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With the Ironman license now in its family, the retail team at Star Trac is moving into its second year showing greater growth than expected.
Not bad during an economic slump that has many running for cover.
“We’re trying to zig when the market is zagging,” said Lamar, vice president and general manager of the retail division. “There’s so much negative, (but) it’s not all doom and gloom.”
Star Trac moved firmly into the retail segment in late 2007 when it acquired the assets of the 3-year-old Lamar Health, Fitness & Sports company, which had been forced out of business by the CFO’s accounting malpractice (Click here to see a Sept. 6, 2007 SNEWS® story, “Accounting malpractices by CFO forces Lamar Fitness to suspend operations,” and click here for a Nov. 14, 2007 story, “Star Trac finalizes back-door deal to buy Lamar company assets hours after its sale.”) Before that, the Tustin, Calif.-based commercial manufacturer had dabbled at retail by partnering with Lamar’s company in March 2007 (Click here to see that March 23, 2007 story.)
Lamar said the retail division is taking the Star Trac Spinning bikes to dealers and has revamped the ST Fitness line. That process will continue now that it landed the license for the Ironman brand for fitness equipment that was homeless after former licensee Keys Fitness went bankrupt (Click here to see that Nov. 17, 2008 story, “Keys Fitness ownership seeks court approval to sell all assets.”) Former Keys director of product development Ken Kruebbe has been brought on to oversee the development of the Ironman brand. Now, Star Trac is selling through the current product and “fixing” relationships with distributors for now, Lamar said, but it will take a look at revamping and updating the product as it progresses at retail.
“It’s a great brand and a great product,” Lamar said. “It got a little tarnished, but we’ll knock off the tarnish.”
That of course means that the company will also take a look at possible brand consolidation to best leverage the brands it does have. For now Star Trac remains the commercial brand; Spinnning will have an exclusive retail product; ST fitness, as the former Lamar brand, will be specialty-focused; and Ironman will go to mass and others points of distribution as deemed appropriate for the brand.
Craig Kirsch, of the Two Wheeler Dealer Cycle & Fitness Stores in South Dakota, said he is optimistic about the ST line, some of which he is still waiting for, although the current economy has indeed been rough on retail.
“We continue to have confidence in Kevin Lamar, Al Cockrill, Chuck Sikora and the rest of the ST team,” Kirsch said, “We look forward to a long and profitable relationship with them. The current sluggish economy will not last forever, and we feel that we’re in a good position going forward.”
All eyes are of course on going-forward – especially when the company per Lamar “blew away” its estimated sales for the first full year in 2008.
“We beat it all pretty handily in a down market,” said Lamar, granting they were conservative estimates but ones based on old Lamar Fitness company numbers.
With the first year of organization checked off the list, this year will be more about advances in product and expanding the retail base. The 2009 Health & Fitness Business show will be the second time the team will showcase its product after the 2008 show’s coming-out party.
“Everybody talks about how bad business is,” he said. “We’re focused on specialty and I want the channel to be successful.”
SNEWS® View: Certainly a small brand with its dukes up (with the backing of a larger brand like Star Trac) can come out swinging. With the bad news in fitness these days, this is one of first flashes of good news we’ve seen, and we hope of course they continue. Still weighing down the prospects of celebration, of course, is the personal guarantee Lamar had on his loans with the bank for his last business, forcing him to try to collect some percentage still on outstanding accounts receivable. Better that, he said, than having the bankers out threatening everybody. This month he said he should be paying off the balance at a percent the bank agrees upon – finally putting an end to that chapter. Certainly the retail division will have the ability to tap into Star Trac’s R&D, which will of course be helpful as retailers seek something new to show to help tempt consumers to part with money in their wallets.