Kelly Davis, founder and new owner of Tuff Country on Episode 241

Tuff Country has been through some changes, from the founding 35 years ago to it’s purchase by a private equity firm to being back in the hands of the founder, Kelly Davis. Kelly shares all the details and what’s coming next. We wish him all the best in his reboot! Be sure to listen on your favorite podcast app.

3:07 – I guess we’ve always been off-road entrepreneurs 

6:54 – He said, “swim or sink, it’s up to you. You control your own destiny here.”             

12:26 – we really engaged with grassroots events all over the country

16:45 – one thing we really tried to do was control our growth 

22:06 – we thought, if we can survive 2008 and climb back out of this hole, we’re going to be some tough dudes 

33:02 – they buy you because you are a well-earned machine, you’re profitable, you have value, and then they get away from your core values 

43:05 – we made an offer, they accepted and the work started, we had to reboot this thing.

51:13 – Quitten’s easy, man, so easy. The harder you work, the luckier you get. 

Special thanks to 4low Magazine and Maxxis Tires for support and sponsorship of this podcast.

Be sure to listen on your favorite podcast app.

Transcript

[00:00:01.100] - 

Welcome to Conversations with Big Rich. This is an interview-style podcast. Those interviewed are all involved in the off-road industry. Being involved, like all of my guests are, is a lifestyle, not just a job. I talk to past, present, and future legends, as well as business owners, employees, media, and land use warriors, men and women who have found their way into this exciting and addictive lifestyle we call off-road. We discuss their personal history, struggles, successes, and reboots. We dive into what drives them to stay active and off-road. We all hope to shed some light on how to find a path into this world that we live and love and call off-road.

[00:00:45.280] - 

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[00:01:13.020] - 

Have you seen 4Low magazine yet? 4low magazine is a high-quality, well-written, four-wheel drive-focused magazine for the enthusiast market. If you still love the idea of a printed magazine, something to save and read at any time, 4LOW is the magazine for you. 4Low cannot be found in stores, but you can have it delivered to your home or place of business. Visit 4Lowmagazine.com to order your subscription today.

[00:01:39.560] - Big Rich Klein

My next guest on Conversations with Big Rich is Kelly Davis. Kelly and his brother Troy started Tuff Country suspensions 35 years ago, built it into a successful business, and sold to a private equity firm, and now Kelly has purchased it back. We will be discussing Kelly's life, business, and future. Hello, Kelly Davis. It's great to talk to you. I'm really interested in all the news, the fresh news that's coming with you and getting your company back. But before we get into all that, we got to find out more about you. But I want to say thank you so much for agreeing to come on and being on the podcast.

[00:02:22.040] - Kelly Davis

Great, Rich. I appreciate it, man. Yeah, it's been a crazy ride, but I appreciate you having me on your podcast. And looking forward to catching up. And thanks for the good opportunity.

[00:02:30.850] - Big Rich Klein

Yeah. So let's start at the very beginning. And where were you born and raised?

[00:02:36.640] - Kelly Davis

Absolutely. Born and raised in Utah. I'm a Utah guy. I left for a couple of years. I went to play college baseball back in Tennessee, but Utah has always been home, man, and it's born and raised.

[00:02:49.320] - Big Rich Klein

All right. I got to ask, what position did you play?

[00:02:51.740] - Kelly Davis

I was a middle infielder. Second base in shortstop, yeah. There you go. Okay.

[00:02:56.150] - Big Rich Klein

Quick reactions.

[00:02:58.390] - Kelly Davis

Had to be.

[00:02:59.390] - Big Rich Klein

So let's go back to the very beginning and talk about those early years.

[00:03:07.700] - Kelly Davis

Yeah, so my dad, I guess we've always been off-road entrepreneurs, if you will. My dad was the original owner of Plaza cycle, which was here in Salt Lake City. And now it's Karl Malone. Karl Malone bought it. My dad sold in the early '80s. But we got our entrepreneurship from dad, from the off-road. So dad That actually goes back to racing against Roger DeCoster back in the old days in desert racing. So that's how far back we go. And so basically, I was raised in a motorcycle shop, basically, if you will. I used to ride an Indian, it was an Indian 40. I learned how to ride a motorcycle before a bicycle. I had training wheels on it and everything. And then during the winter, we raced what they called the Articats, but they called the Babycats. Well, we raced them because they were like 30 cc's. So we've got to just... This is what we know. We've been raised around it. And my dad started an off-road shop in West Valley City. It's called Mister 4x4. And that's taking you back to the early '80s, if you will.

[00:04:15.940] - Big Rich Klein

That was Mister 4x4?

[00:04:17.880] - Kelly Davis

Yeah, it was spelled out M-I-S-T-E-R. It was Mister 4x4. What happened is my dad was basically retired, if you will. He's 81 years old, still alive, and still every single day on hot rods and cars. But he was smart back in the day that he bought a lot of property out West Valley City, which was Redwood Road and about 3500 south. He kept buying all the dry farms up going west, and now that's pretty popular area.

[00:04:47.100] - Big Rich Klein

It's all housing and businesses.

[00:04:50.000] - Kelly Davis

Yeah. Yeah. And he was crazy like a fox. Dad had what the airway called him the Midas Touch. Everything did turn to gold. He also worked his butt off every day. But so dad went to buy off-roads stuff for my brother and I for Christmas. He went to buy... My brother had a '79 Toyota, and I had one of the first Suzuki Jeeps we brought over from Guam before they even were available here in the States. And he went to buy some accessories for him at an off-road shop. I won't give you the name. It's no longer here. It's no longer up. But he just walked in to buy some parts, and it was in November. And it was with my mom, and they both went in The place was a dump, if you will. They were treated poorly. My dad said, Hey, I'd like to buy a bumper for this Toyota. He was just treated poorly. They said, Well, you should have been ordering that two months ago, and brushed him off. My dad's feisty, and I guess it runs in the family. So my dad said, The guy said something. He goes, You're not going to buy anything?

