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Winmark

Winmark Corporation is an franchisor specializing in resale concepts, founded in 1988 and headquartered in , . The company develops and supports franchise brands that buy, sell, trade, and consign used and new merchandise, with a strong emphasis on and the . Winmark operates five primary resale brands: Play It Again Sports, focusing on sporting goods; Once Upon a Child, specializing in children's products; Plato's Closet, dealing in teen and young adult apparel; Style Encore, for women's casual and business wear; and Music Go Round, centered on musical instruments and gear. These brands collectively support over 1,360 franchised locations across the and , generating approximately $1.6 billion in annual franchise sales. In 2024, Winmark reported of $81.3 million (a 2.3% decrease year-over-year), predominantly from franchise royalties of $72.2 million (a 2.8% increase year-over-year). In the first nine months of 2025, the company reported net income of $31.7 million, up from $30.4 million in the prior year. Originally incorporated in as the franchisor for Play It Again Sports, Winmark—formerly known as Grow Biz—expanded its portfolio in the to include additional resale concepts, going public in 1993. The company's centers on providing franchisees with operational support, guidance, and resources to build locally owned small businesses that promote environmental responsibility by diverting items from landfills—recycling an estimated 185 million products annually across its network. In addition to , Winmark maintains a legacy equipment leasing segment, which has been in run-off since 2021 and is no longer a primary focus. With 89 employees as of late 2024, Winmark continues to prioritize growth and initiatives, positioning itself as a leader in the secondhand retail sector.

Overview

Corporate Profile

Winmark Corporation was founded in 1988 and is headquartered in , . The company has been publicly traded on the under the WINA since its in 1993. As a franchisor, Winmark specializes in resale retail stores that buy and sell used goods, promoting through a model that extends product lifecycles and reduces waste. Winmark's mission is to provide resale for everyone, supporting owners via locally operated franchises while minimizing environmental impact. As of September 27, 2025, the company operated 1,377 franchise locations across , including approximately 159 in as of December 2024. By August 2025, Winmark's franchises had recycled over 2 billion items since 2010, diverting millions annually from landfills and underscoring its commitment to eco-friendly practices. The company's primary revenue streams consist of royalties and fees, supplemented historically by leasing operations now in the process of divestiture. System-wide sales, representing aggregate revenues from all locations, reached milestones of $500 million in 2007 and $1 billion by 2015. In 2022, Winmark rebranded as "Winmark - the Resale Company" to emphasize its focus and leadership in the resale sector.

Leadership and Governance

Brett D. Heffes has served as Chair of the Board and of Winmark Corporation since 2020, leading the company's operations and overall strategic initiatives. In a recent enhancement, Winmark appointed Lisa Hake as effective October 1, 2025. Hake contributes extensive expertise in brand strategy, having accumulated over 25 years in marketing roles at franchise-focused organizations like Great Clips and retail giants such as , where she managed brand innovation and partnership activations. Winmark's comprises eight members as of late , featuring a majority of independent directors with specialized knowledge in , , and . Key figures include Lead Independent Director Tom C. Tomlinson and the newly elected Keith T. Credendino, Chief Information and Technology Officer, who joined in August to bolster technological oversight. In the same month, veteran director Jenele C. Grassle, who served since on the Compensation and Nominating Committees, announced she would not seek re-election at the April 2026 annual shareholders' meeting, reflecting ongoing board refreshment aligned with Winmark's emphasis on and . The company's framework prioritizes stock-based incentives, such as stock options, which form the core of long-term rewards and are linked to performance goals including franchise expansion and royalty fee generation.

History

Founding and Early Years

Winmark Corporation was incorporated in 1988. In 1990, financial consultants Ronald G. Olson and K. Jeffrey Dahlberg acquired the franchising rights to the Play It Again Sports concept in , , originally launched as a single store in by Martha Morris for buying and selling used sporting goods. Under Olson and Dahlberg's leadership, the company focused on resale stores specializing in new and used sports and fitness equipment, rapidly expanding to 19 locations across six states by 1989 and generating over $800,000 in revenues. In June 1993, amid diversification efforts, the company renamed itself Grow Biz International Inc. to reflect its broadening portfolio of resale franchises. That August, Grow Biz completed its on , selling 1.6 million shares at $10 each and raising $16.7 million to fuel growth. The early saw aggressive expansion through acquisitions and new brand launches, including the purchase of Once Upon A Child (children's resale) in 1992 with 22 existing stores, Music Go Round (musical instruments) and (electronics) in 1993, Disc Go Round (music media) starting in 1994, and Plato's Closet (teen apparel) in 1998 after its initial founding by and Lynn Blum. These moves established Grow Biz as a leader in value-oriented resale , with multiple brands ranking highly in Entrepreneur magazine's Franchise 500 by the mid-. By 2000, however, rapid overexpansion and adverse market conditions precipitated financial struggles, culminating in a net loss of $350,700 for the year and prompting the divestiture of underperforming assets such as and other brands. This period of distress was alleviated when investor acquired control of the company in 2000, providing the foundation for subsequent restructuring.

