In 1895 a German immigrant to the United States by the name of Ignaz Schwinn founded the Schwinn Bicycle Company in Chicago, Illinois. After the invention of the automobile the sale of bicycles in America declined and many of the more than 300 bicycle manufacturers were in financial difficulty. Schwinn seized the opportunity to buy up these troubled companies (and their valuable patents) and in the process built of the best known brand names in the world. At one time Schwinn Bicycle Company was as powerful and innovative as Apple is today. No Hands: The Rise and Fall of the Schwinn Bicycle Company, an American Institution tells the story of how this once powerful company was destroyed by incompetent leadership in the 1980’s and was later forced into bankruptcy. This book was co-authored by Judith Crown and Glenn Coleman, who at the time of writing were journalists with Crain’s Chicago Business.
When I was a child my first “real bike” was a Schwinn Sting-Ray (with a fat rear slick tire, banana seat, chrome fenders, coaster brake, and a on-the-frame gear shift). When I got a bit older my father bought me a Schwinn Collegiate 10-speed. My father bought both of these bikes based upon his love for quality engineering, and when Schwinn had “an obsession with quality.” Unfortunately, like most Americans, I put my bicycle away the day I got my first car. Twenty-five years later when I decided to take up cycling again the first bike I looked at was a Schwinn—not knowing that they went into bankruptcy in 1992 and company name had been sold. The Schwinn bicycle sold today bears no resemblance to the quality of bikes I rode as a child, so I passed on buying a Schwinn and purchased a Trek instead (actually I bought four of them).
Crown and Coleman open the book with a story from the 1970’s. A team of engineers from Schwinn headquarters in Chicago flew out to Marin County California to talk to a young racer and entrepreneur named Gary Fisher (“Spidey”) about what was considered to be a new niche market at the time—mountain bikes. These brilliant engineers thought Fisher was a jerk and knew that no one would ever be interested in buying a mountain bike. The book quotes Fisher as saying, “The Schwinn engineers were going, ‘We know bikes. You guys are all amateurs. We know better than anybody.” This is just one example of many where Schwinn management misread the market and this led to their demise.
Part of the problem with Schwinn was an outdated business model. Maybe a bigger problem was that in the 1970’s, “through the miracle of nepotism,” the company was run by men with MBAs who didn’t know how to ride a bike. Then in the 1980’s their workers voted to join the UAW (a kiss of death for sure). By the late 1980’s Schwinn had opened a factory in Hungary and their advertising posters on streetcars in Budapest had the slogan, “They’re not as bad as you think.”
Even if you never owned a Schwinn bicycle you ought to read this book if you have any interest in the industry. You will probably never find a better history of the bicycle industry than in this book. You can read of how Schwinn dealt with competitors like Raleigh and upstart companies like Shimano, Trek, Cannondale, Specialized and Giant.
No Hands is a joy to read and serves as a cautionary tale for manufacturers today. The hardback book is 350 pages long and is extremely well documented. Now for the bad news: this book was published in 1996 and is now out of print. However, you can still find gently used copies on Amazon.com and they sell for around $35. I know that price is kind of high for a used book, but if you have any interest in the bicycle industry you need to get a copy.