[00:05:52.190] - Kelly Davis

He said, No, I'm not. He goes, But what I am going to do is I'm starting off road shop and I'm running you out of business. He told the guy, And the guy said, why don't you send me an invitation to your grand opening? So it was confrontational, but dad did. He opened up an off road store and ran him out of business about a year later. And we grew that place. Yeah, we grew up to four stores. We had one in Idaho Falls, one there in West Valley City, one in Sandy, and Ogden as well. So my brother and I ran the Ogden store. So we got up every morning and drove to Ogden. We'd load the van up and take the parts we had sold the day before. And basically, I guess I'll rewind a little bit. I was about, well, I was 20. I was 20, my brother was 22. And we went up to Ogden and we looked at a space. My dad says, what do you think? I said, yeah, I think it's a great location. I think it'll be good. He says, all right, well, we went up there, signed the lease, and my dad handed the keys to me and my brother, and said, swim or sink.

[00:06:54.390] - Kelly Davis

I said, what? He said, swim or sink. It's up to you. You control your own destiny here. So we swam and we swam hard. We had to build the whole store from ground up because it was just a shell. And we laid flooring down. We built displays. We did everything we had to do to swim or sink. And the comfort from there, I guess the rest is history. That store up in Ogden was the biggest grossing store for a couple of years. And we used to buy Trailmaster suspension, which was around many years ago. I'm sure you probably remember the name. It's been around forever. It's a long work here, but we used to buy a truckload a month for our stores. We sold so much of it. Troy and I looked each other one day after unloading this truck, and we said, quality was starting to go down, lead times are getting out there. We just said, we can do better. I think we can do better than Trail Master. We talked to my dad, and we started bringing in leaves and marking them under our own name. We tried everything, man. Rich, we tried Bug Shields, we tried Bikini tops, we made Bug Shields, we made Bikini tops.

[00:08:11.440] - Kelly Davis

We're just trying to see what could stick. We named it under the TCI was the name of the company then, and then it morphed later on to Tuff Country Incorporated, which morphed into Tuff Country, morphed into Tuff Country, Easy Right Suspension. So we did. We started bringing stuff in and suspension stuck. That was the thing that people wanted. And that was back in the... Well, you got to figure that was the late '80s. So we officially spun off of there, just told dad, We're going to do this. He says, Great, you're going to need money. We did. We didn't have any money. He was kind enough to give us a loan at 22% interest.

[00:08:56.870] - Big Rich Klein

That's kind.

[00:08:58.250] - Kelly Davis

It was very him. Yeah, it was very nice He knew what he was doing, but what other choice did we have? So by golly, we took it and ran, and it was just the two of us. It grew, and we started backwards, Rich, if you will. We started in Mail order. Back then, it was truly aill order. You didn't have e-commerce, of course, of any type in the late '80s. So we officially started in January 1989, is when we officially opened the doors to Tuff Country. The customer was a toll free number. You call in, you didn't email, you didn't do anything. You called in off the toll free number. And then we advertised a third-page ad in Fourwheel and Off-Road, and then JP, which was Jeep magazine back then. And we waited the waters. We seen what worked, what fit, what people want and what they didn't want. And I guess the timing is everything. Back then, people We were really into, and I'm talking 10 and 12-inch lifts back in the day, people were on 44s and all those good things. We had to find our niche. Les Schwab Tire Center, which is one of our largest customers.

[00:10:17.460] - Kelly Davis

I think they're close to 600 stores right now. And they came to us because they had Trailmaster in their facility. And they had a following out with Trailmaster, and they needed to fill the hole. And it wasn't a big category for him. So we started selling to him very grateful. I mean, they're an incredible company, large, huge. And they came to us one day and said, Listen, we have a lot of snowplows up here in the Northwest, and this is like '91. And he goes, We need something to lift the front of the vehicle up so when you put the plow on, it doesn't sag so much in the front. So we come up and we developed what we call a spring pack that allowed you to put the weight on it and it would pick the weight up when you needed it. Then when you had to plow off, it was off. But then they came to us and we said, Well, we told them, I said, Listen, the Dodge is all set low on the front. Could you use something in the front? They said, Yeah, we'd like to level them. We could put a bit of one size tire larger if we can lift the front up and level the vehicle between the front and the rear.

[00:11:24.890] - Kelly Davis

That's where the leveling kit came from. We were the first to We were the original people that invented the leveling kits. Now everybody has them, right? But then we were the original ones. It all developed from just you have a problem, then you have a solution, and the best solution was just... We have a whole line, then we developed a whole line of leveling kits. At that time, everybody was doing 12 and 6, 12, 6, 14, 8-inch lifts, and we were just content to make them leveling kits. We were doing 4 and 6-inch kits, but we weren't doing anything taller than that. It really helped put us on the map, if you will. That's just basically the roots, the grassroots. Something that my brother and I really felt was very important is we had to get active in the community, the off-road community. It's huge. You got to connect with the people, right? Yes. I mean, look what you've done. Look what your son's done. I mean, you have to be with the people, and you have to be engaged, and it has to matter. In our world, it's a lifestyle. It's an off-road lifestyle.