Growth and Modernization

In the early 2000s, Winmark faced significant financial challenges, prompting a pivotal turnaround led by investor and CEO John Morgan, who assumed leadership in March 2000 and steered the company away from near-bankruptcy through operational streamlining, including the closure of underperforming segments like Disc Go Round. Under Morgan's direction, the company was renamed Winmark Corporation in 2001, marking a shift toward a focused franchising model centered on resale retail. This restructuring laid the foundation for sustained recovery and expansion. Winmark achieved key growth milestones in the following decade, reaching $500 million in system-wide sales by 2007 and surpassing $1 billion by 2015, driven by organic franchise development and the launch of Style Encore in 2013, a specializing in women's resale apparel. The company's performance earned external recognition, including a ranking of 11th on ' list of the Top 20 Small Public Companies in America in 2011, highlighting its strong sales and earnings growth amid a competitive landscape. These expansions reflected Winmark's emphasis on scalable, low-overhead , with total locations exceeding 1,300 by the mid-2010s. In recent years, Winmark has undergone strategic modernization, including a rebranding to "Winmark – the Resale Company" to underscore its commitment to resale accessibility and within the . This aligns with broader shifts toward enhanced franchisee support through proprietary point-of-sale systems and digital tools for inventory management and , alongside initiatives promoting environmental impact, such as over 185 million items annually. In August 2025, Winmark announced surpassing 2 billion recycled items since 2010, reinforcing its role in reducing textile waste and landfill contributions. Financially, the third quarter of 2025 reported of $11.1 million on $22.6 million in revenue, prompting the announcement of a special $10 per share dividend in October 2025, payable in December.

Franchising Operations

Current Franchise Brands

Winmark Corporation operates five active resale brands, each specializing in the buying and selling of gently used goods to promote and affordability in local communities. These brands collectively form the core of Winmark's operations, emphasizing a model where franchisees purchase items directly from customers for cash and resell them at discounted prices, typically 50-70% below retail. Plato's Closet focuses on teen and fashion resale, offering trendy , shoes, and accessories from the past 12-18 months that appeal to twenty-somethings. Franchisees pay cash on the spot for current styles, creating a dynamic that rotates quickly to match seasonal trends. As of December 2024, the had 515 locations, primarily in the United States, with ongoing expansion across . Once Upon a Child specializes in , toys, baby gear, and equipment, serving families seeking sustainable options for outgrown items. The brand buys and sells high-quality used products at up to 70% off retail, supporting environmental efforts by extending product lifecycles and reducing waste. It operated approximately 430 locations as of late 2024, making it the largest children's resale chain in . Play It Again Sports caters to sporting goods and fitness equipment, stocking a mix of new (about 60%) and used (40%) items for families and adults across various sports. Franchisees buy used gear like bikes, skis, and fitness apparel, paying cash to encourage recycling of equipment. The brand maintained over 300 locations across North America as of December 2024, with approximately 38 in Canada, with a focus on community-based operations that support local athletics. Style Encore targets women's casual and professional clothing, shoes, and accessories for mid-life consumers, launched in 2013 to fill a niche in mature women's resale. Franchisees acquire gently used items in good condition and resell them affordably, emphasizing quality and style for professional and everyday wear. It had around 69 locations by late 2024, concentrated in the U.S. with selective . Music Go Round deals in used musical instruments, gear, movies, and electronics, appealing to musicians and media enthusiasts interested in entertainment products. The brand buys instruments like guitars and drums, as well as DVDs and video games, and resells them at significant discounts to promote . As of December 2024, it operated 34 locations, primarily in the U.S., with a model that supports local music communities. Across all brands, Winmark's model involves local buying and selling operations, with the corporation providing comprehensive support including initial training, ongoing marketing assistance, guidance, and resources for inventory management. This structure has led to high franchisee retention, with a 98.7% renewal rate over the past decade. As of September 2025, the total network encompassed 1,377 locations throughout .

