CIN issue 003 2019

ISSUE 003 // 2019

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from the editor

Jonathon Harker Cycling Industry Chat @CyclingIndustry @JonHarker

THE DAYS OF IGNORING THE ENVIRONMENT MAY BE OVER, EVEN FOR THE BIKE TRADE

info@cyclingindustry.news www.cyclingindustry.news

SIR David Attenborough has not been holding back while narrating Our Planet, a nature documentary series detailing how climate change has been impacting all living creatures. Given a freer rein than he has on the BBC, the Netflix programme has not pulled its punches, brutally broadcasting footage of walruses falling to their deaths thanks to decreasing sea ice levels.

Meanwhile, over Easter the streets of London were filled with thousands of protesters on the Extinction Rebellion protest and marches, closing down bridges, rendering them traffic free for days and therefore temporarily cutting pollution levels to less life threatening levels (UK air pollution could cause 36,000 deaths a year, fact fans). In days, the protesters have done what the newly introduced Ultra Low Emmission Zone (ULEZ) is aiming to achieve, perhaps optimistically, for that same city.

Despite growing publicity around the movement to cut pollution, the environment has thus far not really affected the bottom line of any bicycle industry company. There are some exceptions, for sure, but in markets like the UK, USA and Australia in particular – with their emphasis on sport over A-to-B cycling – it has largely been about faster and more exciting product for cycle enthusiasts, rather than a drive to cut pollution, climate change and keep its riders healthier.

However, environmentalism is finally beginning to impinge on the industry, even the UK one. With the aforementioned ULEZ and e-cargo bike grants giving businesses a good reason to turn to bicycles over cars, suddenly the profits of bicycle businesses may well benefit from the environment and those aiming to make their business less polluting (albeit strong-armed to through legislation).

There’s a line in the Rik Mayall and Ade Edmondson-starring ‘90s sitcom Bottom, that goes something like: “I won’t let the birth of the son of God get in the way of my Christmas.”

Sometimes, it feels like the cycle industry has taken a similar approach to the environment. Two wheels are generally greener than four, but in this way the bike business has been environmental by default, rather than by design.

In a previous life, a publisher asked us to run a regular feature on environmentally conscious brands in the bicycle world. Needless to say, the series ran out of steam in a couple of months. Had we been running the feature in CIN today, would we still be struggling to find any likely brands to include?

Both for those that care about this kind of thing and for those that like to turn a profit, urban mobility may finally be a way for the cycle industry to move closer to being an environmental hero rather than an environmental also ran.

ISSUE 003 // 2019

READY TO ROLL NINJA MASTER AVAILABLE EXCLUSIVELY TO IBDS Ninja Master Cages + Accessories A genius system of lightweight bottle cages and interchangeable accessories which simply and securely click into place on an integrated QuickClickTM mount. Prepare to Ride. topeak.com

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Publisher

Jerry Ramsdale jerry@cyclingindustry.news Managing Editor

Jon Harker jon@cyclingindustry.news Contributing Writer

John Styles Jstyles@cyclingindustry.news Staff Writer

Hayley Everett hayley@cyclingindustry.news Consultant & Contributing Writer

Mark Sutton info@cyclingindustry.news Sales Executive

Logan van der Poel-Treacy logan@cyclingindustry.news Head of Production

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©2019 Stag Publications. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means without the prior permission of the publisher. The Publisher cannot be held responsible or in any way liable for errors or omissions during input or printing of any material supplied or contained herein. The Publisher also cannot be held liable for any claims made by advertisers or in contributions from individuals or companies submitted for inclusion within this publication. The opinions expressed are not necessarily those of the Editor or of Stag Publications Ltd.

Gazelle’s history is very much the history of the bicycle as a popular means of urban transportation. Their original Dutch style comfort bike won over the hearts of the Netherlands 125 years ago and their continued design and technology have people all over the world falling in love today. Today, Gazelle remains at the forefront of invention to make cycling more enjoyable and accessible. Gazelle is an integral part of Dutch cycling heritage and have kept in cadence with today’s global innovation with their new line of electric bikes. Gazelle has positioned themselves as the benchmark for urban mobility traditionally and contemporarily. www.gazellebikes.com

the professionals RETAIL’S BREXIT TRANSITION PERIOD It’s (almost) three years since the UK went to the polls to vote on EU membership. While parliament is overdue on working out what that means, and the leave date has been delayed once again, is the toll growing on cycle retailers? Are suppliers reassuring retail partners on supply, post-Brexit? Are customers cagey on spending their hard earned? Or is Brexit a trifling concern compared to retail’s big period of transition? We went to the polls to conclusively find out…

Paul Lynn Director, Mountain Mania Cycles

ONE RECENT POLL FOUND A QUARTER OF SMALL RETAIL BUSINESSES IN THE UK ARE FEELING FEARFUL OF BREXIT. DO YOU FEEL IT IS A CONCERN FOR YOUR BIKE BUSINESS? Neil Holman, George Hall Cycles No, I'm sure it will have an impact of some description but not enough for me to worry about. I think that if we have another summer like 2018 it will be good. A lot of people have not booked European holidays this year because of the uncertainty (according to travel agents) so people will look to do things at home.

Paul Lynn, Mountain Mania Cycles For our Wallingford store, Rides on Air, we look only at the positives, the objective being to offer a wide selection of cycling solutions from sales to repairs and event support. The target

Neil Holman Owner, George Hall Cycles

John Hamlen Managing Director, Flag Bikes

is to improve on last year’s sales and margins and monitor the variables along with customer service. The biggest impact on the cycle industry every year is weather and the other previous potential impact was the recession but we have only seen sales grow during this period. I guess the question on Brexit is will it ever happen? But I don’t believe whichever way it goes it will impact us.

“I AM NOT CONCERNED ABOUT BREXIT. IT'S THE INDECISION OF THE PRIME MINISTER WHICH IS THE PROBLEM.”

Scott Snaith CEO, 50cycles

John Hamlen, Flag Bikes Yes. Almost everything in the bike business is produced outside of the UK so will usually be priced in US dollars. The aftermath of the Brexit referendum saw the pound drop sharply against major currencies making imports more expensive.

Scott Snaith, 50cycles I am not concerned about Brexit or actually leaving with ‘no deal’. It is the indecision of the Prime Minister which is the problem. This has caused more damage to the UK economy than a bad decision to leave on 29 March ever would have. Indecision and slow action is not what we expect of a modern day economy and can only put it down to very poor governance that questions the very values of democracy.

The EU has already told us there is

WWW.CYCLINGINDUSTRY.NEWS // 005

the professionals RETAIL’S BREXIT TRANSITION PERIOD 'zero negotiation' until we leave the EU. Our strongest position is to leave with no deal and go on WTO trading rules and simply opt for 'free trade'.

To be competitive the EU would have to offer the same if they wanted to maintain the volume of cars, washing machines and electric bikes sold to the UK. We also offer the same for immigration and open the doors to the whole world of talent based on their criteria and not from where the passport says they are from.

Our BH distribution would have been the last of its kind in the EU as we signed on the day before departure. The result either way to remain or leave has no consequence to our relationship with our counterparts in Spain. It is business as usual to drive the market and establish BH as a leading UK bicycle brand.

HAVE YOU SEEN THE UNCERTAINTY AFFECTED THE SPENDING OF CYCLING CONSUMERS? HAVE THEY SPENT LESS, OR MAYBE BEEN MORE CAREFUL ABOUT THEIR PURCHASES? OR IS THAT A GENERAL TREND? Neil Holman, George Hall Cycles Shoppers haven't bought from bricks and mortar shop properly for years so this is hard to say. Talking to my accountant the other day, over the past five years my turnover has stayed within £10,000 and my net profit has been within £2,000 so they are still spending, just in a different way. Less in the shop front and more

006 // WWW.CYCLINGINDUSTRY.NEWS

in the workshop and online in the specialist stuff I do.

Paul Lynn, Mountain Mania Cycles We complete our financial year at the end of April and we have seen a sales increase over the previous financial year along with consistent margins.

Hence we have not seen any impact.

We have a customer base that requires us to offer low cost bikes and services, but we also have the upper scale who don’t made spending on their hobby.

“WE HAVE MAINTAINED GROWTH IN THE BUSINESS ONLY BY WORKING HARD TO GET MORE CUSTOMERS THROUGH THE DOOR, NOT

BY INCREASING AVERAGE ORDER VALUE.” John Hamlen, Flag Bikes Yes. Customers are definitely spending less per person and putting off purchase and bike servicing decisions. Therefore, we have maintained growth in the business only by working hard to get more customers through the door rather than increasing average order value.

Scott Snaith, 50cycles The situation that Theresa May has put us in as a nation has caused the greatest uncertainty on the retail

front. It has been slow for everyone this last six months. We should be planning for the future success of our businesses, not wondering ‘what if?’.

Indecision costs the economy far more than a poor decision ever would.

We as businesses would have adapted very quickly to a No Deal. This would have put us on our front foot looking for a solution instead of looking back and living with the fear of change which is the position we now find ourselves in. Make the break quick and clean and the solutions will follow.

WHAT ABOUT PRICES? THE POUND HAS FALLEN AGAINST THE EURO (AND DOLLAR) SINCE JUNE 2016 – HAS THAT DRIVEN UP THE PRICES YOU’VE BEEN ABLE TO OFFER YOUR CUSTOMERS OVER THE PAST THREE YEARS? Neil Holman, George Hall Cycles We have put our prices up as the suppliers have put theirs up. We put our workshop labour prices up last year by on average 10%. What was funny was when the Brexit announcement happened and the pound fell through the floor, my online sales to the UK rose but my online sales to the world decreased but 30%. You would have thought it would have been the opposite way around, with the pound being weak buying from the UK would have been cheaper for everyone else.

Paul Lynn, Mountain Mania Cycles We have seen very marginal price

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the professionals RETAIL’S BREXIT TRANSITION PERIOD reflected as net importers with free trade in place worldwide.

increases but possibly more impacted by suppliers trying to keep the prices low since the recession and raising them more during 2018 and with the impact on import duties in the later part of 2018, but that was nothing to do with Brexit. Where we have seen price increases we have seen the spec of the bikes increase offering better value for money.

HAVE YOUR DISTRIBUTOR PARTNERS OFFERED ASSURANCES ABOUT SUPPLY OF STOCK IN THE AFTERMATH OF BREXIT? IF NOT, SHOULD THEY? IS PRODUCT SUPPLY SOMETHING YOU’RE CONCERNED ABOUT? Neil Holman, George Hall Cycles No, I am not concerned. Yes, some of our suppliers have assured us. I am sure to start with there will be teething problems but if the trade has any kind of sense, dealers will help out other dealers. There is a lot of stagnant stock out there that dealers can't shift because this trade has been so overfed since 2012. It would actually do us a lot of good if things started to become in short supply.

John Hamlen, Flag Bikes Yes. We have only survived by not being shy about immediately passing all distributor RRP price rises on to our customers. We love our customers but are not a charity and need to stay afloat to continue serving those customers. What is more of a problem is the - admittedly rare - cases where distributors raised our wholesale prices - citing Brexit - but kept the RRP prices unchanged!

Scott Snaith, 50cycles I would not say that the euro to sterling exchange value has made any difference to profitability of selling bikes. What has caused a problem is the uncertainty in the market which has meant over winter everyone is bargain watching which has made discounting more of a problem.

