How’s Business – December 2022

Welcome to our monthly column in which we call a wide range of independent bike shops across Australia and NZ and start by simply asking “How’s business?”.

We always ask a follow-up question. This month’s was: How do your sales figures since the Covid boom ended compare to your pre-Covid figures?

Will Arnott from My Ride Woden, ACT, which has a sister shop at Belconnen, said:

It was a bit quiet for the past couple of months but it’s starting to pick up again. The weather has probably helped with that, and coming into Christmas. Before that we just had rain … just raining heaps. I think everyone was a bit put off with that.

How do current sales figures compare to pre-Covid?

I don’t actually have the figures. I would have been up at the Belconnen store (in 2019). I’d say it was probably a bit better in 2019 than now. That was right at the end of the drought, so you could ride every day (no rain). I think that now, everyone who wanted a bike has got a bike and now there’s a bit of a lull. That boom is definitely over in the mid-range area. Kids bikes are popular and there’s still people wanting high-end bikes. I think high-end is always going to be pretty solid.

I’d say mountain biking has definitely picked up quite a lot. Apart from that it’s pretty much the same. There’s a lot of people getting into mountain biking here.

Mark Priestley from Lifecycle Garage & Bespoke at the top of Highgate Hill in inner city Brisbane, Queensland said:

It’s fairly buoyant. We continued with a pretty constant amount of servicing. We changed the structure of the business and its strategy to be very specialised, concentrating on servicing and on custom builds or accessing bikes specifically for clients.
Our servicing is mostly booked out a week to a week and a half in advance.

Parts still can be a little bit challenging to get but it is what it is. We’ve had shortages of some Shimano products for quite a while – key products like brake pads, some cassettes and for quite a while, cranksets were difficult to get.

That shortage of componentry meant that people looked for alternatives, which for us meant an impact on what we’d normally specify onto bikes from Campagnolo. Clearly they were hit fairly hard with an unexpected increase in demand. That made it fairly difficult and we know that SRAM was also fairly difficult to get a lot of product and still is.

All of our sales are pretty much road bikes. I concentrate on lower volume suppliers such as Lapierre and Willier. Mostly I would promote handmade. Our key products would be Basso, DeRosa, Time. We have access to some smaller volume brands from America and Europe that we’ve been fortunate to be able to bring in specifically for clients and build for them.

There are some lovely bikes being made around the world.

You could say our bikes are high end, but you could spend as much on a Specialized Tarmac SL7, or more as you would on a handmade Italian or USA bike.

The quality and the passion that goes into making these bikes … these people spend a lot of time on engineering, technology and development to bring some pretty amazing frames onto the market.

How do current sales figures compare to pre-Covid?

We’re still continuing to grow. That’s more so from a servicing aspect and from the marketing I do for the custom builds, frames and parts. We’re only a small shop now. (For many years until five years ago, the business occupied a larger premises at the Normanby Five Ways intersection.)
I’m fairly selective.

We’ve got a very strong customer base, which is growing, so we haven’t plateaued, I don’t think.

Sean Kinglsey from Spokes Abbotsford in the inner eastern suburbs of Melbourne, Victoria said:

It’s starting to head back to normal. We’re on trend to be ahead of pre-Covid numbers. Now that we’re starting to see stock land again, we didn’t gamble with pre-orders, so what is landing is what we’re selling.

We’ll see what the next couple of years are like. Retail patterns are definitely not back to normal yet. Our commuter base is not commuting (like before). People are still working from home.

Even though we’re right near the city, we’re noticing a lot more recreational cycling and our service work seems more recreational than what we’ve seen in the past here.

We sell 90% e-bikes, 10% push bikes. But in the workshop it’s the opposite – 90% pushbikes, 10% e-bikes. That’s why I’m not an e-bike-only shop. We already have people who are worried that because we specialise in e-bikes, we’re not a good bike shop. The image of an e-bike shop is that all they want to do is sell. Whereas the image of a bike shop, which is what we want to hold onto, is that we fix and service bikes.

Kalkhoff and Focus would be our two biggest brands and Orbea and Tern would sit just behind them.

How do current sales figures compare to pre-Covid?

We took a conservative, workshop-based approach through Covid. With the Australia Post and Domino’s repair work that we do, we didn’t really chase that Covid sales boom. We sold a lot of stock that we wanted to sell but couldn’t get any (replacement) stock, so I wouldn’t call it a big boom period. It was nice at the start but then just workshop based.

We are seeing a normalisation post Covid to back to 2019 or better figures.

While we couldn’t do test rides through Covid, we can’t sell e-bikes. I don’t want to deal with people buying a bike online and buying the wrong bike. Selling someone the correct bike for them is why we don’t do online sales, still. I know is a little bit backwards.

I’m almost going to ignore the 2020 and 2021 figures. It’s not what I’ll use as a yardstick going forward.

Greg Turtur from Cycle Care Centre in the eastern suburb of Glynde in Adelaide, SA said:

When daylight saving started, things picked up quite a bit. Winter wasn’t a disaster but it was slowish. When the car race (Adelaide 500 held in the City of Adelaide parklands) was here last week it’s gone a little bit quieter for some reason – I don’t know. But overall it’s not too bad.

