LONG before Arnold Schwarzenegger became a movie star and pumping iron a glamour business, weight lifting built the York Barbell Company into a strapping success. York Barbell, founded 54 years ago, put York on the map as Muscletown U.S.A., and still brings Olympic weight lifters here to train. The company still dominates the barbell business, with a 70 percent share of the market for cast-iron weights made in the United States.
But lately, despite the growing popularity of body building and physical fitness, the muscle company may be feeling its age. Its founder, Robert C. Hoffman, died last year at the age of 84. His two elderly associates are expected to step down soon, leaving the business in the hands of their sons. In making the transition, it is possible that the company will end up being sold. Nor are York Barbell’s problems all internal; it faces increasing competition from cheaper weights, made of vinyl-coated concrete, as well as from imported cast-iron barbells.
But York’s management insists that, through product quality and reputation, it can trounce its rivals. ”We might change some of our look in barbells,” said William Dietz, who is the company’s treasurer and the son of its 69-year-old president, Michael Dietz. ”We’ve already begun painting them in bright colors. But we’ll never lose sight of what got us here. Anyway, pumping iron means pumping iron, not concrete with vinyl.”
”We have always been the company that everyone in weight lifting around the world knows,” adds John Terpak, the 74-year-old executive vice president, who joined York Barbell in 1935, ”and we don’t intend to lose our position.”
York’s position is an enviable one. Its customers number virtually all the professional football teams, including the Jets and the Giants, and countless high school and college gyms. The company was the official supplier of weights for all the teams in the summer Olympics at Los Angeles in 1984.
York Barbell today employs 140 people and grosses $25 million in annual sales. About half of that comes from cast-iron weights for its own brand-name barbells and from weights used in body-building machines manufactured by other companies (Nautilus is the major customer). York Barbell’s two foundries in Pennsylvania also turn out stove doors, clocks and other castings, which account for most of the company’s remaining sales. Finally, York earns royalties from licensing its name for a variety of non-prescription vitamin pills and health products. While the company is reluctant to release detailed financial data, it does assert that revenues have been rising steadily and that it is ”pleased” with the level of profits.
Financial data are slim in the weight-lifting and body-building industry, which is dominated by privately held companies and relatively small subsidiaries of public corporations. Lawrence P. Klamon, president of Fuqua Industries, a leader in the field, estimates annual revenues for all exercise equipment at close to $1 billion. Of that sum, however, equipment for weight training is estimated at only $80 million to $90 million.
Like many of the weight-lifting and body-building companies, York Barbell was founded by a fragile young man bent on improving his physique. Bob Hoffman became a physical fitness enthusiast after bouts with diphtheria and typhoid. A tireless proselytizer for body building, he coached the American Olympic weight-lifting teams from 1948 to 1956.
For years his two closest associates were John Terpak and Michael Dietz. Mr. Terpak was another committed weight lifter, finishing fifth in the 148- pound weight-lifting class at the 1936 Berlin Olympics and winning two world and 11 national championships. At the Goodwill Games in Moscow this summer, he was the lead referee in the 220-pound class and was on the jury in two other divisions.
Mr. Dietz, who joined the company in 1936, concentrated on management and finances while Mr. Terpak and Mr. Hoffman traveled around the world promoting weight lifting and body building – and, not incidentally, York Barbell.
”Mike Dietz and I have been running the company since 1983,” Mr. Terpak said. ”The business is still being run the way it was when Bob was active. Remember, Mike and I were his right-hand men for half a century.”
If Mr. Hoffman shared responsibility for running the company, he did not share the equity during his lifetime. He owned 500 shares of the stock; Mr. Dietz and Mr. Terpak held only one share each. According to Mr. Dietz, each of the 502 outstanding shares is worth roughly $20,000 – although the company most likely would bring more than that if it were put up for sale. MR. HOFFMAN, who had been divorced for many years and was childless, left York Barbell to Mr. Dietz, Mr. Terpak and Alda Ketterman, his longtime private secretary. The will states that, to pay Federal and Pennsylvania inheritance taxes, the company will redeem or buy back the requisite amount of stock. The remaining shares will be divided equally among the heirs.
