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Schwinn Home

1880s-1908
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1941-1949
1950-1959
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1952 Schwinn Head Badge
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Authorized Schwinn Dealers


1950-1959
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Frank W. had been impressed by advertising strategies used by Whizzer and in 1950 hired Vice President, Ray Burch, away from the now struggling company and put him to work as Schwinn's sales promotions manager. Burch, in turn, put Bill Chambers, Dealer Relations Manager at Schwinn, to work wading through a mess of records from Schwinn's distribution network. Weeks of work showed that a mere 27 percent of Schwinn's retailers were responsible for 94 percent of sales. Chambers had discovered that Schwinn could afford to fire almost three quarters of their distribution network with only a small impact on the bottom line. Distribution costs would plummet. Chambers set out to find who was selling Schwinns and why.

While most of the bicycle "shops" in 1947 were dingy, greasy places operated in alleys and garages, George Garner's shops were clean and brightly lit. His employees wore clean white smocks. While many bicycle retailers on Schwinn's distribution lists were really hardware stores (or even barber shops) that also sold bicycles-just like the department stores that didn't have time to sell a Schwinn's finer points-Garner sold only bicycles. He went out of his way to fix customer problems. His Southern California bike shops stood out and so did sales. In 1950, Schwinn sold 510,000 bicycles and George Garner's shops were Schwinn's number 1 sellers. Garner held the spot for 17 consecutive years and it brought about one of Schwinn's most important innovations, the Authorized Dealer program, something Frank W. had set his sights on more than a decade previous.

Ray Burch stopped by one of Garner's shops in 1956 to see what made the little business so good at selling Schwinn's. Burch found clean shops with well displayed Schwinn bicycles and only Schwinn bicycles. That was it. That was all it took. Garner's employees/mechanics were well trained and polite, but they said very little. The bike and the shop were evidence enough to show off the quality and justify the prices. Garner let the bikes sell themselves.

Schwinn chopped its distribution network down to just a fraction of its previous total. Authorized Schwinn dealers had to dedicate at least half of their sales floor to Schwinns. Since Schwinn could decide who got their bikes and who didn't, the company rewarded the best sellers with location exclusivity. Schwinn mandated service standards and layouts. The company approved store locations. Schwinn began "managing" these sellers in much the same way that a corporation manages its franchises ...and got sued by the Department of Justice for price-fixing and restraint of trade in 1957. The case lasted for an entire decade. It went before the Supreme Court. It gobbled up time and resources. Frank W. kept right on purging his distributor network of costly retailers.

The purge took as long as the legal debacle. BF Goodrich's automotive and appliance stores were responsible for as much as 25% of Schwinn's sales at times throughout two decades that began in the Depression. But Goodrich sold Schwinns as a loss leader to get people into the store to buy appliances and car tires. Goodrich employees were not trained to properly assemble or display the bikes and the competition was hurting authorized dealers. Schwinn eliminated Goodrich's 1,700 locations from their retail network in 1962. From 15,000 possible retail outlets in the early 1950s, Schwinn was down to just 3,000 in 1967. The winnowing halted at around 1,700. At the end of the 60s, Schwinn had just 22 regional distributors to keep in line.

Schwinn sent George Garner (ex marine) on tour. The company was humble enough to learn from Garner's trench perspective and savvy enough to spread him around. Garner was Schwinn's leading PR tool in creating the "Total Concept Store." He was their example to the mom and pop operations on how to sell Schwinn bikes. But he wasn't their only piece of propaganda. The "Total Concept Store" had many converts. Dealers spent an average of $40,000 to overhaul their shops and Schwinn proudly showed off the success stories. In 1963, 48 dealers were members of Schwinn's 1,000 Club. These dealers had sold 1,000 Schwinns in a year. But as more and more bike shop owners joined the ranks of the middle class another 400 dealers joined the Club by 1968. The average Schwinn dealer was grossing $100,000 in sales.

Beyond building one of the highest quality rides around, Schwinn offered tons of support to their authorized dealers who adopted the "Total Concept Store." They were, of course, walked through the remodeling process, but dealers were also provided with unmatched training and assistance programs. Schwinn provided shops business analysis, group rate medical plans, and retirement investing.

Schwinn supported sales with strong advertising, using stars such as Bing Crosby, Rita Hayworth, and Ronald Reagan in the 40s and Georgia Governor Lester Maddox and actress Carol Channing through the 70s. Captain Kangaroo touted Schwinns to the under six crowd while the annual Playboy Playmate of the year drew attention from adults. Schwinn suggested scripts for local radio commercials.

In 1959, Schwinn was operating a traveling mechanics' workshop allowing their dealers to claim that a "factory trained mechanic" was on duty. This kind of work paid off greatly. Schwinn dealers were more qualified to sell Schwinns. They really knew what they were talking about and became adept at "selling" the benefits of Schwinn's latest offerings to the public. More than that, Schwinn's traveling sales school showed dealers how to close a sale and how to explain the differences between Schwinns and competitive offerings. They also taught about things like inventory management. By the late 1970s approximately 3/4 of Schwinn's authorized dealers were selling exclusively Schwinn bikes.

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