This results in lower margins, which is far more damaging than a few percentage points difference on the exchange rate. I think the pound is holding up quite nicely and if we were to leave the EU the strength of the pound would be

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“I AM SURE THERE WILL BE TEETHING PROBLEMS BUT IF THE TRADE HAS ANY SENSE, DEALERS WILL HELP OUT OTHER DEALERS.”

Paul Lynn, Mountain Mania Cycles I have no immediate concerns on product supply. I am sure suppliers have taken a view and that we support any minor impact should it arise.

John Hamlen, Flag Bikes No, they haven’t. Perhaps it is something I should be concerned about, but it is quite a long way down the list. Since February, and for other reasons, we have been working hard to improve our diversity of supply. This should have the side effect of mitigating post-Brexit supply issues.

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the professionals RETAIL’S BREXIT TRANSITION PERIOD Scott Snaith, 50cycles We work very closely with our Basque counterparts to ensure that our supply chain will be unaffected, if not improved, as we align our strategies to enable a more satisfactory customer experience on lead times of key selling models. This is our ultimate goal whether we are in or out of the EU this year or next.

ARE YOU HOLDING LESS STOCK OR FOCUSING MORE ON SERVICES SINCE JUNE 2016? IF SO, HAS BREXIT BEEN A FACTOR IN THAT CHANGE? Neil Holman, George Hall Cycles Certain stock I have cut back on, but this is just a natural morphing of the business due to the current trading climate. I don't stock a fraction of the clothing I used to because customers don't walk through the door and buy it anymore. Similarly, I stock a fraction of the bikes and bike brands I used to, again for the same reason plus the commitments and buy in deals they still ask for.

In 2016, I did a talk at one of the local school academies in a business studies class. One of the questions I was asked, was how has my business changed since I have owned it? My answer was: "In 2004 when I took over the business, we were a cycle centre that serviced bikes, now we are a service centre that sells bikes. Around 2004 we were selling on average 700 bikes a year, now we do about 120.”

010 // WWW.CYCLINGINDUSTRY.NEWS

Paul Lynn, Mountain Mania Cycles We look at stock holding value all the time to ensure we have the correct level due to customer needs but also vary this through the high and low seasons for cycling.

John Hamlen, Flag Bikes Yes, we have. However, this has been driven more by cash flow and online competition concerns than by Brexit factors.

“IN 2004, WE WERE A CYCLE CENTRE THAT SERVICED BIKES. NOW WE ARE A SERVICE CENTRE THAT SELLS BIKES.” Scott Snaith, 50cycles We hold less stock now but this not due to Brexit, more to do with a change of strategy to focus on quick delivery times from our suppliers.

ARE THERE ANY OTHER WAYS TO LEAD UP TO THE UK’S EU EXIT HAS AFFECTED THE BIKE TRADE? Neil Holman, George Hall Cycles I don't know, other than the UK government in the eyes of most

Europeans are a laughing stock.

Instead of taking the lead on the situation they have cowarded to it.

Paul Lynn, Mountain Mania Cycles If Brexit should cause any concern for consumers then we will see car sales slow and the average household cars reduce but everyone still needs to keep mobile and the trusty old bike will come out of the shed and be possibly replaced with a new one, so we only see positives. We have just relocated to a new building and spent nearly £100,000 on a store refurbishment which reflects our positive attitude going forward in whatever climate.

John Hamlen, Flag Bikes There’s nothing specific to the bike trade. The main issue is the same for all retail: uncertainty is (very) bad for business!

Scott Snaith, 50cycles Brexit has been a good talking point when we meet our suppliers on the continent. We get on as usual and it’s business as usual. I personally try not to let the news grab my attention in any way – it is all a big distraction from getting more bikes out on the road.

Want to take part in our next Professionals Panel?

Contact Jon@cyclingindustry.news to register your thoughts.

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(( PROFILE EXTRA UK ))

EXTRA MILE SERVICE With 28 brands and counting, Extra’s additions of late have been described as “premier league signings”. CIN speaks to Extra’s fast growing team about taking the 25-year-old business to the next level alongside its retail partners…

T

here’s been a notable surge in press communications from Extra in the past 24 months, something that’s generally the sign of a business either having a shake up or experiencing a growth spurt. With Extra it’s a bit of both.

Having completed a move into new digs 12 months ago, formerly occupied by the distributor’s partner logistics firm (we’ll get to that…), both the offices and the warehouse are being slowly filled with more staff and more brands.

In fact, the move came about on the back of a number of high profile hires into the business, perhaps most notably long-term Shimano brand manager Mark Greshon who joined from Madison at the start of 2018.

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BRIAN AND JOHN HAVE DRIVEN THE CHANGES, BUT THE MARKET IS EVOLVING TOO...

Head of marketing – Stephen Hayes joined from Whirlpool, adding big business experience to a team that was already coordinating some 40 events annually on top of all other marketing activity.

To cope with the demands of a now annual turnover of £19 million, in the space of just a few years the business has near doubled its payroll, with around 25 staff on the books, all of whom are

dedicated to customer service, marketing, sales and procurement.

The marketing team has been further bolstered by experienced personnel – like Brand Manager John Harris who joined in December bringing ten years’ in the trade including at Madison – as well as new recruits, like marketing postgrad & keen MTBer Michael Braybrook. More recently, Matt Beighton joined as joined as Topeak Brand Manager, another experienced cycling industry staffer having enjoyed stints at Madison, KTM and Raleigh. Finally, Richard Jones moved across from Extra UK’s technical department to become a marketing and brand assistant.

Adding those extra marketing and brand personnel was in part down to

the changing nature of the bicycle distribution game and also down to a desire to push Extra UK into a new phase of growth.

Set up by cycling industry stalwart Brian Stewart (previously a cofounder of the firm’s Milton Keynesbased rival Madison) alongside business partner John Phillips back in 1994, Extra UK has gone on to build a 28 brand strong portfolio of labels, many of which are genuine class leaders in their respective fields.

“BRANDS WANT MORE FROM DISTRIBUTORS” “Brian and John have driven the changes,” Hayes tells CIN. “Naturally they want to move the business on to develop and grow, but the market is changing too and there was a wider recognition that we needed to support brands in a bigger way.

“Brands want more from distributors and of course we all want to make them a success so we’ve developed much more detailed sales and promotion plans for each brand.” To retain focus, the firm has been tactfully turning distributor deals down too, particularly in the weeks post-Taipei Cycle Show. “We believe in quality rather than quantity. We’re frequently approached by new brands but you can’t just collect brands if you’re committed to the long-term success of the brands you already have.”

In the past 18 months, Extra’s portfolio has grown strategically with carefully considered additions including the likes of HJC Helmets, Absolute Black, Squirt and Pirelli. This year alone, the distributor signed Trent Fitzgibbons’ helmed M20, tube brand Tubolito, FastForward Wheels and perhaps biggest of all, ABUS. “Pirelli is a brand that we’ve been very excited to bring through in the UK,” says Head of Brands, Mark Greshon.

"Their expertise in compounds and tyre construction is second to none and while the exact compounds used are a closely guarded secret, but anyone who has ridden them loves the way they corner in either wet or dry conditions. They’ve

WWW.CYCLINGINDUSTRY.NEWS // 013

(( PROFILE EXTRA UK ))

incredibly low rolling resistance too, a real performance product.”

For the retailer it’s an appealing package too. Presented in slick rectangular boxes, the portfolio at present consists of 23, 25 and 28c road tyres, but will soon be joined by a 38c four seasons style tyre falling under a different family.

Tubolito has been a roaring success so far, especially with the bike packers and adventure bike market. There’s also been interest for the distinctive orange valve stemmed-brand from the BMX race scene. For road riders the weight saving appeal is clear as compared to standard rubber tubes you’ll save almost 70g of rotating weight per wheel. Price for the tubes has not been an issue either, reports Extra.

FFWD arrived in April, filling a gap in the Extra line-up for a quality highend wheels brand. “We’re looking for the long-term potential when we sign brands but with FFWD it all happened quickly. We’ve not spent much time promoting it on the road yet [CIN visited while the ink was still drying on the deal] but we’ve been getting several of dealer calls a day about FFWD,” Greshon reveals to CIN. The groundwork to the M20 Industries deal dates back to Eurobike 2018, where they met founder Trent Fitzgibbons. Returning to the cycle industry after selling his shares in Australia-based distributor JetBlack Cycling, Fitzgibbons set up M20 in 2016 with a range that now includes compression socks, active sport socks (no compression but with features like reflective detailing), performance hydration systems and skin care products.

And last but not least, there’s the small matter of ABUS. Moving to Extra after a decade with ZyroFisher, stock started arriving with the Northants distributor at the start of April. With sales split roughly 50/50 between the brand’s locks and helmet lines, the security lines are largely made in Germany over three locations. The brand is supporting the high profile World Tour team Movistar as well as tie ups between ex pros Fabian Cancellara and Cedric Gracia.

“These aren’t just filler brands,” explains Hayes. “We are deliberate in which ones we’ve taken on. We’re

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looking to exploit the opportunities in the market.”

Aside from the newer arrivals, long running brand relationships with the likes of Topeak continue to unearth product gems, like the recently expanded Ninja series of accessories.

Tapping once again into the adventure market, the clever range saves allimportant bag space via a modular series that attaches tyre levers, tools and more to bottle cages and the like.

An IBD exclusive, the Ninja Master series has a renewed focus on tools.

“This range is one of the latest in a long line of market leading innovations from Topeak. Whether it be tools, pumps, luggage or lights, Topeak is at the forefront of progressive product design, whose prime focus is function over fashion” Beighton adds.

Also newly arriving with Extra is the full range of Synthesis 11 carbon wheels, the fruit of a partnership between Crankbrothers’ and Industry Nine, with Hydra hubs available on the full range. Meanwhile, Ergon’s latest seat launches include products optimised for e-MTBs – featuring a ‘rear ramp’ that supports the rider better in the kind of steep seated-while-riding-

uphill situation that e-bike riders can find themselves in.

With more brands coming on board Extra is investing in training for both its staff and accounts that desire it.

Demo day support is similarly ramping up, with Clif and Nuun support available for demo days and the later recruiting brand ambassadors. A brand specialist for Fi’zi:k and Crank Brothers is also on the road helping develop fresh shop events and demonstrating the range of the hugely successful Fi’zi:k shoe collection.

In further support of accounts, Extra has a wild card up its sleeve; the firm essentially has its own logistics business in neighbouring Datamex, a delivery specialist whose cargo is almost exclusively cycling products from the distributor. “This frees our team up to focus on what we’re good at,” the firm says, adding that “they even manage the B2B and IT, enabling our customer service team to be on hand at all times to answer trade calls.”

To take advantage of Extra UK’s wideranging brand portfolio you can contact the sales team on 01933 672170.

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(( INDEPENDENT RETAIL CHANNEL STUDY 2018 ))

In association with The NEC Cycle Show

If only you knew what the nation’s bike shops are looking to stock more of. Well thanks to Cycling Industry News’ unique own research, we can give you the results.

And for more insights into cycle retailers you can get hold of our entire, far reaching research, by contacting…

Logan@cyclingindustry.news.

