NordicTrack ski machines were remarkably popular during the 1990s, and are still available as of 2010 at garage sales and retail stores. The history of the NordicTrack company has been tumultuous, and the brand has been acquired by larger companies twice. It's hard to believe that the machine itself got its start in one man's garage.
Invention and Founding
NordicTrack was founded in 1975 by Edward Pauls of Chaska, Minnesota. Pauls studied mechanical engineering at the University of Wisconsin at Madison and worked designing ski boots and bindings at another Minnesota-based firm called Rosemount, Inc. When Rosemount closed in 1969, Pauls began work on inventions of his own and designed skis that could be used by disabled skiers. Pauls invented the NordicTrack ski machine as a device that would allow professional skiers, including his daughter Terri, to practice all year round, and built the first machine out of parts from a junkyard. Pauls received requests for the machine from friends, and invested $10,000 of his savings to begin building them in his garage.
Expansion of Operations
Word about the new machine spread, and orders began to accumulate, so Pauls moved his operation into a small warehouse and hired workers to build the machines and take telephone orders. Pauls' wife, Florence, became the new business manager and, as Pauls and his wife realized the device was alluring not only to professional skiers, but average people looking for a new way to get an aerobic workout as well, advertising was expanded to include ads placed in popular publications such as "Smithsonian" and "Scientific American." PSI NordicTrack Inc. was employing over 200 workers by the mid-1980s, and annual sales had risen to around $15 million.
Acquisition by CML
In 1986, Charles M. Leighton's CML Group offered Pauls $24 million and acquired PSI NordicTrack Inc. The Paulses received seven million shares of CML stock and a five-year contract that allowed Ed to retain his position as chairman of the company and Florence to act as senior vice-president. An array of new exercise products was introduced throughout the late 1980s, including the strength trainer Nordicpower and a "$1,200 black leather chair whose arms folded out to allow the busy executive to do some upper body training between meetings" called the Executive Power Chair.
Growth
By 1991, sales of NordicTrack exercise products accounted for "a stunning 86 percent of CML's operating income." In 1992, only 8 percent of NordicTrack's sales came from products other than cross-country ski machines. Throughout the early 1990s, management continued to introduce new exercise products, and by 1993, a quarter of the company's sales were from products other than cross-country ski machines. Retail stores were opened, sales climbed to $378 million in 1993 and CML was named "company of the year" for 1993 by the "Boston Globe."
Financial Decline and Bankruptcy
Overall sales increased in 1995 thanks to the opening of 26 new retail stores, but sales from direct response ads decreased significantly that year. In 1996, sales dropped 27 percent to $368 million, and because of high operating costs, NordicTrack suffered a net loss of $73 million for that year. Management tried to save the company by developing a few new machines and expanding distribution into Sears department stores, but sales continued to plummet and dropped to $268 million for the 1997 fiscal year. NordicTrack filed for bankruptcy on November 5, 1998, and closed all of its 300 retail stores shortly thereafter.
NordicTrack as a subsdiary of ICON
A company called ICON Health and Fitness acquired the NordicTrack brand in 1999 and, according to ICONFitness.com, developed it into its "premium line of home fitness equipment." As a subsidiary of ICON, NordicTrack developed a website, NordicTrack.com, and begun new distribution in retail stores.
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