How’s Business? June 2021

Welcome to our monthly chat with a widely varied selection of bicycle shop owners and managers spread throughout Australia and New Zealand.

Both from these conversations and many other conversations and visits we’ve been making since our previous monthly newsletter, it appears that, for now at least, the bicycle stock shortage has been easing. But things are far from getting back to ‘normal’ and that consumer demand, whilst still strong, is starting to drop in certain categories such as family and juvenile bikes.

As always, we also asked a follow-up question. This month we asked, ‘How are sales of your winter products such as lights and winter apparel going compared to previous years?’

With the benefit of hindsight, we probably asked this question a month or so too early. It seems like most areas have had a later start to cooler weather.

If there’s a particular follow up question that you’d like us to ask in any future month, then please contact us directly or use the comments section below to let us know.

Dan Horton, of Crank It Cycles in the regional city of Palmerston North, New Zealand said:

It’s pretty steady for this time of year. Supply is a bit of an issue, I’m sure you’d probably already know that, but in summary you’d say it’s good.

We’re a Specialized dealer. Our market is mountain bikes but also diversifying into quite a broad range of ebikes over the past few years.

Winter product sales:

It’s going well. Maybe marginally better that than last year. The cold weather has arrived here. It’s nine degrees at the moment (speaking at 1pm). We’ve had a couple of cold blasts, then it’s warmed up, then gone cold again.

Craig Baker of Bicycle Centre Cannington in the south-eastern suburbs of Perth, WA said:

Like every other shop I guess, the past 12 to 14 months has been hectic in our industry. But we’ve definitely noticed, probably in the past three to four weeks that it has quietened down compared to last year.

Whether that’s to do with the (federal) budget… I tend to find when it’s budget time that people are a little bit more cautious with their money. But prior to that it has been ‘normal covid times’. Last April things went gangbusters and it’s been like that ever since until the start of May.

February was also a bit quieter for us. We had our first proper lock down over here then, so Feb was a little bit quieter, then March and April sparked up again and May has been quiet.

We don’t sell any one category here. I sell a lot of road bikes, I sell BMC. Kids bikes and BMX bikes have definitely slowed up this whole year. Things like your e-mountain bikes and your dual suspension mountain bikes are still selling really well.

Hard tail trail bikes, when we can get them, sell really well. Road bikes have slowed a little bit, but they’re still ticking over.

Over here we’ve just heard that Trek is buying TBE (The Bicycle Entrepreneur which is the largest IBD in Perth with five retail locations plus a central workshop / warehouse).

I think that’s such a dumb decision and I don’t mind you quoting me on that. Why would you want to take over such a perfectly well run business? I think that the other bike shops nearby will be rubbing their hands together with the opportunities. I’m not that close to any of the TBE stores so it won’t really affect me. We’ve already got a Trek concept store just down the road from us.

Winter product sales:

Lights sell pretty much all year around, so lights are still selling well. Clothing is a very difficult one. I don’t stock a lot of clothing because I’ve just found it too hard. I found that for the past 20-odd years. I stock knicks, but in terms of jerseys, jackets and stuff like that, unfortunately it’s in the ‘too hard basket’ for me.

Simon Coffin of Total Rush in the inner eastern suburbs of Melbourne, Vic said:

Business has been great. Like the rest of the bike industry, we’ve had a pretty solid past 12 months.

There’s definitely (more recently) been a bit of a downturn in the lower end bikes, which we at Total Rush weren’t traditionally known for, but of which we sold a lot during the covid period; $700 to $1,200 stuff, or whatever. That’s definitely died off a fair bit. But high end is still going quite well.

I think we’re the largest Levo e-mountain dealer for Specialized in Australia depending upon who buys where at any particular time, but we’re up there with one or two other stores.

E-mountain, no problem. Traditionally we were 60/40 road vs mountain but I’d say we were 50/50 at the moment, because road dropped off for a little while, but at the moment we’re selling a lot of new high end road bikes.

Probably 80% are upgrades and 20% are to new customers who haven’t had $15,000 to $20,000 road bike before. Most of them that we’re building are close to $20,000 – S-Works Tarmac stuff…

In the e-mountain bike, Turbo Levo’s of the new Gen 3’s, they’re coming in very slowly. We’ve still got a little bit, maybe half a dozen to eight of the older models, but they’ve slowed down. Everyone wants the new ones, which are trickling through. But the numbers that Australia is getting, I sat with Specialized yesterday, aren’t good for the next few months.

They’re concentrating on supplying Europe and the USA, seeing that they’re coming into their summer. So we’re going to miss out a little bit. We’ve got a million dollars’ worth of back orders (across all product categories) in at the moment, so stock is coming.

Winter product sales:

It’s only really just started. Lights have just started a bit, but you’d have to ask me in another month. We’re definitely starting to stock up for it.

We really only had our first cold weekend just gone. It was 27 degrees in Melbourne a few weeks ago still. The summer really held on for a little bit. It’s definitely cooled off now, so we’ll start to see an impact of that.

