- Associated Press - Saturday, November 22, 2014

NAPPANEE, Ind. (AP) - What started as a recreational vehicle supplier’s side project has grown into a free-standing company that’s riding the nation’s outdoor kitchen trend.

Nappanee-based Challenger Designs is capitalizing especially on growing sales of the Big Green Egg, the ceramic charcoal grill/smoker/cooker, said operations manager Rich Moore.

The aluminum cabinet maker plans, over the next couple of weeks, to break ground on a 60,000-square-foot facility next to its home on U.S. 6 east of town, adjacent to Nappanee Municipal Airport. The company will move production to the new building, slated for completion by March or April, and begin storing inventory in its existing 30,000 square feet of space.

Challenger Designs began four years ago as a cabinetry division of Challenger Door, which makes doors for the RV, cargo trailer and transit industries. In 2012, it outgrew its space within the Challenger Door complex and moved into its current facility, which happened to be Challenger Door’s first home, but initially leased space it didn’t need to another firm, Moore said.

Last year, the firm took over the entire building, and it’s no longer enough space.

Moore said sales are growing at about 50 percent a year, and could double from $4 million annually to $8 million once the expansion is finished.

While it’s obviously a good thing, Moore called that kind of growth “very painful.” Grow too fast and quality suffers, which can forever drive away customers. Grow production slower than your sales and your sluggish delivery time will drive clients elsewhere.

“Growth can kill you just like non-growth can,” Moore told The Elkhart Truth (https://bit.ly/1xKFeav ). “(But) if you miss sales, you don’t get them back the next year. You’ve missed that for that year. We want to put ourselves in a position next year with our new building to be able to capture those sales, so the market can’t grow faster than we can. In the past, we’ve reacted to growth. This year, we’re planning for it with a new building.”

The new facility will require the company, which employs 40 people, to hire about 20 more by the end of next year. The positions, mostly production workers, will pay $18 to $25 an hour.

Moore said the company is confident that the booming outdoor kitchen market, aimed at higher-end homes, will continue growing.

“It’s people who have discretionary income and want to take their indoor living outside,” Moore said. “One of the things I’ve noticed when you have family get-togethers, everyone congregates around the kitchen. You’re outdoors now and you’ve got products that are going to last now because they’re aluminum so it won’t rust.”

Myron Miller, production manager, said metal-based outdoor kitchens are more portable than their stone predecessors.

“In the past they would build their outdoor kitchens out of masonry, and then maybe slide an appliance into it,” Miller said. “This is an opportunity for them to purchase an outdoor kitchen that they can take with them if they ever move.”

About 70 percent of the outdoor kitchen cabinetry market is stainless steel, so Challenger Door has plenty more room to grow. Moore said stainless steel is priced about 30 percent higher, can become very hot in direct sunlight, shows water spots easily and needs to be maintained by a special cleaner.

A big factor in Challenger Designs’ growth has been an exclusive deal it struck a year ago with Atlanta-based Big Green Egg to be its exclusive cart supplier. Challenger makes a cart, called an “island,” that holds the egg.

Big Green Egg, which enjoys a loyal following of users called “Eggheads,” has been making the ceramic eggs for 20 years but has seen more growth over the past few years, said Jodi Burson, director of brand enhancement for Big Green Egg. They’re sold in 50 countries through 4,000 dealers.

Eggs retail from $400 to $4,000, and islands, which don’t include the egg, range from $2,000 to $3,200, depending on the size and style, Burson said.

“They’re very high-quality,” Burson said of Challenger Designs. “That’s why we sought them out as a vendor. They make a very good, high-quality, well-respected product.”

The plant ships a truckload a week for Big Green Egg and has deliveries scheduled through the end of February. That will probably ramp up to a truckload every three or four days with the new facility, Miller said.

Miller said some people start by buying just the egg, then realize they want a place to store their charcoal and utensils, so they buy the cart.

Miller said he and Moore started following The Big Green Egg Facebook page and enjoy seeing the different ways people use their products.

“It’s a cult following,” Miller said of Big Green Egg. “It’s crazy. Rich and I went to Eggtoberfest down in Atlanta and they had like 200 grills cooking at one time, and you just go tent to tent sampling the food.”

Moore said the relationship has been great for both companies.

“We started building carts for their stuff and they were like, ‘Well that’s fine.’ They weren’t very interested,” Moore said. “Then when they saw people starting to buy the carts and starting to get excited about the carts, they came back to us and said, you know what, we want our own. We want to brand our own cart and have our cart specifically used for us. We said, Sure, we’ll do that, we’d love to.”

The new building also will allow Challenger Designs to paint its own products, rather than farming painting out to a vendor as it now does. Moore said that will allow the company to better control quality and reduce the time it takes to meet new orders.

The new ability to store inventory also will enable the company to launch a new “quick ship” program, which will help alleviate order backlogs in the busy summer months.

Like other Elkhart County manufacturers, the firm’s biggest challenge is finding workers, which has become more difficult as the RV industry picks up steam, Moore said.

Another bad winter could hurt too because it means people will be entertaining outdoors later in the spring. To be less weather-dependent, the company is trying to boost sales in the south, southwest and California.

It also must keep a close eye on aluminum prices, which rose 19 percent this year, partly because of Ford Motor Co.’s decision to start producing an all-aluminum F-150 pickup. Miller noted that the company does enjoy bulk aluminum pricing because it buys through its Challenger Door parent company. This year the two companies together are on pace to use 5.1 million pounds of extruded aluminum.

Grill carts comprise about 60 percent of revenue, with 20 percent coming from outdoor kitchens and the other 20 percent generated by a mix of cabinets made for custom garages, cargo trailers and golf carts for the racing industry.

Moore said he believes the company has a solid future, partly because so many outdoor kitchen enthusiasts are empty-nesters.

“A lot of people are doing this in their second stage of life,” Moore said. “Kids are gone. Having friends and family over. The last thing someone wants to do is stand out by the grill while everyone else is somewhere else. You bring that environment outside where you have a bar out there, you have seating, now you can entertain your friends and spend time with them. It’s all based around food, and everyone likes to eat.”

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Information from: The Elkhart Truth, https://www.elkharttruth.com


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