Why I Stopped Selling Powertec

Straight off the bat I would like to make it clear that this is not a Powertec bashing exercise. I love the Powertec brand and literally spent a big part of my life devoted to it. I deliberated long and hard before I stopped selling Powertec.

In my office gym, I still have my old Powertec Power Rack System, Powertec Shape System, Powertec Utility Bench and Powertec Compact Leg Sled. It still as good as the day I set up. This is a testament to the Powertec quality.

It is also important to note that while certain business directions and strategies might not work for my business, they make work for Powertec. It would be stupid for Powertec to sacrifice a strategy that they feel is working for them, for the sake of an Australian distributor.

Walk Down Memory Lane

My love affair with Powertec began in 2004 (I think it was that long ago). At the time I was having trouble juggling my work and training. So I was just casually checking out home gym equipment in Australia and realised it was pretty ordinary. Even more off putting was it was expensive.

How expensive? I always remember a very wobbly half rack with an ordinary lat pulldown was $2,200. So when people complain about the cost of home gym machines today I wish we could jump in a time machine. You would be blown away at what great value gym equipment is nowdays.

The Glory Days

When I mean glory days, I do not mean this was the best years for Powertec. Before the Global Financial Crisis (GFC) life was much simpler. Business was a heck of lot less complicated. And more profitable.

Back then Powertec was run by Ken and Kate Domzalski, in partnership with National Ventures who manufactured the product in China. Ken was a renowned designer who worked on Hammer Strength machines. He really knew the gym business.

Before they had Jay, Powertec sponsored Lee Priest. They had an amazing range back then. The equipment was that good Lee trained in his home gym for pro bodybuilding shows.

In the period up to 2008 Powertec was really a market leader. With the combination of Powertec and Ironmaster I was on a winner.

The End of the World – Not Quite

Then the GFC hit. Thanks to China, Australia did not cop the full brunt. But it hit hard in the US. And it hit Powertec.

In 2009 they lost a lot of money. National Ventures took over control of the business. Ken and Kate were shown the door and stopped selling Powertec. I was like a child in a messy divorce. Both sides blamed each other.

My take on the situation was that Ken and Kate were great at designing gym equipment and building a brand. They might not have possessed the best business skills for challenging conditions. National Ventures were financing the operation and had to focus on the bottom line.

The old management would replace faulty parts straight away. Apparently there was loads of inventory in the warehouse that could not be sold because they were missing parts. The new management addressed this by replacing parts painfully slow – I mean years. So the distributors had to pull spares from their stock. Now the distributors had loads of inventory missing parts.

Reduced Range

In 2010 the range was reduced with several specialty machines removed. Of the machines left, they had been re-designed to reduce costs. Once again this was done to cater for the tough conditions in the US market. For me it meant I had less things to sell.

There were issues with several machines that needed rectifying. Without the old designers some of the problems were not able to be solved. So I made some suggestions and went to the factory in China to help out.

The factory visit was a real eye opener. They had a massive facility and made products for many other companies. There was the potential to expand the range. So I put forward a plan for a gradual expansion. Not just in more machines, but also to expand into the commercial gym equipment market.

Then the summer of love ended. Powertec and IFS split. IFS started making their version of the Megatec range. And I was back to being in the middle of a messy divorce. I just wanted my parents to get along!

The reasons why IFS stopped selling Powertec were similar to the issues I was experiencing. Poor after sales service (we just had to pilfer our own stock for spares and wait), increasing costs without corresponding design or range improvements.

The Powertec Europe team also shared these concerns. So we worked with Powertec for several years to try and address these issues. We came up with great ideas and plans. They just could not be executed.

Ultimately Competition Determines The Winner

During this time Powertec had a lot going on. They changed production facilities, had numerous personnel changes and probably many other issues I was not aware of. Plus the US market is massive so they may not have had the same urgency to change.

I was left in the unique situation where I was distributing both the Powertec and Megatec ranges. As a free market man, I let the customer decide which product was best.

My business philosophy is simple. Get the best value products I can, put on the smallest margin I can, and run my business as tight as I can. This way the customer gets a great deal and returns along with their friends.

There were no favours done either way. Both ranges were great quality. The customer was the one who decided which brand provided the best value for money.

German Efficiency Is Real

Over time the Germans overtook Powertec. They certainly were not perfect. But what they did so well was address issues. The continually improved all aspects of their business.

IFS always had defined ranges. Megatec was their domestic line and Barbarian was light commercial. Then they introduced ATX as a commercial line. Later they would completely rebrand to ATX. Now they have defined ranges – 500, 600, 700 & 800.

This is exactly what I wanted from Powertec back in 2010. Instead we had one Powertec Power Rack for years. It was a great rack. But we had one rack to sell to all domestic users, personal trainers and gyms.

But IFS’s biggest advantage was design. They would constantly tweak and update their existing equipment. Then release some amazing pieces like the best pec fly rear delt machine I have ever tried. It was products like this that opened up new markets for our business.

Once again this is not bagging out Powertec. The American market is massive so you can make good business off a condensed range. That is what Ironmaster does. More sales does not always mean more profit. But can lead to more headaches!

Then covid hit. We could have easily ordered again and anything would have sold. As a gesture of goodwill for our business relationship I sat it out and let Powertec have the stock. Either for themselves or distributors.

This is when I stopped selling Powertec.

I will be forever grateful for the opportunity they gave me. Yes there were some ups and downs. All business relationships experience this. Ultimately Powertec was a massive part of my life. At one stage there was no one on the planet who knew more about the products after Ken and Kate departed.

One of the reasons I hung on for so long was for my old Powertec customers. When I sell a product I want to make sure I can offer after sales service. However I can’t offer after sales service to any of my customers if I go out of business.

My belief was that if I stopped distributing Powertec someone would snap it up. It is a powerful brand in Australia. It is now September 2022, and no one has taken up the offer.

This does re-assure me that I made the right decision to stop selling Powertec. It seems that nobody has been able to make their range and pricing work in Australia.