Retail direct bike companies

[Tim29]

This is not a rant or rave. It’s a question for all.
How do you all feel about this new trend of bike companies selling bikes retail direct to consumer and giving no support to local bikes shops.
Basically there selling complete bikes retail to customers at dealer pricing.
This leaves no margins for bike shops, it’s also devaluing used bikes, reducing local bike shops profits and abilities to sponsor local racers,
Please don’t disect my ever word but rather think of the concepts and respond on how you feel it affects the bicycle industry as a whole.
I have seen several reviews on these bikes and they all have one thing in common.
They state look at the component specs for the money.
Well these companies are buying at manufacturer cost and selling there bikes complete at distributor or volume stocking dealer cost on the components.
I have really mixed feeling about how this can affect the industry.
I have watched this trend happen in other sports and it destroyed the racing side of the sport as there no longer any margins for shops to fund or support racers and racing events.
The path in other sports i have witnessed unfolded like this.
The companies that started the direct sales gained large market share, others followed to survive, after couple years others jumped on or closed there doors. Within 6yrs the companies who started it reduced in size as the others followed the marketing strategy, pretty soon all sales tanked and people where able to purchase all the components at same price as local dealers and the money to support all the events vaporized and the sports died in popularity as every rider was now a pay to play and all the top riders retired or moved into different sports where they could advance to a paying rider level.
How can a sport draw best riders from all over the world if there no prize money, no salaries for riders and no chance to win anything but a trophie.

 

[Dax]

Ambivalent. There are 10 really terrible LBS' for every good one. I think ebikes will help the situation for LBS because people worry a lot more about warranty on ebikes.

 

[ccrdave]

This sort of happened in the scuba diving world, massive increase in online sales of diving equipment put a lot of dive shops out of business, problem is you can't get your diving cylinder filled online. End result scuba diving in this country at least is in decline

 

[Slowroller]

I don't care about racing and wouldn't care if it became an amateur sport. It'll never die, because there are always people that want to race other people. I can sympathize with the pressures on the local LBS, but it's business. Ebikes will require more LBS support than a bike will, that's good for them though.

 

[Tim29]

But spectators

I don't care about racing and wouldn't care if it became an amateur sport. It'll never die, because there are always people that want to race other people. I can sympathize with the pressures on the local LBS, but it's business. Ebikes will require more LBS support than a bike will, that's good for them though.

But spectators don’t come to watch two average Blake’s grudge match, every sport relies on outside influence to drive it forward.
If you take all the profit out then you destroy the driving force behind it.
Then with no profits development slows down.
Look at motocross, on a local level you can be 100% competitive on a 8-10yr old motorcycle.
Go back 5yrs and try and race one of those ebikes!!
Or even try to be competitive on a 10yr old MTB. You have to be a pro riding in expert class to even have a shot at a podium.
I like how bikes are evolving and changing. Amazing new technology.
But when every manufacturer is selling retail direct that development money is going to cut down to less then half there current budget.
And what’s that gonna do to sport.
If your 5yr old bike is as good or better then a new one, why upgrade??

 

[OldBean]

I support my LBS even though they are significantly more expensive for many parts BUT I cannot get my tubeless conversion done over the internet or advice about various MTB related questions also good to meet up with like minded souls over a coffee .
I faced the "Internet" problem when I was in business and found CUSTOMER SERVICE was the main way of staving off the IT invasion. Give the customer 110% of their expectations and they will come back, hopefully .
I bought my bike from a Bike shop chain ( face to face) but the customer service has proved to be marginal and regret buying through them ..certainly will not buy my next bike there.
Problem is if you want a somewhat obscure make they are not stocked by the retailers so then what?
Have fun

 

[Fivetones]

You might have read my comments in another thread but in case not I think it’s personally important to support your local independent LBS. They are more often than not involved in the local cycling community (and wider community, for that matter).

I’m tending to think that way of supporting Hope, Renthal and Orange for similar reasons too.