[00:12:26.820] - Kelly Davis

I tell people all the time, for a Moab, or for a Sand Hall, or wherever we're at, where else would you rather be with your family? On a Friday night, where else would you rather be? Or on a Saturday night? So we really engaged with grassroots events all over the country. And that's where we get the connection because it mattered a lot to us to be engaged and active and people know who you are. And so we continued all those years. We just continued to, one, keep innovating and trying to stay on top of things. And competition came, competition left. And a lot of people came in our space, and a lot of people have made it, and a lot of people have it. It's a difficult space, and it's got crowded at times. Suspension has been crowded at times, and sometimes it got thin. So we were weathered the storm, which is what we believe is just treating people right offering a quality product. And what's really important to us is USA made. It made in the USA. A lot of the companies plain and simply haven't. They haven't. They haven't. They've gone overseas.

[00:13:39.860] - Big Rich Klein

They've tried to save a buck.

[00:13:42.540] - Kelly Davis

Yeah, exactly. You Sometimes we're not the lowest priced, but we know that it's made in the USA, and a lot of it's made just here in West Jordan, Utah. I'd say 70 % of our products made right here in West Jordan, and that's important to us.

[00:13:59.540] - Big Rich Klein

So Let's go back to those early school years with you and your brother, who's Troy, and you're the youngest, right?

[00:14:11.600] - Kelly Davis

I'm the youngest, correct. Yeah.

[00:14:12.940] - Big Rich Klein

What's the age difference? Two years. Two years, okay. Were you guys good students, or were you always looking to go out and get on the motorcycles and the snowmobiles, and you just got by, or what?

[00:14:29.510] - Kelly Davis

Yeah, I He was a get-by guy, I'm not going to lie. I stayed eligible, put it that way. He stayed eligible. I was eligible to play the sports. I was your typical stay eligible towards it. I'd rather be played sports or off-roading or anything like that. I think where'd that come from? I shouldn't say where'd that come from, but Troy and I obviously have incredible bonds. We're brothers, Irish twins, if you will. Our parents, like a lot of people, they got divorced very younger. So Troy and I, we We had each other to rely on. You know what I'm saying? We had each other's back. We moved quite a bit when we were younger. A lot of people say, How do you make it work? How did you guys make it work for all those years? For 32 years, how did you make it work being a family business? Because family businesses most of the time don't succeed. It just went back to a very young age where we relied on each other. Heck, our first business was a yoyo business, a yo-yo repair business. Put it that way.

[00:15:28.270] - Big Rich Klein

A yoyo repair.

[00:15:30.240] - Kelly Davis

Seven years old.

[00:15:31.660] - Big Rich Klein

How to string a yoyo.

[00:15:33.760] - Kelly Davis

We fixed yoyos, and then after we fixed it, we got enough money to buy yoyos. We were the neighborhood yoyo repair shop, and we sold as well as retail out of our their odds. We've always been together, and we've always... Entrepreneurship, we didn't have an option. That was plan B, was to rely on ourselves. But as far as schooling goes, Troy was a student than I was, I think. I was just enough to stay eligible, and then college, it was the same thing.

[00:16:08.120] - Big Rich Klein

Besides staying eligible and in baseball, what was your major?

[00:16:15.890] - Kelly Davis

Small business administration.

[00:16:17.940] - Big Rich Klein

Okay, perfect. Yeah.

[00:16:18.900] - Kelly Davis

And my brother's was finance.

[00:16:21.380] - Big Rich Klein

Perfect.

[00:16:22.480] - Kelly Davis

Yeah. And that's how we ran the business. He took care of the finance side of it, and I took care of the product development, marketing, and events. I had the fun side. You're right, for sure.

[00:16:36.550] - Big Rich Klein

So when do you think were the big growth periods?

[00:16:45.290] - Kelly Davis

Man, and that's one thing we really tried to do, Rich, is we tried to control our growth, which is easy to say. We didn't do SEMA for years. We went, but we didn't actually exhibit because we were trying to take care of the customers we had. And that was the mail order customers, Les Schwab, and some smaller accounts. I think the growth period hit where we went, holy cow, probably 2000, about 10 years into it. Now, Shane, which we'll get back to Shane. Shane, he was our third employee we hired. We'll circle back to him later. Then the growth I have to say about, I want to say about 2000. Then it just started really… We started in a back of an old building for Plaza cycle. It used to be at 35th South in Salt Lake City. We opened Tuff Country in the back of a pet store that was my dad owned. My dad owned the building. We had to rent from him, but it was literally 10 feet of pallet racking to cubicles or desks. We bought it some yard cell or something like that. We had a propane heater. That was the heat.

[00:18:09.230] - Kelly Davis

The air conditioning was to open the garage door. And then we moved out of that. We went were growing. So we moved out of that, moved into another building. It was a two-story building, another one in West Valley City. And it was probably 3,000 square feet. And we thought, man, we are big time now, buddy. We got two offices, real offices and a shipping department, and we We got a forklift. That was big news for us, too. And then we were there for two years, and we grew out of it. And then we built a building in West Jordan. And that's when things really started to really go.

[00:18:47.170] - Big Rich Klein

And that was around 2000?

[00:18:48.860] - Kelly Davis

That was mid 2000, somewhere in there. And then we thought, We will never grow out of this building. There's no way we're going to grow out of this building. We've got six offices, we've got a giant warehouse, we have a loading dock. There's no... And I think we were in probably 15,000 square feet building. And we thought, This is it. We are in, this is awesome. And that lasted about five years. And then a building came up available behind us, directly behind us. All we did was tear the fence down and move pallets a bit it out. It took us a couple of months, but And that's the facility we're in today, and it's close to 60,000 square feet.

[00:19:36.100] - Big Rich Klein

Is that including the 15,000?

[00:19:39.050] - Kelly Davis

Yeah, we're right about 65 when you add it all up. So it's a nice space. And then we thought we were never going to grow out of this place. And then 2007, it would be rich, just before 2008 hit When everything went south with business, we were putting on 20,000 more square feet. We had already approved it to the city, and then the economy went in the toilet, and we scrapped the plan. But we're still in the same building today. If we move out of this, I don't know where else we're going to go. It's been a great ride, that's for sure.

