Signa Sports with Liquidity issues .... (CRC/Wiggle/Bikester/Probike/Nukeproof/Vitus)

[Bummers]

He's basically saying that lots of manufacturers and sellers are over stocked and trying to dump stuff at lower prices. With some of the on-line retailers then having to lower prices to compete with the bigger on-line retailers who are selling low to move stock to get some cash back - Making it harder still for bricks and mortar stores being asked if they can price match.

The main market for them is very slow and they're struggling to sell bikes, except the very high end models where people who are financially unaffected are still buying the top spec bikes like S-Works - He didn't mention the word "Dentist".

I'm baffled by how wiggle/CRC are in trouble. I thought that they were a big online only retailer with minimal costs as they don't have bricks and mortar stores to manage.

 

[Zimmerframe]

I'm baffled by how wiggle/CRC are in trouble. I thought that they were a big online only retailer with minimal costs as they don't have bricks and mortar stores to manage.

It doesn't seem logical.

I think most shops get stock without paying, then pay when they sell things (not always).

I guess the big online sellers obviously buy quantities which are orders of magnitude more and probably get better prices, but presumably due to that maybe they have to pay more upfront. They need huge stocks, which means a big investment, plus large warehousing (I think CR moved recently ish?).

But then you don't know what else goes on behind the scenes. Maybe René Benko insisted his favourite nephew did the CR website at some enormous markup and rather cluelessly and before you know it they're in the poop ..

I guess they just got their predictions wrong, still not quite sure how that translated into the losses they were talking about unless there was some clever and underhand accounting going on behind the scenes and René doesn't exactly have the cleanest history.

 

[RustyMTB]

Wiggle lost £97m in 2022. It's an eye watering amount of money. Their accounts commentary said a few things. A one off cost of £36m folding CRC/Wiggle into SSU. Sales down 30%, partly from the long tail of Covid which they said pulled sales forward I.e. people bought stuff during the lockdowns which translated into lower sales post pandemic and Brexit walloping export sales a full 26%.

It's all very shaky out there right now & a £5k boutiquey bike is a very easy thing to boot into the long grass if your mortgage is about to go up £500 a month..

 

[Amber Valley Guy]

He's basically saying that lots of manufacturers and sellers are over stocked and trying to dump stuff at lower prices. With some of the on-line retailers then having to lower prices to compete with the bigger on-line retailers who are selling low to move stock to get some cash back - Making it harder still for bricks and mortar stores being asked if they can price match.

The main market for them is very slow and they're struggling to sell bikes, except the very high end models where people who are financially unaffected are still buying the top spec bikes like S-Works - He didn't mention the word "Dentist".

Thanks for posting the link ( I couldn't figure out how to post the link as I watch YouTube on my TV), and yes you've described the predicament of the bike industry as described in the video to a tee.

 

[Zimmerframe]

It's all very shaky out there right now & wanting a £5k boutiquey bike is a very easy thing to boot into the long grass if your mortgage is about to go up £500 a month..

FIFY (as doom's likes to say) ..

 

[Shjay]

I visited Wiggle about 10yrs ago with my boss at the time getting them interested in ION clothing. They had 22 work stations/ bike stands building bikes continuously for customers. They had 4 warehouses in U.K., They also had sites across Europe as 3 days later I have ION on the phone saying why are Wiggle discounting our clothes straight away? Then I am having to bollox wiggle for selling at discounted rate

 

[RustyMTB]

I visited Wiggle about 10yrs ago with my boss at the time getting them interested in ION clothing. They had 22 work stations/ bike stands building bikes continuously for customers. They had 4 warehouses in U.K., They also had sites across Europe as 3 days later I have ION on the phone saying why are Wiggle discounting our clothes straight away? Then I am having to bollox wiggle for selling at discounted rate

Sup with the devil, you best have a long spoon! I have customers who deal with Tesco., Sainsbury, Amazon etc. Hear similar tales all the time. Once you're involved, it dawns that you really have little control over things yet they're suddenly your biggest customer.

 

[GeordieKenevo]

Not looking good... Wiggle Chain Reaction Cycles pauses invoice payments and cancels orders as insolvency looms

Wiggle Chain Reaction Cycles pauses invoice payments and cancels orders as insolvency looms

Online retailer has seen its parent company hit with funding cuts earlier in the week

www.cyclingweekly.com

Multiple sources have told the CW and CN that the retail giant isn’t taking on more stock as it scrambles to formulate a plan to deal with the financial situation.

One source told CyclingNews: "We have had open purchase orders cancelled and I was told on a call that they are not paying any more supplier invoices, and not receiving any more goods in until further notice."

Another source told Cycling Weekly that the firm had said it was “hitting the pause button” and that’s why there was not going to be payment of invoices.

 

[jamesm1980]

This is the bullwhip effect that Michael Burry talked about post covid. Lots of businesses are in the same position who saw a bump in sales during covid. Demand was high and production was slow. Orders where placed and stock piles where used up. Manufacturing was increased to match the inflated demand. This is the issue, the demand post covid dropped off a cliff due to increased costs and general demand, as people dont buy a new bike every year. Only way out is to drop the price, but still no demand. Means no cash flow = problems. There are lots of businesses in this position at the moment, and the outlook of the economy in general doesnt look good. The amount of companies laying off staff is a big indicator.