 

[mark.ai]

As with retail in most sectors, more and more is switching to online sales. I just searched for "electric bicycle" on Amazon wondering what I would see - and I shouldn't have been surprised really!

For physical (local) shops to keep existing, they really need to provide a service to encourage people to spend their time to go there and spend money. For bike shops the obvious service they provide is to repair and service bikes, fit new parts etc. So I think to succeed for the future they will really need to excel in this area. I've no idea though what percentage of an average bike shops profit comes from selling bikes compared to other services (or selling components).

I don't see why sports should rely so much on local shops to support racers and racing events. I can see why shops do this now - they like to support something they are passionate about, plus they get some advertising. But surely support for racing can come from other areas as well, like the online retailers instead if that is where the money is going now (e.g. Wiggle the online shop sponsor lots of things).

 

[Fivetones]

I’ve stopped shopping at Amazon too. I choose not to as one day they will be the monopoly. They are also trading on personal data and I choose to duck out of that.

This is a general point but applies to a LBS - what is a high street? In that sense I agree that the LBS has to survive on providing service above all else. That, in my opinion, works best alongside community and talking to other folk.

 

[MattyB]

This is not a rant or rave. It’s a question for all.

Seems awfully like one to me...

Direct sales is now part of modern day life, and the model isn't going away. Fighting it and telling people to "support their LBS" is pointless when the same spare part or helmet they want is 50-75% more expensive there and probably not in stock. This is not just a cycling phenomenon either - it is right across all aspects of retail. Will it put some bike shops to the sword? Absolutely - the ones that can't or won't adapt will die. Is that a bad thing? Not necessarily in my book...

6 months ago I went into a (UK) LBS that stocked Giant and asked about the new Trance E's. His response - "You don't need one of those - you're too young and anyway it's pretty flat around here. Just get an enduro bike!". Gobsmacked I left the shop - he genuinely wasn't interested in selling me a £4k ebike. Contrast that with another LBS near me that is diversifying into a more service based model including bike fitting on behalf of online brands, ebike sales, home mechanic courses, servicing packages, coffee bar etc. I know which I will be supporting in future.

And that's the problem with threads like this; they often paint all local shops (in this case LBS') as wonderful, and all large direct sales companies are evil. It's far more nuanced than that - there are bad and good examples of both, and it's the good ones in each area that will survive and thrive in the long term.

 

[ggx]

I like online bike shops.
Never bought a bike in one (bought other itens as they have good stock available).
Allways found good solution´s (price, service, etc) in LBS´s.

 

[Rob Rides EMTB]

diversifying into a more service based model including bike fitting on behalf of online brands, ebike sales, home mechanic courses, servicing packages, coffee bar etc. I know which I will be supporting in future.

This 100%. Retail need to offer something unique and service is where it’s at. Look at the amount that go to Berkshire Cycles for the service (and good pricing).

Retail need to have a point of differentiation. In the consumer price led world we live in, good will to support a local dealer will only go so far. If you can save 30% by buying online (with good availability and next day delivery) then you’ve got to be seriously dedicated to your LBS to give them the business.

 

[MattyB]

I’ve stopped shopping at Amazon too. I choose not to as one day they will be the monopoly. They are also trading on personal data and I choose to duck out of that.

Don't kid yourself - if you hold any accounts online of any type your personal data is being traded in one form or another. It's not limited to the big corporates...

 

[R120]

I think with EMTB's its a difficult one, certainly in Europe, because many of the best Bikes are consumer direct, so aside from the cost conversation, if you are based in the UK, and want a Shimano bike, the best 3 options are probably either a Commencal, Vitus, or Canyon, purely based on looking at the best bikes out there with that motor, but all of them are direct sales, and you cant buy them in a shop. The new Norco is getting great reviews, but this hasn't hit the shops yet.

The Vitus for example has won many of the enduro emtb group tests in magazines, and has great reviews across the board, but is only available consumer direct.

