How’s Business? December 2019
Welcome to our popular monthly How’s Business feature in which we ask a selection of bicycle shop owners and managers across Australia and New Zealand, ‘How’s business?’.
Being our December newsletter, for this month’s follow up question we asked, ‘How is Christmas shaping up and do you do laybys for Christmas?
Western Australia
John Carney owner of Wembley Cycles in the upmarket inner western suburbs of Perth said:
Business has been good, but you’re calling at the right time of year for me to give you that answer. October is always our biggest month. March and October are always my biggest months turnover wise, and December, I guess like most shops, is my biggest month in terms of number of bikes sold.
March is the start of the mountain bike season over hear. October is Cape to Cape mountain bike race, about 20 different charity rides, adventure races… so there’s all these things driving people in here to get their bikes serviced. I probably sell more nutrition in the month of October for all of those reasons. And all the new season bikes are arriving instore.
The average unit price of bikes sold is higher in October than December. I keep those figures and I’m happy to share them.
Last December my average bike sale price was $1,227 versus $1,632 for October 2018. But other months were higher. This year my average bike sale price has increased. For example March and July were $2,500 for the average bike price.
In fact my average bike price this year has pretty much gone to $2,500 for this calendar year to date.
When I first started keeping this data in 2011 my average bike price was $1,300, so it has increased by $1,200.
There are several reasons for this.
I’ve got a big involvement in mountain biking. I put on mountain bike races so I’m pretty proactive. My marketing is done in the form of putting on races where I’m both the event organiser and major sponsor. So I get my name out there but also managing how it’s done. For example my name’s on every number plate so it’s in almost every photo that’s taken, which is putting it in the mind of the type of customer that I’m after.
And the shop’s been here for 50 years – we had to change location – but in the suburb for 50 years so I’ve got my locals. But we’re a destination shop for Specialized and Santa Cruz. We’re the biggest for both of those brands in WA.
Christmas and laybys…
We definitely do laybys. It always starts around now so all I can say is that they’ve started. I’m not inundated. We generally see a dip in sales dollars coming in the door in November.
People are putting their S-Works wallet away and pulling out the kids bike wallet.
I think we’re looking at a pretty good Christmas but it’s very hard to tell. We’ve got a week of temperatures over here that are over 35 degrees every day. So I can tell you that right now we’re catching up in the workshop and I’m cleaning up my office because there’s not a lot of customers wanting to be out and about when it’s 38 degrees.
We’re busy enough that we don’t mind the time to catch up right now.
Victoria
Daniel Rickhuss of Bairnsdale Bikes in the scenic East Gippsland region of Victoria said:
Business is really good at the minute. We’ve been open almost two years. We started from scratch. It was pretty busy straight away when we started. Then tapered off due to some personal injuries, the shop slowed down for about nine months but now it’s picking up again.
Specialized is our number one brand. Definitely more mountain bike orientated, but we’ve got a pretty solid road following as well.
Christmas and laybys…
Yes we do laybys but we’re down 84% with laybys compared to this time last year. But we’re up in high end bike sales.
We look at the numbers weekly. October and November so far this year are completely different to October and November last year.
It’s a Victorian State Election year. The media is constantly talking drought and doom and gloom. So there’s a correlation, but in saying that, we’re up in high end bike sales. That $3,000 plus bike is really sought after at the moment. Both road and mountain bikes.
New Zealand
Shane Collett, Manager of Kiwivelo in Wellington city centre, New Zealand said:
Business has been good. In New Zealand it’s our fun ride season so everyone is back on their bike after winter. It’s been full on.
We’re a mainly road and tri shop with a bit of mountain bike. We sell Pinarello, Focus and Cannondale as our main three road bikes. We also do triathlon bikes with Felt. We do Norco and Trek for mountain bikes.
The road scene is pretty strong here. It went quiet for a couple of years but it seems to have picked up again. The tri scene has been pretty strong as well.
Christmas and laybys…
We don’t do laybys and we don’t to children’s bikes at all. The cheapest bike we have on our floor is about $800. We sell Garmins and high end electronic things like that so those sales will be good in December.
We’ve got a little, boutique type shop. Bike Barn or My Ride would do the big kid’s bikes numbers in New Zealand.
We have five people working in our shop. It’s full on.
Tasmania
Darren McNeill of Treadlies Bike Shop, in Kingston, just south of Hobart, Tasmania said:
Just over a year ago we moved, not far from the old premises, but now we’re out on the street a bit more. It’s been really good. We’ve got a much larger floor space and a bigger workshop, which is what we really needed.