Former Franchise Brands

Winmark launched several resale franchise concepts in the 1990s to expand beyond its initial sports equipment focus, but these ventures were ultimately discontinued or divested as the company sought to streamline operations and address financial challenges. These early brands represented diversification into niche markets like electronics, media, and tools, but they underperformed relative to core apparel and sporting goods resale segments, leading to their exit from the portfolio. The divestitures occurred between 1998 and 2001, allowing Winmark to concentrate resources on higher-performing franchises amid broader restructuring efforts. Computer Renaissance was a franchise brand specializing in the resale of used and new hardware, software, and related accessories. Introduced in 1993, it grew to support over 200 locations before Winmark sold substantially all related assets and franchising rights in August 2000 for $3.0 million to Hollis Technologies, Inc., as part of operational streamlining during a period of financial pressure. Disc Go Round offered franchises for retail stores buying and selling used and new audio compact discs, operating from 1994 until its sale in June 1998 to CD Warehouse, Inc., for $7.0 million in cash plus a note receivable. The brand had expanded to 137 stores by the time of divestiture, reflecting Winmark's initial push into music media resale but ultimately contributing to portfolio simplification. It's About Games provided franchises for stores reselling used and new video and computer games, launched in 1997 and discontinued by 1999 after a short operational period marked by limited growth. The closure aligned with Winmark's efforts to eliminate underperforming concepts and reduce operational complexity in the competitive gaming resale space. ReTool, acquired through the purchase of assets from Tool Traders, Inc., in April 1998, focused on franchises for reselling used and new tools and small engine machinery. Despite initial promise in the resale niche, the brand failed to achieve viability and was fully discontinued by 2001, with Winmark ending support for all locations to refocus on established resale categories. These former brands exemplified Winmark's exploratory phase in resale , where rapid diversification into emerging consumer categories proved unsustainable, prompting a strategic pivot toward sustainable, high-margin niches like youth apparel and sporting during the company's financial in the early .

Leasing Operations

Wirth Business Credit

Wirth Business Credit, Inc. was established in as a wholly owned of Winmark Corporation, specializing in small-ticket leasing and financing services targeted at small businesses across the . The subsidiary focused on facilitating access to for essential business assets, such as valued between $5,000 and $250,000, through flexible leasing options designed to support operational needs without large upfront costs. As a fully integrated component of Winmark's leasing operations, Wirth Business Credit operated via a franchised model, where independent franchisees originated and marketed leasing transactions on behalf of the parent company. Franchisees received training, marketing support, and ongoing assistance from Winmark to identify opportunities among owners, earning fees for each funded processed through or affiliates. At its historical peak, the network encompassed 41 franchise territories as of late 2007, reflecting rapid expansion in the mid-2000s to capture demand for accessible financing in the sector. Subsequent years saw streamlining, with operations winding down amid strategic shifts at Winmark. Leadership and day-to-day management fell under the broader executive oversight of Winmark Corporation, aligning Wirth's activities with the parent company's and leasing objectives, particularly emphasizing support for growth through specialized financing. This structure ensured seamless integration, allowing Wirth to leverage Winmark's expertise in development while prioritizing leasing that lowered barriers for startup and expansion in and service industries. Wirth Business Credit played a key role in Winmark's leasing segment by generating revenue from lease origination fees, interest income, and related transaction charges, distinct from the company's core royalties. Primarily, it served a broad base of small businesses by enabling leases for store fixtures, technology, and operational equipment, thereby reducing initial capital outlays and promoting . In May 2021, Winmark ceased originating new financing transactions, transitioning to an orderly portfolio run-off; net investments in leases reached zero by December 2024, though minimal income from run-off and settlements continued into 2025 (e.g., $42,900 in Q3 2025). By November 2025, the company had fully exited the leasing segment to focus on .

Financial Services Offered

Wirth Business Credit offered equipment leasing services tailored to small businesses, focusing on financing for essential and operational assets such as fixtures, point-of-sale systems, and inventory management tools. These offerings typically ranged from $5,000 to $250,000 per , enabling clients to acquire necessary without large upfront expenditures. Lease terms were flexible, generally spanning 24 to 60 months with fixed monthly payments and fixed interest rates, often including an option to purchase the equipment at the end of the term for a nominal . The primary target clients were small businesses, including Winmark franchisees launching or expanding resale stores, as well as other entrepreneurs in sectors like and services. This included over 23 million small U.S. businesses that relied on leasing to preserve and lines. By offering quick approval processes—often with minimal documentation and no application fees—Wirth Business Credit supported rapid business setup and growth, particularly for those in the resale industry where affordable access to fixtures and technology was crucial. Key benefits included low initial costs, consisting of just one lease payment plus a nominal documentation fee, alongside tax advantages such as deducting lease payments as business expenses. These features aided cash flow predictability through fixed payments, allowing clients to forecast budgets accurately and allocate resources toward operations rather than asset purchases. For Winmark franchisees, this facilitated efficient store openings, contributing to the overall leasing segment's complementary role in supporting franchising activities. In terms of performance, Wirth Business Credit contributed to Winmark's leasing segment, which reported operating income of $2.2 million in the first quarter of 2025 (including a $2.1 million litigation settlement), up from $0.7 million in the prior year's first quarter, reflecting ongoing portfolio management amid a strategic shift toward . This segment supported the company's broader operations, which generated $11.4 million in operating income for the same period. By Q3 2025, leasing income had decreased to $46,600 due to the completed run-off. By enabling cost-effective equipment acquisition for secondhand retail setups, Wirth Business Credit indirectly promoted within the resale sector, helping reduce through accessible financing for eco-friendly business models that extended product lifecycles.

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