Good news: I am back traveling on the road. Bad news: some shops have closed, and others are thinking about it. At first, I wondered, why? Haven’t we been in a bike boom? Shops should be flourishing, right? Well, some are.
The conversations of late are real. The usual chat about how you have been and checking in on the family is quicker, and the talk quickly turns to inventory, dating, and programs. How soon can we deliver bikes, how many and at what terms? It’s a buyer’s market. It’s even better if your business capital is dialed.
As the industry struggles to catch up, every ounce of data I have collected points to those shops that have their operating procedures fine-tuned, employ a skilled and punctual buyer, and have the capital to act fast when inventory is available are able to navigate these times more easily.
How can we help and how can I use my skills and my “family” to best help other shops? Last week I asked my retail network to help me. I asked them to tell me how they are reacting to a lack of inventory, and to share with me the plans they have in place to flourish in the new now.
A quick look at the Lightspeed system of a select few New England accounts shows that during the “winter” months — November-March — they typically sell a total of 30 plus bikes, adding revenue of $50k plus.
Now sitting with less than a dozen bikes in the shop, how will these shops make up that 50k? Bikes from suppliers are trickling in, but as unreliable as things have been, it’s time to hunker down and bet on yourself.
Something I have been talking about a lot lately is team and network: How we rely on suppliers, colleagues, customers, and other shop owners. We need to collaborate and tighten up these relationships.
My retail network came through. Its advice in e-mails, calls, and texts was overwhelming. We are all in this together. As the industry navigates these unprecedented times, we need to lean on one another.
During a recent shop visit, it was mentioned that the newer stores may struggle in the coming months. I was not quite connecting the dots on why this would be so until I read this feedback from Joe Drennan (Earls Cyclery and Fitness, South Burlington, Vermont).
“First of all, history is on our side. Being in business in the same locale for 67 years and counting is our biggest asset. We have generational customers, so we are often the first place people come to shop or for repairs. Secondly, out of all our immediate competitors, we are primarily bike focused so we’re not distracted by other outdoor activities. In addition to a PPP loan earlier in the year, we also took out an SBA Loan to help secure more inventory when it was still available, and to keep more PT staff on deeper into the year to help with continued high repair demand and to keep turnaround time to a minimum. Inventory issues forced us to basically allocate two full-time staff members to securing/ordering product. We’ve also opened two additional vendors for parts/accessories. If we stay open, hopefully they continue to come!”
Joe’s feedback got me to thinking about our “best customer.” You know who I am referring to: The ones that come back time and time again. With history, you not only get the customers who know you exist, but also those that depend on you existing. People depend on you. More than you know.
Ok, let’s dive into cash flow. It’s a big one, but you need to stay open to buy.
“One of the things done here at Freewheel Cycles (is to keep the) emphasis on what you do best and review your inventory daily. From a financial point, be careful of your cash flow. When a repair is complete, we call our customers to pick up their bicycle quickly. This continuous flow of money is used to procure further items for repair.
“I will admit it is a fine line calling your customers daily, sometimes twice, to maintain cash flow. A tough strategy …" — Garabed Minasian (Freewheel Cycles, Nashua, New Hampshire)
So, for the shops that have history and cash flow dialed, we move onto inventory. How do we best look at making sure we have bikes to sell, and how do we help customers understand they just may need to wait? For this one, I touched base with my good friend Michael Purdy (Blimp City Bike and Hike, Akron, Ohio).
“Hello Heather,
We have tried to inform our customers about the supply chain issues that our industry is experiencing. They have been very understanding. We have many customers that are waiting for bikes that we have on order. We did not run out of bikes until the end of August, and one of our suppliers did get us a shipment to carry us over on hybrid bikes.
“I also increased our stock of Montague folding bikes, ElliptiGO's standup bikes, and Trident Trikes as alternatives. All of those moves have helped us to continue to grow our business when most bike shops have been just trying to survive.
“We are not the typical bike shop that restricts itself to one or two manufacturers. We have always listened to our customers and put in merchandise that they recommend.
“We have had no shortage of service work, so that has not been an issue.
“I decided to pivot to electric bikes back in April when rumors of supply issues started. We stocked electric bikes, but only a few. Now our inventory is 75% electric, and they are selling.”
