CIN issue 003 2018

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from the editor

Mark Sutton Cycling Industry Chat @CyclingIndustry @MarkSuttonBike mark@cyclingindustry.news

WE’D BE NOTHING WITHOUT YOU...

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There’s a handful of entirely separate topics I’d like to touch on in the short column inches I’m permitted this month, so I’ll begin with the most timely; GDPR. This is a subject that seems to closely mirror the attitudes to bicycle retail evolution; there are those that accept change is coming and are adapting now; those that think they’ve time on their side; those that think it’ll not affect them and finally those altogether oblivious. I cannot dwell long on this, but neither can you if you have an email database. 25 May is doomsday, or as it’s been put to me by our own web-savvy overlord, “a brilliant opportunity to clear out the deadwood.” He’s right of course, those that engage with you regularly will remain and an engaged auidence is well worth focusing your time on.

By the time you read this, there’s a mere few weeks left to organise and begin a campaign to get your house in order. In short, any email data you have gathered over the years must be re-verified by your customer base, who are required to again optin to various communications. After this deadline, if you’ve not had this traceable confirmation then you’re sat on dead and likely illegal data.

Next up, on my checklist: a thank you. CyclingIndustry.News, with the help of independent bike shops up and down the country, has just completed the deepest study of the independent bike shop trade ever undertaken. Later in this magazine you’ll see the first of many reports on our findings. If you took the time to assist in what we considered to be long overdue market research then you’ll soon be receiving an email with a password and link to view the findings in full.

In the same vein, as usual, we begin this issue with an albeit smaller survey of retail opinion on a topic that I’ve watched evolve with some interest, bike sales. Jay Townley, my colleague over the pond (and regular contributor to this title) has long been part responsible for much of the USA’s market data. A trend he’s long kept tabs on is the profitability of certain bike sales, if there is any in net terms, that is.

Margin erosion by any means is less and less palatable on the shop floor and so the growing hostility toward the Cycle to Work scheme’s bigger players is an unsurprising development. Of course this scheme has never been perfect; those who are shown to need it most – the currently unemployed and underpaid – have little access at all. It is therefore not the solution to the direly needed grassroots cycling for transport movement the UK must develop to once again see a healthy bike market.

Let’s end with a positive and an all too rare hat tip to those suppliers who are working for the independent through challenging times for all in the supply chain.

Our trade-locked Facebook group – found by searching “Cycling Industry Chat” – recently polled the “most IBD friendly” supplier. Top marks to the team at The Cycle Division for coming out as a trade favourite. Furthermore, throughout this issue you’ll find other suppliers demonstrating their commitment to giving bike shops a leg up on profitability. Choose them wisely and they’ll see you to the next peak on the bike business rollercoaster.

Publisher

Jerry Ramsdale jerry@cyclingindustry.news Editor

Mark Sutton mark@cyclingindustry.news Sales Executive

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

Luke Wikner luke@cyclingindustry.news Published by

Stag Publications Ltd 18 Alban Park, Hatfield Road St.Albans AL4 0JJ t +44 (0)1727 739160 e info@cyclingindustry.news w cyclingindustry.news ©2018 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.

CyclingIndustry.News is a proud member of the Bicycle Association of Great Britain.

the professionals BIKES SALES: A PROFITABILITY PUZZLE With a steady decline in profitability on bike sales it has been suggested that the time may have come for complete bike brands to be renting floor space within bricks and mortar demo destinations. Are we there yet? We ask the trade…

Ceri Dipple Twenty3c

1. IN THE PAST FIVE YEARS HOW HAVE YOUR MARGINS ON BIKE SALES CHANGED? Ceri Dipple, Twenty3c Headline margins haven't changed within our business, but retained margins have definitely decreased.

The discount expectation from customers has significantly increased, which is not helpful.

Paul Kenchington, The Bicycle Chain In a word, downward. In the last five years I’ve lost over four percentage points on my total bike sales margin.

One of the key drivers of margin decline has been the visibility of pricing on the Internet of old models; if you have an old model you can no longer sell it for full money. Reduced prices are highly visible to the web-savvy shopper (everyone). Worse still, the price

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Paul Kenchington The Bicycle Chain

John Askham Kinetic Cycles

stays visible even once the product is sold in many cases in a bid for traffic and to switch sell to the latest year product.