Business is good. There was lots of work with the move, setting up a new workshop and fitting out the new store in the way we wanted to do it for the past few years but hadn’t had the chance to. The move has given us a good opportunity to actually do the things we had been talking about.
We really wanted to update our workshop and start a new digital system in the store. In the old Treadlies, everything was still written on paper. So while we were doing stocktake with the move we put everything onto the new digital system. We’re running Vend, which seems to work alright running the shop at the front and the workshop out the back.
It was a lot of work to get every product on, that had never been scanned before, but it seems to be working alright.
Our main brands are Giant and Liv. We’ve only just taken on an Orbea dealership as well so we’re trying to create some space on the floor for a new brand and get in some new bikes, which is exciting.
Most of the bikes that we talk about with customers are mountain bikes. They’re riding Derby and Maydena and those sort of new places that are opening. There’s a new trail hub at St Helens that’s about to open as well. That seems to be generating a lot of interest in mountain bike sales, especially full suspension.
Christmas and laybys…
We do laybys for Christmas. I reckon it’s down this year compared to what it has been in the past. I’m not sure if people are just waiting longer before they come in to organise Christmas presents this year.
Northern Territory
Nick French, Store Manager of Cycle Zone in the city centre of Darwin, Northern Territory said:
We’re really quite busy, actually. Obviously we’re a bit different to the rest of Australia. We have our wet season and dry season. Winter in the southern states is dry season here, which is the primary time when people would be riding. At the moment we’re just getting into wet season, which is hot, humid, wet, raining.
Some how we manage to stay busy pretty much all year round, but if you had to put a peak on it, then the dry season would be the peak.
Our workshop is enormously busy. We have three full time mechanics and at the minute we’re booked out for the next three weeks. We don’t have room for any more mechanics to be honest. That’s probably the limiting factor.
Our mechanics have a good reputation around town that they do good work. They seem to be the go-to guys, which is good.
We sell every sort of bike apart from BMX. Hybrids, mountain bikes, road bikes… we’ve got a decent fleet of ebikes these days. Our main brands are Giant, Trek and Scott.
Christmas and laybys…
Yes we do laybys. Christmas can be a funny one. Obviously we can do a lot of kids bikes. But a lot of people and families leave Darwin at Christmas time to visit family interstate.
So it tends to be that January can be the busier month of the Christmas period because people are back in town but they’re still on holidays and they have time to go shopping.
New South Wales
Brad Prescott, Consultant at Tarramurra Cyclery in the leafy northern suburbs of Sydney said:
Business is pretty good. Around the middle of the year it was a little flat. But since then it has been really consistent. The workshop has been pumping. Really a struggle to keep on top of the demand. It’s like a sushi train, the rate that repairs are coming through and service work.
But the sales on the floor have been pretty good to across pretty much all sectors – kids bikes, the high end market… it has been a bit confused the past couple of years because you’ve got disc brake road, rim brake road… everybody’s got a foot in each camp.
The consumer has been quite confused by the market, but it’s starting to settle down a little bit. A lot of people who have been sitting on the fence are now starting to commit to a bike, eventually. They’ve been saying, ‘Let’s wait to see what happens.’
Now they’re, ‘Let’s go.’
We service a unique market where there’s a lot of people after super light weight and racing stuff. We still do a lot of both types of bikes.
The average person who’s just out for fun, recreation, most of them are going to disc to future proof themselves because that’s where 80% of the market is going, or more. Not really because they need it. They ride it and they like it. ‘This feels good.’ It feels confidence inspiring when they’ve got to stop in a hurry. But nobody actually needs it.
A lot of the bike companies are getting their colours good this season. People walk in and they’re like, Wow!’ You see paint schemes on $600 to $800 bikes that you’d be proud to see on a high end carbon bike. It’s really eye catching for the consumer.
It’s gone away from, ‘What rear derailleur does it have and how many speeds?’ To, ‘Does it fit well? Do the brakes work well? Has it got a quick release seat post and quick release wheels?’
The consumer is not picking everything apart down to the valve caps at that level whereas in the past they seemed to.
Christmas and laybys…
Absolutely we do laybys and they’re starting to fill up. Each week we see the list growing. Things are getting stashed for Santa. We have a very big cave for Santa to stash his bikes. It’s a well oiled machine.
Disclaimer
How’s Business is a record of recorded phone interviews with a wide range of bike shop owners and managers. All opinions expressed within How’s Business are solely those of the interviewees and not the opinions of The Latz Report. Any data shared by interviewees including, but not restricted to, dates, prices, volumes etc is taken at face value and in most cases not independently verified.