I live in a college town with several bike shops, all of them still tied to the traditional retail model. The one I suspect has the worst prospects is the most upscale one. They have a big clean showroom full of expensive sporty bikes, but their mechanics are second-rate. You can tell because their shop is in the basement and you're not allowed to come down and watch them work on your bike. And the one time I made the mistake of going there for service they sniffed at my decent, well maintained commuting bike because the paint was dinged up and it was covered with road dust, charged me twice what the repair was worth, and didn't fix the problem. The shop I'm rooting for has a tiny showroom and a big repair shop right behind the counter. There's grease on everything, and I'm pretty sure they've been under-charging me for labor because they know I commute by bike. They already order and assemble bikes for people, and they also rent by the day. They, I suspect, will be just fine.
I have spoken with many bike store owners and employees, they know they can't compete with the prices you can get for parts and accessories from online retailers. But very few have an alternate plan.<p>The ones I see who are being smart about this reality are instead focusing on having absolutely excellent mechanics and experiences like shop rides to get groups out on amazing day trips / overnights. There is a huge value add in teaching people skills and thus converting them into more advanced cyclists who'll want better gear.
As a 17 year veteran of Independent bicycle dealers, this hits it right on the head. The most successful shop I ever worked at focused their inventory on parts and offered 24 hour turnaround provided the bike didn't require special ordered parts. Service is the only thing that can't be replaced by the internet.
Spent years working in a bike shop, so this was a really interesting read for me. He may be right, but I can't help be think that most people just don't care enough about their bikes to have enough customers to sustain a good Service Shop. Most people have a bike, but would never bother taking it somewhere fancy like this to get it fixed or serviced. They paid $100 for it at Walmart.<p>He said something in there that caught my eye:<p>"Think back to the '80s when market experts were predicting that internet sales were going to doom UPS and FedEx ... Huh?! Crazy as that sounds, that's what experts said, which made absolutely no sense to me."<p>Is that true?
I dont think this is new - a lot of bike shops are repair only now, with a few loyal customers.<p>I also think that bikes are getting more technical - electric shifters, the tolerance limits on gears means that its increasingly hard for people to repair their own bikes. So bike repair makes sense, and they can probably charge<p>At the higher end - lets say $1000+ bikes bike shops can still do a good trade as people new to the sport probably need a bike fit to ensure they are getting the best machine for them
This is interesting on its face, but also as an analogy. My employer is a B2B reseller of computer hardware and software, and this sounds very much like your industry.<p>Cloud services are eating into hardware sales, and manufacturers (e.g., Adobe) are going direct, disintermediating us. There's no sense fighting back, but there's new opportunities for those helping with cloud services, and with managing software licensing and so forth.
I live in Edinburgh, and I've personally counted half a dozen of these little, one or two person IBS type shops open up round town in the last couple of years. They have a small retail space at the front, an open workshop at the back, and the mechanic stops working on a bike to have a chat with you when you come in to the shop. Edinburgh's pretty bike friendly, so given the number of these shops springing up, they must have a viable business model here.
As bicycles prices start moving toward motorcycles and cars, I don't understand why the shops still feel like the margins can't/won't change. They say 20-30% profit is small, but compare that to buying a new car: 2-3% profit.<p>And to keep the car comparison going: during the summer, bike shops routinely book two weeks out, which is almost unheard of with car service.<p>I'm both surprised and not surprised to hear that clothing is not a big seller--I've never been a fan of getting clothing without trying it on. However, once I know how a brand fits, that's not as much of an issue. It is surprising to walk into a bike shop and want some shorts only to find they don't stock anything under $80--you really have to work hard to find $80 shorts at the mall. So maybe the problem is they need to do better at picking what their customers want.<p>Unfortunately, I don't have good ideas at what they should sell in addition to labor. Need it now items are great (tires) but it's hard to make all of your money just on mechanics.
I'm surprised the bike manufacturers have not stepped up to create their own branded shops as a way to provide/control a more direct 'experience'. Imagine separate 'Specialized' stores, 'Cannondale' stores or "Gary Fisher' stores all with carefully crafted service and support.<p>It's similar to how the local generic electronics store (including CircuitCity and now BestBuy) got squeezed from the bottom by Target/Walmart on the low end and the high end by the Sony/Apple/Bose Store at your local luxury Westfield or Simon's mall. Even woman's fashion is trending way - Target/Walmart/Costco for the majority and direct 'experience' stores like Coach/Burberry/Tiffany with Macy's and Kohl's getting squeezed out.
This has been an ongoing debate in the mountain bike world for a number of years now. Direct to consumer brands have clearly been making a dent in the traditional retail model. Intense just announced a hybrid model, where shops stock demos and consumers receive their new bike directly from Intense. Seems like a win-win - shops don't have to stock slow moving inventory and consumers get lower prices year round.<p>This artcle explains the pros/cons in detail: <a href="https://www.pinkbike.com/news/intense-announces-lower-retail-prices-and-hybrid-direct-to-customer-sales-model.html" rel="nofollow">https://www.pinkbike.com/news/intense-announces-lower-retail...</a>
There's a bike shop that opened near me but I've had the impression that most of their income comes from the coffee shop in the front and the bikes are more of a passion of the owners. They're nice folks, but their bikes start at $800 and go up very quickly from there.<p>I actually did give them a chance and tried out a couple of the bikes when I was looking to replace my tired out commuter bike but I just couldn't feel the $600 premium. The biggest surprise is that the shifters didn't even feel any better, it was the one area where I expected the better bike could really make a difference but they were no better at shifting quickly or under load than my old shifters.
