‘Self-inflicted wound’ preceded RunTex downfall, auction

RunTex, a business that took Austinite Paul Carrozza 25 years to build, was sold off, piece by piece, over the span of just a few hours Tuesday.

In rapid-fire succession, an auctioneer hired by the Travis County tax assessor/collector’s office found new owners for hundreds of items – running shoes, shelving, signs, popup tents, sports memorabilia and more – seized from the company last month.

Carrozza — who through the years has become one of the leaders in Austin’s running community — was there to watch it all unfold.

“I’m a gutsy guy,” said Carrozza, who blamed his lack of business acumen for RunTex’s problems. “I kind of felt like I had to be here.”

The daylong sale netted just over $60,000, according to the county. The cash will go to pay more than $17,000 in past-due property taxes owed by RunTex, with the remainder going to the company’s other creditors, including its landlord, who obtained a $150,000 court judgment for missed rent payments.

“RunTex is a beloved, iconic Austin business,” Tax Assessor/Collector Bruce Elfant said. “This is a profoundly sad event, but we had to take this action to protect the taxpayers’ interests.”

Carrozza told the American-Statesman some vendors are still awaiting payments as well.

RunTex hasn’t declared bankruptcy, Carrozza said, and he said he hopes such a move won’t be necessary.

Items auctioned during the first hour Tuesday included an autographed Lance Armstrong cycling jersey that went for $750 and a pair of running shoes worn by former President George W. Bush that fetched $1,450.

“I think it’s interesting there’s so much interest,” Carrozza said. “There’s so much meaningful stuff here.”

The first item sold, just after 11 a.m., was a box of foot sizers used to measure runners’ feet. The winning bid was $20.

The company’s two vehicles – a pickup and a van – went for $1,900 and $9,500, respectively.

Elfant said the merchandise sold at prices higher than he’d expected.

A couple of hundred people attended the auction, cramming into the flagship RunTex store at 422 W. Riverside Drive in Central Austin. One was Parvaiz Dama, who walked out midday with an armful of running shoes he’d purchased for his church’s youth football league.

“RunTex has been around such a long time,” he said. “I can’t imagine Austin without RunTex.”

Carrozza insists the RunTex name will survive. But beyond that, he said he’s not sure what’s next for the company.

“I hope to be Phoenix rising from the ashes,” he said. “I’m hoping to take off again. We’re not giving up. We’re just … re-engineering.”

A return to retail is possible, Carrozza said, but unlikely. Instead, a “new” RunTex might offer running classes or prescribe footwear that can be purchased elsewhere, among other things, he said.

The RunTex Foundation, a separate nonprofit entity, stages dozens of health and fitness events each year, and that will continue, he said. From 2007 to 2011, the most recent figures available, the foundation took in contributions totaling $419,784, according to filings made with the Internal Revenue Service.

In 2012, the RunTex Foundation helped revive Austin’s Trail of Lights. The partnership was “highly successful,” the city said in a written statement, and the two entities plan to work together to stage the holiday event again this year.

And, in the coming weeks, the foundation hopes to resume placing water jugs along the Lady Bird Lake running trail, Carrozza said.

“I love what we do,” Carrozza said. “I love keeping people moving.”

‘Business mistakes’

Carrozza said he never planned to open a sporting goods store. As a student at Abilene Christian University, he had dreams of becoming a doctor – not a shoe salesman – but his love of running led him down a different path.

“I’ve never considered myself a retailer,” he said. “Sure, I’ve put a lot of shoes on a lot of people, but a lifestyle is what I’ve been selling.”

That lack of business acumen, Carrozza said, is how RunTex wound up in financial trouble. He said an increase in competition and a failed expansion attempt also contributed to the problems.

Last month, hours after the store marked its 25th anniversary, Travis County deputy constables swooped in and took control of all the company’s belongings.

“You learn a lot after 25 years in business,” Carrozza said. “I’m not proud of my business mistakes.”

News that RunTex was struggling wasn’t much of a shock to many Central Texans.

“I could pick up on the vibe,” said Mike Haggerty, co-owner of ThunderCloud Subs and a longtime friend of Carrozza’s. “You could just tell that the inventory levels weren’t what they should be.”

Owners of other area running stores said they could also see RunTex was struggling.

“We’d already been seeing some of the fallout,” said Steve Sisson, co-owner of Rogue Running, which has locations in East Austin and Cedar Park. “Their staff had been sending folks over to us to get what they needed. It’s a sad day for all of Austin – not just the running community.”

Carrozza said some vendors cut off deliveries to RunTex because they weren’t being paid in a timely fashion, leaving shelves bare.

“This isn’t something that just popped up last week,” he said.

‘Self-inflicted wound’

When Carrozza first opened for business at West 12th Street and North Lamar Boulevard, he said no one else in town stocked many of the items hard-core runners needed.

“I’m passionate about running,” he said. “I did it out of necessity.”

Area athletes liked what they saw and quickly became regulars.

“Paul’s the guy who put me in my first pair of shoes,” said James Bonney, an Austin triathlete. “Everyone said, ‘RunTex, RunTex, RunTex’ … it was the place to go.”

But it wasn’t long before Carrozza’s loyal – and lucrative – clientele caught the attention of other entrepreneurs eager to emulate his early success. Today, he said, the city has more than half a dozen specialty shops selling merchandise that was once exclusively found on RunTex’s shelves.

While some shoppers, such as Bonney, continued to patronize RunTex, others went elsewhere.

“You always want your friends to succeed and flourish,” Bonney said. “I certainly wish RunTex was still there.”

Business at RunTex peaked in 2008, Carrozza said. That’s the same year he embarked on an ambitious expansion campaign. Stores opened in the Arboretum area, in Georgetown and at the Triangle development, among other areas. But the company simply didn’t have enough capital to support the growth, Carrozza said, and has “had to work the last five years to try to catch up.”

When Travis County seized RunTex’s merchandise last month, the West Riverside Drive store and one on Far West Boulevard in Northwest Austin were the only ones still in business.

“Ultimately,” Carrozza said, “this is a self-inflicted wound.”

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