[00:20:25.500] - Big Rich Klein

Let's talk about what you just mentioned, and that was the economy drop in 2008. We all suffered in that. By the time 2009 ended, I was ready to give it all up. I had just met and gotten together with Shelley, and she really changed my view because I was ready to hang up We Rock. We Rock was going to be dead at the end of 2009. I was over it. Our numbers were way down, everything. How did you guys get through all that?

[00:20:59.920] - Kelly Davis

I'm really proud to say we did not have to lay off anybody's employees. We had a few leave. We had to reduce some hours back then, and they left with our blessing. But what we did is we got very lean and mean. We where we were maybe got happy. We were so busy, we were subletting parts getting made, like cutting as simple as a sleeve. We were having somebody else do them, cutting sleeves for us for bushings, for lease springs. And We brought that back in house and cut our own sleeves and had our employees do with those. That is when I truly found out how lean and mean you can get. We ended up from that point on, from 2008 on, we got 12 turns a year out of our inventory. We turned our inventory every single month. We had to get very efficient. Lean amine is the best way I can put it. We got very efficient. There are sometimes I didn't get a paycheck. Everybody else did, but my brother and I did not get a sometimes. It was Tuff, man. We were at the same spot as you. It's like, We got to survive.

[00:22:06.330] - Kelly Davis

If we can survive 2008 and climb back out of this hole, we're going to be some Tuff dudes. There's going to be a lot of people leave. There's a lot of people that aren't going to make it. We weren't leveraged. So not being leveraged, that helped a ton. So we were not heavily leveraged at all. We got very efficient and just climbed back out of it and We just kept fighting the con and getting better. We went back to back then, heavy, 2008, 2009 is when people were making the IFS kits with the big knuckles, right? And knuckles are expensive. The cast iron, and you got to pay for molds, and the kits were expensive. So we made a transition in product development and went back to, well, upper control arms, which people are very popular now. But back then, they weren't popular. But we went to upper control arms because, one, we could control them. We could control the manufacturing. We weren't relying on outside sources to make these big, giant, expensive knuckles. And the kit is economic. When you're maybe selling a four or six-inch independent Chevy suspension or a Ford, you're looking back then with $1,800, $1,700.

[00:23:25.210] - Kelly Davis

And by doing these upper control arm kits and going down to four-inch, you're looking at about $600. So the economic turned into being smarter. So once we did that, everybody followed suit, which we understand happens. But we were able to... Well, One Made in the USA, we were able to react really fast to be able to get, Okay, this ain't working. Let's go to upper control arms and let's go to the smaller kits. People still wanted to lift their vehicle, but they didn't want to a couple of thousand dollars. They're going to spend a couple of hundred. We were able to... We call that supermarket shopping, if you will. If you want a steak, we got a steak. If you want ramen noodles, we got ramen noodles, too. It's up to you. But we didn't want to give that customer any wiggle room to not buy from us. If we've got them on the phone or they've called and we've got them on the phone, we got what they want. We're going to sell them what they want. We're going to give them the choice. But we don't want to lose that sell, because every sell is important.

[00:24:33.110] - Kelly Davis

Every phone call is important. So that's how I think we were able to react quickly in 2008, get lean and mean, get 12 turns a year out of our inventory. I think That was our success, was able to be able to react quickly, I guess.

[00:24:50.470] - Big Rich Klein

The people that worked for you as they came on, there were some key individuals?

[00:25:02.500] - Kelly Davis

We've had some incredible employees. I guess one thing that's great is we've had some long-standing employees. Shane, which was key to us. Shane was a professional baseball player. He played baseball at University Utah, got drafted, and he was in spring training in late '89, I think it was. And he thought he was getting promoted to Triple A. So his parents came out getting ready to watch you go play a Triple A baseball game in spring training. And he got called in by the coach and got released that day. Instead of getting called up, he got released. So he called. Yeah, right? So he was for us during the summer times wherever he could. He was just a young kid. He calls me up and he says, You always told me if I wanted a full-time job and baseball didn't work out, you'd give me a job. I said, Yes, I did. He said, You got a job for me? I said, Do you need one? He says, Yeah. I said, Then I got a job for you. He says, Okay, I'm on my way. I'll be there tomorrow morning. I said, No, you just got released.

[00:26:06.100] - Kelly Davis

You're in Arizona. Take your time. He was there the next morning. He left, and that told me a lot, right? Yeah.

[00:26:13.290] - Big Rich Klein

For those that don't know, Shane's last name is?

[00:26:16.550] - Kelly Davis

Shane Jones. Shane Jones, he came to us. He was our utility, did everything, shipping, packaging, you name it, he did it, wrenching. He did it all. He He formerly went into... He rolled into operations. He was our Director of Operations here for all those years. Then he was very key to get in. Then we got some young talent that these guys are heavy Toyota guys. I think you know them, Rich. It's the Scott and Zack Sweenies. Yes. They're called the Sweenie Brothers, and they've been with us both since they were 15 years old. They joined us, and they do a lot of our product development. They work off a solid works, hard software, and they do our product development. They're fantastic, and they've been with us forever, 20 plus years. My kids, my son, obviously has been with the company since he's born, going one way or the other. He was packaging shock boots when he was four or five years old. Perfect. Yeah, now he runs our... Yeah, Keep him young. And he does e-commerce side for us. So, yeah, we've had a lot of key people. We've had some really good key people that when we sold to private equity, We lost them, and that was heartbreaking.