With the industry in general, I think it needs to adapt from the shop point of view. I know lots of shops that have switched to focusing on servicing and selling parts, and the only bikes they really sell in the shop are standard commuter or kids bikes, with the odd high end model.

The world is changing, and the question is how do you deal with the new reality, and not the old. Consumer direct is the norm now in so many areas of our lives, with the need to go in a physical shop diminishing, to the extent that in 20 years time you will be dealing with a generation of adults for whom buying online is the norm, and going into a store is a rarity.

The bicycle shop is in a lucky position in that all these bikes need servicing and maintaining, and if anything there are now more bikes out there, and more people requiring the service of a local bike shop to do so - focusing on this, and making that the mainstay of your business is the way to survive, and getting involved in the local scene with rideouts etc. If I look at the good local lbs's they are active in being part of the local scene.

A lot fo the local shops also offer a fitting and assembly'PDI service on consumer direct bikes, which I know they do well out of. One of my local shops was telling me that they on average provide this service to about 3 customers a week looking at high end Canyon road bikes.

 

[Tim29]

I wasn’t referring to small items, or even large bike parts, more so the sale of a complete bike at wholesale price retail direct.

One thing i have noticed. I have been loyal to several shops, moto shop for my dirt bikes and LBS.
THE moto shop i been with 19yrs now they sell me parts at cost plus 10%.
Mountain bike shop gives me 10-25% on most items. But they have some items that there being sold online cheaper then they can purchase

The comment i walked into bike shop guy said you don’t need one of those.
Question, was he a pissant employee or shop owner??
I didn’t paint a picture that all LBS where cherries.
Automobiles have stayed true to dealer network and thrived or failed according to there designs.
Motorcycles your starting to see it with cheap copies. They been copying the entry level bikes and because of that big 7 have stopped investing in those markets and focus on markets there not.

 

[Slowroller]

But spectators
But spectators don’t come to watch two average Blake’s grudge match, every sport relies on outside influence to drive it forward.
If you take all the profit out then you destroy the driving force behind it.
Then with no profits development slows down.
Look at motocross, on a local level you can be 100% competitive on a 8-10yr old motorcycle.
Go back 5yrs and try and race one of those ebikes!!
Or even try to be competitive on a 10yr old MTB. You have to be a pro riding in expert class to even have a shot at a podium.
I like how bikes are evolving and changing. Amazing new technology.
But when every manufacturer is selling retail direct that development money is going to cut down to less then half there current budget.
And what’s that gonna do to sport.
If your 5yr old bike is as good or better then a new one, why upgrade??

There are two levels of racing. Local/regional, where your LBS might have a team and sell at cost to the people on that team, and national/international, where the LBS has no impact. I know more teams that are "sponsored" by breweries than bike shops. At the local level, there are no spectators outside of other racers and family. Even at national level XC races here in the states, no one watches. I was stunned by how few people show up to watch a "big" XC race. I've gone to a few EWS races, which are the pinnacle of mtb races really, and they have spectators, less than a minor league baseball/soccer game, but yeah, a few people like me go to watch.

You do realize that direct sale bike companies like YT and Canyon are already heavily invested in racing right? If the LBS goes away, racing will still happen. It already does. I'm totally in agreement that racing drives development, it's not the only route forward though.

I'm hopeful that LBS can stay in business, they'll have to evolve though. Focus on service, have fewer bikes out on the floor and order them in. Or cooperative sales like some of the Direct companies are offering.

 

[galaga187]

I’m not sure that LBS and direct to market are mutually exclusive but I do feel LBS need to adapt. I’d gladly have paid my LBS to support me on setup skills e.g going tubeless or suspension setup or advising on upgrades at time of next service. I’ve had some good chats with the guys at Berkshire cycles and sent people their way I’ve also steered people away from canyon by highlighting delivery issues. my brakes are bad and now need a bleed kit local shop £70 to supply cobble together a kit that should work VS Amazon next day £25 and step by step YouTube videos to fit, it wasn’t hard to decide.

