26/07/2018

26 July 2018
26 July 2018, Comments Comments Off on Jason Lippert – LCI
Jason Lippert - LCI

Face to face with LCI’s CEO

 

In the last three years Lippert Components has acquired many companies in the RV sector in Europe, such as Project 2000, Metallarte, RVDoors, and STLA , plus Sessa Klein in the train sector and Lexington and Taylor Made in the marine sector. Everyone would like to know more about the strategy of this large group which is a market leader in the US, and is going to be a big player in Europe, too.

Words Antonio Mazzucchelli

We met the Chief Executive Officer of LCI Industries (the parent company of Lippert Components), Jason Lippert. Winner of the “Entrepreneur Of The Year 2018 Award” in the Mid-West (USA), Jason (46) represents LCI’s third generation of leadership by the Lippert family. Lippert Components, founded by Larry Lippert in 1956, now supplies a broad array of highly engineered components for the leading original equipment manufacturers (OEMs) in the leisure and mobile transportation industries. The company has grown tremendously over the last 60 years, making more than 40 acquisitions in the past 15 years, and has become a $2 billion revenue company. With over 65 facilities throughout the United States, Canada, Ireland, Italy, and the United Kingdom, LCI is pursuing global growth in the mobile leisure market by replicating its North American competencies with acquisitions of high quality, high potential suppliers that share LCI’s core values, and establishing the same enduring partnerships and relationships with international customers that it has earned in North America. Let’s hear more from our interview with Jason Lippert.

Aboutcamp BtoB: What is Lippert’s strategy in Europe?
Jason Lippert: It is very similar to the strategy here in North America. We will continue invest heavily in research and development, both here in Elkhart and in our European facilities, to develop products specifically for the European Caravan market. We will continue to build strong and strategic relationships with our European OEM partners. We will continue to build our teams in Europe and do everything that we can to put them in the position to succeed. Just recently, Andy Murray was named Chief Sales Officer, and he will now oversee our European Caravan Market as well as the North American RV Market. Andy will help align our US and European strategies, which is very important. Finally, we will continue to search for strategic acquisitions that make sense for LCI. We typically do not make acquisitions where the product produced is not in what we call our “core competencies.” Our core competencies would be soft goods like furniture and mattresses, metal fabrication and glass. When a good company with a good leadership team and a respected product comes along for sale, we will look seriously into acquiring it.

Aboutcamp BtoB: How important will the adjacent markets and business, such as Marine, be for Lippert in the future?
Jason Lippert: Adjacent markets, which we consider any market outside of towable RV OEM sales, has been one of our top initiatives for years now. In 2017, our adjacent market sales to OEMs was $427 million dollars. Total sales for all adjacent markets in 2017 reached almost $1 billion. The marine segment is obviously a huge part of this. The acquisition of Lexington and Taylor Made over the last year has cemented LCI as a major player in the marine industry. Taylor made alone generated approximately had a $150 million in revenue in 2017, and through our synergies between the two companies we expect that we can generate more sales than that in 2018. This is all very exciting and we can’t wait to see where LCI is five years from now in the marine market.

Aboutcamp BtoB: As a US company that is successful in the RV market, you are now also expanding in several new sectors and countries. Where do you see Lippert Components in 5 years?
Jason Lippert: Right now LCI is laser focused on being an engineered products company for ALL leisure and mobile transportation industries, not just the RV & Caravan industries. We’re trying to diversify away from being an RV centric company. We started this transformation after the 2008 recession and never really stopped. To illustrate, in 2008 our sales were 90% RV OEM, and today we’re about 60% RV OEM. We want the world to know us as much more than simply an RV company; we want to be known as the supplier of choice for all engineered products both in Europe and North America.

Aboutcamp BtoB: How do you see the evolution of the US market? It seems there may be signs that the incredible pace everyone has enjoyed we’ve seen recently might be slowing down. Do you agree?
Jason Lippert: We see 2018 as a year where the industry may slow down a little in order to let the retail side of things catch up with some inflated inventories at the OEM level. We don’t perceive this to be a particularly negative thing. All indications are that consumer sentiment is still very high for the RV lifestyle. Millennials are buying RVs at a record pace. Kampgrounds of America (KOA) just recently reported that 61% of all US households camp, and this statistic alone is the best thing going for the US RV Industry.

Aboutcamp BtoB: Are you worried about any repercussions on your business from US Administration’s tariff policy?
Jason Lippert: It would be an understatement to say that we’ve had a challenging steel and aluminum environment over the last two quarters. These policies have had some adverse effects on our business. Since September of last year, the cost of aluminum has risen 30%, and steel has risen approximately 35%. We currently purchase about 300,000 tons of steel and 50,000 tons of aluminum each year, and almost 100% of this is purchased domestically in the US. We believe that domestic steel and aluminum suppliers are trying to recoup some of the costs that they have not been able to pass along over the past few years due to steep foreign competition. This has been a very trying year for us, but we will figure out ways to mitigate these rising costs the best we can.