[00:27:33.210] - Kelly Davis

But it's been a lot of good people. We've been real fortunate, and you treat people right, and they'll give you all. And we've been really fortunate in having key employees come and not leave. That stays team environment, very much team environment, and always has been.

[00:27:52.920] - Big Rich Klein

I've had a lot of friends over the years that have gone the way of private equity, I don't blame them whatsoever. That dangling carrot, and it's C-A-R-A-T, is hard to pass up. I understand that. I've had others that have said, No, I'm staying true. That private equity stuff, it's starting to go away. I mean, the whole four wheel parts thing, now DPI, the thing with Polaris and everything that they had and everything that's going on. How did they approach that? Did you guys approach them or did they approach you guys?

[00:28:51.430] - Kelly Davis

Yeah, just a brief rundown. We've been doing it for a long time. My brother and I, we're getting up there in age. What I don't do very well is idle. I don't sit well. I always have to be moving. But we started to get to the point where I've had several surgeries, a lot of it from off-road racing. Loved it, played hard, but I'm paying for it. My brother was getting to the point where we never seeked anybody out. We never seeked and went, Hey, we were always seeked out. And early on, some companies talked to us. And a lot of... 2008, 2009, people were coming out of the woodwork to try to buy you, right? Because that's when they say you make the most money is when the economy's down. But we just didn't. Nothing seemed right. Just nothing seemed right. And we weren't seeking it. And so this particular deal came across. And I've been working, sometimes seven days a week. We worked hard. We worked lots of hours. And there's days that when we were in the retail store in October, if it snowed or it was a blizzard, we stayed there.

[00:30:06.530] - Kelly Davis

We had a couch in the back, we sleep there. So we worked our fingers to the bones, if you will. And we thought, well, maybe it's time to slow down. Maybe it's time to listen to more people that are coming out of the woodworks that they're wanting to buy. And they contacted us and I said, well, let's listen. And you're right. A lot people say no right off the bat. And I was to the point where I've been doing 30 plus years. Maybe let's listen. It doesn't cost us a thing to listen, right? So when they approached us, it was at SEMA, believe it or not. I want to say 2018. Yeah, it was 2018. And it was quite like the courtship first. It was like a dating, and this and that, and we could do this. And we got all these other companies and all the synergies. And the other thing that we were looking at for is our employees and our families, right? It's a family business. And I have cousins and kids and nieces and nephews. And we are truly a family-owned business. And so it had to be right for them, too, or we weren't going to do it.

[00:31:22.500] - Kelly Davis

If you're going to move us, we're not going anywhere. We're this place is staying right where it's at. So we had a lot of things that were important to us. And it was evolved from basically family and friends. And so we listened some more. And then they started the due diligence process, which my brother handled because it was finance side. And it just came to a point where... I'm trying to think. We were flying back from somewhere, and they offered us an LOI, which is a letter of intent. And we looked each other and we got off the and we had known that the offer had been submitted while we were in the air. And so we went into the sky room, if you will, the Delta Sky room, and opened it up and took a look at the number, and we looked at each other and said, okay, listen, it's the right time. We felt like it was the right time because we thought we were towards the end of our career. We thought it was a good fit. And so And after many days and talking and talking with my dad and getting his gut feeling and Troy and I, we decided to move forward.

[00:32:40.050] - Kelly Davis

And the rest is history. That was April third, 2019 is when we sold. So it's been a crazy ride since then. So when you sell a company, you stay on for a year for a transitional period, right?

[00:33:00.870] - Big Rich Klein

Typically, yeah.

[00:33:02.070] - Kelly Davis

Yeah. So we did. We signed a contract that kept us on for a year to help transition and consult and whatnot. And so after that year was up, they said, we would truly like to keep you And that first year was good. It was okay. And we said, Okay. They offered me the GM job for all 12 brands. So I was a general manager of 12 brands. So I went from own in and managing two companies to taking care of 12 and overseeing 12. And so we stayed on. And we started seeing things happen. We're head scratchers at times, I guess. And I'm like, There's some good private equity companies out there, and there's some that's not so good. And there's some that are really supportive and focused and engaged, and there's some that's not. And we've seen what's happened to a lot of them out there. Like you mentioned, it's been It's been sad to see, right? It's been really- A lot of family-run businesses and names are going to disappear. Disappear. It's heartbreaking. They buy you because you are a well-earned machine, you're profitable, you have value, and then I guess they get away from your core values.

[00:34:25.330] - Kelly Davis

That's what I guess it's because they get big and they lose their focus. One thing I've always learned is nobody can run your business like you. You have to be there. You have to be engaged. Some things became less important to them, if you will. That was very important to us.

[00:34:42.920] - Big Rich Klein

The bean counters get involved.

[00:34:45.480] - Kelly Davis

It comes down to a bottom line, brother. You're exactly right. It comes down to this. You could go past everything else, go right to the bottom, and it's the bottom line. I guess they don't understand. They're not connected. They have no connection. They have two do what's going on. And the bottom line becomes what's the most important. And sometimes that's not the most important. Sometimes it's engaging and then getting... Not sometimes. It is important to be involved and every single day be engaged and know what's going on and going to events. And the first thing that happens when things get slow, they start cutting events. That's the cheapest thing, the easiest thing to do. And then after that, it's its wages or it's its employees. So It got really disheartening there at the end, to be honest with you.