2022 article : Michael Burry Sounds Fed Warning. What Is the Bullwhip Effect?

 

[steve_sordy]

Many years ago I worked in Logistics. To help explain stuff to non-logisticians we had a supply chain game. There were people playing the role of raw material suppliers, manufacturers, retailers and customers. The customer placed an order, the retailer satisfied it, their stock went down and they had to replenish stock by ordering from the manufacturer and so on down the line to the raw material supplier(s). They were set up with existing orders and stock to get them going but were free to decide to change their stock levels and how much to produce.

None of them could see what the others were doing.

Unknown to them all, the demand was absolutely flat at 4 units per week. Except in week 3, demand went up by 1 unit in week 4 and then back to 4 units in week 5, and stayed there!

In the post mortem afterwards, the players could not believe the chaos that resulted from that simple change. Bullwhips were mentioned. The solution was for the players to talk to each other and provide advance information.

In my own experience, there was a real-life version of this when the buyer at one of the big four supermarkets took a week of holiday and doubled his orders the day before he went. He didn't tell us that this double order was to cover two weeks. This caused considerable upset (not quite chaos) until someone at our end contacted the supermarket and talked to them. After some time, we found someone sensible and chaos was averted.

 

[Arminius]

Fahrrad.de in Germany filed insolvence today.

 

[Rob Rides EMTB]

Possibly Bikester and Campz too:


Stuttgart Internetstores GmbH, which includes the brands Fahrrad.de, Bikester and Campz, filed for insolvency at the Stuttgart District Court on Monday afternoon. The Munich lawyer Christian Gerloff was appointed as the provisional insolvency administrator. This secures and receives the assets of Internet stores and checks in a first step whether Internet stores can pay the costs of the procedure.

Source: Auch Fahrrad.de betroffen: Stuttgarter Internetstores GmbH meldet Insolvenz an

 

[Rob Rides EMTB]

Names within internet stores that filed today:

Addnature
Bikester
Brügelmann
CAMPZ
Fixie Inc.
fahrrad.de
Ortler
Probikeshop
Red Cycling Products
Serious Cycles
Vermont Bikes
Votec

 

[JP-NZ]

Gee whizz this is all sad news. Ive purchased from both CRC and Wiggle over the years. Lately though wiggle's shipping has been extortionate to New Zealand so didn't use them as much.

Sad to see a giant of the parts industry gone

 

[RustyMTB]

Starting to think the plan is to ditch all the satellite operations in Europe & save Wiggle/CRC. I'm aware this could age like a prawn on a radiator.

 

[Dax]

Bet they are regretting closing the NI warehouse and combining everything with wiggle after The Glorious People’s Brexit.

 

[Shjay]

Ordered a rim from Wiggle 12.50pm yesterday arrived 9.15am today paid no extra for postage or anything plus haribo starmix inside which my son stole

 

[Dax]

Ordered a rim from Wiggle 12.50pm yesterday arrived 9.15am today paid no extra for postage or anything plus haribo starmix inside which my son stole

Brave

 

[RustyMTB]

My return has been refunded

 

[Zimmerframe]

Brave

Yup, you don't want Rim sting.

 

[Shjay]

Brave

Well as I have rim not really

 

[TheSnowShark]

Is there a one-wheel embt ?

 

[InRustWeTrust]

Dont order from bikester right now .

many people on a swedish cycling forum have ordered stuff from bikester and paid but no package is sent.

you will receive an email instead with the message We apologize for not being able to respond or help you yet as we are currently working on starting an insolvency process.

 

[IcePaws]

I (and seemingly many others) have had their e-bike orders cancelled by CRC / Wiggle in the past few hours, even after the bikes have been dispatched by the courier.

I would NOT place any orders with CRC / Wiggle right now, due to their ongoing financial difficulties.

 

[Ou812]

When is the “everything must go” sale happening?! I need some new winter riding gear, I’m down to one serviceable pair of trousers now after finally ripping the leg out of my onesie.

 

[RustyMTB]

Isla bikes throwing in the towel too. I once tried to buy an Isla bike for my daughter. They wouldn't entertain me until I supplied inside leg, weight, height, arm length, a character reference from the Vicar... I just went to Halfords instead.

 

[Zimmerframe]

They wouldn't entertain me until I supplied inside leg, weight, height, arm length, a character reference from the Vicar

Did the Vicar not have all of that to hand ?

 

[Dax]

Well as I have rim not really

Pretty brave to submit an order to a company that’s liable to cease trading any day. Ok with a credit card or paypal, but hassle

 

[Mikerb]

Signa's problems may just be part of the broader economic picture in Germany that has been in recession for 3 quarters It shows no signs of that situation changing. Germany is heavilly dependant on the manufacturing sector which took a big hit from the pandemic, followed by an energy crisis due to being heavilly dependant on cheap gas from Russia.....now under sanctions. Best hope for CRC is to be bought out by Fraser Group PLC.

 

[Doomanic]

No Hope stuff on Chiggle now...