The expansion of SKUs has meant that we’ve all got far more stock than we need, so it’s dumped by suppliers and retailers alike. You either go with it and clear, or hang on growing your stock and endangering your cash flow.

John Askham, Kinetic Cycles We've been open six years now and I would say our margins have remained relatively stable. I think there are certainly more targets to hit and incentivising from suppliers in order to retain competitive margin, but we seem to be hitting them regularly and therefore haven't really suffered as a consequence.

Mick Murphy, Mickey Cranks Not significantly.

Mick Murphy Mickey Cranks

2. DO YOU THINK YOUR NET TAKINGS ON BIKE SALES HAVE INCREASED OR DECREASED? Ceri Dipple, Twenty3c It depends if you are looking per unit or overall. Per unit, it has decreased, but overall it’s increased for us.

Paul Kenchington, The Bicycle Chain Two years ago I made 65 pence per bike sale before corporation tax and I am not making much more than that today.

I firmly believe it costs a reasonable sized IBD about 30% margin to run the business and making more than 30% margin on bikes is proving tough.

If the IBD is to survive and prosper the whole dynamic needs to change; a lot of brands haven’t realised or admitted this yet. If they do realise it and they do accept the need for a

different dynamic then we can all move forward.

There’s a lot that needs to change, but it needs bravery from the major brands, I fear none will risk their market share for the long-term health of the IBD route to market.

John Askham, Kinetic Cycles I would say our net takings on bikes have increased. Our volume of sales hasn't, but we're seeing excellent growth at the top-end of the sales spectrum.

In retrospect, we're probably selling slightly fewer bikes than five years ago, but our average sales price is increasing nicely.

For us, the entry-level road market (call it £500 to £1,500) is dead and we're happy to leave that to big box retailers who are still ploughing through warehouses of two-yearold stock.

That being said, the entry-level MTB market is buoyant, as are the high-end markets across all spectrums. Typically these bikes will have lower margin and require more sales times, but on the flip-side, very often can deliver a greater net yield.

Mick Murphy, Mickey Cranks I’d say they’ve decreased due to a combination of over supply in the market and online competition.

3. HOW MANY TIMES HAVE YOU CHANGED YOUR BIKE BRANDS IN THE PAST FIVE YEARS? Ceri Dipple, Twenty3c We went single brand 18 months ago, with a few key products from others to complement our existing range. We haven't dropped any brands to favour another though.

Paul Kenchington, The Bicycle Chain The top three I’ve not changed; if you look at GFK’s sales data you would not get rid of these brands. Because the marketplace has very little data many suppliers and IBDs are not aware of what sells, but if you know what sells you can make very informed buying decisions.

In answer to your question, we have actually dropped one brand and vastly reduced a couple of others that mainly achieved sales when our key suppliers ran out of stock.

We have taken on one additional brand which has proved very successful both for us and the brand.

John Askham, Kinetic Cycles Our 'core' brands are the same as when we opened, but our niche brands change relatively regularly.

We'll typically give a brand a good 12 months or so of profile in-store

before we think about cutting them loose. Only once or twice have we thought 'this was a mistake' right from the off. Often this is to do with the brand itself and how it is run, rather than the product.

Mick Murphy, Mickey Cranks Our core brands, Cube and Cannondale, have remained the same and last year we added Specialized.

We have experimented with five niche brands that were nice to have, unfortunately they did not return a high enough volume of sales to make them worthwhile. In a lot of cases we ended up clearing niche stock online and through eBay as a last resort.

Our mainstream brands Cube, Cannondale and Specialized have proved to be profitable.

4. WHAT WERE THE PRIMARY REASONS FOR CHANGING BIKE BRANDS? Ceri Dipple, Twenty3c There’s many reasons; product range, availability, marketing, how well a brand manages its distribution – all of this must be considered and reviewed from time to time.

There is no perfect brand, it's ensuring that the brand to retailer relationship is strong and that both understand one another.

