BEHIND THE SCENES #5

«BEHIND-THE-SCENES» LETTER #5 - WRITTEN 12.02.2020

Read the first letters here.

Let me add some relevancy first:
Big Norwegian sports chains are struggling and going bankrupt. Many of them are threatened by the bad winter season and price pressure. Do we worry about how this crisis will affect us every day? Absolutely not.

My gut thoughts: The world doesn't need another sporting good warehouse. We don't need businesses that survive by pushing out as many products as possible to as small of a price as possible. This affects suppliers, employees and the environment. We have always politely declined selling our products to businesses like these, and I promise that we never will in the future either.

What the world needs is an underdog that thinks differently. Someone who gives the customers something other than gibberish and nonsense. We want to fill that role to the fullest. If there is no room for (crazy) companies like us, then well, we're over. But there's no doubt: We are just getting started.

1. Economy
Being cocky is easy, making money isn't quite as easy. Our goal was to break even in 2019. But because of a weak ending to the year, our result ended in around 70000 Euro in minus. Our growth was still 40%. As I've mentioned before, we have high production costs that make profitability challenging. The easiest way to do this is to increase turnover. This year we're betting everything on making a profit.

TTT - Things take time. At the same time my vision is completely; build a company that challenges the norm and that people like, and profit will follow. Luckily I've come to realize that I like swimming upstream. It's tiring, but after awhile your arms get pretty strong.

2. Team
There are five of us at the office now. The newest members to the NP-family are Marita with economy and logistics, and Anders with sales and photography. We do a lot of cool things at Northern Playground, but there are very few people who catch wind of them. We have to get better at telling our stories. That's where Anders comes in. Just wait and see. In addition we have a very committed board, and not to mention, four women in Grünerløkka and Tøyen who making as many products as they possibly can.

If you think back to earlier behind the scenes letters, you'll remember that I've been pretty open about the tough sides of being the founder of a company. I don't think like that much anymore. Now it's just really cool. And that mostly has to do with the people around me.

3. Store
Before Christmas we opened a pop-up for six weeks. It was a lot more fun than we expected. Thanks for stopping by! What we don't realize when we're in our office is that we have fans. In the pop-up we met hundreds of people that dig what we do. It has been very inspiring. So we can't stop now! That's why we are in the process of finding a spot for a permanent "factory store", filled with production, reparation, redesign, licorice and fantastic products.
4. Community
This letter is part of how we believe the future's companies have to and should be: honest. We believe that we are pretty close to being a completely open and honest company. Amongst other things, we are owned 50 "normal" people who take part in deciding how the company is run. But we want to take things one step further, and invite you to be an even bigger part of the company. In not too long a few customers will have the opportunity to be a part of a test version of our new "community" concept. Stay tuned in your inbox in the next few weeks. We can't wait.
5. Made in Oslo
Last fall we launched another project in Oslo. A beanie in 100% Norwegian wool, knitted by unemployed immigrant women in Oslo without modern equipment. Long story short: Mama mia, it would have been much easier ordering these beanies from China. Then we could get a good wool beanie for around 5 Euro and sold it for 50 (like everyone else). The beanie from Løkka costs us around 18 Euro to make. When you take away the state's share, transportation and marketing costs, we don't have anything left. That won't work in the long run. But we can't fuss over that. We are sure that we can scale this project. Textile production in Oslo and Norway is not impossible - and we are going to make it work.
6. Environment

We defined a new vision in 2019. It is: The more products we sell, the better the world. The paradox is obvious - production is generally bad for the environment. But the point is that we have to try our hardest to reach this ambition, and that it pushes us in the right direction. To name a few things we are doing:
- In a few weeks we will be launching a collaboration with Protect Our Winters. It'll be awesome.
- I can say that we are in the process of making a completely different category of clothing with an extremely ambitious environmental profile. We have to be a little secretive here - I have to leave some things to the imagination 😉
- And yes, we have a new government in Norway. Maybe it's time I nag the new Environmental minister and Finance minister about more taxes? You'd think that the group that's left is a bit more progressive than the last one.

7. Winter 2020
Like I opened with - bankruptcies in the sporting goods industry are just getting started. Thousands of products are on their way onto the shelves with extreme discounts. It won't be easy fighting against them. Discounts that last forever are definitely not a good thing, and we're interested to see if anyone buys products from us at full price when everyone else is selling them at 50-70% off. Should we stand against the discounts or take part in them? What do you think? I'm all ears!

Happy winter! (Yeah, it kind of sucks (here in Norway, at least), but at least bad skiing conditions make you a better skier.)

Best,
Jo

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