[00:35:33.060] - Big Rich Klein

They start cutting that stuff, and then it starts affecting. They think it's going to increase the bottom line, and it does until people forget about you. Yeah. And it's maybe not forget about you, but Somebody else isn't cutting those things. So they get the share, especially in a digital age. A hundred %. And one thing I've learned about off road since I got involved in it in '82, '83, was It was that it's about the people that are hanging around the campfire. A hundred %. It's about the people you know, who you trust, who you like, and have like values. And That all went away. I mean, it's with that. I mean, look at it in the media side of it, print magazine. Oh, my gosh. I mean, it's just now us with Forlough and Crawl magazine, John Herrick. You know, that's pretty much it. Yep, And everybody else, there's some great guys out there, and they're all struggling to try to fit into the digital age now, where print is still viable.

[00:36:42.420] - Kelly Davis

It's 100 % viable.

[00:36:44.340] - Big Rich Klein

It's crazy.

[00:36:45.410] - Kelly Davis

Yeah. No, I agree. People want that touchy feeling, right? That print is 100 % viable.

[00:36:52.340] - Big Rich Klein

You're right. And that's why shows are important, because people want to touch the product.

[00:36:56.930] - Kelly Davis

Yes. Tangible, right? They want to touch it, really.

[00:36:59.090] - Big Rich Klein

They want to smell the rub. They want to see how the welds are done. They want to see how things move and flex, not just look at it, look at it online.

[00:37:08.170] - Kelly Davis

Yeah, I agree 100 %. I mean, I've seen so many... I mean, the magazines were... You've been around as long as I have, Rich. You've seen how the magazines were king, and you still see the value. I see it, too. But I see these people like Chris Corbett. He's with Nittle now, but he was with the magazines for all those years. But You hit the nail right on the head. It's the people that you surround yourself with at the campfire, up wheeling, at the desert. That's how we got involved with Little and Trail Hero. He was friends with the Sweenies. He knew the Sweenie boys, and they came to one day and said, Hey, this guy is so cool. And his dad told me, Give me your background on you and all you've done. And you said, You start this new event and you just need some support from the industry people. And he said, We have the big total home and trailer, which we still do. He said, I talked to Rich and he said, I really appreciate it if you could come down and bring the big rig down with you. I really think it was the first year, Rich, and we did because of a conversation that somebody had with my people, the people that I knew and gave value and told me how they knew what you had done and know that Rich Little could do the same.

[00:38:29.460] - Kelly Davis

That's how that whole relationship started. It was people. Out of the events and people. That's the first thing that they cut. It's easy. They don't see the value in it. I'm like, We would go sell T-shirts at cost at these events. Get your name out there. Every year now, just for instance, like a Jeep Safari, and we've been doing that since, I don't know, 30 plus years. Every year, we had a new T-shirt, and people would come up and they knew it was cheap, but it had this year on it, and it had a different logo on it, or different saying or whatever on it. And they just come buy it every year because they bought the year before, the year before, the year before. It's just connection with people. It's invaluable.

[00:39:14.490] - Big Rich Klein

Right. They don't get that. Selling a T-shirt or giving away a business card, which means more. A business card sits on somebody's desk or in their card file, whatever. T-shirts get worn.

[00:39:26.570] - Kelly Davis

It's a billboard, yeah. So Yeah, it's... And I don't want to degrudge any of the people. It's just two different ways of thinking, people, person, entrepreneurship or bottom line. And At the end, the company went into what's called a receiver ship, and that's when the bank came in, and that's when they started selling companies. And we got to the point where I knew what to do. I've been doing it a long time. I was wore out. I was tired. And Shane came to me. I was in the middle of transitioning HCR, which is in Cedar City. I was down there for like doing it weeks at a time because it was one of my responsibilities. They were having people look at them and doing due diligence. And so I was down there and we had a phone call with the powers to be, and they said, well, we've had a lot of people look at the Tuff country, this and that and the other. And some people are going to move it. They wanted to buy it and move it. They wanted another private equity company. I'm on this call. It's a team's call, of course.

[00:40:41.240] - Kelly Davis

I'm just shaking my head, okay, okay. And Shane was on the same So Shane, to back up, Shane was our director of operations here for Tuff Country. Then a year after we sold the corporate office and seeing the value in him, and he's just a bulldog, go getter. So they hired him in Phoenix. He picked his family and then moved to Phoenix, Arizona, and became the director of operations of all the facilities, all the companies. So he was on the same phone call as me. And my wife happened to be down there with me because I've been spending a lot of time in the role. So she happened to be down there with me. The biggest support thing I've ever... My wife is by far the reason I'm still back in the business, if you will. Shane calls me in the hotel room. I I'm frustrated. I'm mad. I'm in a bad spot, bad place. And like I said, he heard the same things I heard. I told my wife about what was going on and possibly moving it here or another private equity company. And Shane Colesby says, You know what? What? He goes, Are you thinking what I'm thinking?

[00:41:50.760] - Kelly Davis

I said, Shane, I'm not thinking straight right now, man. I've been overloaded. I've got no bandwidth left. I've done. He says, let's buy it back. And I went, Shane, I'd love to. I'd love to, dude. I said, But give me some time. Okay, let me talk a little bit with my wife. Let's make him an offer. You and I, we could do this. We know what to do and we certainly know what not to do, right? I said, yeah, we know that. We know what not to do for sure. And I got off the phone, talked with my wife, and I slept on it. And the next morning, it was just like I had a new life. I had juice. I was like, You know what? No, we're buying it back. We're buying it back. And the last couple of years, I just didn't have the fight in it, which was sad for me because I got a lot of fight in me. I just felt down running down with what was going on around us. I told him, I said, All right, let's do it. Let's make an offer. I went from cleaning my desk out, cleaning my office out, 24 hours later with the fight that I've never had since I was 20 years old again.