WWW.CYCLINGINDUSTRY.NEWS // 005

the professionals BIKES SALES: A PROFITABILITY PUZZLE Paul Kenchington, The Bicycle Chain My motivation for taking on a brand is if they find a niche that current brands are not focusing on. An example many years ago was Yamaha e-Bikes when the sector was just starting and no existing suppliers had the quality and back up needed for this new technology.

Another would be Allied Cycle Works; we are their UK agent. They are developing Made in the USA carbon road frames with custom paint finishes, quick lead times and no stock piles to be dumped. We believe there are enough customers who want something a little different but backed with knowing where it was really made and by whom.

John Askham, Kinetic Cycles Mostly it's market demand, other times it's price or availability, sometimes it purely comes down to a brand bringing out a great bike and capitalising, or just having a stinker of a year.

Typically the brands that end up rotating have small product lines and can rise and fall based on one or two bad choices. We've had discussions about dropping brands because their best-selling line now comes in a terrible colour choice.

Mick Murphy, Mickey Cranks We wanted to add flavour to our offering and try something new to keep our customers engaged.

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5. HAVE BRANDS EVER PRESSURED YOU WITH UNREALISTIC SALES TARGETS, OR UNFAIRLY IMPACTED YOUR TERRITORY HOLDING? Ceri Dipple, Twenty3c There are always unrealistic expectations; not just from brands or distributors, but from retailers as well. Everyone has sales targets, if you were to look at the growth in targets and compare them to growth in market size there will always be a disparity.

Paul Kenchington, The Bicycle Chain Yes and I stopped dealing with them immediately.

I remember agreeing a trading territory which was re-engaged upon and some lame excuse offered as to why it didn’t count. I stopped dealing with them and both the IBD and the brand no longer exist. I do see fellow IBDs having sleepless nights because they have too much stock and sometimes it is their over enthusiasm, but too often it is suppliers wanting to shift the stock from their warehouse.

We again come back to the lack of accurate data for the size of market, if no one has a clue the supplier might be correct that the IBD should take X number of bikes, but if they are wrong everyone suffers.

We do have an advantage from years of working our local area to know roughly what our sales

numbers will be, especially as our local population is quite static and we don’t have a big cycling commuting culture like big cities have developed in recent years.

John Askham, Kinetic Cycles On occasion it's been threatened, but sometimes deservedly so.

I think, in this day and age, you'll be asked to be brave with ranging, but you'll get more support for doing so. I think if you give a brand fair representation in store, you know and like the product, you market it well and it doesn't work out as you hoped, brands will work with you. If you 'stock in' a brand, sell through your stock and then continue to try and call yourself a 'dealer' with no range to present to customers and said brand identifies another dealer within your territory that they feel is going to do a better job then you will probably lose it. I think in this instance loyalty is a two-way street.

Mick Murphy, Mickey Cranks Our suppliers work with us in the majority of cases. The switched on brands realise the value of floor space over unrealistic pre-orders.

6. WILL YOU CARRY MORE OR LESS BIKE SKUS AND BRANDS IN THE FUTURE? Ceri Dipple, Twenty3c We don't carry a huge stock at the moment, it would be the biggest

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the professionals BIKES SALES: A PROFITABILITY PUZZLE threat to our business if we did. It's difficult to liquidate stock quickly given the level of discount available to consumers 24/7, so I'd rather not expose the business in that way.

Paul Kenchington, The Bicycle Chain I don’t think you can move too much either way. If you don’t carry all the sizes the customer will ask if you’re a proper bike shop.

I’d love to think you could carry less and the brands keep saying they are reducing SKUs, but I’ve not seen it yet. If it’s available customers want to see it and try it, they may not buy it, but they naturally want to make that decision. My plea would be to suppliers don’t make it, but that is never going to happen as everyone is chasing the next big thing.

John Askham, Kinetic Cycles We'll continue to stock a good range of SKUs. What we've been keen to do is identify a niche and stock the brand that we feel best represents that niche. In some instances we can cover multiple bases from one brand, but if we identify, for arguments' sake, 12 key areas and we feel we need a different bike brand to cover each, then so be it.

These days you've got to stay flexible and continue to evolve your portfolio to stay competitive.