Clothing

13.43%

Road bikes

19.40%

Mountain bikes

20.40%

Electric bikes

48.76%

BMX

1.49%

Triathlon

2.99%

Commuter bikes Including Folding

WHAT PRODUCT WILL YOU ALLOCATE MORE FLOOR SPACE TO AS THE YEAR PROGRESSES?

20.90%

Kids’ bikes

12.44%

Components

18.41%

Accessories

28.36%

I:ndoor training

6.97%

Nutrition

9.95%

Tooling

7.46%

Spares

Electric bikes top the survey results here.

Who would have thought it? Well, most of us have been waiting for this for a good number of years, to be fair. But seemingly the planets have finally aligned enough to give the nation's cycle dealers the confidence to grow their e-bike floor space after many years of the sector stuttering.

On reflection, accessories is a rather generic way to group products together, so we arguably do not learn much here, but more revealing is the third most popular product type to have grown in floor space - commuter bikes (including folders). Could this be further sign that the UK market is maturing into a space for utility cycling as well as sportsbased cycling? You can be sure that bike shops, which all have to be very confident indeed in their stock while trading remains challenging, will not just be bunging in more commuters and folders for the sake of it, so here is some interesting ground-level insight into a new direction for the UK cycle retail market. Further down the poll, MTBs edge ahead of road bikes while nutrition and clothing are making gains in some shops.

18.41%

Footwear

3.48%

Supplier POS

5.47%

0%

10%

20%

30%

016 // WWW.CYCLINGINDUSTRY.NEWS

40%

50%

60%

70%

80%

(( PROFILE GAZELLE ))

After 127 years in business, Gazelle has seen more cycle trends come and go than most of us have had hot dinners. CIN visits Gazelle’s Netherlands HQ to get its take on the shifting cycle retail market, why specialising is the way forward and how to get more consumer-centric…

“Cycling is like having breakfast here.”

You don’t need us to tell you that if you take a short hop over the North Sea you find a very different kind of cycling nation.

The Netherlands seems to have everyday cycling embedded in its psyche - and the infrastructure to go with it – while the UK… isn’t quite there yet.

So, it came as a bit of a surprise for the CIN team to learn that one of the biggest bike labels in western Europe’s cycling capital has its roots in old Blighty.

127 years ago, the two founders of what is now Royal Dutch Gazelle started the business by importing an English bike brand into the Netherlands. Within 10 years, the firm moved into making its own bicycles and took inspiration for its name from residents of the local woods, hoping to emulate the speed and flexibility of those animals in their bikes.

Setting up in Dieren, in eastern Netherlands, the town that has evolved around (and partly because of) the imposing Gazelle factory. Unsurprisingly, we spotted no other bike brands in the town’s shopping precinct.

018 // WWW.CYCLINGINDUSTRY.NEWS

Globally, few bicycle HQ buildings will date all the way back to 1902, however Gazelle’s Dieren building is no relic from the past. While there are plenty of reminders of its history, Gazelle’s revamped HQ is a modern marvel.

The old building is joined to a new modern block comprising offices and a cutting-edge bicycle production line. Huge windows lining the production hall, so passers by can see the bikes they ride being put together.

“Every Gazelle e-bike is made in Holland” CIN’s guided tour of the facility, hosted by Daan Ruitenbeek, International Sales Manager for Gazelle, showcased a production line that mixes automation (largely supporting functions, like shifting product from one area to another) with manual work. Frames are engineered and designed in-house, parts come to the Netherlands and are assembled there.

Gazelle’s claim that its 1.6km paint line is better than one in the automotive sector has special credence considering PON’s auto expertise, but also - when it comes down to the

E-bikes are more expensive and complex than your average bicycle, so Gazelle makes things as easy as possible for customers, including this education wall.

fact that bicycles get knocked about more than cars - a more robust paint job makes complete sense. After each layer of paint is applied, the frame or part has a spell in the oven before the next layer goes on (there are four in total, starting with a base powder coating going on first and finishing with a final layer of tough clear paint).

550,000 wheels are produced in Dieren across seven production lines. With ride quality affected by wheels, Gazelle takes extra care with experienced staff.

Efficiency is not limited to the production line itself. Once completed, bikes are loaded – via monorail – straight into delivery trucks, one every 30 seconds.

Gazelle’s testing facilities push bikes beyond what the ISO standards require, piling on excess kilos to push frames, posts, rear carriers (“we even put our kids on them here in the Netherlands”) and more to their limits.

As a bicycle manufacturer, Gazelle has a specific set of challenges that are not as familiar to UK cycle businesses, namely finding staff that have manufacturing skills. The firm seeds its future workforce through

outreach to local schools – a recent visit preceeding CIN’s saw local school kids visit the production line and get to grips with puncture repair.

“There is seasonality in terms of our headcount,” explains Ruitenbeek. “We have 400 staff in high season, roughly split with 100 in the office and 300 in production.”

CIN’s visit comes at a peak time: “Pre-orders are coming in now and people are getting ready for the start of the season. We’ve had some good weather in February, so there has been a good amount of re-ordering and sellthrough,” says Ruitenbeek.

To CIN’s eyes, Gazelle’s production line looks like a model of optimisation, but the firm is not resting on its laurels and is chasing greater efficiency throughout: “Organisation is critical. Everything we sell we have to make and we need to control production to suit a growing market. Having the right amount of bikes on-hand is a challenge.”

Efficiency has seen Gazelle pare down its SKU count. If it produced grips for each model, for example, supply

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(( PROFILE GAZELLE ))

Gazelle’s production line combines automation with manual skilled labour

issues would proliferate. Honing the SKU count has also are reaching out to customers more through marketing, but seen Gazelle move from that traditional model year churn. everything we sell goes through the dealer.”

Gazelle has been steadily growing in the UK, particularly “Some models last four years, although we do tend to over the past six years during which time it has grown its have yearly updates and you refine elements, but nothing dealer base to around 80 shops. too drastic. It makes sense if you know you will be able “Sport is so dominant in the UK, and in the USA and to sell a bike next year - you can afford to take on more Australia too. It’s that Anglo-Saxon thing, but there is culture stock and make a bigger order. shift going on.”

“In terms of production, you can E-bikes are clearly central to miss the season if you are not super Gazelle’s strategy and while electric organised, but we’re in a strong cash progress in the UK has been as slow flow position, we have stock in the a… well non e-bike going up a hill, system and that is a selling point “IN TERMS OF PRODUCTION, as to dealers.” the electric market is famously huge YOU CAN MISS THE SEASON on the continent, not least in territoThe mobility connection ries where Gazelle holds an enviable IF YOU ARE NOT SUPER market share, giving the firm “a PON Holdings bought Gazelle in 2011. competitive edge”.

PON’s background is with companies ORGANISED, BUT WE’RE IN that serve the automotive and mobility “The average sales price of an electric bike is growing in mature markets, linking with household names A STRONG POSITION AND markets, which is of course a good like Volkswagen, Audi and Caterpillar. thing for retail. Sooner or later, it will And its connections in the car leasing WE HAVE STOCK IN happen in the UK. sector also caught CIN’s eye.

THE SYSTEM.” PON’s bicycle acquisition strategy “20 years ago, e-bikes were seen as for the elderly. Now more and more we has seen it bring a roll call of signifisee younger people get on them, with cant brands on board, including commuters and families. That middle Cervelo, Derby Cycle (and its many age group is not so much on e-bikes.” brands). More recently Santa Cruz was added and if PON gets its way, Accell Group will be With its electric and utility cycling expertise, Gazelle is well placed to make the most of the growth of urban acquired too.

Since Gazelle’s acquisition, the firm has sought to mobility, a point bolstered still further by its mobility/automotive links. The firm has some interesting become ever more consumer-centric. prototypes of heavy duty e-cargo bikes for companies, “We are interested in premium, the best people and the including the DIO. best products. There are big opportunities out there and we

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(( PROFILE GAZELLE ))

Gazelle's experience centres are akin to a car showroom. Light, clean, inviting and geared towards test rides.

The Gazelle experience 2019 has got off to a good start, the firm tells CIN. Gazelle’s retail strategy has seen it introduce experience “We are focusing on improving the demand processes. centres in strategic locations. Featuring each and every The initial demand we see comes from dealers, but how Gazelle bike in all sizes, the experience centres are someis the sell through? We have to be co-operative and where for consumers – who can see the full range online but combine our strengths. We have to compete with the maybe can’t see the bikes in the flesh quite so easily. Crucially, Amazons of the world. The e-bike market is growing – you there is no retailing from the experience centres, consumers can see concept e-bikes at every motor show! The future test them there, receive personal advice is good for e-bikes.” from staff and then head back to their Even heavy hitting bike brands like local shop.

Gazelle have had to adapt their busiAkin to a car showroom, Gazelle has ness model to recent changes in the four experience centres in Holland and market, Ruitenbeek says. two in Germany, with more to come.

“40 years ago, there were three “IT'S IMPORTANT FOR An impressive number of cycle brands in Holland. Now the market is BRANDS TO CHOOSE THEIR customers enter the doors (approximuch more crowded. mately 20,000) – Gazelle is a firm “It’s important for brands to choose BATTLES. THE DAYS OF believer in ‘bums on seats’. their battles. Gazelle used to produce “E-bikes are bigger ticket items,” MTBs, kids bikes, etc. The days of doing DOING EVERYTHING explains Ruitenbeek. “So, it can be a everything are long gone. E-commute bigger customer journey to buy them. is one of the areas we now focus on. It ARE LONG GONE.” The consumer is in the centre. It’s has been a gradual process. about how they spend the money.”

“But it is a growing market. You have An education wall helps make the to position yourself where customers technicalities more straightforward for will see you. We are putting customers customers who don’t necessarily at the centre of what we do. We are spend hours reading up about the latest in e-bike tech. optimising our processes.

“It’s a complex product and we’re trying to help customers “Shops have to do the same thing. They have to ask, what along that journey to buying a bike. It’s our challenge to segment will I cover? A bit of everything? Something in the connect the different points of the journey together.” middle? It’s important for retailers to choose their battles too.

With bigger ticket prices, Gazelle bikes are also available “Creating a culture and a community is important, buildthrough leasing in the Netherlands, but this again is done ing a lifestyle around your product and your business. It’s by one of Gazelle’s hundreds of Dutch bike dealers, abiding beginning to happen with commuters, like it has with road by local rules on leasing and finance. and MTBers.”

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((( PROFILE MINX-GIRL ))

THE STORY OF MINX-GIRL The internet's effect on cycle retail goes beyond the clichéd 'bricks and mortar vs online' view. Duncan Moore speaks with Debbie Burton, Minx-Girl founder...

M

uch has been written about how the internet is to blame for the demise of the LBS. But to accept that point of view is to miss many important points and one great illustration of this is the story of Minx-Girl.com; a website that rode the dot com bubble, helped to change people’s perceptions and suffered from the pressure of larger operations.

In the late ‘90s, the mountain bike boom was in full swing, more and more people were getting into cycling and more and more independent cycle stores were opening up.

However, a common theme among not only the newcomers but existing

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stores too was a failure to acknowledge the existence of women riders.

One of those riders who felt ignored was Debbie Burton.

