For example, most “middleweight” Schwinns take 26 x 1 3/4 tires, which are hard to find, not 26 x 1.75 as used on other brands. Spoke Life Cycles focuses on Schwinn Cruisers because they are second to none in style and performance. The sometimes unhappy family shareholders felt entitled even
though they were not contributing anything to the company. Although they did
not take large amounts of cash flow from the company, a big problem was that the
family wanted to keep Schwinn entirely under private control.
After the death of Frank W. Schwinn, the
communication gap between the factory and Schwinn management widened. This
culminated in a 1980 vote schwinn mountain bike by workers to unionize the Schwinn factory. Now
Schwinn had to deal with the turnover of two chief executives in the space of 8
years.
By 1960, annual sales had reached just 4.4 million.[10] Nevertheless, Schwinn’s share of the market was increasing, and would reach in excess of 1 million bicycles per year by the end of the decade. Schwinn also didn’t want to part with all of its tried and
true children’s market and this meant that bicycle shop inventories
proliferated out of control with too many bicycle models. Selling children and
adult bicycles was an awkward mix for Schwinn dealers. During the late 1980s,
all of these companies were competing for a shrinking piece of the bicycle pie. Bicycles sales declined by 20 percent from about 12.6 million in 1987 to 10.7
million bicycles in 1989 (National Bicycle Dealers Association, 2021). After the death of Frank W.
Schwinn, the three legs of the stool that had built Schwinn bicycles began to wobble.
For the children of the 1950s, bicycles were more than just
a toy. For them, the bicycle was a critical means of transportation and gave
them the first taste of freedom from their parents. Children could independently
ride around their neighborhoods, to a friend’s house, to pick up baseball
games, or to just hang out. With the increasing suburban sprawl creating longer
distances but safe low traffic volume streets, bicycles became something of a childhood
necessity. Selling bicycles through smaller shops meant that that
Schwinn had to develop its own marketing strategy. Schwinn boldly stepped out
of its engineering comfort zone and recruited many of Hollywood’s top stars to
promote their innovative bicycle lines.
The marketing team also did their research to back up their impressions. After painstakingly going through sales records, they found that 27 percent of Schwinn retailers accounted for 94 percent of sales (Crown and Coleman, 1996). To make matters worse, Schwinn marketing materials such as the catalogs at the end of this article were sent to small shops that sold less than one Schwinn per year. The Paramount was never the most profitable product for the
company but it firmly engraved the Schwinn name into the annals of bicycle
history. One goal of the Paramount line was to market the Schwinn brand as producing
bicycles of the highest quality.
He
established a new company named Motomag that first sold stronger wheels to modify
existing Stingray-style bicycles. In 1976, he established a new company called Mongoose to
offer a complete line of BMX bicycles. This was a very good move because sales
of BMX bicycles in the US surged from 140 thousand in 1974 to 1.75 million by
1977 (Crown and Coleman 1996). These Varsities and the Continentals were road bicycles made
from the traditional heavy steels, the same material used in producing the kids’
bicycles.
He would retain the title of chairman and
chief executive until he died in 1988 but Ed Schwinn, Jr. would take over day-to-day
management of the company. Frank V. Schwinn had a more relaxed management style and
relied heavily on seasoned managers such as Al Fritz and Ray Burch. Frank V.
Schwinn reasoned that the existing schwinn bicycles crop of managers had met decades of earlier
challenges and there was no reason that this trend could not continue. Thus, during
the rest of the 1970s, the company was in the hands of Frank W. Schwinn, a
non-confrontational manager that tried hard to accommodate opinionated managers
and shifting family alliances.
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. At the end of the 1980s, bikes coming in from overseas piled
up in Schwinn’s warehouses.