Mick Murphy, Mickey Cranks We are assessing what is profitable in-store and allocating the correlating space to those SKUs. If brands/SKUs are showroomed or discounted massively online we will discontinue them and replace with lines that are not. We increase floor-space for what returns the best income, and decrease space for poorly performing bikes.

7. HAVE WE REACHED THE POINT WHERE BIKE BRANDS SHOULD BE COMPENSATING RETAILERS FOR THEIR SHOP FLOOR SPACE IF THEY WANT TO FEATURE? Ceri Dipple, Twenty3c No! It's a really interesting topic, I've got quite a few thoughts on this, but I’ll have to save these for another day.

Paul Kenchington, The Bicycle Chain I would say to a degree we are already there with one major brand significantly changing credit terms for 2018 product. They recognised the stupidity of IBDs having to pay for new product at the most challenging cash flow time of the year around February and moved it to May. I hope with the awful weather this winter they will not have caught a cold.

I believe the dilemma is greater than just floor space it must also include the cost of our staff’s wages.

We all need great staff but they deserve to be well rewarded and that requires the IBD to make a good return. The modern cost of selling bikes comes at a great cost paid to third parties and they have taken large amounts from the industry with the IBD shouldering all the burden.

Whether they actually bring new business or not is another debate but if suppliers picked up all the ride to work costs and interest free credit charges it takes to sell their bikes the IBD would be a lot better off and wages could rise.

John Askham, Kinetic Cycles No, I think that's bonkers. There's no doubt that there is more competition than ever before, but there are also more cyclists than ever before. It's up to the brands to produce the best kit, but it's up to the retailer to showcase it. There are certain brands that support their dealers better than others, this is true, but they also expect a return on that investment. If brands are starting to compensate dealers for showroom space, they'll just look for alternative routes to market, squeeze margin, or just raise their RRP to a point where their product is no longer competitive.

Mick Murphy, Mickey Cranks I don’t feel this is necessary with the brands we carry currently.

Want to take part in our next Professionals Panel...?

Contact markk@cyclingindustry.n news to register your thoughts.

008 // WWW.CYCLINGINDUSTRY.NEWS

(( TRADE OPINION ))

FORECASTING THE FUTURE THE NEXT 10 YEARS OF THE BICYCLE TRADE

By John Styles, bike industry sales agent and Cyconomist founder.

I

n the UK, I believe we will see eBikes accounting for 50% of sales by value within three years. Thereafter, I’d suggest 50% by volume within eight years. You just have to look at Europe and anybody could guess that may happen.

But I’ve come at it from a different angle, studying the demographics of the UK and our bike buying habits at different stages of our lives. And I have some worrying news. I suspect it won’t just be about the growth in e-Bikes, it will also be about a steadily accelerating decline in conventional bike sales.

There may be a bit of cliff edge waiting for the unwary and it’s not too far down the road. Already the industry isn’t coping too well in some respects. I suspect the transition will not be easy.

Least of all because of the inherent inflexibility and lag in our supply chain. If we are not careful we will all be chasing

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“HOW MANY OF US REALLY GET WHAT COMMUTERS, RETIRED MOTOR-HOMERS OR KIDS ARE REALLY ABOUT?” the game for the next five or 10 years.

In many ways, 50/50 will be a good place, if and when we get there. Fewer PDIs for a higher average basket price.

However there will be some pain along the way. I keep hearing from stores that bicycle supply in many categories is pretty poor – yet in others there are overstocks. This appears to be across much of the industry and across multiple bike brands. Three months for this, four months for that, sold out for

the season after just two months in production.

Some stores keep a log of their lost sales and they are not insubstantial.

When one brand is out of supply, other brands just pick up the slack. When multiple brands are out, consumers just don’t purchase. This means more stores close. Lack of reliable supply may be a bigger problem than showrooming nowadays? Certainly CI.N’s own Independent Retail Channel Study confirms this.

Part of the issue is supply chain lag when assembling bikes so far (in both time and distance) from their end user.

Another issue is manufacturing capacity. Organisations with locally based flexible manufacturing, especially those who are expanding those facilities, should be well placed to succeed in this more dynamic market place.

