How’s Business? – August 2024
Welcome to How’s Business, brought to you by our sponsor Dirt Works Australia.
Australia just had its most successful Olympic games ever both overall and across the cycling events. Specifically in cycling, we won gold in the Women’s Road Time Trial, one gold, two silver and two bronze in track cycling, One gold in BMX racing and one bronze in freestyle BMX.
Because of all of this success, for this month’s follow up question we asked, “Do you think that the Olympics and Australian cycling gold medals will have any impact upon your business?”
The majority of our six respondents were not counting on any Olympic tail winds as we finally start to emerge from what has been a very tough winter for most dealers.
Matt Weir from Bikeaholic Mountain Bikes in Queenstown on the South Island of New Zealand said:
It’s interesting. We’re in mid-winter and we’re a resort town, so there have not been a lot of sales recently.
We’ve still sold a few high end e-MTB bikes recently, but not a lot of anything else.
We do have a new scheme in New Zealand called work ride. (This is a government scheme, similar to the one in the UK, where customers can buy bikes with pre-tax dollars) We’ve been doing a little bit of that, which has been interesting. That’s getting quite a bit of traction, which is good.
Other than that, we just can’t wait for summer – bring it on!
There’s a lot going on with new bikes, we do Specialized, lots of things coming out but not a lot of interest in buying them. Not just Specialized – there’s lots of innovation happening, but people are buying the older models that are discounted, rather than the new, flashy stuff.
Our tagline is “100% mountain bike”, but every now and then we’ll sell something else. We don’t do anything generally below about $4,000. We operate pretty high up there. We do have a couple of kids bikes, but not many.
Most of our bikes are full suspension. Probably like 60/40 e-bikes to non e-bikes.
Our official interest rates in New Zealand just got cut by half a percent today, so we’ll see if there’s any flow on from that. I’m looking forward to interest rates falling. But there’s a lot of people not spending much money at the moment in this country.
So I think we’re going to have a tough year to be honest, but hopefully it will come back a little stronger at the end of the year.
We have a long summer season in Queenstown, which is great. We’ll get pretty busy.
Queenstown has got world class everything… I love living here!
Any Olympics effect on your business?
I don’t think so. I did see that all the Specialized bikes in the Olympics had that 50th anniversary livery – they all had the same paint job, which was pretty cool. But I don’t think we’ll see much come back from it.
Mitchell Pereira from Cheeky Bikes in Warners Bay, on the Central Coast of NSW said:
It’s been alright actually. We’ve been keeping ourselves pretty busy, mainly with servicing and stuff.
Sales have stayed relatively stable over the past couple of weeks, just doing run out stock. Mondraker, Rocky Mountain and Shogun have got pretty decent discounts on them at the moment – whether it’s just old stock they’re trying to clear out, or excess stock – stuff like that.
We’ve had our Warners Bay store for about 12 years. We used to be franchised across Lambton and Belmont (nearby suburbs of Newcastle) as well. But within the past year we’ve dropped the Lambton and Belmont stores, just to focus on the Warners Bay store, which has always been our strongest store.
Entry level dual suspension MTB and intermediate level hard tail MTB are probably the two most common types of bikes that we sell. Mainly to younger audiences that are looking to getting into mountain biking.
We definitely hold more stock of mountain bikes. And within the past year or so the commuting e-bikes having been coming up a fair bit. A lot of people are getting electric cruiser bikes to ride around Fernleigh (a popular scenic paved rail trail from Newcastle to Lake Macquarie).
A new section has just been opened up to Marks Point. They’ve extended it from the previous end at Belmont.
Any Olympics effect on your business?
I’d say it would. I don’t think it would have a massive impact in the area we’re in. We don’t see a lot of higher performance road bikes and stuff going out. But it definitely will have an impact at some point.
We do hold a bit of stock of BMX and dirt jumpers, so the BMX is definitely coming up a bit more as well.
Andy Murane from My Ride Unley, in the inner southern suburbs of Adelaide, SA said:
It’s a bit up and down to be honest. I think everyone’s in the same boat.
Repairs – workshop’s going really well. New sales – mid to upper range is not too bad.
I’d call it a little unpredictable. We’re building some high end gravel bikes at the moment. That’s a bit of a mover and shaker at this time of year. Gravel’s kind of been teetering along for the past couple of years, but I think this year it’s really starting to get a hold – there’s some more events, some more things going on, so we’re selling a lot more gravel.
We’re actually doing custom paint jobs. We’re changing from the standard GRX to Di2 GRX, because a lot of people have Di2 road bikes and they want to Di2 gravel.
That’s something a little different that we’re doing.
We have moved the whole business from the Woodville store to Unley as they’re developing the Woodville site and at short notice we had to move out of there, so we had to move everything from there over to our Unley store.
It’s a vacant paddock there now. They’re building 21 units and a gin distillery there – so I might go back there and buy a gin one day!
I’d like to reopen there. It’s a really good position. But I don’t think there will be any commercial space available there.
So we’re back to only Unley. The customers at both sites were pretty much the same. Adelaide is small enough that the same clientele will travel from one site to another. Although the demographic of the housing is much different.
Any Olympics effect on your business?
I wish they would! But I don’t think it does.
It’s like the Tour de France. These days people don’t rush out and buy bikes, where 15 years ago they did. The Tour, and the Tour Down Under, used to produce a lot of sales. These days they don’t. A lot of people talk about it, but it doesn’t translate to sales.