It might be the calm before the storm, with the Tour Down Under coming up.

We’ve been in this location for two years. It’s mainly service and repairs. I do sell bikes on consignment or I might buy some myself, do them up and sell them. I still have an account with De Grandi Cycles, so if I need a Pinarello or Willier, they’re kind enough to supply me. When they’re available, that is (laughes) … especially the high end.

There’s tricklings of bikes coming through but, especially in Pinarello, it’s been pretty slow in that department. They’ve got some Williers. There are shortages of components too, in some cases.

I was going to close (Greg’s former shop, Mike Turtur Cycles) and find another job, but after thinking about it, I thought I’d do what I’m doing now. But I needed to change my business identity.

When I first started Cycle Care Centre, I stayed in the previous shop location, but the building went up for sale and I had to move. I found this shop to operate from. It’s only small but it suits me for what I need to do.

I service everything. I’m not too much into the e-bike side of things. My stand wouldn’t take an e-bike that well, but I get everything in here now – mountain bikes, hybrids. I’m still getting road bikes from my regular customers but overall it’s a bit of everything.

I’m a one-man show but I do get a lot of walk-ins and I tend not to turn people away. I can turn over the bikes.

How do current sales figures compare to pre-Covid?

Mine would be based on what bikes went through the till, so I would be down because now I’m more based upon service and repairs. I did look at the figures the other day. It’s hard to compare one year to the next. I don’t sell as many bikes as I used to. I expected that.

Conor Smith from Ulverstone Bicycles on the north coast of Tasmania said:

Business has been really strong this side of the new financial year. With stock back to normality, it’s probably been one of our busiest Christmases. I’m not sure how we’re going to find time to build all of these laybys but we’re going to make time.

A lot of kids’ bikes, as per normal. Our shop is very renowned for stocking a good range of family and kids’ bikes. Trek is our main brand. We’re the original Trek dealer on the north coast. We’ve been dealing with Trek since 2008.

We also do a lot with the west coast of Tassie. We do a fair bit of advertising down Queenstown way (195 km to the south west). They come up to the coast a fair bit and collect whatever they need. Our Facebook is probably our biggest marketing avenue we use.

How do current sales figures compare to pre-Covid?

With the Covid spike, it was pretty good, then we couldn’t get stock for 14 months. But looking at what we’ve ordered in the past five months, with stock coming back to normality, we’ve doubled our bike sales in five months compared to when we couldn’t get stock during Covid. So this Christmas is pretty much double compared to last Christmas.
(Compared to 2019) the figures for us are always increasing. I’ve had the shop for seven and a half years and we’re still kicking goals, except for the downturn when we couldn’t get stock.

Mick Langdon at Ride South Coast in Ulladulla, NSW about three hours south of Sydney said:

It might feel like it’s slow but I think it’s pretty good. Last month we felt like we weren’t doing enough, then the numbers told a different story.

The sub-$1,500 market has blown out. In other words, I feel that everyone’s (already) got a bike.

I’m not overly stocking for Christmas but we seem to have a steady flow of bikes coming through.

We are still selling e-cruisers, like Electra Townies. We’re getting interest in duallies and mid to top hard tails. But the last Trek price rise two or three weeks ago has made things tough. Prices went up $100 on the base model. A Marlin 4 is $800. It’s a great bike. I get kids off 24-inch bikes onto them. But people’s spending habits have changed dramatically. They haven’t got the spare income to drop that for a new bike for their child.

But we’re seeing a massive divide in socio-economics. For example, I’ve got a $5,500 26-inch Mondraker dually e-MTB which is for a child for Christmas. There’s some people with money to burn. But other people come into the shop and the first thing that they say is ‘I’m poor’.

I’ve had people spend an extra $700 to buy a Trek because they didn’t know the Mondraker brand, even though the Mondraker was better spec’d. I’m just feeling the water with them to start with. I’ve got two downhill bikes in the shop at the moment: a Mondraker Summon and a Trek Session. There is $1,300 between them and they’re nearly the same spec.

We’re getting more interest in downhill bikes again now that Thredbo is coming open. We always bank on that. (We’re) still selling full-face helmets easily enough.

It has died off since Covid but overall I feel that business is more controllable. It’s letting us feel more refreshed and approach each customer new.

I just was putting two bikes on a car for a bloke who’d driven down from Wollongong (144km away). He said he wasn’t getting the same service up there. I was chuffed to hear that. He said everyone was trying to sell to him but we didn’t try to sell.

We were just explaining the bikes and telling him to stick to his budget. He just gave us $2,000. I’ve really been pushing that, ‘We don’t sell, we help you compare and get you on the right bike’.

It’s bringing people in.

How do current sales figures compare to pre-Covid?

I know what we did Christmas three years ago and last month (November) we were five grand below it. I was pretty happy with that. I’m feeling pretty optimistic. The pure cyclists are still out there wanting good stuff and good service and we’ve sieved out the knee jerk reaction sales. They’re the people who give you the most grief as well.

People who are into their riding understand the challenges at the moment. They’re willing to still accept when there’s components that we can’t get.

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