Burton is a life-long cyclist, who like many riders first discovered cycling through the then-new craze of mountain bikes. Always an early adopter she describes her cycling CV as “mountain biking since it started, one of the first into triathlon, trying ‘cross racing before it became the thing. I wasn’t good at any of them, I always finished mid-pack in a tri, bottom half of an MTB race and dead flat last in ‘cross. The point is not that I was some brilliant cyclist who decided to carve her own trail but

that I was an enthusiast who just loved riding a bike.”

It was that enthusiasm that would form the catalyst for what would go on to become a revelation for so many other women on bikes. Like her fellow riders at the time Burton struggled to find riding kit. “I knew people in the business (my other half is cycling photographer Russell Burton, who started in bike retail) and when I asked why the offering of women’s clothing was so poor they always said there was never enough demand and what there was, was difficult to meet because everyone wanted something different.

“On the other hand, women who

“WHAT WOULD NOT BE WORTH STOCKING IN MANY DIFFERENT LOCATIONS WOULD ACTUALLY BE WORTH MULTIPLE SALES FOR ONE ONLINE SHOP.”

might have found something they wanted to try on found bike shops without changing rooms, or the changing room was the loo (nice) and once they wriggled into the garment the sizing was like nothing else on the high street.”

These were not the only issue Burton had to deal with while trying to buy kit at that time as she explains it was not just the lack of options but “at that time [the late-‘90s] female specific shorts, if you could find any, were cheap, shiny and the most unflattering garments anyone bothered to invest money in stitching together. There were few good women’s jerseys so my friends and I mostly bought men’s.”

However, Burton was in the fortunate position that her career in sports buying, including technical apparel development and range building with some marketing and a lot of trend forecasting along the way, meant she travelled a lot. One of her most common destinations was the US and that proved to be a godsend for her. “I bought most of my cycling kit in the USA where there was more choice.”

The arrival of her daughter in 2001 meant Burton had to put her career on hold and with it the chance to buy decent cycling kit overseas. With time on her hands, Burton started to consider online shopping as a way of getting what she wanted – not just for herself but for others too. “Online shopping was just beginning but everyone was still very nervous about it. There had been some memorable over-invested businesses going bust before they even launched properly and horror-stories of people shopping on dodgy sites and never seeing their goods. But it was something I kept coming back to.

“Net-a-Porter was somehow starting to make a success of selling luxury clothing online and everyone said that couldn’t be done either, so with that in mind I made a plan,” says Burton about the catalyst for what was to become Minx-Girl.

The plan that she came up with was a website specifically for women cyclists, neatly side-stepping the problem of a fragmented market. As she says: “What would result in sales of just one pair of shorts per store in different locations across the country (and therefore not worth stocking) would actually be worthwhile multiple sales for one online shop.”

However, the site’s real USP was

that it would only sell functional female-specific items. Other points taken into account at the planning stage included ensuring the experience of visiting the site was as much fun as shopping for other clothes, “lust-worthy product that inspired an emotional WANT. It had to give the same amount of joy when you tried it on as a new party top. Not the ‘It’ll do then….’ that was the usual response to buying bike kit because it didn’t look that great but at least it was SOMETHING.” Expanding further on how she took her own bike shop experiences and turned them on their head, Burton says: “Everyone knows shopping is always better with a best friend who will be honest about what suits you and doesn’t. As an antidote to the horrible retail trying-on experience, Minx would always be on hand to give you the heads-up on what would work and what wouldn’t depending on your body shape. Hence the ‘looks great on sporty thighs’ or ‘comfy on post-cake tums’ copy.”

Many of the points that Burton incorporated into Minx-Girl were simply done on instinct but she now notes that “many of these things have become part of creating a great user experience.

Someone once commented that it was the perfect coming together of all my work experience combined with a gap in the market. Truthfully, we were a little ahead of the market because it was maybe another five years before women’s cycling really started to take off, but ironically we made our best gains when it was more niche.

“When I started the balance was definitely towards mountain biking and we tapped into the early commut-

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((( PROFILE MINX-GIRL ))

ing trend by providing clothes that didn’t mind being sweated in on a bike but looked like ‘ordinary’ clothes off it. Gradually as more women got into road cycling I went in search of properly female-specific chamois, shorts that didn’t turn thighs into sausages.

It was always about delivering functionality but in a way that riders could bear to be seen in.”

However, it was that very change that began to impact upon the success of the Minx-Girl website. “As the market was shifting in end use and women’s cycling was growing in profile so distribution patterns started to change,” explains Burton. “Some of the niche independent brands I had discovered in the US saw the opportunity in the UK and moved to a distribution rather than direct model. Good business for them but brands previously exclusive to Minx were suddenly more widely available and often on discounted promotion. This, by the way, is not exclusive to the cycling industry, it has happened with every brand I have ever worked with, it’s part of the product cycle. Niche brands are discovered by independent retailers who make them cool. They get onto the radar of distributors, multiple

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retailers and today, bigger online platforms who can afford to buy higher volumes. It’s great for the brands’ growth and I’ve never come across one who can manage that balance but it means that independents have to remain agile.

“IT'S NOT EXCLUSIVE TO THE CYCLING INDUSTRY, NICHE BRANDS GET ONTO THE RADAR OF MULTIPLE RETAILERS. INDEPENDENTS HAVE TO REMAIN AGILE.” “Some of the more ‘mainstream’ brands I worked with also changed from direct to distributor supply - that meant some of the products Minx had done well with were not always available as the volumes weren’t high enough for the distributor to consider making them part of the UK line.

“There was a tough year while this played out but I took Minx back to her roots of working with exclusive women-only brands that were deliver-

ing something different to the women’s cycling market and growth returned.”

When Burton began Minx-Girl, Burton started it with the expectation that it would supplement a freelance income, but within a year it was a fulltime job. “It grew to such a point that I had to decide to either look for outside investment or consciously remain small. I looked at going bigger but it was always hard to see how Minx would scale, I hadn’t started it to have an empire, I decided to keep it niche.

“Gradually my other freelance work changed and I found myself working within businesses again and enjoying it. Balancing my commitments became harder and eventually I decided in 2016 that the women’s cycle clothing market had changed enough that there was a lot of choice out there - my initial work was done and therefore my lovely Minx customers would forgive me if I took a break before I broke.”

That break became permanent but the legacy of Burton’s work bringing new women’s clothing brands and women’s options from existing brands to the UK market and changing the way retailers think about how they stock, display and ultimately sell that kit remains.

info@lyon.co.uk | 015396 24040 | lyon.co.uk/cycle

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(( TRADE OPINION ))

REPAIR SHOP NUMBER 2 “But we’ve always done it like that” and other phrases worth ditching: Sales training expert Colin Rees’ has some fresh new ideas for bike shops to boost profits through the workshop, in this second of three focused articles on repair shops…

Colin Rees Retail Sales Trainer & Business Consultant. w colinrees7.wordpress.com. e Colinrees7@gmail.com

L

ast issue, I promised owners a revelation in I mentioned last time, they are a hidden sales force in changes that can be made to running their store, some stores where they are ‘never let out’ and actually focusing on the repair shop as a profit centre, as are often most happy not coming out at all. Not good. opposed to some attitudes I have seen from They only need basic sales skills to be successful and owners, who look on the workshop as just a place that means training. The main thing they need is convivicustomers expect you to have. ality and confidence, which are both trainable. Often This series - of which this is the penultimate article described as ‘nice people’, they need to be able to hold a has been making the case for creating the best bike shop conversation, watching for buying signals, taking a experience in your district; one where customers are a customer down a road to lead to a lasting relationship. hard core of people who just wouldn’t go anywhere else On the course when mechanics are present, I like to and in the last issue in the series next time, we will be shock them by saying they have the propensity to be the summarising how to do that. most boring people on the planet. When a customer asks In the meantime, it seems sensible to look carefully at a technical question, they just want to know the answer, the area where the internet has literally no chance, the not the finite detail a mechanic is able to give, down to workshop. If selling bikes is becoming increasingly difficult, the name of the person who welded the frame and his vastly improving your sales performance is a must, we have grandmother’s shoe size. covered that, but so is concenGiven the correct properly trating on the profit centre trained team, the new worklargely seen as second best, to shop profit centre is ready to “IT IS CRITICAL TO TAKE A LONG HARD replace the missing income. go. However, an element of As I mentioned in previous planning, we have already LOOK AT YOUR PEOPLE. THEY ARE KEY articles, it is critical to take a said, is innovation and lots of long hard look at your people other things will happen when TO YOUR FUTURE AND NOT JUST because as usual, they are the you relocate the whole repair THERE TO GET THE WORK OUT.” key to your future, not just area to be visible and put chaps there to get the work out. customers in touch with vast, You would expect me to technical knowledge, your centre on training and as I mentioned last time, training greatest staff asset. The internet will never be capable of is the key to sales increases, given you leave everything a face-to-face discussion with someone technical, propas it is now, so looking carefully at your mechanics first erly trained to answer and help customers who then will becomes the sensible starting point. not go anywhere else.

In past articles, we visited the idea of examining how Mechanics first and foremost must be able to fix bikes, that’s a given. But do they fix bikes profitably? your particular market would respond to professional sales people selling your bikes and accessories, as Are they careful with stock and parts? Do they waste opposed to the traditional way in our industry of recruitmaterials? Are they time efficient? What is their ing ‘bikey types’ who are cheerful and hoping that works. productivity like? Are your maintenance packages fully Having brought technical know-how into predominance, costed regularly? Have you recently worked with them it is readily available to sales people as well as customers. for a day here and there, to see what actually happens This means, sales people no longer need to know as much and where savings can be made?

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(( TRADE OPINION ))

and this opens the door to another revolution. Staffing the sales team with people who understand selling as their main skill and are trained in just the aspects of bike technology they need to have to do the best job, is then an accessible option. Sales have to rise?

You just do not need a high level of knowledge to sell a bike. What you do need is just enough because, a huge font of knowledge is on display, working away where they are accessible. Ah, is this something else the internet cannot match?

So, in summary, we have a visible workshop that welcomes customers gazing or browsing as it’s called, properly dressed professional looking mechanics, perhaps a new ‘type’ of sales person and a revamped store with accompanying marketing and press releases.

In essence, a team of people setting out to give customers the very best bike shop experience they can get, who just would not go anywhere else. But something is missing.

What did it actually cost the business to get to this point?

Such alterations might well take some budget but in essence, surely, all that is actually happening is a move round, a clean up and some strategic placing of tools and equipment? In the main, the time and effort comes free and the business is paying for that anyway.

It will not cost mountains of profits and it is life changing for the business. It is well known in retailing that upgrading or changing a retail space sparks great interest and usually leads to a lift in sales levels, in any event.

So this said, you get the investment back, week after week after week.

Perhaps it’s worth mentioning that accepting change of any sort is often mentally resisted. If you want to take elements of the suggestion, perhaps putting bike building in the middle of store and keeping muck and bullets in the back, hallelujah. The customers will still be getting all the benefits of seeing the workshop process and what is it they say about a picture being worth a thousand words?

Let’s talk about making cash. What can we do with our new area? How do we start making instant revenue?

Well, it is so easy when you start having very simple ideas after reviewing how, and why, you do things the way you do. One simple idea will increase your net profit overnight if you spend this evening thinking about how your business receives repairs. Some shops say everyone takes bikes in for repair which means, no one specialises. Let me explain...