I loved the feedback from Mike. I know electric is coming, and I have been urging my personal shops to consider it as well.
I used to own a shop, and if I ever did again, I would most likely consider somehow working my way into convincing longtime friends Beth and Jim Mills (Cycle Lodge, Pembroke, Massachusetts) into letting me help with Cycle Lodge. Jim and Beth are an amazing couple who have built a community around their shop. Beth is an experienced, expert-level bike fitter and Jim a top-notch mechanic. You can’t find two people better suited for the industry. They wrote me not only on supply issues but also on how they are adjusting service.
“Here are some thoughts with dealing with the COVID-19 lockdown.
- Supply chain: Most people are patient and understand the issues with supply as it is not unique to the bike industry. We are now more service/fitting-focused with an occasional bike sale.
- Service: Good time to reach out to customers on preventive maintenance, especially on high-end mountain bikes. Many customers have no idea they should have regular service intervals on their suspension and pivot points.
“Sourcing product has been the biggest challenge.”
Oh, and then they had one more stellar tip:
“We’ve had good luck selling older (NOS and used) product on eBay during the lockdown, especially for people restoring/rehabbing older bikes.”
Over the course of a few days, I had lots of great feedback. I was still working out just what to do with this information.
I had a chance to ride and chat with Amos Brumble (Brumble Bikes, Westerly, Rhode Island). A longtime buddy, I feel it’s OK to ask him anything. “Hey, Amos, so what would you think if I wrote the exact feedback in an article for Bicycle Retailer? … I think shops may want to hear from other shops, what do you think?”
“Yes! Listen, sometimes I get stuck in the shop for three days, and I have no idea what’s going on outside the shop, or in other shops. It’s nice to hear what others are doing.”
Amos additionally had his own feedback for us on steps he is personally taking within his shop:
- Taking the time in-store to set realistic expectations for the coming year with customers. (Note: customers have appreciated me taking the time to explain the situation as it relates to inventory shortages; from the feedback, many shops are not doing this or are probably tired of repeating the same story, and that isn't good.)
- Shifting the emphasis to repairs in the coming season.
- Prepping for this by buying more service parts, working with current employees to get them used to a different year ahead.
- Concentrating on core customers (those who list me as their first choice for a shop to buy) and passing the others off to other shops. I have made sure to keep delivering the same level of service to avoid disappointing my best customers, even if this means turning away new customers when other shops have overflow work.
- I will note that I saw increased repair demand because shops near me reduced hours. Also, I noticed that other shops were putting out subpar service work, which was making customers seek alternative shops.
- Looking at what all of those new riders will need in the future (clothing to continue to ride — many shortages outside of the bikes themselves were related to what all of those new riders would need, the question I ask is what's the NEXT thing they will need?)
Collectively, these retailers are nailing it. It’s not enough to blame anything on the bike shortage; it’s time to be the best entrepreneur you can be. Dialed policy, strategic planning, and unwavering customer service.
“The used market, repairs, local following, and unwavering customer service has kept Astro Cycles afloat.” — Brad Jurgens (Astro Cycles, New Port Richey, Florida)
Want to go the extra mile? How do we keep customers engaged with the shop in a social sense now that we can't do group rides? This is the big-ticket item. Figure this out, you have it made.
“Perhaps tell folks they can hold Zoom maintenance classes, or virtual watch parties for the latest bike film or movie, or an Instagram live of someone doing a product talk about how to buy an indoor trainer or a YouTube live tour of the shop, etc., or a virtual Zwift shop group ride, etc.?” — Jason Braley (Maine Bike Works, Saco, Maine)
So, please, share with me. Share with us. Take over the comments with your comments. Tell us what your shop is doing. To everybody, please reply, leave feedback here. Let’s make this noise big. We are all in this together.
Editor's note: Heather Mason has done nearly everything in the bike industry. The former pro 24-hour racer has been a retailer and national sales manager for a well-known brand. Now she is a bicycle industry advocate, business developer, columnist, and athlete who shares her knowledge, insight and passion with everyone she meets. She is also in charge of eastern U.S. business development for Bianchi Bicycles.
