Re: [CR]Richard Burke & Trek's origins

(Example: Production Builders)

Date: Wed, 09 Aug 2006 12:25:20 -0700
From: "Rich Pinder" <rpinder@usc.edu>
Subject: Re: [CR]Richard Burke & Trek's origins
In-reply-to: <8C889FF8D5DD258-1678-5276@FWM-D45.sysops.aol.com>
To: classicrendezvous@bikelist.org
References: <DB138660B6B01D458B16F9205C0C2634021CA11F@ISOEMAILP3.iso.com>


I found info on the VintageTrek site for my TX 710 (probably) model. From 78 approx ? They were mostly sold as frame only, I believe. I think I read the TX 700 series were what Trek thought of as 'touring'. And they go back to the beginning... 1977. Steel / 531 - and they offered an option for cable braze on's for the top tube I read as well (as is the way mine came) I'm behind on my website, but I could send pics of mine. But similar model is seen at: http://www.vintage-trek.com/Trek_galleryRH.htm

Rich Pinder Van Nuys, CA

loudeeter@aol.com wrote:
> Mordecia Silver provided the excellent "Origins of Trek" post. Below are the steel models that I have for Trek in the Used Bike Buyers Guide. I'm sure when I started gathering this data that I omitted their touring frames. If anyone has more information to fill the gaps, I would appreciate them. Also, does anyone know the role that Bevil Hogg, Mike Appel, and Tom French played in the founding of Trek and when they joined the effort? Thanks. Lou Deeter, Orlando FL, USA
>
>
> Trek Models:
> 630 531
> 970 79 Columbus SL
> 957 81 SL
> 757 81 531
> 759 81 531
> 412 82 Ishiwata
> 613 82 531
> 614 82 531
> 715 82 531
> 736 82 531
> 640 83 531C
> 760 83 531C
> 560 84-86 501 or 531
> 720 84 531ST
> 730 84 531
> 770 84 531P
> 400 85-88 Chromoly
> Elance (T400) 87-88 531 main tubes
> 410 85
> 570 85 501
> 660 85 531C
> 520 85 501
> T.S. Isaac Signature 753
> 500 86 531
> 700 86 531
> 370 94-95 Chromoly
> 470 95-96 Chromoly
> 420 96-97 Chromoly
>
>
>
>
>
> -----Original Message-----
> From: MSilver@iso.com
> To: classicrendezvous@bikelist.org
> Sent: Wed, 9 Aug 2006 12:32 PM
> Subject: [CR]Richard Burke & Trek's origins
>
>
> http://tinyurl.com/gutku
>
> Trek's Burke: How I did it
> Tue Aug 8, 2006 9:17 AM ET
>
> By Leigh Buchanan
>
> (Inc.com) - The first Trek bikes, manufactured 30 years ago in a barn in
> Waterloo, Wisconsin, were cult items, appealing to purists who would no
> more ride their fathers' Schwinns than drive their fathers' Oldsmobiles.
> But Trek had no brand strategy or money to advertise, and in the early
> years it wobbled badly. Richard Burke turned things around by
> positioning the company to ride the rising interest in competitive
> cycling. Today Trek -- still in Waterloo, now employing 1,727 people
> worldwide and producing annual revenue of $600 million -- is the largest
> bicycle company in the United States and the second largest in the
> world. The company is famous for its carbon fiber frames and really,
> really famous for making the bikes Lance Armstrong pedaled to seven
> victories in the Tour de France. Burke, 71, is chairman of the board and
> Trek's majority shareholder. His son John became CEO in 1998:
>
> Here, Burke reveals how he built the bicycle giant:
>
> I was marginal in college. I had a 2.0 average at Marquette University.
> They barely graduated me. But in 1956, the economy was booming. Everyone
> had his pick of offers. I entered a training program in Caterpillar's
> finance department. After 18 months I knew that large corporations were
> not for me and I was not for them. Just before they fired me, I quit.
>
> I answered an ad in The Wall Street Journal for credit manager at a
> small paint company in Madison. I lasted about 18 months. Just before
> they fired me, I quit.
>
> I took a job as credit manager of an appliance distribution company in
> Milwaukee, Roth Distributing. I was there a month when the president and
> sole owner dropped dead of a heart attack. I figured I was out of a job
> again. But some of the managers decided to try to reorganize the
> company. I understood finance so I became treasurer and a shareholder.
> If you go back in Trek's history, its original corporate charter was
> that company's.
>
> In 1973 two things happened: the oil embargo and the first physical
> fitness craze. That caused an enormous increase in bicycle sales. As
> distributors we wondered, should we get into bicycle distribution? But
> we decided that the boom would end and manufacturers would eventually
> sell direct to retailers. So we passed.
>
> Later I met a fellow who had represented a French bicycle company in the
> United States. He had married an American girl and wanted to stay here.
> We decided it might be possible to make bicycles.
>
> In 1976, management gave me $25,000 to investigate manufacturing bicycle