To value the estate, the three heirs have hired an independent appraiser, whose report York will deliver to the Internal Revenue Service next month. ”If the valuation is so high that selling back the stock would not adequately pay off the taxes or wouldn’t leave enough to run the business at the quality level we demand, we’d have to consider selling the company,” said Mr. Terpak. ”Since Bob’s death, a few companies have put out feelers. Believe me, I don’t expect that to happen. We would never sell York Barbell unless we absolutely had to.”
Once the estate taxes are paid, Mr. Terpak said, he plans to phase himself out of the business. Mr. Dietz, on the other hand, said he ”will leave York only when I’m six feet under.” But, according to Mr. Terpak, Mr. Dietz has health problems and would retire if the taxes are settled to his satisfaction.
If Mr. Terpak and Mr. Dietz retire, they are likely to be succeeded by their sons: John Terpak Jr., 48, the company’s secretary, and William Dietz, 30. The younger Mr. Terpak has some athletic inclinations; as a student at the University of Pennsylvania, where he majored in English, he was a running back on the 1959 championship Ivy League football team. He joined York in 1980 after 20 years as a Marine Corps officer, and he is being groomed as the athletically skilled salesman counted on to keep up the contacts with the Olympic organizations and the numerous athletic teams that have been York’s key market for decades.
Since 1980, Mr. Terpak has accompanied his father on visits to conferences and trade shows. While York advertises in trade journals, it relies primarly on its name and good will within the industry to hold customers against the competition of lower-cost vinyl-covered concrete weights and imported cast- iron equipment. WILLIAM DIETZ joined York in 1977, after earning a degree in business administration from the University of Pittsburgh. His two older brothers also work at York, although not in management positions. Like Mr. Terpak Jr., he never considered working for another company. ”Our fathers and Bob Hoffman lived and breathed York Barbell,” he said.
But for years the older generation operated with minimal competition from other domestic manufacturers of cast-iron weights. Its biggest rival today,
Hofmann Industries of Sinking Spring, Pa., began competing with York at the retail level only last year. And York now must vie with companies that import their castings, such as the Ivanco Barbell Company of San Pedro, Calif. ”Even with the added shipping charges,” said Thomas Lancir, Ivanco’s president, ”we can under-price York, given the low labor costs in Taiwan.”
The rising sales of weight-lifting equipment are a major reason York can keep revenues growing. The American market currently is divided equally between cast-iron, the York specialty, and vinyl products, which are cheaper. For example, the suggested price of the 110-pound York barbell set is $71.95; vinyl goes for $39.99.
”Let a kid drop a vinyl weight on his bedroom floor and it doesn’t mar it,” said Cal James, president and chief executive officer of Diversified Products, the dominant vinyl weight manufacturer. Diversified, an Opelika, Ala., company, is owned by Britain’s Grand Metropolitan. He added, ”Momma doesn’t like cast iron, if you know what I mean.”
But Lorenzo Barrett, assistant manager of Spartan Gym, a health club in Temple Hills, Md., a Washington suburb, does. His gym has more than a dozen York weight-lifting sets. ”York is the grandaddy of the business, so why go to anyone else,” Mr. Barrett said. ”The equipment does not chip or split when dropped, and you pay for this quality.”
York considered going into vinyl a few years ago, according to the elder Mr. Trepak, ”but the quality is just nowhere as good as cast iron. Sure, lots of people buy their first set of weights in vinyl. But after a while they realize that they chip easily and are not as accurate in poundage. They turn to cast iron.”
The younger Mr. Dietz agrees there will always be a market for cast-iron barbells. The increased emphasis on staying in shape ”helps us all around,” he said. ”Our weights complement their machines, and we’re supplying the top- quality equipment manufacturers.” Arthur Jones, founder of Nautilus Sports Inc., which both makes exercise equipment and operates health clubs, recently placed an order at York for 500 Olympic sets at a cost of $153,000. The York weights will be used at Nautilus health clubs.
Most health clubs purchase at least one set of barbells to supplement the fancy and popular rowing machines, exercise bikes, treadmills and muscle- building devices, Mr. Dietz said. ”Health clubs can be inconvenient for us,” he explained, ”and you can’t take a Nautilus machine back to your room to work out.”