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Schwinn zone prices, 1,2&3

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Grey Ghost

Wore out three sets of tires already!
Does anyone know what parts of the USA zone 1, 2, and 3 were in Schwinns zone pricing?

When did they start this? When did they end it?
 
I believe Schwinn was working on organizing their "approved" Dealer outlets for sales and distribution centers in 1950 for the most part. Chicago Cycle Supply Co may have been involved at the beginning until Schwinn invested in supposedly three distribution centers. The locations were posted somewhere here on the Cabe a while back, but I can't recall the exact locations. West coast area, one in the South and one in or near Chicago. There was a member here that lived a few blocks from one of the distribution centers and posted some pictures. Here's a 1951 retail page that might suggest there was only one near the factory at that time. See the print at the bottom.

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From the Schwinn Fair Trade Price Sheets

Zone 1-Central and Eastern zone: Includes all states not listed in Zones 2 & 3

Zone 2-Southern Zone: Includes Alabama, Akansas, Florida, Georgia, Louisiana, Mississippi, North Carolina, Oklahome, South Carolina, Tennessee, Texas (except El Paso County)

Zone 3-Western Zone: Includes Arizona, California, Colorado, Idaho, Montana, New Mexico, Nevada, Oregon, Utah, Washington, Wyoming, and El Paso County in Texas
 
Thank you.

So, the further you got from the factory in Chicago, the more you paid.
 
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To answer the question of when it start/ended. I believe this started with the inception of their distribution centers as Gary says above. As far as when it ended I would say probably until about the time they started tanking and moved production out of Chicago. V/r Shawn
 
A couple of thoughts.

Schwinn's Zone pricing was solely a way for the dealerships further away from the Chicago factory to recoup some of their freight costs. At the time if you purchased a full railroad box car of bicycles (about 240) you could expect to pay about three dollars per bike in shipping freight. If you look at the difference between the three zones it was a buck extra per zone. Zone three prices were three dollars higher than zone one.

On the above price list they state "ceiling selling prices", later it was referred to as "Fair Trade Price". The government considered it as price fixing. It ended up being a class action case that went to the U.S. Supreme Court. I believe Levi Strous join Schwinn in the suit. Basically they wanted their products sold in high quality dealerships with full service operations. They wanted dealers to upgrade their locations and invest into beautiful retail stores, not the hole in the wall bicycle/key shop/lawnmower/toy/hobby stores of the past. The Fair trade pricing allowed the dealers to make a fair profit stocking and selling Schwinn Bicycles. In the end the court agreed, but said that Schwinn as a company lost control of setting pricing after they sold the inventory to one of their independent distributors (Chicago Cycle in the Midwest, Harry Wilson Sales Agency in SoCal/AZ). This resulted in Schwinn being forced to terminate their sales relationships with their long time distributors. This was a very emotional period because everyone was like one big family going through a divorce. Schwinn opened four "Schwinn owned" distribution centers. Schwinn Sales West (City of Industry), Midwest (Elk Grove), South (Atlanta), and East (New Jersey). When a Schwinn independently owned dealership purchased the bicycle from a Schwinn distribution center the ownership only chaged one time and Schwinn had the right to enforce it's Fair Trade Pricing. This was a huge change for the direction that would shape the 1970's bike boom.

After the Chicago UAW strike things changed with the sourcing at Schwinn. The distribution centers were enlarged, and more models were shipped in by container from other Schwinn factories in Hungary (Cespal), Ohio (Murray), Mississippi (Greenville), Wisconsin (Waterford), Japan (Panasonic/PDG), Northern California (Kestral), Tiawan (Giant), and China (CBC). Schwinn's problem was just like GM's. GM was geared up to build millions of large Impalas, but the market wanted to buy smaller, fuel efficient front wheel drive cars. Just like Schwinn it would cost millions to change over the production to lugged frames for the lightweights, and tig welded frame production for the new BMX and Mountain Bike markets. These companies were just too slow in adapting to the changing sales markets. The later 1980's were a struggle.

John

John
 
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