• Teros, Elizabeth St, Hobart, Tas
    Teros, Elizabeth St, Hobart, Tas
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How’s Business

Welcome to our monthly survey of bicycle shops across Australia where we start by simply asking, ‘How’s business?’

As always we asked a follow up question, which this month was, ‘Which product category, if any, is giving you the best growth this year?’

 

Ahmet Bektas of ebike specialist Teros located in the city centre of Hobart, Tasmania said:

Business is changing. We’re doing really well in some areas and less well in other areas. Generally our sales are about 10% to 15% up on the same period last year. But last year our ebike sales were growing fairly steadily but this year they’re a bit flatter.

Since Christmas to now our sales are about the same or a little bit better than last year on bikes.

We’re picking up on service and the other products that we sell in the store, because we’re more of a department store for green lifestyle products and those are growing faster than the bike business.

We’re still finding that the bikes from Ezee Bike with a throttle, built to Australian regulations with a 200 watt motor are the most popular. Of the European Bosch equipped bikes the mountain bikes are most popular. We’ve pretty much sold every mountain bike we could get hold of over the summer. Stock of e-mountain bikes is still an issue.

But for commuting and recreation the non-Bosch bikes are doing better.

I think the whole scene is changing with the arrival of ebikes from the major brands.

(Growth product category?) My gut feel is that it’s in service. We’ve been selling electric bikes for six years now and we’re seeing a lot more of our earlier customers coming in for replacement batteries. As our base of customers has grown, service is growing too.

 

Nigel Letty founder of the newly established second hand specialist Alchemy Cycle Trader in the eastern suburbs of Melbourne said:

Business is good, but I did open the business at a time when I knew we’d be coming into winter. Being a totally different model, we’re learning a huge amount every day, with opportunities coming outside the box that I hadn’t envisaged.

We are slowly but surely building our stock levels. We’ve got loads of social media going, that’s bringing in increased traffic flow all the time. I’m confident that our business model is good and that we’ll continue to grow.

We have 75 bikes on the floor now, all second hand except some ex VIS (Victorian Institute of Sport) bikes which were back-up bikes for team riders if they had an accident. These bikes sat on a pallet for four years and now we’re selling them off for half the normal retail.

I would say that 60% of our bikes are coming from the trade: ex demo bikes, sample fleets, warranty bikes that are scratch and denters, things like that. And 40% from the public, but the more awareness we have, that’s going to shift. I can see in the future that the split will be 80/20 with 80% of the bikes coming from customers and 20% from the trade.

Our average dollar sale is around $2,200. I’m very happy with that. We were hoping that it would be $2,000. The most expensive bike we’ve sold was $5,000, but there’s been a few at $4,000. On the lowest end there’s been a few around $1,000 and $1,500.

(Growth product category?) Currently it’s bikes. I think our model is totally reliant on selling more and more bikes so that we then manage to sell more helmets, shoes, accessories, more workshop work, food products. All of that’s going to happen but only after we’ve built more customers who buy second hand bikes.

Our roadworthy certificate is part of our policy. Every bike that we take in as a second hand bike we do a full roadworthy report so that we have the information available to a purchaser, but also for the seller so that they know exactly where the negotiation, valuation and position in the market should be.

The seller pays for that. It’s their only out of pocket expense when they drop the bike in, $49.95. Then we charge 20% commission upon the sale of their bike.

 

Shaun Hopkins of ABC Bikes in Liverpool and Campbelltown, just south west of Sydney, NSW said:

It has been pretty steady since the rain we had in March stopped. Things have been ticking along. The biggest problem that we have at the moment is that there are a lot of popular bikes sold out from our suppliers, which is creating a lot of holes to try and fill. But we keep doing what we do.

It’s one of those things. Those particular models have obviously been popular nationally this year. Giant are out of a few bikes. Merida have sold out of a few of theirs so trying to find the particular bikes our consumers are interested in is the biggest issue at the moment.

For us road bikes and dual suspension mountain bikes are the two categories where we’ve got the biggest holes. For example carbon framed 105 level road bikes, it’s becoming increasingly difficult to find the bike in the frame size and specifications that that customer is looking for.

But we’re also now into winter so we’re seeing a spike in winter clothing and indoor trainers as well.

(Growth product category?) Our road bike sales this year have been substantially better than we’ve had in years gone by. We’ve been able to take advantage of clearance specials from wholesalers. Monza have had a lot of Cannondale bikes on special, so we’ve been selling a lot of older model road bikes on special.

Everyone’s looking for a bargain, particularly in that up to $1,200 road bike category, we’ve been selling a lot of bikes.

 

Peter Giessauf of International Cycles in the inner north eastern suburbs of Adelaide SA said:

Business has gone very quiet in the last week for me here. Bike sales are slow. Repairs are getting a bit quieter for us. It’s just a matter of waiting for the next job to come in right now.

For the first part of this year I’ve been absolutely flat out. We’ve been really busy with a lot of repair work and we do a lot of restoration of old bikes. A lot of people get referred to us to restore old bikes for them.

It only dropped off a week ago. Before that we were booked out two to two and a half weeks in advance, it’s come to a cliff this week and down it went, but that could pick up again next week. It could be a combination of the weather and that we’re just getting over school holidays.

But I do know that it’s been fairly quiet across Adelaide and that a lot of the smaller shops are being affected by 99 Bikes coming to Adelaide. They’re on Marion Road (in the southern suburbs) and another one just near Mike Turtur Cycles (northern suburbs) and I believe they’re going to open another one by Tea Tree Plaza (north eastern suburbs).

(Growth product category?) Fuji bikes. They’re really great. For us it’s road bikes and hybrid bikes, in the Fuji range that are our main sellers.

 

 

Dianne Bennett from Bennett Page Cycles in the Queensland regional city of Toowoomba said:

Business is very good at the moment. We’ve been really quite busy. It’s nicer weather at the moment so more people are starting to ride again after the hot summer that we had and people are buying new bikes.

Things are starting to be exciting again.

(Growth product category?) In our store our major brand is Giant and I think this year we’ve seen growth in every category. I know that people have spoken about how mountain biking seems to be taking off in a big way at the moment, but we’re certainly still having equally good sales in women’s road riding, family and recreational bikes.

Commuting… in our city we’ve noticed that there are a lot more people commuting this year than at the same time last year. This is a country town basically, so with the introduction of a lot of paid parking there’s a general inclination, people are thinking about riding to work.

We have a lot of customers who work at the local hospital and commute to work. There’s somewhere there where their bikes are safely locked away. There’s been a big new library built which has facilities for cyclists. There are more bikeways but we’ve got a long way to go until we’re at the level of Brisbane bike ways.