> frames. At first that's all we made: frames. We opened a small factory
> in a red barn. I was president but low profile. Trek was still a
> division of the distribution business. In fact, it was until 1997.
>
> At that time Schwinn was dominant in the domestic market. But the
> Japanese were making major inroads, and Schwinn would not allow its
> dealers to handle Japanese product. So we offered the dealers American
> product.
>
> In 1978 I was a Sloan Fellow at MIT, which I think somewhat offsets my
> miserable academic record. I got to work with Lester Thurow and Paul
> Samuelson.
>
> We built our first real bike plant in 1980. By 1983 we were around $20
> million. Some years we made money; some years we lost money. Everyone
> looked on it as Dick Burke's Tonka toy.
>
> In 1984 we made some bad product. Then in '85 we introduced the first
> bonded aluminum frame, but we didn't know how to build it in a
> production environment. We went through a year of building bad frames
> that came back to haunt us.
>
> I had to make a management change. On a Friday night I took out the
> general manager. On Monday morning I was running a bicycle company, and
> I didn't know a goddamn thing about manufacturing. We did a turnaround:
> fixed the frame and got rid of that bad '84 product. We also executed a
> major growth program. From 1986 to 1996 we took sales from about $30
> million to more than $300 million.
>
> We've never been a great strategic planning company. I put down a
> mission statement that's still in place today. It says we're going to
> provide our customers with quality products at competitive value and
> deliver them on time. We are going to create a positive environment for
> our customers and employees. And we are going to make money. That's what
> we did.
>
> All five children have worked in the business. It's a rule: If you're a
> family member you're entitled to a job. My son John graduated from
> Boston University in 1983. He was offered a marketing job at Procter &
> Gamble, which I told him he should take. Instead he took over a Trek
> sales territory. A couple of years later he became customer service
> manager. He just knew that he wanted to sell bikes.
>
> We first backed a team in the Tour de France in 1998. In 1998 if you
> asked 10 people on the street they wouldn't have heard of the Tour. If
> you wanted to watch it you couldn't find coverage.
>
> No one had any idea in 1999 that Lance or the team would do so well.
> When we realized that Lance might prevail I flew over. I get there three
> days before the end. Our VP of marketing is there and he says, would you
> like to ride in the team car? Johann Bruyneel, the team manager, is
> driving. I'm sitting in the front seat with a stopwatch and a clipboard
> to write down intervals. I'm not too good with the stopwatch. The
> mechanic is in the back seat with another set of wheels in case Lance
> goes down. This is my introduction to Lance, sitting in a car 50 yards
> behind him listening to Johann talking to him on the radio and exhorting
> him to that performance. The intensity was amazing.
>
> We have a separate long-term endorsement deal with Lance. If it had been
> up to me we would have never signed him. I'm too cheap. I give all the
> credit to young people like my son and Dick Moran, the marketing
> manager. They said, "This is something we want to be a part of."
>
> I think now that Lance is retired we will just continue to push cycling.
> He's a poster boy for us, but our focus is still technology, quality
> products. We put a lot of emphasis on R&D.
>
> Global sales are 30 percent of revenue, 35 to 40 percent of profit.
> We're losing money in China, but not a lot. Eventually the Chinese will
> have the time and the money to take up cycling seriously.
>
> About four years ago Trek moved to S status. It's been good for my
> family; everyone owns 3 percent to 4 percent. And it's been good for the
> ESOP, which holds about 25 percent of the company's stock. We tie a lot
> of direct and indirect compensation to company performance. If you're
> making money you ought to share it.
>
> Family businesses are frustrating. Going from the first to the second
> generation can be clear cut. But the third generation isn't far away. I
> have nine grandchildren. Most people say half of them won't want
> anything to do with the business. So which four or five might be
> interested? And what will it take to run a billion-dollar company, which
> we will be in five to seven years? It isn't a case of which kids will
> have the opportunity. We don't have enough kids for all the
> opportunities.=09
> =09
> (c) Reuters 2006.
>
> ------------------------------------------------

>

> Mordecai Silver

> NYC=09