How’s Business? March 2015
Welcome to How’s Business, which continues to be the most widely read column in Bicycling Trade.
If our six shop, Australia wide snapshot is any indication, it seems that we’re settling into a solid, if unspectacular new year of bicycle industry activity.
With product suppliers investing more heavily than ever in women’s specific products, for this month’s follow up question we asked, ‘Do you have any specific strategies in place for selling to women?’
Kerry Cosgrove from Bikeline in Toowoomba, the largest inland city in Queensland said:
Business is not too bad. We’ve had a couple of quietish years, but this year seems to have kicked into gear nicely. November and December were good and then January and February were very good, so all things going well, it’s not a bad future.
I think the leaner years were pretty much across the industry. We keep good tabs with other shops and friends over the years that we know in business. Whether it be remnants of the GFC, politics… all sorts of reasons I guess.
Plus, in that two year downturn, we had the store under management and that’s not a reflection of management, but as you know, owners in their own businesses tend to work harder perhaps and get better results.
Since we’ve come back on board in September last year, we’ve seen it turn around again.
Three years ago we went Specialized Concept. We’ve been in business 25 years and had been through all the bike brands over the years in varying shapes and sizes. But we felt that the future belonged to aligning yourself to a major brand that’s going hard at it. That seems to have paid off for us.
Certainly the product is good, supply is good. The company’s good to deal with, certainly very helpful in terms of staff training and things like that. We’ve taken full advantage… sales courses, merchandising courses, Body Geometry Fit, all of those add on things that I think are essential in the current climate with the internet and everything else.
If you’re not going to be able to personalise it and offer service above and beyond then you’re probably in the wrong game.
We do have a secondary brand. We have Apollo, which we’ve done for 25 years and that’s been fantastic. Then we do a little bit of Esperia just for a little European touch. We have access to a number of other brands that we don’t carry on the floor, but we can get the one-off sales if we need to, but we’re primarily committed to Specialized.
Without blowing our trumpet, we’ve been one of the leading lights for women’s cycling. We’ve had a women’s cycling program for 15 years. We’ve got a women’s specific social club, Bikeline Women on Wheels. They’re super active. Raised bucket loads of money for cancer research over the years with a major Pinktober Ride that they do each year.
We do tours away for them. That’s been great for us all along. In the last year or so more and more women seem to be joining the fray.
This is the seventh year of Pinktober. We deck the girls out in a pink kit. The guys go along on that ride too. We’ll get 80 to 100 in a bunch and do a 60 or 80 k ride and finish at a car dealer who’s one of the sponsors of the ride. He moves all of the cars out of his dealership and we have a breakfast and get some celebrities in, so it’s just a big fundraising day.
It all goes to the local oncology unit in St Andrews Hospital. We know exactly where it’s being spent.
So we’ve done a lot with women, primarily I suppose because my wife Donnamaree is a cyclist. She’s really proactive in that since day one.
We do monthly get-togethers and do drinks in the shop or various watering holes around the place. We’re just in the throes right now of organising our annual ANZAC ride to raise money for the RSL. This one will be our 20th year and a big one, being the 100th year since Gallipoli.
So we’ve always been a very proactive shop in terms of organising people to go to things. We’ve taken bunches to do Byron Bay. We’ve done Around the Bay probably seven or eight times with 20 or so riders. We’ve just taken 14 or 15 to the Cadel Evans race. We’ve got a group going to Europe in June.
For us it’s more about keeping them on the bike rather than selling them a bike. Selling is one thing, but make sure they use it as well and wear it out!
We’ve always looked for the point of difference. You’ve got to do that in business, particularly now, it’s just so service driven. You’ve got to be doing more and more of the service stuff and less and less of the, ‘hoping they walk in the front door’!
Simon Doran of Saint Cloud in the inner northern Melbourne suburb of Fitzroy, Vic said:
Business is quite good. We’ve had a really steady entrance to 2015. We’ve found that usually in the industry things quieten down for January. Everyone’s spent their money and made their purchases for Christmas, however we’ve had a steady roll through.
That’s thanks to doing a lot more custom work and having a niche in the market. Being a point of difference has kept people coming through the door more consistently. We’ve been quite busy. It’s been good.
We’re a small store, about six metres across at the front and about 12 metres deep.
