Sensing a missing link in customer service as well as in possible income for specialty retailers, Treadmill Doctor is launching an extended service plan program to be sold with equipment at retail.

“Service plans in the fitness industry are huge business. They’re a great source of margin and cash flow,” Treadmill Doctor CEO Jon Stevenson told SNEWS®. “And when you consider fitness equipment, if you use it, it’s going to break.”

The program, dubbed the Treadmill Doctor 360 Degree Guarantee Extended Service Plan, will roll out at retail Sept. 1, Stevenson said. It will not only offer the opportunity to sell extended service to a niche often overlooked -- specialty fitness or bike shops, and small sporting goods -- but also will be a branded program using the Treadmill Doctor name.

“We have a brand that has meaning now,” Stevenson said, noting the millions of visits to read its reviews and order parts and services. “Whether you like us or note, the bottom line is, a lot of people are reading our reviews and if you can use that to make more money, why not?”

To be setup to sell the program, retailers will sign up with Treadmill Doctor, which teamed with Virginia Surety for the program. Retailers pay nothing upfront or to be a part, he said. Treadmill Doctor staff will train retail staff either online or in-person, depending on location and store size, and provide P.O.P. materials, hangtags, banners and other promotion. When the retailer sells a plan, the business will get 35 percent of the proceeds. And when customers who have the plan have a problem, they will call Treadmill Doctor directly using the contact information on the plan or, if customers call the retailer, they will be directed to the Treadmill Doctor.

The cost of a one-year to four-year plan for a customer depends on the length of time selected for coverage and on the original cost of the equipment, Stevenson said, with prices ranging from $99 to $1,300. For example, a piece of equipment that costs $999 or less with a one-year service plan will be about $99, while a four-year plan for equipment that costs between $3,000 to $3,999 will cost the customer $499. The service plans extend the manufacturers’ service plans, said Stevenson (jon@treadmilldoctor.com). In addition, it covers problems not usually covered such as failures from power surges, normal wear and tear, and “lemon” equipment.

Sales staff working with Treadmill Doctor (www.treadmilldoctor.com) include Woody Fisher, Southeast/Texas; Gregg Frazier, West Coast/Mountain States; John Conti, Midwest; Bill McGinley, Northeast and Mid-Atlantic; and Al Cockrill, sporting goods and big box. The program will start in all 50 states and spread to include Canada by 2011.

Stevenson said service will mostly be done by the nationwide network of repair specialists who already work with Treadmill Doctor and are known in the industry. In addition, a number of manufacturers have already signed up to put the materials in their product packaging, including Sole Fitness, Smooth Fitness, True Fitness, PaceMaster, LifeCore and LifeSpan.

Several retailers have also already signed up, including Fitness4Home Superstore in Phoenix, Ariz., whose owner said the plans would extend benefits to customers that are really valuable.

“The plans aren’t cheap, but they’re not that much if you really break it down,” said Fitness4Home co-owner Bob Lachniet, “especially if it’s something the person is going to keep for a decade.

“The program may not be a huge profit center, but it’s something, and right now something is better than nothing,” he added. “You can’t afford to turn away a new revenue stream.”

--Therese Iknoian