Dear bicycle dealers,
Why are you inventorying bicycles and going to the bank to borrow money for your bicycle manufacturers? I have been in this business in all forms for over 60 years and things have really changed and all of us must change.
The bicycles you sell today are not Schwinn Stingrays that cost less than $100 each. You are now inventorying bicycles that range in the hundreds or thousands of dollars and can be outdated whenever a new part comes into the supply chain.
You must look at the big box retailers like Best Buy, Walmart and Target to see the solution to this terrible financial and inventory problem. They call it slotting, which means the manufacturer pays a fee to put their toaster or flat-screen TV in your store for a monthly or yearly fee. The manufacturer provides point of sales supplies or video displays and pays you a fee for the floor space (slot,) which is deducted from your purchases or paid up front. As an agent for this company you carry a small inventory for people to touch or buy.
When someone comes into your store and you explain everything about a bicycle and they buy it directly from that manufacturer or worst from a different dealer, that today is nuts.
The cost to you is workers' salaries, financing and floor space. If the customer gets his exact properly tuned bike in a week or less that should not kill the sale. If a manufacturer has three or four warehouses throughout the USA that means you are two to three days from getting any bicycle and at a lower freight rate.
The bicycles should be almost ready to ride out of the box and if they bought it somewhere else you still were compensated for your demonstration time. Why make preseason orders? Let the manufacturers do that, they have all the data from all the dealers. There will be fewer stupid models, colors and sizes if it is their money to gamble. You could carry 10 different brands and have a total of 50 bicycles in inventory. If one manufacturer gives you a hard time or cannot deliver, you have nine others to choose from. The bicycle, electric or standard, is a product in motion, which means wear and tear and that transforms into labor and parts for your bottom line.
It makes more sense in 2025 to have a smaller team of three or four people who love the bicycle business and have a decent financial life instead of this constant turnover of people that now is in play. Take that valuable floor space (slot) for bikes and sell accessories, which you can make 50% on your money. And remember installation is always extra.
Thank You,
Bob Lickton
Lickton Supply Corp. serving the bicycle community since 1929.