Our core complete bike brand is Fuji, right through from their entry level single speeds to their top of the line road bikes. We’re also doing a lot more of the boutique custom builds as well. We’ve now got Parlee and we’re doing quite a few custom builds. Also a smattering of Cinelli and Look single speeds and track builds. A more diverse range than we did a couple of years ago.
I think we’ve just evolved with our clientele. As they’ve become more brand aware and spending more time on their bikes, they’re more inclined to spend more on their bike and their set up.
We’re quite a small store so there’s only two of us on staff. We do have a couple of girls on our race team. We’re also stocking some women’s specific bike models and some women’s specific kit. We’re doing women’s specific kit via Capo, there’s some new women’s specific kit from Maap, a new Melbourne brand. There’s also women’s product from Creux, another Melbourne brand that do more of the urban style cycle clothing.
We’re specialising in women’s cycle fit and carrying a women’s line of road shoes as well.
We’ve got quite a diverse range of both guys and girls coming into the shop. We try, as a small shop, to cater for as many people as we can and I think that we’re getting there.
Graham Douglas of Blackman Bicycles in western Sydney, NSW said:
Business has been quite strong for us in all three stores: Parramatta, Blacktown and Penrith. We’ve had good turnover in all ranges of bikes. The past two months have been very strong since Christmas. Our workshops are all extremely busy. A lot of people are pulling their old bikes out of their sheds and getting out on the new cycleways, like the M7 cycleway out west here.
I oversee the three stores. I get to spend Monday out at Penrith, Monday morning and Tuesday morning at Blacktown and the rest at Parramatta.
We run the same product in all three stores. It’s very rare that we make an exception to that. Giant, Merida would be our two major brands, then Norco, Cannondale and also very strong in the Mongoose juvenile bikes.
The Penrith store, being closer to the mountains, does a lot more in high end mountain bikes. Parramatta does a little more in the better end of the road bikes. But in general bikes, all three stores do well in everything from kid’s bikes to medium level mountain bikes.
Including casuals we’d be up to 25 staff in total across the three stores.
We’ve had a female staff member in both Parramatta and Penrith. The lady at Penrith has just moved on to one of the wholesale companies, but we have a new junior lady that we’ve just started up there.
Apart from that, the only real strategy is that we treat the ladies exactly the same as we treat the men. Our women’s sales in clothing in particular have increased over the past six to 12 months.
Bicycle-wise we’re finding a lot more ladies heading towards what we classify as the sports hybrid area, where they can ride the bike for a bit of exercise but still have the ability to shoot down a dirt trail.
All our sales staff are pretty adept at talking to the ladies about what they need, and how we set their bikes up a little bit different to the men. I don’t find that they specifically come into our shop and head towards our female staff.
This week is Blackman Bicycles 40th birthday. Graham Blackman opened his first store which he still has at Blacktown in 1975 and he is still the original owner, which is quite an achievement.
Grant Bull from AvantiPlus Kalgoorlie the mining town in outback WA said:
Business is quiet at the moment, reflecting what is happening in the mining industry. The town has reduced in size. In the past 12 months I believe we’re down about 5,000 people. That’s mine closures. It will rebound as the commodities come back in price.
Luckily we’re not in an iron ore area. Iron ore is having a very bad time at the moment and expected to go down some more. But gold, nickel and our other nearby resource, uranium, looks like taking a fairly major turn in the next six months or so. Gold is holding its own, nickel is trading at low to moderate prices and uranium is the star on the horizon. It’s the only growth industry in the area.
We sell everything from kids to mums and dads, BMX, racers. We have fairly active road and triathlon clubs in town. It’s a constant battle right across all the categories with the internet, to the point where they’re just buying the stuff outright and bringing it in for us to put it together for them.
It’s not getting any easier being bricks and mortar, but until the internet works out how to fix a bike, we should still be doing some business. We take the job and build the bike. We’re the only bike shop in town. They’ve got nowhere else to send them. That also goes for purchases from K-Mart and Target. We charge a good dollar for it, so we do alright from it, but it’s something we’d rather not do.
We do fairly well (selling to female customers). We ride on the wave of the cycling club and the triathlon club. Both clubs have a good percentage of women and we do what we can to get them started, right from teaching them how to ride.
We’ve had 60 year old women come in and buy bikes that can’t even ride and within 12 months they’re doing 70 kilometre race rides.