[00:43:05.360] - Kelly Davis

And he made an offer. It was the longest 48 hours of my life because it was 48 hours span before they replied. And long story short, they accepted the offer and then the work started. We had to reboot this thing. And it's a lot of work. You got to start with all the business it's EI, N numbers, and employees, and keeping who you're going to keep. And they had got it to place anyways, but we did it. And it officially happened about 10 days ago. We wanted everything lined up before we set that press release out, that you were so kind to read and you and your son shared it. And it's gone absolutely crazy. And the support from the industry people, it Like I told you earlier, I think it's become a, hey, we're buying it back and we're excited. We can do this to a movement. I mean, I've had people, incredible support, and they're just fed up with private equity. It's been really encouraging, and we're here for the fight and ready to do it.

[00:44:19.510] - Big Rich Klein

It was interesting because I remember when the four wheel parts was buying everything up, and then And then all that was happening, and then there was others going on. And then all of a sudden, I remember in Moab, a bunch of guys, business owners all together, and all of a sudden, what I called Daystar ended up bringing everything, bringing all these companies in in a short period of time. And I was like, wow, this one might work.

[00:44:57.440] - Kelly Davis

Yeah.

[00:44:58.040] - Big Rich Klein

And then it It didn't. It didn't. That was the one I thought might because I thought the companies were good. At least it seemed that people behind it to begin with were right, but all of a sudden they were gone. It was like, wow, okay. That one was a blindside.

[00:45:22.140] - Kelly Davis

It really was. That's why you see what I saw. I'm looking at these companies that they already acquired. I'm looking at the ones that they're telling me who they're looking at and inquiring I'm like, This is the right fit. This is the good... That's why we were sold on it. That's why we... It aligned with some great companies, Nitro and Toy Tech and Daystar and Performance Accessories and Voodoo. There was some quality brands. At first, we were marketing correctly, and it worked. Trent McGee, I don't know if you know who Trent McGee is.

[00:45:59.050] - Big Rich Klein

Oh, yes. Trent and I are good friends.

[00:46:00.890] - Kelly Davis

Good dude. We were trying to hire him because in the marketing. Absolutely. He's a quality dude. I've known him from the magazines. We were... Tuff Country was a suspension sponsor for Top Truck Challenge, and ultimate adventure, a diesel challenge, and all those. And he was always involved in those. We were always involved with them. So we became really good friends, industry friends and friends. I tried to hire him. I was in here in a Tuff country, and he was a Phoenix guy, so they were hiring him there. I had the interview with the CFO and CEO, and then he calls me afterwards. He says, What do you think, Kelly? I said, Well, we talked. I said, It's some good brands and some good people. I said, What do you think, Trent? And he says, Kelly, this is one thing I've learned, I've heard over the years, private equity. He said, When it's good, it's good. But when it's bad, it's bad. It's bad. That really resonated with me, especially as time went on, right? And he hit the nail on the head. He really did. Smart guy. I always remember that comment. It stuck with me a long time.

[00:47:15.350] - Big Rich Klein

He's gone through that a number of times. The last time, of course, with the magazine business and ultimate adventure and everything. Also, I believe with Superlift and back in those days.

[00:47:33.270] - Kelly Davis

You're exactly right.

[00:47:34.400] - Big Rich Klein

And I know that we had... We Rock was purchased at one point, and we were held for six months. And we were part of another... And they were different businesses because they were trying to create a recreation brand. And there was a guy that was producing They were basically surfboards with little jet power motors on them. So it was like a Jacuzzi jet, like a jet boat is. Oh, man. Then there was the little off-road go-cart type things.

[00:48:23.830] - Kelly Davis

Yeah, I remember those.

[00:48:25.370] - Big Rich Klein

And then it was us as the competitive side that we were going to put together events to promote all of these different types of items. And then one guy that was part of the group, and I forget, there was five or six different companies involved, screwed over the major investor because the guy ordered, goes, Okay, I want 10 of these carts. And the guy never delivered, took the money and never delivered. Oh, boy. And so the guy backed out of the whole deal. They had cleared a lot of debt for me, and then they turned around and just handed me the company back.

[00:49:11.390] - Kelly Davis

Oh, man. I love it. Good for you.

[00:49:13.090] - Big Rich Klein

And I was like, okay. And that was all before the downturn. And that six months saved it because I had been screwed by a guy that I was bringing in as a partner, and he took me for over 120 grand. In cash, and that was all supposed to go to drivers. So it was a rough time. Sure. And got out of it, got cleaned, got things whole. But then the economy hit, and I was like, All right, I'm just so over this shit. It wouldn't stop. I mean, before I did my first event was 9/11.

[00:49:56.090] - Kelly Davis

God.

[00:49:56.820] - Big Rich Klein

And here I am getting ready to put on my first event, and that was in November, and 9/11 hits. And I'm thinking, Here we go. Same thing happened when I owned a landscape company, had all these employees, and we got hit with the first desert storm. Gosh, yeah. There was a big recession. It was a depression here in California, especially if you were a landscaper, because we had a drought going on as well. And I thought, man, I'm getting smacked every time. Every time we drove around. And that's all I could think about. And then, then in 2009, like I said, met Shelle, and she was retiring in 2011 and convinced me, hey, let me help you. And I said, you don't want to help this mess. This mess is so beyond. But she was a chief financial officer for a $44 million company and was doing... She understood what it took. So we went lean and mean, got whole, and we're still cranking it out. It's awesome. And brought a partner in to run it so I can step back and retire from all the physical labor. And it's worked out well for us, and it worked out well for rock crawling as well.

[00:51:11.750] - Big Rich Klein

A hundred %. Look what you've done.

