A Big Drop in the Number of UK Bike Retailers because of Online Retailers

The reason behind the big drop in the number of IBDs in the UK is the same as in other countries; the inability of dealers to compete with price offers that are intensively communicated by online players. Halfords states “The cycling market is highly fragmented; there are over 2,500 bike shops in the UK, the majority of which are independents. The changing marketplace and growth in online are making it increasingly difficult for these independents to be competitive. Research shows that the number of bike shops has declined by nearly 10% over the last year.”

My2C:  This is significant.  Traditional business importer/ distributor/ retailer models have already changed overseas.  Change in the South African Industry is coming – We have to be ahead of it, or will not survive otherwise…  You also see more and more importers/brands communicating and selling directly to consumers.  This has many advantages/disadvantages, but I believe we will be seeing more and more of it during the next year or two.  What has happened in the UK, is that the big importer/distributors have bought a large chain of retailers.  They are expanding this chain, thus increasing their footprint to sell directly to consumers.

Trade and ‘Experience’ Combined

Once started as a small show next to a mountain bike happening and Eurobike decided to revive the early days of the event alongside the important business days. The new concept sees the introduction of two Festival days, which took place on Saturday, September 3th and Sunday, September 4th.

The 2017 Eurobike celebrated its 25th anniversary. In the past decade, the fair has transformed from an event for the mountain bike scene to the world’s leading trade show for the bike industry, with 1,350 exhibitors.

E-Bikes Leap Forward in Italy

The Italy bicycle market statistics by ANCMA reveal that e-bike sales increased by a huge 121% in 2016 compared to the 2015 sales total.

Market share

With the 2016 sales total e-bikes have passed a significant threshold that in particular applies to the market share they hold now. It is said that once a 4 to 5% market share is reached sales will accelerate as consumers start to recognize this new bicycle category and will also start to talk about e-bikes. At least, experiences in Europe’s largest e-bike markets Germany and the Netherlands showed that.

My2C:  In Germany and the Netherlands, E-bikes are already more common than normal bikes.  In these countries, bicycles are mostly used for transport (commuting), not recreation.  You see them everywhere.  In Italy and the rest of Europe, bikes are more used for recreation, as in South Africa.  The fact that E-bikes are growing in Italy in the recreation market, is an indication that we are likely to see big growth in that segment in South Africa as well.  Having test ridden many of them at Eurobike,  I must say that they are fantastic.  If I could afford it, I would probably buy one.  You get to play much more downhill, in your limited time, compared to your normal bike.  Also, the fun factor is massive!  You still get the same workout, you just ride faster…

Speed Becomes the New Currency

How the bike sector can anticipate on such changes is by preparing future scenarios. In these scenario’s the consumer has to come in the first place. Their demands come first in particular as dissatisfying consumers is a deadly sin. This requires a 100% product availability which is currently one of the failures of the bike industry. In order to improve the performance in product availability lead times have to come down. It results to “speed becoming the new currency”, said one of the keynote speakers at the World Cycling Forum. And as speed matters “simple is beautiful and companies have to become data smart.”

Speed and lead times

Taking the need for speed very, very serious is done by Adidas as this company even has a vice president SPEED as well, as a SPEED factory which is located in Germany. It allows for 2 months lead time for making products that have proven themselves to be the best in the selling season.

My2C:  Having stock ready to sell is a very big problem, also in South Africa.  Importers often do not have the right models/sizes available mid-season.  The cycle industry in Europe is trying to counter this by building factories in Spain with very short lead times.  During the season, they will then be able to manufacture, on short notice, the most popular models/sizes, ensuring that they do not run out of stock.

Biggest E-Bike import growth from China

Close to 80% of all imported e-bikes from outside Europe stemmed from China. 912,500 units of the import total of 1,165,000 came from the Peoples’ Republic accounting for a huge 78% market share. The China imports showed the biggest growth of the top 5 supplying e-bike countries to Europe. Chinese e-bike imports rose by a big 67%, counting for a growth of 365,000 units, to a total of over 900,000. The other main e-bike supplying countries for the EU 28 member states were in 2016 Vietnam/Cambodia, Taiwan, HongKong, and Switzerland.