Hmmm. A lot of this rings true, but a couple of things seem to indicate to me that brick-and-mortar bike shops may continue to exist over time:<p>Bikes are an interesting confluence of both <i>very personal</i> (i.e. the style/"feel" of someone's new bike is important, or the "fit" if they're buying with a bit more experience), <i>very expensive</i> (relatively), and <i>very physically large</i> (and hard to assemble).<p>That means that people will want to try out bikes before they buy, since the investment is substantial. Bikes need to be assembled to try out. If a brick-and-mortar store went online-only, it might be a substantial outlay for them to ship bikes to people to try out, and a hassle for folks to assemble them before trying them (unless they were shipped assembled, which is a much larger container). It seems like that might be cost/difficulty preventative for moving a lot of merchandise compared with the benefits of a showroom. Sure, bike stores might have to become more showroom-only, but I don't think they're going away.
> "Dan Sotelo was the founder of Onza"<p>Onza stuff was awesome. Was always insanely jealous of the bar ends and clipless pedals one of my friends had.
This is generally correct, and certainly aligns with larger trends in commercial real estate. On-premise retail of easily-shipped items, with no value-added ties to online retail, is on its last legs. The strip mall of the future has coffee shops but no clothing stores. Bike shops are fortunate that they have this sort of transition to attempt. Lots of menswear shops have an in-house tailor, but it's not as though they can refocus the business around that.<p>Bike shops aren't the only party trying to hold back the sea, however. Some specialty equipment distributors are so proud of the "network of bike shops" (often with various goofy "badges" and "qualifications") they had to build 20 years ago that they won't ship outside that. As if it's to their advantage to erect barriers to potential customers! Someone should send e.g. Surly a link to TFA. The author has a better idea of how they ought to run their business than they seem to have.
I am baffled why the manufacturers aren't all offering direct B2B for the bike shops. There clearly isn't enough margin left for the average bike shop if they aren't moving the volume of bikes due to direct sales, but at the same time, all the supplies they need for servicing bikes are sold through some intermediary that's skimming a cut for the service of aggregating all the different manufacturers.
<a href="https://www.ogc.ca/" rel="nofollow">https://www.ogc.ca/</a> and <a href="https://norco.com/" rel="nofollow">https://norco.com/</a> haven't substantially reduced their margins since I last worked in a bike shop 20 years ago.<p>And aggregation is not a service that would be required anymore if the shops could just go direct to Shimano, SRAM, Fox, Maxxis and DT-swiss (etc). That aggregation can be performed by the bike shop itself via a B2B solution.
A local bike shop closed business a few months ago. They had had a location on Downtown Main Street for years, but for some reason [I'm guessing rent] moved several blocks away from their old location -- and several blocks closer to where I live. I imagine that this negatively impacted their foot traffic, even though it was directly in line with my own walk-to-the-bus commute.<p>I shopped at both of their locations several times, but not routinely or regularly. When the "inventory sale!" signs started going up, I admit that a part of me literally saw the writing on the wall but I didn't want to believe it. I believed it when I walked by and saw the location empty and deserted, a lonely 8x11 explaining what was up.<p>I'm curious as to what happened, but suspect that I was part of the problem -- not shopping there more often, for product or maintenance service, even though I am just one person.
I buy bikes from local specialty shops because they know how to put the bikes together and service them properly. Other customers like to use them to try accessories before purchase.<p>The family-owned shop I use in the Boston area (<a href="https://farinas.com" rel="nofollow">https://farinas.com</a>) has a pretty solid, all-season business model: Bikes on the second floor, lawn mowers and snow blowers on the first floor, and the repair shop on the first floor. I see they also sell generators and chainsaws - items that may not be easy to ship or service online.
Great article! I had a similar notion a while back for ski shops. Here are a couple of additional ideas from that thought experiment.<p>1.) Deeper web presence. For example, why not sell coupons for services on the stuff people buy on the web?<p>2.) Subscriptions. Basically an add-on support fee for your bike. This makes sense for anyone who commutes, especially if you can make it trivially easy to collect. That leads to...<p>3.) Additional services. Combine bike parking in cities with on-going maintenance . This already exists in some cities.
Even the service model is not that encouraging. I knew someone whose dad owned a bike service shop in Japan; it wasn't a vibrant model. I got the impression they scraped by, but by and large it was a labor of love--nothing wrong with that, but it does not have ample opportunity, except maybe for a franchiser.
Similar to that recent article posted here about how "experience retailers" are inverting the relationship of the vendor. (Where an experience retailer is actually a marketing arm of the manufacturer).<p>But yes: I would love to able to drop by and get my bike fixed by someone competent.
This brings to mind Moen's Law of Bicycles:<p>"Good customers make for good products"<p><a href="http://linuxmafia.com/~rick/lexicon.html#moenslaw-bicycles" rel="nofollow">http://linuxmafia.com/~rick/lexicon.html#moenslaw-bicycles</a>
I've recently become aware of Canyon Bikes as well as other direct-to-consumer manufacturers. In one video I watched, the buyer had a mobile bike shop come and setup their new bike. I think the mobile bike shop approach plays well with the direct-to-consumer model.
Tire Rack has done this to the tire retail business. You can get the tires you want from Tire Rack, and get referred to a shop that will mount and balance them. That's what should happen to bike sales.