Aboutcamp BtoB: You have started the Project 2000 beds production in the United States. Did you do it only for reasons of increasing sinergies and improving on efficiency or is there a relation with the “Buy American, Hire American” policy?
Jason Lippert: No this is not really the case. It is really all about having the ability to decrease lead times and service our North American customer base as fast as possible with these products. Our number one priority is servicing our customer, and we will take every opportunity to improve our service capabilities as they arrive.

Aboutcamp BtoB: Lippert Components is a company that is very focused on its corporate responsibility: last year you launched an initiative to complete 100,000 hours of community service, making your employees step up as community leaders and create positive impacts. How was this experience and what were the results?
Jason Lippert: This has been one of the most satisfying parts of my career at LCI. In early December, 2017, we successfully reached our goal of 100,000 community service hours, and this year we are continuing this pledge and are well on our way of reaching our 2018 goal. The work that our team members are doing in the community is truly transformative and it is changing the lives of our team members, and our community members, for the better. If just one company can make such a huge difference, just think what would happen if 100 companies did the same thing? This is why we started “Acts of Service.” With Acts of Service, we are actively reaching out to other companies in our communities and helping them set similar community service goals so they can have a similar impact. We are trying to change the world for the better at LCI!

Aboutcamp BtoB: With the “Everyone Matters” leader training program, your 14 front-line leadership coaches will train middle-level managers so that LCI becomes a better work environment and you will decrease the turnover of workers. How is this experience going?
Jason Lippert: This is another initiative that I am very proud of. Our goal is to be the employer of choice in the communities in which we serve as well as making sure EVERY team member truly feels that he or she is a valued member of our team. We want our team members to feel a deeper sense of purpose at LCI and help us continue to build a company culture that is second to none. The leadership development team has been a key success factor in making sure the “Everyone Matters” initiative reaches every plant and every employee at LCI. We have seen our attrition rate drop dramatically over the past three years and it is continuing to drop. Others in Elkhart County are experiencing attrition rates that continue to rise, so yes, I feel like it is working and we are leading the way in workplace culture in the RV Industry.

Aboutcamp BtoB: Can you tell us more about the “Action Initiated by Mindset” program at LCI?
Jason Lippert: Action Initiated by Mindset, or AIM for short, was developed to help our team members at LCI achieve their goals and dreams. We have several leaders within the organization that sit down one-on-one with team members and map out a process in which they will achieve these goals. The feedback thus far has been amazing. Our team members feel invigorated and excited to come to work every day. A couple of examples thus far are: We helped an team member purchase their first home, we helped a team member lose a substantial amount of weight and adopt a healthier lifestyle, and we helped another team member quit smoking.

Aboutcamp BtoB: Passionate about winning – Team Play with Trust – Honesty, Integrity, Candor – Caring about people – Positive attitude. These are the core values of Lippert Components. Can you go deeper into these?
Jason Lippert: A little more than five years ago, we knew we had to change our culture. We were growing at an unprecedented rate, and our people were suffering because of it. The first thing that needs to be done in order to change your company’s culture is to define who you are as an organization. So we came up with these five core values that defined LCI. Once we defined who we were, it became a lot easier to communicate to our team members what we expected out of them. We expect every team member at LCI to practice these core values. We ask potential new employees in the interview process how they demonstrate these core values. Instituting our core values did not happen overnight. It took years. We created a leadership development team in order to institute and reinforce these core values at every level of the company. Today, we’re not perfect, but our core values were the cornerstone of the transformation process that LCI has gone through over the last five years.

Aboutcamp BtoB: What did your first years of activity in Europe teach you? Has it been very different from what you imagined? Will it cause you to alter your strategies?
Jason Lippert: We are learning every day and are continually improving our European strategy. We found that just about every product we manufactured here in the US had to be modified to work in the European market. We knew this would be a challenge all along, and we are continually adding more resources in order to create the products that the European market is asking for. We will hopefully debut several of these products at this year’s Caravan Salon show. We continue to make acquisitions of companies in Europe with strong brands, respected products and great management teams. This is a strategy that we have always used and will continue to use as we grow further into the European market.

Aboutcamp BtoB: Which products do you think will do well in Europe?
Jason Lippert: We have really been pushing Slide-Outs and the “Space on Demand” concept. We believe that the European market is very close to widely accepting the slide-out concept. We’re really excited about several leveling and stabilization products that have been in development for some time now. We hope to display a couple of these leveling products at this year’s Caravan Salon. Not to give much away, but one of the products is unlike any that has ever hit the market before.

Aboutcamp BtoB: Will the new RVX: The RV Experience show in Salt Lake City be a real change compared to the Louisville show? Why?
Jason Lippert: This is a hard question to answer, especially since the details of the show are slowly trickling out and no one really knows what to expect at this point. From what we know about next year’s show, we will more than likely only bring our newest and most innovative products. This seems to be what the show is all about; to get dealers excited about what’s new in 2019. The Louisville show, for us, was really about connecting with our dealers as being in Elkhart Country, we can reach out and be face to face with our OEM partners every day.