 

[Fivetones]

Don't kid yourself - if you hold any accounts online of any type your personal data is being traded in one form or another. It's not limited to the big corporates...

I’m realistic about this as everyone has a data shadow - I’m fully aware of the technical aspect here.

There’s things you can do to minimise this exploitation of your data though. And regulation is only just around the corner.

—-
The nice thing in this thread is that a consensus is emerging. One where we all agree on what we want from modern face to face retail. I find that encouraging.

 

[R120]

I love my LBS, and quite often just pop into it for a chat with the guys in there, and usually end up buying something at the same time - They know its unlikely I will buy a bike from them, but I have bought a lot of parts off them, and all my kids bikes, wife's bike etc, and they do a full sit-down and service of my bikes once a year.

They have been established locally for over 80 years, and the key to their longevity is that they are ensconced in the community, and a great bunch of guys, with great service.

 

[Tim29]

wow Some great insight.
One thing i May add. Most the local bike shops that are good, meaning have put in the time to learn how to setup bikes come from having a demo model and learning the bike and it’s secrets.
Another interesting point.
It was cheaper for me to buy a consumer direct bike, gut it throw frame in garbage and build my personal bike, then to source the pieces to build it at dealer cost.

Regarding xc racing. I went to a couple as my cousin is a hard core xc racer. So wanted to see what it was about, i can honesty say watching an xc mountain bike is about as exciting as watching paint dry.
But how many people lined the Mesa at Rampage?? 50k ish.
Look at what xc racer makes in income annually compared to a free rider.
There was at least 10k people at EWS enduro race at North Star.
Mammoth kami the whole DH run was lined with spectators.

When i commented that LBS sponsor riders i don’t mean on a national or World Cup stage. I was referring to entry level support, getting young new talent into the sport and coddling then and there families on getting them up and going

 

[MattyB]

...The comment i walked into bike shop guy said you don’t need one of those.
Question, was he a pissant employee or shop owner??

Pissant? Not sure what that means, but I do know this guy was the owner. In todays economy with Brexit-maggedon possibly days away I wouldn’t have thought being an LBS owning ebike hater was possible, but there you go.

 

[WheelsandBoards]

Seems awfully like one to me...

Direct sales is now part of modern day life, and the model isn't going away. Fighting it and telling people to "support their LBS" is pointless when the same spare part or helmet they want is 50-75% more expensive there and probably not in stock. This is not just a cycling phenomenon either - it is right across all aspects of retail. Will it put some bike shops to the sword? Absolutely - the ones that can't or won't adapt will die. Is that a bad thing? Not necessarily in my book...

6 months ago I went into a (UK) LBS that stocked Giant and asked about the new Trance E's. His response - "You don't need one of those - you're too young and anyway it's pretty flat around here. Just get an enduro bike!". Gobsmacked I left the shop - he genuinely wasn't interested in selling me a £4k ebike. Contrast that with another LBS near me that is diversifying into a more service based model including bike fitting on behalf of online brands, ebike sales, home mechanic courses, servicing packages, coffee bar etc. I know which I will be supporting in future.

And that's the problem with threads like this; they often paint all local shops (in this case LBS') as wonderful, and all large direct sales companies are evil. It's far more nuanced than that - there are bad and good examples of both, and it's the good ones in each area that will survive and thrive in the long term.

Agree entirely....my company sell to supermarkets......the world is changing, technology is having an enormous impact on the retail landscape. Holding back the tide or reminiscing about the good old days is pointless. Hoping to prevent this evolution is pointless. Bricks and mortar retail need to evolve and remain relevant by offering what people want rather than what they want to sell....service, support, a place to hangout, specialism, these are some of the things cyclists will need and want....and be willing to pay for.....paying thousands more for the basic bike in some romantic gesture of altruism is simply not going to happen in the future.....
Goes against Human Nature.