However, fundamentally, whatever

HOW E-BIKE SALES VOLUMES COULD TRANSITION IN THE UK 80 70 60 50 40 30 20 10 0 2018

2019

2020 ■ MTB

■ ROAD

2021 ■ URBAN

2022 ■ LEISURE

■ KIDS

2023

2024

■ E-MTB

■ E-ROAD

2025 ■ E-URBAN

2026

■ E-LEISURE

2027

2028

■ E-KIDS

These charts take a “snap shot” of a local IBD store who has an equal volume split across the 5 unpowered bicycle categories. It applies modest year-on-year % declines to each of them. The compound year-on-year effect is of course more dramatic. At the same time it also applies rapid (though consistent with recent trends) growth %s to the e-Bikes sector - starting from the store having a low base in this sector. The effect on value is amplified as powered e-Bikes are assumed at x3 the average price point of an un-powered bike. Value Parity is potentially “just around the corner” for the store in this iteration of the predictive model. Sense checking that, you might only need one in four bikes sold in store to be e-Bikes to reach value parity, in some European countries, and some UK stores, they are already there.

part of the chain we work in and whatever our manufacturing set-up, what we all need is a better way of forecasting consumer demand. And that starts with the right questions, research and mind-set. Industry veterans, let’s ask ourselves a searching question. Does most of our industry dialogue (between stores, reps, importers, media and brands) consist of this: 1. Look! We made this amazing new bike, isn’t it shiny (95% of the chat wow I’m excited) 2. It’s for this type of consumer (5% yawn, that’s obvious, I lost interest and stopped here) 3. The numbers of consumers like this are growing/declining so...

4. Their disposable income is growing/declining so...

5. Their propensity to spend that income on bikes is growing/ declining so...

6. So... this year we will need lots more of bike (a) and much less of bike (b).

How often do we “as an industry” talk about steps three through six?

Granular, sector by sector, data and behavioural driven demographic forecasting.

Be honest, it’s not happening very much anywhere is it? Otherwise we

wouldn’t have such a large number of big (and small) names in trouble.

Otherwise I wouldn’t be getting calls from institutional investors who say: “We are disappointed in the dividends we are receiving from the cycle sector during the last 2 years, what is the earnings potential of OEM manufacturer (A), will it recover or should we liquidate our position and invest the portfolio in brand (B)?”. And no, I can’t tell you what I told them.

Are we all just looking at the last three years numbers and trying to draw a line that simply extrapolates what went before? That may have worked in years’ gone by, in a “steady state market equilibrium”. The current climate and indeed the next five years will be anything but that and the industry is going to need to adapt, otherwise there will be multiple business failures at every level in the supply chain. Size and scale will be no defence against the ocean swell of rapidly shifting tides in consumer demand.

Don’t get me wrong, we’re not completely hopeless. The industry is great and engaging with the pro peloton, Danny McAskill and weekend warrior Enduro types. We are there, we feel it, we get it. We constantly create new and exciting categories of cycle sport. We even re-invent the wheel, frequently.

But outside of that, how many of us really get what commuters, retired motor-homers or kids are really about?

How about how many there are or how their lifestyles are changing? Maybe somewhere deep in the industry this research or conversation is going on.

Forecasting is no easy job and I don’t

envy those who have to do it. It’s a bit of a rock and a hard place type activity.

Organisations may need to devote more (and different) resources to this business critical area as the market becomes less predictable. Big business is already looking to AI to better forecast future demand for goods as you can read here: tinyurl.com/ydzdmn9l Industry statistics are notoriously tricky, fragmented and in many cases need a large dose of salt.

So, what follows is my current best guess where sales in the UK cycle industry are going (Ceteris Paribus). Of course any sort of forecast or prediction is by no means guaranteed. Even I’m no expert. After 20 years in the industry, I still have much to learn and am always meeting people who have more or different experience to me. So, this is just a first step, opening the conversation, prompting debate on the subject matter.

Where I welcome the help of other industry veterans is in fact-checking and verifying my initial forecast. If you have a piece of data, research or statistics that either supports or contradicts this forecast, can you share it with me?

