For nearly a decade, TrueRide Inc., a Duluth-based company, has been an industry pioneer, designing and building some of the most innovative and popular skate parks in the nation. But TrueRide has reached the end of the road.
The company's founders -- Greg Benson, Dave Benson and Tony Ciardelli -- have decided to get out of the skate park business and concentrate exclusively on two other promising ventures that began as sidelines. After May 25, the business trio plans to focus exclusively on making cutting boards as Epicurean Cutting Surfaces Inc. and lawn furniture as Loll Designs Inc.
"This is a decision we're making," Greg Benson said. "We're not being forced into it."
Benson said he and his partners recently evaluated their operations and concluded that operating three businesses was too much to juggle. They agreed that the best way to pursue growth was to exit the only part of their business that was shrinking. That meant closing TrueRide.
The most difficult part of the decision involves saying goodbye to a handful of valued friends and employees, Benson said.
TrueRide employs 12 people. Six of those workers will be reassigned to other duties with Loll and Epicurean. Because those firms are adding a couple of sales and marketing positions, the overall number of people employed by Benson and his partners in West Duluth is expected to decline by just four positions, slipping from 36 to 32 people.
Benson said TrueRide remains in negotiations with a former competitor that could keep its product line alive, even when the company ceases operations. If the deal goes through, it could produce job opportunities for up to three of TrueRide's departing employees.
The employee count at Loll and Epicurean is of special interest because the facility they share was built in a Job Opportunity Building Zone. The state program -- called JOBZ for short -- encourages companies to grow by temporarily waiving many of the taxes they pay.
When TrueRide and Epicurean moved into a new shared facility at the top of North 59th Avenue West in November 2005, they employed 29 people. One year later, the companies had 35 people on the payroll, fulfilling a program obligation to boost their shared work force by 20 percent within one year.
Heidi Timm-Bijold, a business developer for the city of Duluth, said employment figures will next be reported to the state in December. She remains confident Loll and Epicurean will be able to make their numbers.
"I think this will just be a hiccup," said Timm-Bijold, noting that Epicurean has enjoyed robust growth in recent years.
Epicurean had about$2 million in sales in 2005 and is on pace to sell more than$5 million worth of cutting boards this year.
Meanwhile, TrueRide's sales have stagnated. The company went from sales of nearly $4 million in 2004 to about $2 million the past couple of years.
What's more, Benson said, True Ride's profit margins have been squeezed by intense competition from other skate park builders. The business challenges multiply when you add travel expenses, long lead times and the uncertainties of working with municipal governments.
TrueRide focused on building structures made of steel and wood/poly composites. That part of the market has shrunk as concrete parks have gained in popularity. Benson estimates that at least half of the new parks being built today are concrete.
"After operating TrueRide for several years, we realized we were never going to be able to turn it into a $10-, $20- or $30-million business," Ciardelli said. He noted that the potential for growth at Epicurean and Loll appears much brighter, and both companies boast much more attractive profit margins.
TrueRide will complete its final skate park installations in Iowa, Wisconsin, Minnesota and British Columbia in the next couple of weeks. The company will leave the scene having built more than 350 skate parks in North America.
TrueRide will be missed, said Heidi Lemmon, director of the Skate Park Association of the United States of America, an industry group based in Santa Monica, Calif.
"They're probably the leader in above-ground ramps," she said. "I'm really sad to hear they're closing out."
"It was a tough decision to make," Dave Benson said. "But when we looked at the multiple businesses we had and asked where it made the most sense to put our energy, we agreed we needed to focus."
For Ciardelli, bidding goodbye to TrueRide will be bittersweet.
"While it became a very difficult business to manage, TrueRide got us to where we are right now," he said.
Greg Benson offered a metaphor, saying: "TrueRide was a booster rocket, and now we're jettisoning it so our company spaceship can reach new heights."
He recalled that he and his partners originally began making cutting boards and lawn furniture as a way to use scrap materials, reducing waste and diversifying the business.
"I don't think any of us thought it would take off the way it did," Greg said.
"The kitchen and housewares industry ate up our whole story of going from building skate parks to making cutting boards," Benson said. But he noted that the performance and quality of the wood composite material used in the high-end boards were equally important.
Gone are the days when scrap materials were sufficient to meet demand for cutting boards, however.
Last year, Epicurean manufactured about 500,000 cutting boards, and Ciardelli said that was with the company's machinery running at only about 40 percent of capacity.
Loll Designs is a much younger venture. In 2006 -- its first full year of operation -- the company sold about $100,000 worth of outdoor furniture.
Greg Benson said Loll aims to triple those sales this year, and the company appears on pace to reach that goal.
PETER PASSI covers business and development. He can be reached weekdays at (218) 279-5526 or by e-mail at email@example.com.