[00:51:13.740] - Kelly Davis

It's just crazy. That's a great story. It's just perseverance. You get knocked down, you got to get back up. It's true. Quitten's easy, man. Quitten's so easy. My saying to my employees and myself Hey, the harder you work, the lucky you get. Just remember that, you guys. The harder you work, the lucky you're going to get. That just comes with perseverance. Like your story, I mean, every time you got on top, you got knocked back down, and then it's just, Okay. All right, quitting is easy. I can't do that. And that's a great story. And yeah, having a supportive wife next to you sure makes things easy, doesn't it, man?

[00:51:53.530] - Big Rich Klein

A supportive and smart one.

[00:51:55.530] - Kelly Davis

Yeah, both. I hear you. Yeah, that's a great story. But yeah, there's a lot to be said for it. And here we are. Five years later, I thought, here we are. I couldn't be any happier. I'm happy for our employees and the family. We're getting back to what we do, developing good products and affordable products made in USA. I have all the faith in the world with my group and the team. It's really fun. Fun is the word. Like I said, I've never had this much energy. I'm back at it, and I'm right in the middle of the fight. That's awesome. It's fun. It's good stuff, man. Support from you guys and the industry has been overwhelming, for sure.

[00:52:45.690] - Big Rich Klein

And so what's on the horizon? What are you guys... What's the first call to action that you guys need to get straight? And where are you headed?

[00:52:56.400] - Kelly Davis

Ebit. We got to get hold. We got to For the last five or six months, the money just wasn't there. So we're getting whole again. We got some pretty good working capital, but it takes time to... When you've got a machine like this big, and this strong and powerful, and it just stops. And it takes a while to get the machine back up and running and putting coal back in the engine, if you will. You got to get it moving again. And that was the first thing that we're doing right now. You're setting up all the new customers and all the suppliers and vendors and getting whole. And the great thing about it is we've got this, we've got support. We treated people so good for a very long time. And They trust who's back in charge. Again, they lost their faith for a while. Just like all these companies we've had, TeraFlex and ReadyLift and WillPro, I could go on forever. They We've got their faith, we got their loyalty, but we got to produce product. We got to get a product back out the door. That's the biggest thing is getting whole and getting the supply chain back up to where it was at and what we're used to and what our customers, quite frankly, are used to.

[00:54:16.140] - Kelly Davis

Then from there, it's back to the ride home from Cedar City, when I do, we were going to attempt to buy the company back. The first text I sent out was to your son. It was during... Well, and I kept it under... Because that weekend was Trail Hero. I said, Listen, I know it was one of your first manufacturers, but got away the last couple of years. He was just an incredible kid. And he knew why and he understood it, but always supportive. I said, You can't tell anybody. It's not 100 %, but this is what we're doing. I said, I'm not going to be a Trail Hero this year, but I'm going to be there next year. And he said, I got a spot for you. So we're going to get back to events, is I guess what I'm getting at, a long story short. We're getting back to the grassroots, supporting the off-road community and getting back to being out in people's faces, see and be seen. That's highly important, very important. Then just going back to innovative new product development and getting... We lost a year, if you will. We haven't been on top.

[00:55:24.840] - Kelly Davis

We were always... Tuff Country was always so good at being first to market, and we haven't been first to market. That's another thing that's very important to us is getting back to getting out in people's face and being first to market. Then we just keep growing the business again and growing people. Good. Yeah. That's the plan going forward. We're very excited about it. Excellent.

[00:55:47.350] - Big Rich Klein

I see a bright future. I really do. I think that you're going to be one of the first of many or that first wave of getting back to it. Whether it's like yourself is one of the founding partners bringing it back or somebody that was like some of the other companies where maybe it was a key employee that decided to step up and take it over. I think we're going to see that more and more, especially now with the way the market It is just cranking today because of the election yesterday. A hundred %. That's a great sign. And so hopefully, we'll get some of our public lands back or or at least keep them from going away. So we're a solid place to still recreate, which always is good for sales.

[00:56:51.870] - Kelly Davis

A hundred %. And I appreciate your kind words. And I think you're spot on. I think we're going to see a movement of people saying, Okay, enough's enough. People seeing what's happened out there with these large companies buying all these other companies up. I think you're right. I think you're spot on, Rich. We couldn't appreciate your support enough. Thankfully for reaching out and the support and your people. And it means a lot to us here at Tuff Country, that's for sure.

[00:57:20.940] - Big Rich Klein

I think there's those big companies like Bezos and Amazon that have been screwing over the small business for so long. That it's time for the small business resurgence, Main Street over Wall Street.

[00:57:36.200] - Kelly Davis

A hundred %. It's time to stand up. It is time to stand up. And it's correct. Amazon is not I don't know if you don't buy a lift kit from them tomorrow, but the small companies will, right? We'll know because it's important to us. And so, yeah, I agree with you. It's time to get back to doing the right thing. And and get this train back on the track and go for it.

[00:58:03.390] - Big Rich Klein

Well, great. Kelly, anything that we can do on our end to help you along the way, let me know. Reach out. A rising tide lifts all shows.

[00:58:17.840] - Kelly Davis

A hundred %, yeah. And I certainly appreciate that. And I agree with you. And thank you so much for the support. And we'll see you soon, I'm sure.

[00:58:25.630] - Big Rich Klein

All right. Kelly, you take care. Great story. And thank you so much. Thank you.

[00:58:30.630] - Kelly Davis

Take care. All right. Bye-bye.

[00:58:31.910] - Big Rich Klein

Bye-bye. Well, that's another episode of Conversations with Big Rich. I'd like to thank you all for listening. If you could do us a favor and leave us a review on any podcast service that you happen to be listening on, or send us an email or a text message or a Facebook message, and let me know any ideas that you have or if there's anybody that you have that you think would be a great guest, please forward the contact information to me so that we can try to get them on. And always remember, live life to the fullest. Enjoying life is a must. Follow your dreams and live life with all the gusto you can. Thank you.