It is normally better for the creditors to allow a company in BK to operate and generate revenue than take a break. My read is the company filed for Chapter 11 and the creditors may have pushed liquidation as they don't believe in the business. From the filing I was able to see it looks like their "parent" is the largest creditor and may have just pulled the plug on the name. At any rate very disappointing.

 

 

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So possible deals for consumers on equip

 

 

Bags

[Greasegun]

Im so bummed about this. I bought a set of PTX irons last fall, and a TK 50deg wedge. Love the wedge so much I thought that once my new clevland wedges are shot I would go all Hogan. Guess not.

 

It pisses me off that the golf market is all about marketing and not quality. The most innovative and quality clubs dont make it because they company cant compete with the big boys. I gamed Adams forged irons for a long time and was really bummed about what Tmade did to them. Along came Hogan to save the day and now this...

[GolfSpy Barbajo]

Im so bummed about this. I bought a set of PTX irons last fall, and a TK 50deg wedge. Love the wedge so much I thought that once my new clevland wedges are shot I would go all Hogan. Guess not.

 

It pisses me off that the golf market is all about marketing and not quality. The most innovative and quality clubs dont make it because they company cant compete with the big boys. I gamed Adams forged irons for a long time and was really bummed about what Tmade did to them. Along came Hogan to save the day and now this...

 

I think a lot of Hogan's troubles were self-inflicted. I think there were two key mistakes, and a miscalculation that ultimately led them to Chapter 11.

 

First big mistake was building the facade of a big company before ever selling a club. They had a large HQ in Fort Worth and had big plans for assembly, spent an awful lot of money and tried to play the part of a major player in the business, and then expected the sales to come rolling in to backfill it.  That never happened. The second mistake was their initial insistence on going green grass and specialty fitters only for retail. You really had to work to find Hogan clubs to demo initially - which dulled any momentum the brand may have had after it announced its return. They eventually made their way into several retail outlets, but it was apparently too late.

 

The miscalculation may very well have been in the product they chose to introduce - namely the Ft Worth 15 irons. They are awesome irons, but as more or less a blade (even though they're pretty darned forgiving - for a blade), they were squarely focused on a relatively small segment of the golfing world that tends to hang on to their irons longer than others. When you shrink your audience right off the bat like that, and you're not available at retail to demo, and your green grass/fitter network is small - you're going to have your growing pains. It's worse if you have a hefty framework to support.  

 

The PTx irons were a good second offering - more forgiving but with a player's look - but again, the potential buying audience was small. 

 

You can also say, with some justification, that the loft numbering system was a bust. People either loved it or didn't (didn't bother me any - I love telling people I'm hitting a 29-iron!), but I'd be willing to bet it created inventory issues - having to manufacture and stock individual lofts from 20 to 64 has to have been costly, and it very well may have been confusing or intimidating to some consumers. Again, once you've played them for a round or two it's easy to figure out, but it was one more hurdle for a company that didn't need more hurdles. 

 

Hogan sure as heck created buzz when it returned to the market 2 years ago - and there was no shortage of people who really wanted the brand to succeed. I think if they started off realizing they were a startup brand and laid the foundation of the company first, and then slowly and logically built the framework, they would have had a chance. As it turned out, the new Hogan was really a House of Cards, built on a non-existent foundation. 

[McaseyM]

Overhead had to have been insane with that many options. Since they had a slightly different design every 4 degrees, maybe forge in the middle of the range and then bend them

to desired specs, then stamp the loft or number at the end. Yes it would have taken a little longer, but coulda cut costs of stock piling heads by a ton, unless they forged as they went, but even then, that would be time consuming.

 

 

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[mega]

As much as I loved my Hogans and thought the world of their quality I had been dreading something like this given the competitive nature of the golf equipment business and the niche they were in. 

 

I was an early adopter of the Scor Wedges down to my 9 iron and jumped at the chance to convert to the BH wedges, especially when they offered me a trade-in deal.

 

Today I have TK/FW 15 irons from 41 to 61 degrees, added some PTx mid irons and backup wedges for a travel bag I can take on business trips and leave behind as needed for return trips.

 

I just added the VKTR hybrids which have done a lot to tame the hooks I've had with other hybrids.

 

Hopefully they can come out of this but based on posts above it doesn't seem likely.

[fozcycle]

Well I still have my SCORs 31* to 57* ready to go. Will pair them with Mizuno JPX800 forged, 6-8. I am hoping to game them this summer.

 

 

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[GolfSpy Barbajo]

Heard from CEO Scott White yesterday  - he says they're still making clubs to fill existing orders, and are actively looking for another investor. When we first spoke in early January he said their investors asked for the restructuring because they weren't seeing progress toward profitability. Sources told me that just prior to the PGA Show, Hogan officials admitted that they were pretty much completely out of cash, so it's no surprise Chapter 11 followed soon after.

 

White gave me the contact info for their Bankruptcy attorney - I'll try reaching out to him today to see if there's anything he can share...

[Hackste01r]

That's a bummer!!!

 

 

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[Greasegun]

Heard from CEO Scott White yesterday - he says they're still making clubs to fill existing orders, and are actively looking for another investor. When we first spoke in early January he said their investors asked for the restructuring because they weren't seeing progress toward profitability. Sources told me that just prior to the PGA Show, Hogan officials admitted that they were pretty much completely out of cash, so it's no surprise Chapter 11 followed soon after.

 

White gave me the contact info for their Bankruptcy attorney - I'll try reaching out to him today to see if there's anything he can share...

Thanks for the update. Hopefully someone jumps onboard.