We had covid – I’m not blaming covid, but everyone bought bikes during covid, so I think everyone has something sitting in their shed where 15 years ago, they didn’t. A good percentage of people have bikes in their shed.
I think that’s why the workshop is busy these days. They’re not cyclists as such, so they’re just bringing them in, to get services.
I wish that it (the Olympics and other big events) did promote more into the industry, but I don’t think it does.
Chris Ravenhall from Bicycle Centre, Alice Springs, NT in the desert heart of inland Australia said:
Workshop is flat out, pumping. Bike sales are slow. But Alice Springs is a very commuter friendly town, so that we see that people are getting their bikes repaired to commute to work and put the car away.
It’s always been a bit like that, but with fuel going up and cost of living, it’s definitely had a big impact on our workshop.
Our most popular bike is your basic mountain bike. Merida Big Nine 20, for example. You’re looking at about $829 for one of those. People are budgeting from around $700 to $1,200.
There is a trail riding market and the most popular budget for that would be from $2,000 to $4,000. We’ve got great trails – natural trails – not overly manicured. Lots of adventure riding here in Alice Springs.
We sell e-bikes sparsely. It’s not a big thing at the moment. We probably average between five and eight commuter e-bikes per year.
I’ve had the shop for seven years. One of my best friends owned it before me for about eight years. He sold it to someone else, who started to go under. Then I took the helm since 2017.
It’s neat and tidy. It’s quite a big floorplan. We keep it very open so most people can see what they want.
There’s actually three bike shops in town. You’ve got My Ride who used to be just up the road but they’ve moved back into their original establishment, that was where they were about 30 years ago when I first moved here.
Then there’s Red Centre Adventures – that’s a new bike shop. They do more tours and bike hire.
With a small, working class population, it’s a lot of bike shops to keep open.
Any Olympics effect on your business?
No, not really. There used to be a healthy competition scene here in Alice Springs. It’s sort of dwindled away. It’s more of a social aspect now from the mountain bike club and the cycling club.
I’ve seen a decline in competitive edge. What I mean by that is that people don’t want to get out and have a friendly, community sort of competition. For the most part, our bike shop relies on people wanting to do recreational rides and have fun, or people riding to work.
Nathan McAvaney from Topgear Cycles in Bulleen, which is a north-eastern suburb of Melbourne, Vic said:
It’s been a challenging few months – a very challenging winter. Sales have been well down, workshop has been down.
We reduced hours of one or two and I took on more myself. We run a fairly skeleton crew – we were pretty lean as it is. Fortunately we didn’t have to let anyone go, but certainly we reduced some of their hours.
Things have picked up in the past two weeks. We’re now seeing a pretty much fully booked workshop this week and last week.
We’re just starting to see an uptick in sales and enquiries. It feels like the break in winter we’re starting to see down here is bringing people out of hibernation.
We’re a Specialized dealer and we sell Scott as well. We’re a bit of an everything store. From your keen road and cross country mountain bikers, we’re seeing more gravel and e-mountain bikes. But also your kids bikes and general flat bar, hybrid or gravel style of bikes as well. We sell a lot of those to commuters who just want to ride the abundance of trails that we’ve got around here.
We’re on Bulleen Road. We’ve got major roadworks happening as part of a big infrastructure build here in Victoria (Northeast Link Motorway), that’s occurring right across the road at the moment.
I wouldn’t say that it’s impacting sales, but we’re certainly getting people calling us to make sure that we’re still accessible and that sort of thing.
There’s a tunnel exit being built, basically across the road from us. Long term we’ve got a bullish outlook because it’s going to make our road slightly quieter which will make access easier.
Also, we’re going to have parklands with a greater amount of shared use paths and they’re going to feed directly into the main Yarra trail as well. I’m quite bullish about it, but we’ve just got to weather the storm of the construction, which is going to be a couple more years yet – at least three years. It’s a long time.
Any Olympics effect on your business?
I’m always hopeful! Haven’t seen it yet. You’ve got to have a hopeful and positive outlook in this industry in the moment. You’d always like think that someone’s been inspired by it and would want to jump on a bike themselves.
Tahja Slattery from Pump n Pedals in Cairns, far north Queensland said:
Great! So crazy.
What’s selling? Bikes. Lots of bikes. Full suspension mountain bike – I would say from $4,500 upwards. That’s all push bikes. Our e-bikes start around eight grand and they are also going ridiculous.
A lot of people are going over to powered bikes as opposed to push bikes, but I still think push bikes are winning, just.
We do Trek, Specialized, Cannondale, Norco and Orbea. We’ve always had quite a few brands. Trek, we probably picked up five years ago, Orbea in the past two years, but most of the time we’ve always had quite a lot of variety.
Kids bikes are going very well. We sell more than we can keep up with.
Cairns is going good. Busy. Lots of events going on in the community. Lots of group rides, charity rides. Lots going on.
Any Olympics effect on your business?
Yes, I think so. Just general excitement. Inspiring some people. Probably not a specific bike, or at least not that we’ve seen yet, but definitely a lot of talk around.
We haven’t got any Specialized 50th anniversary bikes yet (as seen in the Olympics) but I’m hoping we are getting a roadie. They’re going to be a limited edition.