I like joining up the dots. It’s a hobby, a passion, an interest that keeps my brain occupied on evenings and weekends. Usually when Bake Off is on the telly. If it can also be useful to others, so much the better. Just drop me a line at info@cyconomist.com if you have anything to share. Or, if you want to chat (confidentially or even anonymously) you can reach me via GLGs London Office.

FOOTNOTE & “HEALTH WARNING”: My last article dealt with what quite definitely has happened in the cycle trade as a result of the 5th Kondratiev Wave. In this article, I have discussed what may happen in the next 10 years due to the Demographic wave. Which reminds me: Economists deal with what may happen, in general, with everyone’s money. As opposed to Accountants, who deal with exactly what has happened with your money. Which is why every business has an Accountant but very few have an Economist. So, my predictions come with a health warning: Make up your own damned mind.

WWW.CYCLINGINDUSTRY.NEWS // 011

(( TRADE OPINION )) SECTOR

DEMOGRAPHIC DRIVERS

FORECAST

UN-POWERED TRADITIONAL BIKES The average age of a keen MTBer now is 45 years old? There seem to be fewer and fewer young MTBers coming through to replace

MTB

them. Younger customers have less time, money and space. Though currently excited by new technology, over the next 10 years many

Rapid Decline

MTBers will likely transition to e-MTB, road or another sport entirely. 50 may be a key milestone for many and I suspect an e-Bike may

from 2022

feature highly on the wish list.

The average age of a keen road cyclist is 55? There are fewer cyclists coming through to replace them. Some will transfer to eBiking. Others will “import” e-Bike riding family to ride with them. The attrition rate will be lower than MTB. In addition the sector

ROAD

may gain from MTB transfers and modest women’s cycling growth. Gravel/adventure/bikepacking will perhaps receive a lot of media attention but (like the “Freeride/North Shore” boom of 2005) the Supply Side could rapidly over-reach the Demand Side of

Steady Decline from 2017

the equation - sales may be slow as very few people will have the time, fitness, inclination or skills to do this. Tri will likely remain more or less static year-on-year, though average participant age will probably rise.

Young people are increasingly abandoning the idea of private ownership of assets and instead favour shared resources (because

URBAN

they have lower and lower disposable income and/or space to store bikes and/or time to enjoy riding bikes.) Bikeshare will

Modest growth

become commonplace in all urban environments. Although Bikeshare may encourage more (privately owned) cycle purchases in

until 2020, then

older generations, I suspect it won't amongst the young. Therefore the net postive or negative impact of bikeshare upon retailers

very rapid decline

and bike purchases in any given area will likely depend on its local demographics.

Leisure bike sales to the over 50s should hold up for a period of time then reduce accordingly with the demographic wave. There

LEISURE

already is a steady transition to e-Bike usage with age. Hire and bikeshare schemes may have an impact, but not as extensively as within the Urban category.

Steady Decline from 2022

Quality kids’ bikes will likely hold up steadily as the nature of kids’ bikes makes it more resilient to economic and demographic waves

KIDS/YOUTH

(less price elasticity of demand in relation to both price and income). In addition, Bikeshare and rental schemes could grow in

Parity

popularity but also encourage growth of private ownership.

POWERED ELECTRIC BIKES e-MTB may see sustained growth from both keen/regular MTBers transitioning across and Leisure riders who want something

E-MTB

that “looks like an MTB”. e-Bike Enduro racing could surpass regular Enduro as a participation sport possibly as early as 2019. We

Rapid growth

are at the tipping point where e-MTB becomes cool (Thank you Chris S et al). e-Treking may emerge as a similar size niche market

then plateau

to gravel bike-trekking.

e-Road bikes may grow very rapidly as keen cyclists encourage their unfit parents, husbands, wives, cousins, brothers, sisters, neigh-

E-ROAD

bours and friends to come out and join them. This has very high potential to grow the industry by attracting and creating new cyclists from non cyclists. e-Sportives will begin to be offered as a separate category in many events. Somebody will launch an e-Road bike

Very Rapid growth then plateau

with variable top-speed settings as a specific coaching/training tool.

e-Urban bikes should grow steadily but plateau at a lower level than other e-sectors due to the demographic challenges faced by

E-URBAN

younger people. Some areas will roll out e-Bikeshare schemes, though these may prove problematical and expensive relative to non e-Bikes. Speed Pedelecs are being offered with licensing / helmets / insurance packages - wide-spread adoption of this practice may

Steady growth then plateau

prove more instrumental to selling the bike than the bike itself.