Steve Krajc of Bicycle Fix in the small Adelaide Hills town of Woodside, SA said:

It’s certainly slowed up a bit. Obviously this time last year we were well into the pandemic and things were going nuts.

We can’t complain. We’re still selling bikes, the workshop is pumping. Things are going well. We’re never going to match what we did last May. But we’re tracking along pretty well. I feel like maybe it feels like it’s slower than what it actually is, because it has been such a busy 12 months.

We work hard with our social media and make sure that we stay in people’s faces in a positive way, and that pays off for us.

In this location previously there were two businesses, one was called About Bikes and one was called Bikeabout. About Bikes was a retail store and Bikeabout was his tour business. We bought About Bikes and re-branded straight away. We stared Bicycle Fix in 2013 as a mobile business, but then we were stationary for a while because I was working in the wholesale side of the industry. Then this opportunity came up to introduce About Bikes.

We changed the name straight away and we introduced new brands like Trek, then Rocky Mountain, Santa Cruz and now Pivot.

We’re just about to launch a shuttle business for the local mountain bike trails. We’re close to Fox Creek, Kersbrook and Bennets. More trails will be open there soon.

We’re about two weeks away from launching the shuttle business which should be a nice addition to the shop. We’ve a 12 seater van so we can take 11 passengers and we’ve got a 14 bike trailer. We’re just negotiating with State Forestry on some licencing agreements and doing a photo shoot this Sunday ready for our launch.

Winter product sales:

Our apparel sales go reasonably well, but we focus more on the mountain bike side of the business, so we don’t really do a lot in your traditional winter gloves, arm warmers, leg warmers and that type of thing. We keep them here but don’t really sell a lot of it.

But winter jackets for mountain biking and apparel ticks along well. We’re a bit of a destination mountain bike store, especially with our proximity to Fox Creek (the most popular MTB park in the Adelaide Hills which is 12 km away).

Light sales, they always start to tick along this time of year, April, May when the days start to get shorter, for sure.

Darren Symons of ACT Bike Superstore, in the northern Canberra suburb of Mitchell, ACT said:

That’s a pretty broad question! The Canberra winter has hit so it is starting to quieten down a bit. We’ve had a pretty good year all in all. I think we could have probably done better if we could have got more bikes. But then, would we have?

It’s that whole economies of scale thing. If we had bikes and everyone else had bikes, would we have done any better? I don’t know.

The thing we rely on (pre covid) is that we don’t stock everything. If someone walks off the street, generally, we would be able to order in that bike. That was the cream on the cake for us. Whereas, now, we can’t (order as required from wholesalers). So we’re losing that customer that’s looking for something that previously we could say, ‘We can get it’. That’s hurting us a bit.

But things are pretty good. The workshop’s still ticking over nicely. I’ve made sure that I’ve kept on top of my parts and accessories stocks.

Winter product sales:

It’s probably picked up. I suppose those people who bought bikes during the pandemic are now realising they need stuff for the winter. We’re pretty strong in that. We sell some good lights. We do stock winter clothes, long knicks, base layers and things. It’s pretty good.

Chris Aitken of Two Wheel Industries on the main city street of Newcastle NSW said:

It’s going well for us up in Newcastle. Still pretty busy. Obviously we don’t get affected as much by winter. That’s handy for us, being further north than Melbourne and places like that.

We’re starting to catch up on repairs. We’re still booking in for about two weeks in advance, or a bit over, rather than the five weeks that it was during the pandemic.

Things are going well for us. We don’t have any empty spots for bikes on the floor at the moment. We’re pulling from a fair few brands currently, keeping on top of things, which is good.

We’re seeing a big uptick in the ebike market, which I think everyone is. But definitely gravel for us, in the last probably 12 to 18 months, has gone nuts for us. I think people are… not nervous on the road, but they’re not as keen to ride on the road around here. We don’t have awesome cycleways around Newcastle. We have some, but there’s also a lot of good mountain ranges not too far out of town that people can go exploring on gravel styles of bikes.

They can use them for commuting during the week and adventuring during the weekend. A lot of roadies are getting them as a second bike. They’re getting that alternative bike but they don’t want to go full mountain biking.

We traditionally were a road store, but we’ve gone more into the mountain biking and off road stuff as well. A lot of us ride mountain bikes, so it only makes sense to sell them.

With Glenrock, Awaba and a new mountain bike park at Dungog within an hour’s drive, mountain bikes have also started to go pretty fast for us as well.

Five years ago we were predominantly road. Now we’ve got four main categories. Mountain Bike, Road, Gravel and Ebikes.

Winter product sales:

It has been pretty warm for us until the past week. When we had those wet weeks a month or so ago, we noticed a massive upturn in anything waterproof.

But just in the last week we’ve stocked the shelves with all our winter products. That’s ticking though nicely as per normal, but we don’t sell heaps. We don’t have super cold winters. It might only get down to 5 or 10 degrees in the morning and by mid-day it might be 23.

Lights – we punch through a fair few of those to the commuters, as soon as it goes from daylight savings, everyone’s in getting their lights again.

Join the Conversation: What follow up question would you like us to ask the dealers in next month’s How’s Business?

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