Skiing Off Into the Sunset

Kiplinger's Personal Finance Magazine, May, 1999 by Jane Bennett Clark

* With NordicTrack's downhill slide, who do you call if you need service?

It sits in the corner of the family room, an icon of Scandinavian vigor, evoking images of wide, snowy fields and the eternal quest to get in shape. And now it's gone--or at least the company that made it is.

NordicTrack, the Minneapolis-based maker of the quintessential cross-country ski machine and other fitness gear, recently filed for protection under Chapter 11 of the bankruptcy code after an unexpectedly rapid slide in revenues. Parent company CML, in Acton, Mass., sold NordicTrack's inventory and trademarks to Icon Health & Fitness, a Logan, Utah, equipment manufacturer.

Having observed the company's enormous success, even insiders were taken aback by NordicTrack's fall from fiscal fitness. "I was surprised," says Mike May of the Sporting Goods Manufacturers Association. "It's a household name. Everybody knows those guys." But the company wasn't too swift in coming up with an encore, says John Horan of Sporting Goods Intelligence, an industry newsletter. "It's a one-trick pony. After they found all the people who wanted to buy the pony, they had nobody else to sell to."

Plus, he says, some buyers suffered skier's remorse: "A lot of the machines were sold to people who made New Year's resolutions to lose weight and then found out that to lose weight they had to actually use the machines. That turned them off a bit"--and may have helped derail NordicTrack sales.

With thousands of NordicTrack skiers and treadmills sitting in Americans' garages, basements and possibly even exercise rooms, what do you do now for service if your skier springs a sprocket? Icon Health & Fitness (800-727-9777), which began manufacturing NordicTrack's treadmills several years ago, says it will honor warranties for those treadmills but not for NordicTrack equipment built previously. Icon will, however, service machines for a fee.

Icon has reopened 20 NordicTrack retail stores and arranged with Sears to sell NordicTrack-brand treadmills, cross-country ski machines and other equipment. (The new machines will carry warranties.) Soon you will also be able to order NordicTrack equipment and other Icon products on the Internet at www .workoutwarehouse.com.