November 26, 2008, 12:00 AM

High margins plus low costs equal a strong bottom line at LeatherUp

Motorcycle and leather goods retailer LeatherUp.com has developed a business formula that the company says enables it to grow sales and turn a profit even in rough economic times.

While many retailers are struggling to find a successful business formula, LeatherUp says it expects to end the year on a strong note with growth of 17% and overall sales projected to surpass $20 million in 2008.

In addition to its b2c site, LeatherUp.com, No. 348 in the Internet Retailer Top 500 Guide, also has a wholesale site, MyLeather.com. The company’s success rides on its ability to mind the numbers and keep an eye out for the small things.

“We are a unique firm not looking for top side growth but for bottom line strength,” says Aaron Golshen, vice president, LeatherUp.com. “We have worked to cut costs, reduce manual processes and negotiate every little thing from advertisements to box or tape costs.”

Launched in 1999, the company operates its sites with a staff of 28 employees. It manufactures its own line of motorcycle helmets, boots and jackets, which help it sell at high margins. The company also has made investments in marketing to build brand recognition as well as in customer service to help retain customers.

“Over 50% of sales are going to be word of mouth and repeat business by the end of year,” Golshen says. Over the past year, average order size has increased 18%, according to the company.

The company has also invested in a new e-commerce platform from Los Angeles-based Nox Solutions and credits the platform for part of its success. “We have not been down once in over a year since changing to them,” according to LeatherUp.com.

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