They focused on selling Schwinn branded bicycles at low prices in companies like Sears, Kmart and Target. The Pacific approach for selling Schwinn bicycle combined with several other major brands worked quite well. In 1993, Richard Schwinn, the great-grandson of the company founder Ignaz, and Marc Muller made a deal with Zell-Chilmark. They were able to purchase the Schwinn Paramount design group and production facility in Waterford, Wisconsin from Zell-Chilmark.
The Greenville closing virtually wiped out its balance sheet. Predictably, the family members were hopping mad at the demise of the Schwinn business. They expressed themselves in no uncertain terms and the focus of their fury was Edward Schwinn. The Schwinn family Trust indirectly played a role in the demise of Schwinn.
This was a no-expense-spared project of Frank W. Schwinn, who wanted the bike to be introduced in 1938. It was an unqualified success, other than that it was very expensive to produce and showed little if any real profit potential. Sponsorship of 6-day riders produced a team to showcase the Paramount, the riders such as Jerry Rodman (The Michael Jordan of that time in Chicago) and the rest of the Schwinn Co. bicycle line.
In the early 1990s, the company lost $2.9 million with outstanding debt $80 million. The caused Schwinn to violate one of its bank covenants. Schwinn’s bankers called a meeting to see if something could be worked out.
The main producers of Schwinn bicycles in China and Taiwan were not being compensated for shipping their products. The banks were swooping in and taking any cash from the business to hedge their possible losses. In essence, the Bank loans were taking away any possible way for Schwinn to pay its suppliers. Two-speed rear hubs, that the rider shifted by back pedalling, were common, but some featured external rear derailleurs with 3 or 5 gear ratios and automotive-like gear shifters mounted on the top tube.
Questor tried to breath new life into Schwinn again developing an updated line of historic models. Zell-Chilmark had no use for the Waterford schwinn ebike plant which specialized in high-end bicycles. The investment group had decided to focus on the wider markers of less expensive bicycles.
Our customer experience team is ready to answer any questions. Deck the halls with bikes, helmets, and accessories for every rider on your list. Find all your favorite Schwinn products at the retailers listed below. Shop online or in-store to bring the fun of a great ride home today. Just four years after purchasing Schwinn, in 1997 Scott Sports Group and Zell-Chilmark sold Schwinn to Questor Partners Fund for $80,000.
In exchange for ensuring the presence of the Schwinn name, distributors retained the right to distribute Schwinn bikes to any hardware store, toy store, or bicycle shop that ordered them. W. Schwinn tasked a new team to plan future business strategy, consisting of marketing supervisor Ray Burch, general manager Bill Stoeffhaas, and design supervisor Al Fritz. In 1962, Peter Mole of John T Bill & Co contacted Huffy Corp about making a new bicycle called High Rise. The bikes had a long seat called a banana seat with strut and taller handlebars. Huffy hesitated for several months before agreeing to make the bike with the stipulation that if it was a flop, Peter Mole would buy all the left-over parts and bikes. By 1965, several other American and foreign manufacturers were offering their own version of the Sting-Ray.
We have spent over a century building the bicycle industry into what it is today, and we’re not done yet. For Scott USA, Schwinn was a good fit for them to be able to sell bicycle in the USA without making the substantial investments necessary to start a new company. The company revamped the bicycle line and ended the long tradition of building bicycles in the USA. The first act of Scott USA was to move the corporate headquarters to Boulder, Colorado.