A training course always includes loads of simple, often hugely profitable ideas. Here’s how we convince staff to change their attitudes and it works best when the boss sits in. As I go around stores all over the UK and Ireland giving training sessions, towards the end, I ask one of the mechanics to go and fetch out any repair bike waiting to be finished.

He brings it out, we stand it up and look at it, identifying who took it in and swearing him to silence. We then discuss what sort of person rides this bike? How much riding has been done on the bike, we ask what repair the bike has come in for? Invariably, as you would

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“LET’S TALK CASH. WHAT CAN WE DO WITH OUR NEW WORKSHOP AREA? HOW DO WE START TO MAKE INSTANT REVENUE? IT’S VERY SIMPLE...”

expect, they are spot on with their assumptions.

There are two reasons for this exercise, the first being to show people that they may be employed as sales people, but everyone in the store is capable, efficiently to ‘receive’ any bike that comes in for repair. It is a confidence prelude to a technique that made one store in the Midlands, a sizeable lift in turnover and many more since.

The second objective is to play a game. Having correctly identified the rider, I ask, what accessories could be added to this bike that are not present. Believe it or believe it not, all over the UK, the average that every team comes up with, is five. That’s the average, so some are four and some are eight.

For the purposes of this revelation, let us assume a very conservative estimate of what is achievable perhaps, three. So, let’s do the math. How many repairs do you do in the course of a year, my next question to the team? Well, say five a day, times six days maybe, that’s 30 a week, times 50 weeks allowing for breaks, that’s 1,500 repairs.

“IF YOU ARE NOT ALREADY DOING THIS, THEN YOUR BUSINESS IS LOSING A POTENTIAL 4,500 ACCESSORY SALES EVERY SINGLE YEAR. AT AN EXTRA COST OF NIL.” Here’s the good bit. So, 1,500 repairs times three accessories per bike means that business is losing a potential 4,500 accessory sales every single year because all they have to do is point out to the customer those accessories can be fitted to the bike when it’s here, you will make no charge for the fitting and they will have a hugely better bike. How easy is that? But the best bit is yet to come. At what cost? Nil. So, all the margin goes straight to net profit, the reason for you being in business in the first place and if your store is suffering from Internet buying, implement this today.

Many shops I have trained have put this into practice.

The one in the Midlands allocated the best sales person and a senior mechanic to work together to take in every repair, just them, and implement this strategy. Accessory sales went through the roof. Repair profits increased.

What they call, a win-win team.

If you think that’s good, in the last article in the series, I will reveal the way any bike shop with a fully functioning workshop can implement a way to capture the repair market in their area for around £5… and some sales training.

In today’s retail environment, it is time people dumped the phrase, “we’ve always done it like that” and started to think out of the box. It’s the way to bigger net profits.

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(( TRADE OPINION CRANK LENGTH ))

WHY ALL YOUR CRANKS AREN’T WHAT THEY SHOULD BE In his reply to Damon Wyatt’s piece on stance width (CIN 02 2019), bike designer Mike Burrows implied he had more to say on crank length. It’s actually an area he has been interested in, and experimenting with, since the ‘90s….

I

n a way, a shorter crank is like a higher saddle in that your leg is used more at full extension and has less load put on it when well bent, which not only feels bad, we are assured by the medical profession is bad for us.

Short cranks have other factors for us to consider.

Correct crank length is of course related to body height in the same way as frame size, but whereas we take a great deal of care in getting our frame size just right, we mostly take what comes in the way of crank length.

So it will be 170mm for road use, maybe 165 if we take track cycling seriously, and 175 for off-road. Not every-

one does of course – there is an awkward group who have to have 172.5 or whatever.

But how did they decide on this length? How do you go about finding what is right for you? How did anyone find out what is the right length? Where did the magic 170mm come from? Well, I for one don’t know, neither do I know anyone else who does!

There was a time when we rode on much shorter cranks, in days of yore perched atop a ‘penny’ your cranks would have been 100-125mm long, and probably slotted for adjustment. Anything longer would have meant reducing the wheel size, which would have

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(( TRADE OPINION CRANK LENGTH ))

lowered the gearing as well, so it was quite easy to find the right balance.

Then along came Mr Starley and his chain-drive Rover Safety (1885) and the link with wheel size and any restriction on crank length was gone.

There followed something of a rush to fit much longer levers, which is what cranks are, and we all know that longer levers give more power; after all, didn’t that nice Mr Archimedes say that he could move the whole planet if he had a long enough one? Quite possibly true but it is a rather misleading one-liner, just what the populist scribes of the day would have liked. A rather better one-liner to keep in mind is: ‘There is no such thing as a free lunch.’

Longer cranks do not increase power, for power is force x speed and as you lengthen a lever, force increases and speed decreases.

The first inkling I had that the 170mm crank had not been mentioned on any stone tablets was when a young German, Frank Lienhard, arrived at the 1996 BHPC Championships with 110mm cranks on his faired HPV. Frank was not very tall, but even so – 110mm?

These were very small sticks! True, but they in turn allowed his fairing to be a lot smaller than normal. When laid back and feet forward, a lot of height is needed to clear feet on 170mm cranks, and aerodynamics being important, Frank decided a small power loss would be a good trade-off for lower drag.

Frank did not win any races and so there were no overnight conversions. Some while later I met Frank riding his regular road-going laid-back, also now with 110mm cranks, because as Frank discovered, your body and brain take a while to get used to them, and are not so happy about changing back, either.

Most surprisingly though, Frank was going as well as ever, without any aerodynamic benefit other than slightly less air being stirred up by the feet.

Shortly after this my son had to have a knee joint replaced and due to some tendon damage was unable to bend his leg as far as normal but did still want to cycle, so I re-drilled a set of old cranks to 125mm (he is 6-feet/183cm), which got him back on his bike, and after a few weeks he felt quite normal.

Since then I have converted my regular fleet of three uprights and three laid-backs to 145mm and 140mm cranks. This seems to work well, feels very nice, and means I can still ride a 170mm if I have to, although they do now seem very awkward.

I have not been able to think of a way to do any worthwhile testing of crank lengths and nor, it seems, has anyone else. Tests have been done but over a very short time span, which gives no time to adapt to a change from ‘normaI’. Yet even these tests suggest that the optimum length for a regular rider could be between 120mm and 150mm.

Copyright Dmytro Prudnikov/Komoot 2019

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WHY? As an engineer, I know very little about human bodies, so it follows that the rest of this piece is even wilder speculation than before.

So I’ll start by drawing a parallel between us and the motorcar. The evolution of the internal combustion engine has involved the stroke getting shorter and the revs increasing, giving more power strokes in a set time, and making best use of a given amount of fuel by optimising valve timing.

So if you were to push down on your cranks once a minute, your heart and lungs would have no difficulty in processing the blood needed and in fact would be idling most of the time and ‘wasting’ power; but if you attempted to push down a thousand times a minute, they would not keep up.

Somewhere in between is the right speed. But simply trying to pedal faster with the same cranks will not work any more than a Ford Popular can rev as fast as a Ferrari, and for the same reasons – the inertia of the reciprocating parts and internal friction. We need more revs but the same foot speed, i.e. shorter cranks. You will get less energy per stroke but more strokes and I am guessing that the blood can flow through and replenish the energy faster than we thought.

On the other hand it could be the other side of the equation, that by increasing the revs we are getting closer to a punch than a push, with more of the muscle fibres firing simultaneously which is probably a good thing as then they release together and let the new blood flow through more easily.

I apologise if I seem to be going on about this one but l do believe very strongly that short cranks are the way forward.

I would say the ideal crank length for a rider 5ft 10in (177cm) is between 120mm and 150mm. They are lighter than 170mm cranks; the chain ring can be a bit smaller and thus less chain; they are in themselves a bit more aerodynamic and allow smaller fairings for laid-backs and a lower tuck for racing on ‘safeties’; they are better, or at least less bad, for our bodies. There is definitely no big power loss and all my experience suggests a probable small increase.

Further reading: “Bicycle Design: towards the perfect machine” by Mike Burrows & Tony Hadland. www.bikefix.co.uk

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PERFORMANCE COMPONENTS

New facilities for cycle technicians

Hands-on with Shimano

Geoff Giddings, Senior Shimano Brand Manager, Madison

Shimano’s new UK Technical Centre opened for business in Q1 and CIN was lucky enough to sit in on one of the very first sessions at Bradwell Abbey, Milton Keynes. We quizzed Geoff Giddings, Senior Shimano Brand Manager at Madison, on what the new centre means for the nation’s Shimano stockists and the opportunities it will bring…

WHAT LED TO THE SETTING UP OF THE NEW UK TECHNICAL CENTRE? WAS IT SOMETHING SHIMANO & MADISON HAD PLANNED FOR A WHILE? Madison has always had Shimano Tec Reps on the road to offer training and support for Shimano customers and it was the next logical step to open a central training centre. Products are becoming more technical as well and we see the need for a well-trained dealer network where consumers can get expert advice. There are also a number of Shimano Sales Offices in Europe who offer this training at a central facility which is proving popular with dealers, so it was only a matter of time before we opened a UK centre.

WHAT HAS THE RESPONSE BEEN LIKE? I GATHER YOU ARE FULLY BOOKED UP…?

The response has been excellent. Our first session could have been filled many times over and the next three courses are already full so it shows there is a real need and desire from dealers to become experts on Shimano.

It is a fantastic opportunity for dealers to differentiate themselves from their competition.

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HOW MANY PEOPLE CAN YOU FIT IN ONE SESSION? We have six training workstations fully equipped with tools and a workstand and we can facilitate 12 people per course. This is an optimum number to ensure they all get personalised tuition.

WHAT KIND OF COURSES ARE YOU RUNNING? To start with, we will run courses on the most requested topics: An introduction to Shimano STEPS, di2 and etube and finally disc brake setup and bleeding.

We plan to run one course per month and alternate these topics. We also ran our first course on bikefitting which was really well received and we had great feedback from the retailers attending.

WILL YOU BE LOOKING TO INCREASE THE RANGE OF COURSES YOU RUN? Yes, that is the plan but probably for 2020. We see the need for more advanced training in a number of Shimano product topics but we are also investigating retail-related courses to help retailers get the most from their business and workshop.

MADISON SAID IT IS INCREASINGLY INVESTING IN EDUCATION AND TRAINING – IS THIS PART OF THE STRATEGY TO RETAIN AND GROW ITS SHARE OF THE BIKE MARKET? We see retailer and consumer education of our products vitally important and therefore a key strategic objective in our future plans. Consumers want excellent service and local bike shops can offer this to differentiate themselves in a competitive marketplace.

IF THE RESPONSE CONTINUES TO BE SO POSITIVE, WOULD YOU CONSIDER EXPANDING THE CENTRE OR EVEN CREATING ANOTHER? At present we are learning fast about the knowledge level out there and what courses we need to run in the future.

We need to deliver quality training with case studies and real hands-on education that everyone in the group can benefit from. We may look to run courses more frequently in the latter part of the season when shops are a bit quieter and able to release staff.

Retailers can also easily increase their Shimano knowledge by signing up to Shimano Tec where there is a suite of educational videos on Shimano products. They can learn at their leisure and this is something we encourage every dealer to do as it is one of the requirements of attending a course so we can ensure participants are at a similar level of knowledge.

