What was already one of Australia’s largest bike shops has just expanded by a further 50% in floor area.
South Australian Premier Steven Marshall was one of a large crowd on hand to celebrate the newly expanded and upgraded Bicycle Express store on Halifax Street in the city centre of Adelaide during an event that was combined with a Tour Down Under function.
Bicycle Express is owned by the Tregoweth family, with Ben running the city store and Sam running their second location at the nearby suburb of Norwood. Meanwhile, we spoke to their father, Peter, who although he jokingly claims not to be allowed in the stores too often by his sons, uses his accounting and business background to play a key role behind the scenes.
“Bicycle Express has been here since 1992 or 1993,” Peter recalled. “We’ve owned the business since April 2009.”
“The previous tenants (a paint shop located in what is now the new expanded section of Bicycle Express) closed in September 2019. We were away in Italy for all of October, but my son got it deconstructed. We had plans drawn up and we were in a week or two before Christmas.
The expansion required a major financial commitment which in turn will require a significant increase in sales from what is already the biggest bicycle shop in Adelaide. So we asked how Peter could be confident that there was more upside to be had.
Hi replied, “It’s always been my belief that when you display your stock properly and you have the requisite range of stock, then you stand the best chance of selling it, so fingers crossed! I’m too old to think of new tricks.”
The new area has been fitted out in the exact same style as the existing shop, so that if you didn’t know to look for the evidence of a former dividing wall in the polished concrete floor, a new visitor would think that the store was always its new size.
One brand new feature is a café that faces both into the shop, via hinged shutters and out to a small laneway, via a large roller door.
“South Australia generally follows the eastern states and in Melbourne there are a lot of these small laneways with coffee shops,” Peter explained. “The new section we purchased lends itself to that laneway. It already had the roller door. The business model is that I own the coffee shop, we built it, and the fellow running it pays me rent.
“I don’t want to think about coffee. I like drinking it, but I don’t want to run a café.
“I hope it works. It’s busy now. Hopefully it stays busy.
“With the roller door, he can come in when he likes. The shutters (between the coffee shop section and the bike shop) come down and lock. But we’ve alarmed it so that if anyone climbs over the top the alarms will go off.
“So he can open whenever he wants, but from half past eight when everyone drifts in he can throw the shutters up and serve coffee inside.
“Our plan behind it is that coffee and cycling seem to go together. Our Saturday and Wednesday shop rides have coffee and cake there at the end of the ride.
“It’s also to keep people in store when they’re here. If one person is looking at a bike, their partner can sit and have a coffee and moan about the cost of things!
“It’s worth a shot,” Peter continued with no pun intended. “I’ve spoken to a lot of bike shops that have run coffee shops themselves and they say they couldn’t make money out of it. So we’re trying the business model (of renting it out) and we’ll see how it goes. If it doesn’t work, I’ve wasted a few bucks building it, but, we’ll see.”
With its extension, Bicycle Express is now a relatively long rectangle, with street or laneway frontage on three sides.
“The new area has increased our size by about 50%,” Peter estimated. “Each unit is about 450 to 500 square metres, so we’ve gone from just under 1,000 square metres to about 1,400 or 1,500 square metres.
“We haven’t put any more stock in… well, we’ve put a little bit more in, but not much. “We’ve just spread it out more and made it easier to see and displayed it better.”
Given that they had only been trading in the expanded space for just over one month at the time of this interview, it was too early to gauge results.
“So far so good,” Peter said. “We had a good December, but the new section was only finished in the last week to 10 days. But January has been good so far. Let’s hope it continues.”
Bicycle Express is the opposite of a concept store, instead choosing to stock a wide range of bike brands including BMC, Cannondale, Cervélo, GT, Gazelle, Kalkhoff, Lightweight, Look, Merida, Norco, Pinarello, Santa Cruz, Tern, Trek and Wilier. That’s at least 15 brands but sometimes additional approaches are make by bicycle wholesalers.
“I don’t think we’ll be doing any more brands,” Peter predicted. “It’s flattering to be asked, but there’s a limit. Staff have got to get their heads around all the brands.
“We sell a lot of high end bikes. The numbers that I’ve seen about the size of the IBD market in South Australia is somewhere in the $40 to $50 million dollar range. I think we account for roughly 25% of that in dollar value, give or take.”
One of the reasons that one business can take such a market share with just two locations from a total of over 50 is that Bicycle Express generates significant sales beyond the state’s borders.
“We had a customer coming down from Hong Kong on Sunday to buy a couple of Cervélo’s,” Peter continued. “The attraction is that the Australian dollar makes the bikes cheaper for them and they get their GST back when they leave the airport. That was a $30,000 sale.
“I think our reputation is reasonably good. Ben has been flown to the Gold Coast to deliver a $30,000+ bike and fit the guy up.
“We’ve sold bikes to Bangkok and Singapore. People are flying in to pick up these bikes. “We’re not posting them and not breaking our dealer agreements at all.”
Peter is always quick to mention his staff as a key reason for the success of Bicycle Epress.
“We’ve got a fantastic staff,” he said, “not just our sales team but our workshop staff and our back office staff.
“We try to do all the little things right like answering the phone within three rings, being nice to people… basic stuff.
“We talk about it a lot amongst ourselves. We try to exceed expectations. We don’t always succeed, but if we make a mistake, we’ll fix it. We try to be honest. We don’t try to rip anyone off because Adelaide’s a small town and you get found out.
“We have between 30 and 35 staff across this store and Norwood. It’s seasonal. In winter some of them go to Whistler and ride downhill and things like that.
“But when the whips are cracking at this time of year, we have about 35 all up between both shops.
“Sam has got Norwood up and running very well for a small shop when small shops have been closing across Adelaide. We’ve seen long established bike shops close in 2019… Bernie Jones Cycles had been there for a long time. It’s sad for the people who own it and for the industry.
“You might say, ‘It’s good for you mate, you’ll get some more business’, but I’m sorry for them. I don’t need to gloat over the misfortunes of others.
“Tomorrow (Thursday 23rd January) will be our biggest day of the year. We’ll do upwards of 400 transactions because it’s the BUPA ride on Friday. (Peter was referring to the annual mass participation ride of the Tour Down Under, for many years sponsored by Bupa but now officially known as the ‘Westpac Challenge Tour Presented by The Advertiser’.)
“The workshop is under the pump something chronic! They’ve all been working overtime. You can see it. Everyone’s normally full of beans in the morning but now everyone’s starting to get tired.
“I turned 70 yesterday and I’m loving every minute of it. Long may it continue… not that they let me come to work that often. I just wish I’d done it 10 or 15 years earlier.”