Our busiest time is Christmas. Temperature wise, probably the friendliest time is June/July but that’s also our quietest time of year. It’s probably the cold weather keeping people off the bikes then. They don’t go out riding in the 50 degree heat, but you’ll see a lot of bikes on the road in the morning and the evening when it cools down.
We haven’t dipped our foot into the fat bike market yet because we don’t know how to keep them pumped up… because we have a bad ‘double-G’ problem here in town. Caltrop / double G keeps us in business with tubes and tyres.
We’ve had a few requests for fat bikes, but we haven’t got into them yet, because we can’t see us winning the battle against the local thorns, ‘double-G’ is the local name for it. Tribulus terrestris is the name of the weed. It came from South Africa. It’s a three spike thorn that keeps us in business in rubber!
We would pump something in excess of 200 litres of Slime a year and in the vicinity of 8,000 to 10,000 tubes per year.
The local rumour going around is that we introduced it to keep ourselves in business.
It’s an interesting weed. You don’t see it out bush because I believe the rabbits keep it down, but there’s not rabbits in town so it just grows wild. And the Council comes along with a slasher which spreads it 10 times further than it would naturally.
Gary Mills, of Elizabeth Star Cycles to the north of Adelaide SA said:
The last couple of weeks has slowed down a little bit, but I think it’s just because there’s so much else happening in Adelaide. We’ve got the Fringe Festival, the V8 Supercars, but now everything’s over and back to normal, business should get back to where it normally is.
We had a pretty good Christmas. We were up the previous Christmas, which is always good. That followed through to January and the first three weeks of February, then it quietened down with all the festivities, I guess.
We’ve changed one brand. We’re doing GT, which we haven’t done in recent years. We’re just a normal everyday bike shop and pretty much sell the same things.
BMX went pretty well for us this Christmas and we’ve sold more mountain bikes this Christmas than we did the previous one. I’m reasonably happy with it.
We don’t have female staff, but we do have a selection of women’s clothing and women’s specific accessories.
We have noticed a bit of an upturn in women’s cycling. Maybe it’s because I’m mixed up with the Gawler Wheelers and there’s quite a few women riding there. We get a bit of a spin-off from there.
This coming Saturday is the fourth anniversary of Gawler Wheelers. We meet on Saturday mornings at 7:30 am. We generally get 50 to 60 riders. The group has got 380 members or something like that, so we just hope they don’t all turn up at once! But this week with the anniversary will be a big turn-out.
We run three different rides. If it’s a hill ride we’ll have beginners, intermediate and extreme. You pick the group that you think is most appropriate for you. On a flat ride we normally just have two groups, as slower and faster group.
We’re selling a few retro style bikes. They’re going ok. Only to women though. That’s a women’s market, for us, anyway.
I think there’s a lot more women taking up cycling recreationally, hybrids and flat bar road bikes and that sort of thing.
The next two years will tell for us. With Holden’s closing down. We’re right in the middle of it. (The main Holden factory is nearby) Interesting times ahead I think.
Nick Kontos from ACT Bike Superstore in Mitchell, ACT said:
Business is really good. I can’t complain. It has been much better than the previous year, but not anywhere near as good as 2011. 2009 to 2011 was our peak time, but the last few years not as good, but this year, for whatever reason, coming back again.
Our workshop is very busy, sales have been strong. Despite the government cuts here in Canberra it’s not as good as it was in the past, but still strong.
Our major brands are Scott, Avanti, Malvern Star and Haro. Now we’ve taken on Cannondale as well. We’ve always had Mongoose, GT and a few brands like Fuji. We’ve got quite a few brands I must admit, but not as many as we used to have!
Unfortunately, for some reason we can’t crack the women’s market. We have clothing, saddles, bikes specifically for women, but we don’t have that market.
We always maintain one to two female staff. At the moment we have one and we always try to keep one female staff member on sales. It is a mystery. Shoes as well, that’s another women’s specific product that we carry. But it is a mystery why more women don’t get involved. Our road bike sales are up, mountain bike sales are up, bread and butter is very strong, but specific women’s road and mtb… I don’t know. It’s a mystery to me.
We’re coming up to 40 years in the industry. I think women’s sales are even getting slightly worse. For some reason we don’t have that particular market.