HOW CAN DEALERS SIGN UP? We have an online sign up which shows the courses and availability, this is accessible through the dealers Madison B2B login.

The training is delivered by Madison’s Shimano Tec Reps, Richard Wilson and Peter Treviss.

Calendar and booking system is online (fully booked until July): bit.ly/Shimano-Training

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((( FOCUS ON URBAN MOBILITY ))

CREATING FUTURE CITIES Urban mobility is rapidly emerging as a key market for growth, opportunity and innovation for the cycling industry. Taipei Cycle Show’s Cycle Forum explores how design, culture and tech trends could be utilised to improve cycling in the cities of the future...

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n overriding theme of this year’s Taipei Cycle Show was urban mobility, a concept continuing to make waves in cycling and micro-mobility. In an urban setting, the bicycle can become a commuter’s everyday transport choice, a local business’ delivery vehicle, or even an eco-friendly taxi service.

How the bike industry can capitalise on this burgeoning area formed the basis for discussion during the show’s two-day Cycle Forum, which brought together industry experts from across the globe. Speakers proficient in the areas of bike design, cycling culture and e-bike trends imparted their wisdom, observations and recommendations on how the industry can create the ultimate bikefriendly cities of the future.

SESSION 1 > BICYCLE DESIGN Mark Sanders, Director, MAS Design Stephen Esser, Constructing CAD, SQ Lab Henry Chang, Chief Designer, Gearlab The Cycle Forum kicked off its first session with a look at design excellence in the cycling industry. Describing the bicycle as the “perfect human amplifier,” Sanders introduced his ‘Blue Ocean’ concept, which suggests the bike industry’s image must be desirable to all, rather than just cyclists or ‘sporty males.’ According to him, cycling has a real opportunity in the urban mobility market if there is a

shift in focus from sport to transport, with the same ringing true for the design of apparel and accessories.

Sanders’ ‘Blue Ocean’ concept suggests that only 20% of the cycling industry’s potential market is currently being reached, with a whole host of untapped potential.

“The bike industry must lead design, not follow,” he said.

“We must design with everyone else, making real userfocused improvements and looking at everything that makes life easier.”

Esser seconded Sanders’ idea of a ‘Blue Ocean’, revealing statistics stating 10% of people already ride, an

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(( FOCUS ON URBAN MOBILITY ))

estimated 60% of people are interested in cycling however are scared or frustrated with current provision, and 30% of people will never ride. In his opinion, bikes need to be designed with the human body in mind, consulting doctors and health specialists to provide ergonomic improvements to fit the user, or they simply won’t be used.

“We need to create the right compromise for customers when it comes to safety, comfort and looks,” Esser advised. “It is important to learn about new materials and production processes and to be able to predict what’s coming, such as cargo bikes.”

The relationship between design and solution was also raised by Chang, who believes that design exists to solve problems. In his opinion, the market continues to solve problems that have been solved before with new solutions. “Are you sure you’re doing the right thing to solve a problem?” He asked the room. “You have to ask yourself, what do you want to solve? When we have a list of what to solve, it’s mostly specs because they’re tangible.

It’s the intangible that will set your company apart and where design is effective.”

SESSION 2 > CYCLING CULTURE Klaas Verschuure, Deputy Mayor, City of Utrecht, The Netherlands Rich Conroy, Director of Education, Bike New York Vicky Yang, CEO, Cycling Lifestyle Foundation This session focused on trends in cycling culture from three different perspectives; the bike-friendly Netherlands, carfavouring US and Taiwan with its moped monopoly.

With one million bikes sold in the Netherlands last year

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alone, and 35,000 km of cycle paths throughout the country, it’s clear that the Dutch are onto something. According to Vershuure, bikes are seen not merely as a pastime, but as a vital means of transport.

“Urbanisation is a worldwide trend,” he said. “Cities are becoming busier each day, so how do we make it more pleasant to work and live there? A policy which prioritises healthy living goes some way to creating a flourishing urban society.”

In Vershuure’s opinion, cultural change is the biggest barrier to the bicycle’s urban mobility success: “The most important success is co-operation between businesses, residents, unions and knowledge institutions, which are all involved in decision-making processes and work together.”

Conroy believes a bike culture would see the bicycle become a default choice of transport. In a country with a proud motor vehicle heritage, existing alongside a BMX and mountain bike culture, integrating urban mobility solutions in to such a large and diverse land mass is tricky, to say the least.

“The US has a long way to go in treating cycling as an everyday activity, we still have a car culture here and there’s a winner and loser mentality over road space. Every bike lane or path built turns in to a big political argument.”

Conroy also believes bike advocates may be hindering the cycling culture cause: “When you spend too much time saying how dangerous the streets are to cycle on, it puts people off. You don’t sell a product by linking it to death.”

Yang and her YouBike bike-sharing system also have road competition from mopeds, the main transport mode

More cargo bikes than ever were on show at Taipei Cycle this year

of choice for getting around the island’s cities. However, Taipei’s Riverside Park Transformation project saw 1,450 new bikes donated in a bid to rejuvenate the space and make bikes available for everyone.

The basis for this project, and those carried out in the inner cities, came as a result of Yang visiting cities such as Utrecht to observe leading infrastructure and practices to implement them in Taiwan. “It is impossible to create the cycle culture and lifestyle without policy support,” Yang admitted. “Now, after the delegation visited Utrecht, the government has a better idea of how to implement the bike-sharing schemes in the cities.”

SESSION 3 > E-BIKE TRENDS Susanne Brüsch, CEO, Pedelec Adventures Marian Baukrowitz, Director of Research, 4C Consumer Insight Manuel Marsilio, General Manager, CONEBI Whether you consider them to be ‘cheating’ or not, it’s hard to argue against the rise of e-bikes as an industrychanging phenomenon. Pedal-assist features have helped to open up cycling to larger and more varied groups of people than ever before, while providing credible commuting alternatives for longer journeys.

The e-bike has in turn led to the development of ecargo bikes which can be utilised as last-mile delivery alternatives, green taxi services and for simply transporting your shopping. This session asked the question; what

are the trends the cycling industry should focus on in the next five to 10 years?

The forum’s speakers and attendees collaborated to come up with recommendations to help the industry capitalise on the e-bike as a driver of urban mobility solutions, firstly through managing relationships with the automotive industry and creating a crossover to complete the user experience.

Greater product differentiation is needed, according to the recommendations, to cater for entire families, however those partaking believed the e-bike needed to stay close to the normal bike, with availability of energy in view of consumption.

SESSION 4 > FUTURE CITY Morten Kabell, CEO, Copenhagenize Design Company Kevin Mayne, Chief Executive, Cycling Industries Europe Shyue-tair Chen, Commissioner, Department of transportation, Taipei City Government The final session of the Taipei Cycle Forum collated the discussions had across the two days, in a bid to determine the cycling industry’s role within urban mobility, answering the all-important question: How do we sell it?

According to Kabell, infrastructure and provision is vital to the success of a bike-friendly city, while it has to make economic sense for a person to cycle, infrastructure is the biggest pull. “Communication is key in attracting and appealing to people,” he said. “This is not just about

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(( FOCUS ON URBAN MOBILITY ))

cycling, but about creating better cities. You have to know your data and choose your arguments, providing different groups with alternatives.”

Mayne stated that EU Cycling is aiming to see 240 million cycling trips completed a day throughout Europe by 2030, with car-free centres and cities a key aim for European cities of the future. However, he warned of the chaos of new tech start-ups providing alternative micromobility solutions to the bicycle. Electric scooters, drones and even hoverboards are all fighting for space in the urban mobility market.

“The bike industry has the chance to take ownership and create its own rules here. It needs to find proxies and ways into digital, to be a part of that world.

“If digital highways exist, cycling needs to be a part of that world. There needs to be a collective approach to creating bike-friendly future cities.”

A recurring sticking point which surfaced during the discussions was that of regulation. Regulatory frameworks for bike-share systems and micro-mobility do not currently exist, and that breathes uncertainty over what is coming next.

“This is the new Wild West,” shrugged Mayne. “Everyone wants to get rich, commercial companies especially. Cities and governments are playing catch-up with technology.”

So, how do we conquer the challenges of creating bike-friendly cities? According to Kabell, it needs to be a citizen-driven, bottom-up change towards an environmentally-friendly, sustainable, CO2-free approach.

Meanwhile, Mayne believes the commercial benefits of

You can count on seeing more of these out and about over the coming months

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car-free city zones speak for themselves, and these are worth it despite engineering works.

During the interactive part of the forum, attendees were asked the following question: Who should the cycle industry be talking to in terms of urban mobility, in order to have a decisive influence?

After much discussion and digression, it was advised that the best ports of call are the following: • Logistics companies • App developers • Emergency/health services • Educators • Local businesses • Automotive industry • GPS companies • Hotels • Media channels • Property developers • Self-regulated industries The Taipei Cycle Forum attracted over 250 attendees and buyers. Next year’s Taipei Cycle Show will take place 4-7 March 2020.

China Airlines flew CIN to the Taipei Cycle Show and provides direct flights from London Gatwick Airport to Taipei in its all-new A350 Airbus. www.China-airlines.com

(( THE NETHERLANDS ))

“E-BIKE RIDERS ARE GETTING YOUNGER AND YOUNGER HERE” CIN hopped over the North Sea on a visit to the Netherlands to find that there is more to the local cycling market than its famously enviable infrastructure…

A

msterdam is to allow ‘emission-free vehicles’ only by 2030, with millions of euros set aside to improve bike paths, parking and general cycle infrastructure in the run up to the milestone date.

Despite this being a bold move, there probably won’t be too many cycling industry watchers who are altogether surprised to see this plan, given the Netherlands’ famously pro-bike attitude.

Infrastructure is one thing, but how is the market faring?

Like many cycle markets around the world, things have got more competitive. As Gazelle tells us (page 18): “40 years ago, there were three brands in Holland. Now the market is much more crowded.”

Brands have doubtless been keen to grab a share of a territory that continues to grow. Recent figures from the Netherlands’ RAI Association (with BOVAG and GfK) revealed that the sale of new bicycles increased 25% in 2018, compared with 2017. This mature market saw more than one million bicycles sold for the first time in four years.

E-bikes have been the star performing category for the Netherlands. Now the biggest sector of the trade there, four in ten new bikes were electrically powered in 2018 and e-bikes contributed to a rise in the average purchase price of a new bicycle, to €1,207 (it was €734 in 2011).

Despite those impressive stats, the industry still feels e-bikes have room to develop further. “The growth of electric bikes will continue,” a Gazelle spokesperson tells Cycling Industry News.

“Besides older people, we see other consumers like students and commuters also taking the e-bike or speedbike. The e-bike as a product for elderly people is history. Related to the fact that more people choose to ride the e-bike, this also means more e-bike sales. Due to traffic issues in larger cities, congestion as well as government policy, we believe that the number of e-bikes will only increase.”

Another significant player in the Netherlands and wider cycle markets is Cube Bikes and Oneway Bike Industry BV. The firm tells CIN that e-bike sales are “going through the roof” with even children using them en route to schools. Three bikes per person is a standard in the Netherlands, the firm adds, with a thriving second hand bicycle market within which Cube Bikes are popular and hold their value.

