2nd Wind Exercise kicking it home with monumental growth

2nd Wind exercise equipment founder Dick Enrico started 20 different businesses before he discovered a winner. Now he’s jogging ahead of the competition with a baker’s dozen of new stores in 2004 alone, 66 percent growth in personnel numbers, and a new corporate headquarters completed this week.

“We’re very optimistic about the specialty fitness industry,” Enrico said, calling his growth “monumental.” “The big-box operators are out there, but we deem them as another option for consumers, not competition.”

The company’s new headquarters in Eden Prairie, Minn. — a building Enrico bought in August for $3 million — is 65,000 square feet, which is a big jump from the current corporate center in St. Louis Park at 1,800 square feet. The biggest plus, however, will be that the new building will now pull under one roof the company’s 55,000-square-foot distribution center, which was in New Hope, and its commercial showroom, which has been at 2nd Wind’s Richfield store.

“We (were) operating in three different facilities,” Enrico said. “We just think the new location will be more efficient. It’s a tremendous value to get everyone under one roof. The commercial showroom will be 2,000 square feet, which is much bigger than our previous one, and will house an employee workout room that will be a model for people who want to implement something similar.”

The new headquarters is not the only way in which 2nd Wind (www.2ndwindexercise.com) is expanding. A recent growth spurt included an addition of 80 employees, bringing the company to a total of 200. Enrico has also opened 10 new stores, with three more to open in the next 30 days, bringing the chain to 40 total by year’s end. He plans to open six to eight more in 2005.

“With all these locations and so many employees, we’re competing with Target now,” Enrico said, pointing to the national discount chain. “It’s challenging. Anytime you’re growing, it’s challenging.”

Training and marketing vital
But, Enrico said, 2nd Wind is up for the challenge. He expects sales to exceed $50 million this year, up from $41 million last year. When asked how the company is doing so well when other retailers in the Midwest have been struggling, Enrico cited his employees and marketing strategies as sources of success.

“We’ve got great people who are highly motivated and trained, and they get the job done,” he said. “We also market more aggressively. Our marketing budget for August alone was $200,000.”

Enrico is not the only one who approves of 2nd Wind’s marketing approach, which has been at times called everything from risqué to cheesy (see SNEWS® story, Sept. 26, 2003: “In-your-face marketing works for 2nd nd Wind Exercise”).

“His success started and continued with a commitment to marketing 2nd Wind,” said Dennis Lee, president of Octane Fitness, which sold its first elliptical in a 2nd Wind store in 2002. “You may love the ads; you may hate the ads, but he’s made a major commitment to be in front of his customers, day-in and day-out. He’s marketing his business so when somebody’s ready to buy exercise equipment, they think of 2nd Wind.”

Lee also agrees with Enrico’s statement about the training and knowledge of his employees and how that lends to happy consumers and, ultimately, a successful business.

“When you go to 2nd Wind, you’ll talk to a professional,” Lee said.

Jeff Partrick, CEO of strength-products supplier Hoist Fitness, has been working with Enrico and 2nd Wind since 1996 and underscores the company’s follow-through.  

“Dick chases them in the doors, and the crew makes sure the sales go through,” he said. “That’s the good foundation of any business. The real key there is the people.”

Catching a second wind
Enrico started 2nd Wind in 1992 after seeing forgotten exercise equipment gathering dust in his friends’ homes (hence, the name). His original concept was to resell slightly used equipment, but that quickly expanded. His company now offers pools and spas in addition to fitness products — a method some specialty fitness dealers have used to offset slow fitness sales in the summer.

“We open our doors from scratch,” he said. “The average volume for August for our stores was $89,000 plus. In the middle of summer some of our stores are doing better than our competitors’ stores do in winter. Plus, we sell solutions to people’s problems rather than price to satisfy a pocketbook.”

Although some retailers want to grow bigger and beyond, Enrico is for now satisfied to keep 2nd Wind in the Midwest.

“Currently, we’re in seven states,” he said. “We’ll probably look at other markets, but right now this is our focus. We’re very good at what we do.”

SNEWS® View: No matter what the season or how the economy is faring, Enrico never chintzes on marketing and promotions. Of course, it doesn’t hurt that he’s such a larger-than-life character himself either. Although SNEWS® isn’t in the Midwest and can’t catch the TV and radio spots, we hear they are a constant barrage, and have developed Enrico into a regional persona that most people, even non-exercisers, recognize. That means that when those same people do buy fitness equipment or talk to someone who wants to, 2nd Wind is the first place they think of. That’s smart stuff. As marketing gurus know, you have to put yourself in front of someone a lot before you truly make an impact. Enrico and 2nd Wind have made quite an impact.