This sector will likely grow rapidly as the Baby Boomer generation continues to enjoy its second childhood with free time, disposable

E-LEISURE

income and storage space to spare. Staycations prompted by the weak pound will encourage more e-Bike hire schemes in holiday

Rapid growth

resorts and hotels. Many will purchase an e-Bike after trying one on holiday. IBD stores will be challenged by the likes of SAGA, QVC,

then plateau

John Lewis and G-Tech who likely will also grow this sector.

A sizeable minority of MTBers in their 40s and 50s could purchase these for their kids to enjoy longer off-road rides with them.

Current offerings using full size batteries and mid-drive motors aren't quite right. Companies who produce lighter, smaller, less powerful and cheaper models will be successful. In addition, a budget sector will emerge selling a craze product (like scooters

E-KIDS / YOUTH

and heelies this sector will only sustain itself for 2-3 years). Road models (by contrast with off-road) will be fraught with legal and moral hazard. For both road and off-road, many bikes in this sector will come with warnings that the product should only be used under adult supervision and on private land. Sales will be mostly focused in the 24” wheel size as it will be 6-10 year olds who are the key recipients.

012 // WWW.CYCLINGINDUSTRY.NEWS

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(( TRAINING: DNA ANALYSIS )) Muhdo DNA profiling kits retail for £249.99

MUHDO: A REVOLUTION IN RIDING? Over the last 10 years innovation and technical development has changed the cycling industry irrevocably.

Composite materials, gear set innovation, ‘aerofication’, onboard computing, wearable trackers – it’s all going on. But what about tuning the rider up? Muhdo CEO Nathan Berkley introduces us to DNA profiling…

As the potential to improve the equipment saturates, where will shop owners generate interest and differentiate their offer? Muhdo believes the next frontier of customer value is in tuning and optimising the rider. After all, for the vast majority of customers coming into your shops they themselves will represent the weakest ‘component’ in the setup. If customers spend a little time and money they would get far more enjoyment out of their biking experience.

Taking cycling performance to the next level, Muhdo has brought advanced DNA profiling and personalised nutrition to the world of cycling. Now on offer via Madison, our scientists are now capable of offering your customers DNA profiling and fitness plans in-store.

Contact Madison Web: Madisonb2b.co.uk Phone: 01908 326032

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HOW DOES IT WORK? It starts with an impactful videoenabled POS unit in-store, where customers can purchase a profiling kit. Then a simple saliva swab taken at home is sent to Muhdo laboratories in a pre-paid envelope. Two to four weeks later, Muhdo deliver a detailed report on the genetic make-up of the individual and personalised nutrition and fitness recommendations including hundreds of recipes, workout recommendations and micronutrition advice all tuned to the customer’s DNA. In a matter of weeks customers can expect to see their Strava times fall; quite simply, you’ll feel more up to challenging your personal bests.

WHO’S THE CUSTOMER? The benefits for any highly competitive cyclist are clear. Muhdo offers the opportunity to gain a competitive edge and drive fitness forwards. Muhdo is already working with Team Genesis and Saracen. But DNA profiling is for anyone who wants to get fitter, lose fat and enjoy their cycling experience more.

While the benefits are great for those chasing marginal gains, it’s a product for a very broad audience.

COMMERCIAL AND CUSTOMER OPPORTUNITY Muhdo DNA profiling kits retail for £249.99, including a healthy profit margin for the shop. Relative to the price of many bikes, compenent upgrades and bike fits it is a small cost that will make a big difference. For retailers meeting a minimum order requirement, Muhdo offers in-store event partnerships to talk your customers through the science behind performance and how DNA profiling can help.

Muhdo represents an opportunity to drive a variety of customers to your store and engage local cycling clubs and teams in a new performance and health concept. Muhdo also provides store owners with videos and marketing material to help promote the service to your database.