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Cube Leersum opens next to neighbouring trail centre “The generation buying into e-bikes is getting younger and younger,” Jeroed Beije tells CIN. Beije runs Cube’s new store in Leersum, near Utrecht in the Netherlands. He sees older riders as pro e-bike too, but there’s a stubborn group between, around 28 to 35 year-olds, that remain sceptical about electrical assist, he says.

Cube’s Leersum store opened its doors in March 2019, situated close to a national park with an enviable set of trails. With a significant e-MTB fleet of demo bikes, the shop has been tailored as a hub for the neighbouring MTB network. “20,000 registered cyclists use the trails there,” explains Beije. “They have to pay a €7.50 annual charge to use them.”

The general retail market remains tough, he adds, with many shop owners reluctant to give up old ways of retail and relying on old retailing techniques and methods used the way their grandparents may have. Cube’s Leersum store is, however, a decidedly modern outlet. With a shop tailored to make the most of its location and a significant demo fleet, the shop also boasts plenty of nice details (like a big mirror outside the changing room so punters can get a proper look at themselves in new gear) and even business cards for its mechanic – a man so popular that one devoted customer cycled near to 100,000 kilometers (round trip) just to have their bike serviced by him, we’re told.

OUR PARTNER PROGRAM HELPS INCREASE YOUR SALES We buy your customers trade-ins We buy unwanted demo, display and old stock Bikes, frame, wheels & parts Road, TT, Cyclocross & MTB Fast pricing, collection and payment

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(( OPINION RICK VOSPER ))

BULLETINS FROM THE LEFT SIDE OF THE ATLANTIC It’s shaping up to be another crazy year for the US bike business. Yes, again.

And since the trouble we stir up on this side so often makes it to your side of the Atlantic, here’s a supersized American helping of three developing stories which may or may not be headed your way soon, from Rick Vosper...

GREEN MEANS GO, RED MEANS PAUSE BRIEFLY The number of cyclists killed on US highways has increased by almost 20% since the turn of the millennium, according to the National Highway Transportation Safety Administration.

Relations between cyclists and motorists grow increasingly fractious.

In the middle of this, a number of US states have been passing laws allowing cyclists to roll through stop signs, and to continue through red lights after stopping, whether the light has changed or not. As one source puts it, “A red light is treated as a stop sign; a stop sign is treated as a suggestion.”

I note the same question is coming under discussion in the UK. And, as in the UK, one prevalent notion is that cyclists are scofflaws who expect

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special privileges not afforded motorists, and the “Idaho Stop” is doing nothing to dispel this notion.

People For Bikes' spokesperson Morgan Lommele says: "Studies show that bicyclists are safer when they are able to get a head start at intersections, and they become more visible to the drivers behind them, which helps avoid crashes and keeps all road users safe." But opinions are divided, even within the cycling advocacy community. In 2017, when the first Idaho Stop laws were being enacted, industry consultant John Schubert summed up the counter-opinion this way: “The vehicle code is vehicle-agnostic… What happens when we give one class of vehicle operator different rules?

Among other things, they get crushed by turning trucks.”

Just to keep things interesting, The popular US TV show Blackish recently played the notion of swerving at cyclists “just to scare them” for laughs, eliciting the not unexpected (and by no means unjustified) response from the cycling community.

ASE, FUJI PERFORMANCE ET AL: “IT’S NOT OVER ‘TIL IT’S OVER,” OVER AND OVER Apparently dissolving a vertically integrated multi-hundred-milliondollar conglomerate of factories, wholesale brands and a 100+ storefront retailer network is, well, not as easy as it looks. The latest (8 April) installation in the ongoing ASE (Advanced Sports Enterprises) slo-mo train wreck is a long line of unsecured creditors who have announced they are suing some of those who got preferential treatment in the company’s February 1 settlement.

The list of bag-holders includes a pair of Asian bike manufacturers (one of whom, Polygon, is a part owner of the Marin Bikes brand); Vista Sports, owner of the Giro/Bell/Camelbak

“1,800 EMPLOYEES NOW OUT OF WORK AT VARIOUS CORPORATE LOCATIONS AND PERFORMANCE BICYCLES’ 104 FORMER RETAIL OUTLETS.” group; the USA’s IRS tax agency, and shipping company UPS. These six alone are owed some US$16.4 million (£1.3 million). And there are at least 600 others.

That’s a long line of creditors, and it says nothing whatever about the fate of

the approximately 1,800 employees now out of work at various corporate locations and Performance Bicycles’ 104 former retail outlets. Even in the USA, that’s the most bike industry people out of work in a long, long time.

A hearing is currently scheduled for June.

The big—and almost entirely unasked—question is whether ASE is an isolated example of an overextended retail operation taking down its otherwise profitable supply arm, or the tip of an industry iceberg afloat in a shrinking ocean that already has more bike and equipment brands than it can comfortable sustain.

SHIFTING THE BALANCE OF POWER IN THE INDUSTRY… AND IN ADVOCACY At a time when the Bicycle Association of Great Britain is building its retailerbased resources, membership in the US-based National Bicycle Dealer Association (NBDA) is rumored to be at an all-time low. Retailers consistently tell me that contracts, especially with top brands like Trek and Specialized are increasingly onerous and one-sided, and that margins on all classes of products keep slipping. The balance of power between retailers and suppliers, they say, is clearly

shifting… and not in retailers’ favour.

Now the American suppliers’ trade group, BPSA (Bicycle Products Suppliers Association) is merging with the industry’s largest advocacy group, People For Bikes. The deal has been in the works since 2017 and was approved by boards of both groups in mid-April, subject to vote of the BPSA membership, which is expected to be forthcoming.

What this means is that advocacy efforts will henceforth literally be whatever is in the interests of bicycle

suppliers.

The fifteen-member People for Bikes board of directors currently has exactly two retailers, one of whom is a vice president with the 140-store sporting goods giant REI. No word yet on how governance between the groups will be accomplished, but let’s suspect that the notion of putting any retailer in charge of the industry’s supplier group is strictly a nonstarter.

Retailers are understandably concerned.

US CYCLIST FATALITIES 2000 – 2017 (Source: NHTSA) 900

“A RED LIGHT IS TREATED AS A STOP SIGN; A STOP SIGN IS TREATED AS A SUGGESTION.”

850 800 750 700 650 600 550

17 20

16

20

4

15 20

1 20

13

20

12 20

11 20

10 20

09

20

08 20

07 20

06 20

05 20

04 20

03 20

02 20

01 20

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(( PROFILE CYCLE EXCHANGE ))

WE’LL TAKE AWAY THE HASSLE OF

BIKE PART EXCHANGES

Was your first car second hand? Why hasn’t the bicycle industry managed to import the part exchange model so successfully used by the motor trade? And with higher ticket e-bikes growing in popularity, is the market now ripe for a decent second hand cycle trade? CIN speaks with Cycle Exchange’s founder and CEO Matt Connelley about how his firm can help the nation’s bike dealers…

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egular readers may recall our last edition of CIN the shop so they can use that as part payment for the (issue 02//2019) invited the trade to discuss what customers new bike.” ideas for shifting product cycle retail could take Bike shops who like the potential of, but are daunted from the motor trade which, current difficulties by the mechanics, of offering part exchange in the sale with Brexit aside, is doing pretty well – undeniably, it has of new bikes should approach Cycle Exchange, Connelley made a pretty decent fist of getting new cars into the explains: “Part exchange of bikes makes complete sense hands of consumers. but is not straightforward for a retailer. They are difficult The part-exchange model has been a motor industry to price and not easy to sell on, especially if you don't standard for decades, lining motor pockets with untold have space or time to deal with it. It's a real hassle - we millions. But as yet, the cycle take all that away.” trade has been unable or Cycle Exchange has been in unwilling to make such a business for a number of model work. The partyears, predominantly concen“PART EXCHANGE OF BIKES exchange model is one our trating on the road sector, but industry panel could see has been broadening its focus MAKES COMPLETE SENSE potential in, but without out in recent times: “We have BUT IS NOT STRAIGHTFORWARD anyone offering the service and been mainly focused on road challenges in terms of resell and tri bikes but are moving FOR A RETAILER, ESPECIALLY value, there were real obstaquickly into off road - gravel cles in seeing such a concept and mountain bikes. MTBs are IF YOU DON’T HAVE SPACE work in cycle retail. a bigger challenge as a used Cycle Exchange buys, sells product - both for storage and OR TIME TO DEAL WITH IT.” and exchanges predominantly how they are used. We have a second hand bikes. Cycle tonne of MTB experience in Exchange founder Matt house and are moving to Connelley tells CIN: “As a bike trader we own all the bigger premises for the extra space required.” stock we hold, so if you have a bike to sell and we can One other trend is the growth of electric bikes. These agree a price, the funds are credited to you within a few higher ticket items, in theory, are absolute prime candihours of bike inspection.” dates for part exchange, with the potential to retain much “We work with a growing list of bike shops and we facilof their value on the second-hand market. itate part exchange for them. So, if one of their customers “We are definitely keeping a keen eye on how that wants to trade in a bike against a new one, we provide a develops, it's still niche in the UK but that will change and price and organise collection. The funds are credited to we will be ready.”

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(( PROFILE CYCLE EXCHANGE ))

“When people discover we exist, their response is usually one of relief” Cycle Exchange was developed out of a customer need.

Connelley picks up the story: “I've been into road cycling and triathlon for many years but I came new to the cycling industry in 2013. I'd been trying to buy a TT bike on eBay as I didn't want to buy a new one. After being messed around so much it was clear there was a gap, and a professional bike trader was needed, particularly with the popularity and cost of decent bikes rising so much.”

The firm started out with a website and after two years found there was a need to open a bricks and mortar outlet. “The website and the focus on ecommerce is key for the business and future growth but it is also important to have a bricks and mortar presence especially for higher end sales. People want to know there is a permanent base which they can visit and return to if there are any issues. Our Kingston store has helped unlock a significant and loyal customer base. We sell bikes from £200 to £10,000 and we warranty every sale.”

With the pace of change on the high street, have attitudes changes to the pre-owned bikes market?

“When people discover we exist, their response is usually one of relief. That there is a trusted service for

dealing with used bikes has definitely changed the attitudes of our trade and consumer customers. Growth has been strong but doesn't come without challenge. Margins are hard sought and aggressive discounting by retailers makes pricing tough. Being able to turn bikes over quickly is critical to cash flow.

“I think cycle retail has its challenges whether new or preowned, the structure of the market means margins are very thin for retailers. That makes them vulnerable to a shift in market conditions be that technology or product orientated. I do think there is room for growth in preowned but that will only come if the service and quality assurance is actually better than the first hand market. Buyers are rightfully wary of buying an expensive second hand bike, there is no manufacturer warranty to fall back on or reliable registration the accounts for the bike’s history.”

Connelley concludes: “If you want to increase sales and have a more enduring relationship with your customers then part exchange is key. Working with us will remove the risk that comes with second hand bikes.”

Get in contact to become a part-ex partner via partners@Cycleexchange.co.uk Cycleexchange.co.uk

“THAT THERE IS A TRUSTED SERVICE FOR DEALING WITH USED BIKES HAS DEFINITELY CHANGES THE ATTITUDES OF OUR TRADE AND CONSUMER CUSTOMERS.”