Bad enough being slated for having an ebike....if you bought one from tinternet that must truly mean you're going to hell. !!!!!!

 

[Fivetones]

Perhaps but try and get something like a Levo 2019 for less than a shop by going online. And you get to demo it too.

When all you can shop in is amazon and they tailor your price up by knowing your whole life (hello Alexa).... Technology will indeed well and rule change everything, but will you like it?

 

[dirt huffer]

I think it's important for LBS to build a culture around their store. Some of the most successful shops in my area sell coffee and pastries. Riders stop in all the time to snack up and talk to other cyclists. You don't have to just sell and service bikes. You can do other things as well... Heck one store has a bike junk yard where there are 100s of bikes you can pull parts off of

 

[steve_sordy]

...............You can do other things as well... Heck one store has a bike junk yard where there are 100s of bikes you can pull parts off of

Great idea! Love it!

 

[MattyB]

...When all you can shop in is amazon and they tailor your price up by knowing your whole life (hello Alexa).... Technology will indeed well and rule change everything, but will you like it?

Complete nonsense. For specialist products with a lot of variables like the bikes we ride there will always be specialists who sell and support them. Yes there may be less LBS’ in future, but those that survive and thrive will have that specialist knowledge and customer service that no Amazon, eBay or Banggood can ever deliver.

 

[steve_sordy]

I suspect that eBikes will "save" bike shops. I was in Rutland Cycling, Whitwell in late Jan and got talking to one of the sales guys. He told me that if it hadn't been for eBikes, the shop would not be there. He told me that they sold £5m of eBikes in the last 4 months of the year. They have also produced a maintenance package for the bikes (all bikes) they sell that is cheaper if you bought the bike from them than if you hadn't. So in addition to bike sales, they get a second bite at the servicing. Then a third bite when the customer buys something else while they are delivering and/or collecting their bike for servicing.
And it's a friendly and helpful place to shop, with a huge range of stuff and they do on-line sales as well. They rent bikes too, and they have a deal where you hire a bike and if you buy it they knock off the hire fee.

PS: I do not own shares in the place.

 

[Fivetones]

Complete nonsense. For specialist products with a lot of variables like the bikes we ride there will always be specialists who sell and support them. Yes there may be less LBS’ in future, but those that survive and thrive will have that specialist knowledge and customer service that no Amazon, eBay or Banggood can ever deliver.

I think a modicum of respect might be nice.

Matty, I’m stating what kind of retail environment we have right now in that scenario - that is actually not some future scenario. We have non-local chains like Evans go under. City centres are shadows of their former selves.

All I’m saying is, if one wanted a LBS to survive in the current retail environment then putting business it’s way is something I see as important.

 

[MattyB]

I think a modicum of respect might be nice.

Matty, I’m stating what kind of retail environment we have right now in that scenario - that is actually not some future scenario. We have non-local chains like Evans go under. City centres are shadows of their former selves.

All I’m saying is, if one wanted a LBS to survive in the current retail environment then putting business it’s way is something I see as important.

My response was based on your statement that "When all you can shop in is amazon and they tailor your price up by knowing your whole life (hello Alexa)....". I stand by what I previously posted - there is absolutely no way that will ever happen, in cycling or other retail areas. I agree that the number of local independents will continue to diminish for some time yet, but that does not mean wewill end up with zero - how are Amazon gong to service those bikes for a start? Besides, in every western economy I am aware of there are checks and balances in law to prevent any single player becoming overly dominant in a marketplace.

 

[Fivetones]

I think this is possibly off the topic now but it’s also ok we don’t agree. These things are very hot topics for government and economists. What level of regulation is needed? Who owns the data? What constitutes a monopoly?

I’m at a lucky point where I’m happy to support local (bike companies, component companies and my LBS/local economy). I appreciate others might not agree or be in that position.