A version of this feature ran in the May issue of BRAIN.
Arnold Kamler is an icon in the bike industry. He founded the U.S. industry's second-largest bike company by volume, Kent International. Their Kent brand is sold through mass channels, while their specialty brands include Univega and Van Dessel. Their two factories located in Clarendon County, South Carolina, total 350,000 square feet.
Kamler's grandfather immigrated from Poland 1906 and opened a bike shop in New York City. Arnold's father Phil converted the business to wholesale and started a company called PhilKam Cycle Supply in Newark, New Jersey, located at 30 Kent Street, thus the origin of the company name.
In 1958, the elder Kamler started importing bikes from Belgium and the Netherlands. Arnold graduated from American University in 1972 with a degree in Business Administration and was scheduled to work for a company in Washington, D.C. after graduation. But his father asked him to continue the family legacy and at least try the bike business for two years. He is still there.
Kent International's business headquarters is in Fairfield, New Jersey. Earlier this year Arnold passed the torch to his son Scott, who is now the company's president and CEO. Arnold remains as the Chairman of the Board.
BRAIN: You are one of the few U.S. bike companies that currently sells lower-cost bikes to the mass and high-end bikes to IBDs. How would you characterize the current state of the business?
Kamler: As I guess everyone knows, it's still quite challenging. Our core mass business has recovered but the IBD business remains super challenging, with the largest suppliers still dramatically overstocked and offering deals that we cannot afford to match. There is also quite a glut of adult bike inventory that was purchased during the height of the pandemic, which is hindering the recovery. I'm guessing it will take most of 2024 until adult bike inventories will be healthy again.
The bikes we're all overstocked on are saleable. As we have often said, particularly in our popular-price business, bicycles are not strawberries. They do not go bad. Our bank has been very patient with us and that has helped us during this period quite a bit.
The most disappointing part for us is that we worked so hard to build our IBD business both for the bikes produced in South Carolina as well as the bikes imported from China. Now that there is enough supply, most of these retailers have lost our phone number. I'm not sure I can blame them with some of the crazy offers from their large suppliers.
Bottom line, the adult business was booming at both mass and IBD until it wasn't. In retrospect, we were angry with Shimano for not increasing production capacity. History has proven them correct. It wasn't another "bike boom," rather just a pandemic-induced shortage. If we'd all listened to Shimano we'd all be better off now. We got caught up in our own hype.
BRAIN: You manufacture and ship millions of bikes out to retailers every year. What do you see as the weakest link in the modern bicycle? Mechanically, what keeps them from getting used more?
Kamler: I'm hoping that the electronic shifting cost will come down a lot to become affordable to most customers. And it's time to get solid tires into the market in a bigger way. Now they're a lot more expensive but they're a better product than ever.
But in my opinion, the number-one biggest challenge is distracted driving.
There are so many laws on the books against this and the police just do not have the time or the budgets to enforce them.
I know PeopleForBikes is working on this but the answer to me is simple. I think if you received a ticket and a $200 fine, you would put the phone away. And why the heck are people not even using their Bluetooth on their phones when they are driving the car? It's a bad habit that needs to go away.
"Bottom line, the adult business was booming at both mass and IBD until it wasn't. In retrospect, we were angry with Shimano for not increasing production capacity. History has proven them correct. It wasn't another 'bike boom,' rather just a pandemic-induced shortage. If we'd all listened to Shimano we'd all be better off now. We got caught up in our own hype."
BRAIN: It's been true for decades that 98% or more of the bikes sold in the U.S. every year come from Asia. Are you trying to change that and do more U.S. manufacturing?
Kamler: With my new role as Chairman, I'm spending half of my time now building our U.S. manufacturing to make manufacturing possible and competitive with Asia. We do need help from the U.S. government and Washington is in such a mess now that almost nothing is getting done with so much in-fighting.
The help we need is tariff relief for any American assembler. We are paying an average of 23% Section 301 Tariffs on bike parts made in China, when companies in Taiwan and Malaysia and Vietnam and Cambodia and India do not need to pay this – even if 90% of the components are made in China. There are other aspects to the bill we're working on with Rep. Blumenauer from Oregon but we need support on both sides of the aisle.
Despite this, we're still planning to grow our production by 50% in the next year. But with tariff relief we could grow our U.S. business five-fold in three years and all of the benefits would be there for all of our competitors as well.
BRAIN: You were the main source of info during the pandemic about the state of the bike industry. Interviews with The Wall Street Journal, the TV networks, all high-profile exposure. Why are you the only "big bike" executive who seems willing to share numbers and talk about strategies?
Kamler: Over the years, I've come to know who can be trusted to print what I have said accurately. I've also been consistently candid and outspoken. We are a fairly large company in the bike business and being privately held, there are no shareholders or investors to worry about. It seems most companies are just afraid to make public comments that may need to be revised. I always speak honestly and from the heart and it works for us.
In 2019, I penned an Op-Ed in The Washington Post disagreeing with the Trump Trade War and became a television favorite for live interviews. I did more than a dozen. It was my first live television appearance since being in the Peanut Gallery of the Howdy Doody show when I was 8 years old.
BRAIN: Where are your brands headed with e-bikes? We're not seeing any Univega or Kent e-bike models? Is there a future for e-bikes in mass channels or are the price points too high?
Kamler: For the mass retailers, it's possible to build a good quality e-bike at affordable prices but the big challenge is after-market service. We're tiptoeing in this market now as we really hate the state of the e-bike industry in the U.S. E-bikes should be pedal-assist only with a maximum motor of 350 watts. Anything more than that and anything with a throttle should be classified as a motorcycle.
BRAIN: Thanks for being so candid, sir. Any final thoughts for our readers?
Kamler: There are not many businesses that can remain vital for so many years as our industry has for over a century. While it is good to copy successful products and popular trends, you need to have a defined strategy of what you stand for, whether you're a bike shop or a major manufacturer.