050 // WWW.CYCLINGINDUSTRY.NEWS

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(( TRADE OPINION ))

What to look for when choosing a finance provider UK consumers spend £800 million monthly on goods and services using retail credit, according to the Finance and Leasing Association (FLA). With cycles finance worth over £100 million yearly, more providers want a slice of the pie, writes the ACT… he cycle retail finance landscape is currently experiencing many changes; providers consolidating, a lack of funds meaning providers have had to close and providers withdrawing from the market. Some of these scenarios have left cycle businesses high and dry.

The Association of Cycle Traders (ACT) has released the following information to help dealers know what to look for when choosing a finance provider partner.

T

automatically increase. This is especially true when a business has an account with a broker, not with the actual finance provider. Some brokers are known to offer very attractive initial subsidy rates but as they are paid on volume, they bury a rate review deep in the small print of your agreement. Many brokers also include a minimum contract length that leaves you trapped in an expensive and restrictive solution.

Market knowledge Finance providers are moving into the cycle’s sector without knowledge of the industry and bring finance products to the market which are aligned closer to white goods and other products. Ensure your provider has experience in the cycles marketplace and their finance solutions are tailored for the IBD.

Advice when you need it Finance providers are not allowed to provide direct training on how to maximise finance. This is where the ACT can help - enabling you to get the most out of your Ride it away account by providing bespoke training based on your individual requirements.

Beware of false promises In a bid to entice retailers to sign up with them, some brokers and providers promise a guaranteed acceptance rate or to increase your current acceptance rate. At face value this sounds great, but it's important to question any provider who even suggests you could get 100% acceptance rate, there are always some people who will not qualify for credit! Reputable finance providers will only accept a customer who can afford it.

Low rates mean lost sales As with many things in business, the cheapest is very rarely the best. You may be tempted by providers that offer low rates but there is a lot more to retail finance than rates alone - a cheap bike isn’t the best, so why would cheap rates be? As a general rule of thumb, a lower subsidy rate equals a lower acceptance rate. Put simply, the less money a finance provider makes from each sale, the less risk they can take when lending. This means a customer who would be accepted by one finance provider might not be accepted by the cheaper one; putting the sale and any future business with that customer at risk.

Watch out for the small print Providers offering lower rates often have Average Order Value clauses included in the small print e.g. if you don’t do enough volume at a high enough value the rates will

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• The importance of empowering staff • When to introduce finance in your sales process • Online integration • How to maximise your margins using different finance offerings • Upsell, upsell, upsell • Bundling products The ACT also provides a free, unique service many other providers do not offer; to help decide if FCA authorisation is right for your business, to assist with getting authorised and helping you to complete your annual return. Whilst you do not need to have FCA authorisation to offer retail finance, doing so might be better for your business and help protect margins.

The ACT work in partnership with V12 Retail Finance ensuring their finance products are the right fit for the cycle trade - under the consumer-facing brand Ride it away.

V12 is fully funded by a UK bank resulting in a stable lending environment. They are the leading provider in the cycle sector, the number one provider of online POS retail finance and widely accepted as having the best online integration solution (says the ACT). They have also just been awarded the 2019 Feefo Gold Trusted Service Award for providing superb customer service and the best possible experience for all their customers.

If you have any queries about the Ride It Away scheme you can call the ACT on 01273 427 700.

(( MUC-OFF ))

MUC-OFF MOVES HQ FOLLOWING RECORD YEAR

F

ollowing growth in sales and staff numbers, MucOff is moving to a larger home, just a few miles from its current base just outside Poole.

From May, the cleaning and lubrication specialist will be located in a larger facility in Branksome, just outside Bournemouth. Thanks to significant recent growth of the Muc-Off team, larger offices were needed to house the new joiners and to make space for future growth. 15 new people have been added to the team, taking the firm from 35 to 50 staffers in the last year.

On the sales front, Muc-Off is continuing to make noteworthy gains. The firm told CIN that current year-on-year growth looks to be hitting around 30%, and that’s following a record-breaking year for the brand in 2018. Across the pond, Muc-Off is up 60% year-on-year.

Finally, Muc-Off has added a number of big-name athletes and events to the rosters for the year ahead, including the likes of Monster MTB athlete, Sam Pilgrim and Team Katusha Alpecin in the road discipline to complement the world class team including Danny MacAskill, Tahnee

Seagrave, Matt Jones and Tomas Lemoine. In addition to this, Muc-Off is putting in appearances at significant events like Sea Otter, Crankworx and select European stops of the UCI Road and MTB world championships, to name a few, setting the firm up for what it expects to be its biggest yet.

Looking ahead, Muc-Off has some significant product and company updates lined up for the coming months.

Stay tuned to CIN to hear more of those.

(( PODCAST

))

LEND US YOUR EARS With the third episode of the CIN Podcast now live and available to stream and download, here’s a sneak peek at who will be appearing on the next one…

EPISODE THREE ‹ OUT NOW ›

EPISODE FOUR

For those who haven’t yet had the chance to listen, the third episode of the CIN podcast is now hot off the press, recorded from March’s Taipei Cycle Show.

We sat down with Liv Founder and Giant Chairperson, Bonnie Tu, to discuss women’s cycling, click and collect, and what’s coming up in the pipeline for the world’s second largest bicycle manufacturer:

Keep your eyes peeled and your ears open for the next episode, where we will be speaking to Tern Bicycles’ Team Manager, Josh Hon, and Sales & Business Development Director, Matt Davis, to hear how the brand is making waves in the field of urban mobility and sustainability.

BONNIE TU, CHAIRPERSON, GLOBAL GIANT GROUP

JOSHUA HON & MATTHEW DAVIS, TERN BICYCLES

Focused solely on the trade, we will be inviting industry players, special guests (and just about anyone with an opinion) to talk about all the goings-on in the bike business. Fancy getting in touch with a topic you want discussed, or have something to say yourself? Then contact a member of the CIN team.

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WORKSHOP MANAGERS, SALES REPS, ACCOUNT MANAGERS, GRAPHIC DESIGNERS, RETAIL BUYERS, SALES ASSISTANTS, MERCHANDISERS… LOOKING TO FILL A ROLE IN THE BICYCLE INDUSTRY? WHETHER YOU’RE RECRUITING IN ABERDEEN, MILTON KEYNES, VIENNA OR ANYWHERE ELSE, POST A JOB WITH CYCLINGINDUSTRY.NEWS TO REACH THOUSANDS OF POTENTIAL CANDIDATES.

LISTINGS START FROM £70 FOR MORE DETAILS, PLEASE CONTACT LOGAN@CYCLINGINDUSTRY.NEWS OR CALL +44 (0) 1727 739160

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ask the boss

ED IBBOTSON > HOTLINES

With a full demo calendar lined up for 2019, fresh brand signings and a change at the top of the business with long-term GM Illy Anastasi stepping down, Hotlines has a busy rest of 2019 ahead. CIN caught up with Ed Ibbotson…

Illy stepping down is obviously a big change for Hotlines, but we imagine it will be business as usual while the search goes on for a successor?

Illy was a longstanding member of the team, so it has been a big change not to have him at the helm and involved in day-to-day decision making.

However, the senior team have all been with the Hotlines for over 5 years, and in the industry for over 10: we’re confident that we have a very experienced team sharing the load as we push hard into 2019.

Aside from that, what’s the focus for Hotlines in 2019?

Hotlines continues to focus on supplying strong products to a fantastic network of specialist retailers.

Marketing remains a huge part of what we do, making sure our brands are visible and highly regarded in the UK. Rolling out a full demo calendar, we also make sure our product is being ridden, rated and purchased across our IBD network.

You must be pretty excited about the return of Ragley and the updated specs that have come with it?

Ragley has always been a staff favourite as well as having a passionate following at dealer and customer level. The frames have always been progressive designs but at

a price point that gives appeal to riders new and old. The new range builds on this, the flagship steel bikes are slack, long and low. Their alloy counterparts follow the same theme but offer a lower price point. Specs are designed with UK riders in mind: a reliable and proven package to keep bikes on the trail and their owners having fun.

Introducing a gravel/adventure bike was an obvious next step.

“IT'S ALWAYS HARD TO GET SOLID FACTS: BUT IT CERTAINLY SEEMS THAT MTB IS MORE BUOYANT AGAIN.”

FUJI has been in the Hotlines stable for around a year. How’s that going?

Did dealers respond well to the ‘no MOQ’ requirement? Was it tough to get independent bike shops to work with the brand after its association with Evans?

Fuji remains in its infancy with Hotlines but initial sales have been good. Some strong reviews on the road range have

brought frequent consumer and dealer enquiries. The new Auric mountain bike (enduro and trail versions) has also caused a stir. Given the low commitment level, IBDs have focused on specific parts of the range, we are confident this will expand. Evans promoting the brand previously definitely kept it in the eyes of the media and consumers, the fact it’s now open to all IBDs has only brought positive feedback.

Hotlines has great depth in terms of MTB brands, have you benefited – with the market (reportedly) seeing MTB growth, following road’s heyday?

It’s always hard to get solid facts: but it certainly seems that MTB is more buoyant again. Hotlines do very well with mid to high-end ‘enduro’ style bikes across all brands, particularly with Nukeproof and NS. While we don’t argue that the road market may be challenging at the moment; we have again seen growth over the past two years. Wilier proving a particular success on the road, and Rondo exploding onto the scene with their unique and refined take on gravel and road+. Exciting things are ahead for both these brands.

Generally, are you finding bike dealers are more wary of taking on bike stocks in shops? Is that a real trend from your perspective? What do you do to

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ask the boss

work with them to combat that – more MOQs? Is this a wider industry challenge that needs tackling?

Dealers are still stocking a good number of bikes on brands (and in categories) where they have a proven sales history. Dealers are more cautious on taking new brands. This presents challenges for us in forecasting, but like bike shops, we must adapt to their changing needs.

With this in mind, we offer a stock refresh scheme on key brands, meaning they can swap out any remaining stock at the end of the year for the new range: no obsolete stock and the newest product continuously on display means minimal risk to the retailer.

We have seen a number of headlines about IBDs shutting, while some pundits have put it down to a natural ‘churn’ with plenty of new shops coming to market. What’s your take on IBD numbers?

We have seen a couple of significant closures this year, but the sales have always gone elsewhere. Consumers are still buying, new shops are still opening (and staying open), there is definitely much greater optimism out there for the year ahead. Bicycle retail is hard and constantly evolving, but the doom and gloom reported isn’t representative of our corner of the bike industry.

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ED IBBOTSON > HOTLINES

Aside from those glum topics, what are the big opportunities in the market ahead?

Call it gravel, adventure or bike packing, we are seeing a huge increase in interest (and sales) in this category.

It’s capturing the imagination of existing riders and those into the wider adventure lifestyle. On the road, road-plus is evolving into something which suits so many: bikes like the Rondo HVRT are incredibly relevant and we will see this type of bike become big over the next year or two.

Are you gearing up for another house show in August?

We will be presenting the best from all our bike brands in July or August, dates and format TBC. Previous years have included presentation from industry veterans like Mark Lynskey and Szymon Kobylinski, rides on the UK’s finest trails in the Tweed Valley, air bag capers and whiskey tasting. Whatever we decide on this year, it will be well worth attending.

Anything else you’d like to draw our attention to?

There is exciting news coming from all our brands. It sounds silly to say this at the end of Q1, but 2020 product shifts the level up again. Stay tuned. www.hotlines.co.uk

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