YOUR FULL SERVICE DISTRIBUTOR FOR ALL YOUR CYCLING PRODUCTS

√ FULL SERVICE DISTRIBUTOR √ CUSTOMER & SALES SUPPORT √ CUSTOMIZED MARKETING ACTIVITIES √ SERVICE, WARRANTY AND MAINTENANCE √ PLACE ORDERS 24 HOURS A DAY, 7 DAYS PER WEEK We go above and beyond with services that you wouldn’t normally get from a regular cycling distribution company. We offer outstanding customer & sales support and tailor the marketing campaigns from all of our brands. Our webshop is open 24 hours a day and 7 days a week.

Are you interested in a dealership? Please get in touch with us via 0031 10 340 3510 or send an e-mail to info@o-w-d.nl // www.o-w-d.nl

(( INDEPENDENT RETAIL CHANNEL STUDY 2018 ))

In association with The NEC Cycle Show

ARE YOU GETTING YOUR CUT? We must begin with a thank you to the 201 UK independent bike shops that took the time to complete CI.N’s 2018 Independent Retail Channel Study; the largest of its kind ever undertaken in the UK market. If you participated and supplied us with an email you will soon receive exclusive access to our full report. In subsequent issues you will enjoy data detailing everything from salary averages at retail, information on which brands are gaining ground in the market, what lines retailers plan to stock more or less of and plenty more. Alternatively, the full report is now available to purchase at cyclingindustry.news, or by emailing Logan@cyclingindustry.news.

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In association with The NEC Cycle Show

(( INDEPENDENT RETAIL CHANNEL STUDY 2018 ))

1

BY WHAT PERCENTAGE WERE YOUR PROFITS UP OR DOWN IN 2017?

GREEN SHOOTS IN A DOWN MARKET? With the e-Bike market bubbling away but yet to boom to levels familiar elsewhere in Europe there’s a notable cluster around ‘flat’ in the absence of any other segment delivering notable year-on-year growth. The predicted gloom of “1 million less bikes” imported over the road boom averages of 2010 to 2015 did however fail to materialise and in fact the market saw a 3% increase in bike import totals over 2016 numbers.

Looking closely at the data, it’s erring slightly more on the side of positive with those up by 50% or more representing 7.59% of our pool, while those down by more than 50% represent 4.14% of the 145 who answered this question. Where profits are truly stemming from is detailed elsewhere in our study, with the following questions pointing strongly towards services, in particular workshop tasks.

Anecdotally, from numerous visits our team has made, there are green shoots both for innovators in the market and those steadfastly dropping lines or services that are not pulling their weight in net profit terms. Certainly those bike shops enhancing their in or out of store events, as well as creating a unique reason for shoppers to visit are tapping into a demographic that Mintel data suggests will shell out cash for experiences as part of their shopping trip.

2

WHICH OF THE FOLLOWING ARE YOU HANDLING MORE TRADE VIA:

3

WHICH OF THE FOLLOWING ARE YOU HANDLING LESS TRADE VIA:

Finance

Finance

Cycle to Work schemes

Cycle to Work schemes

Sales via demo schemes

Sales via demo schemes

Online sales

Online sales

Workshop revenue

Workshop revenue

Sales at events

Sales at events

WHERE BUSINESS IS WON AND LOST The workshop is an unsurprising standout, with 66.88% of a pool of 157 pinpointing the work of their mechanics as an area for increased investment, turnover and profitability.

With an increasingly strong set of ePos and eCommerce tools available to the bike store just over a quarter of our pool are handling an increased turnover in online sales, though profitability here again is carefully weighed

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against investments made in marketing to reach new customers. It may be for this reason that just shy of a quarter are reporting less online trade yearon-year.

According to the Association of Cycle Traders, whose Ride It Away programme tallied £100 million in sales in the 12 months to November 2017, retail finance is not yet meeting its full potential. 16.56% of our pool reported increased business year-on-year,

contrasting against 21.77% who believe they are handling less via this means.

Having racked up criticism in recent months among independents the big loser is cycle to work trade; astonishingly 63.27% said this business had dried up for them year-on-year. Opinion sought by CI.N attributes this to rises in commission by the market’s main players, as well as marketing promotions that have seemingly skirted the independent trade altogether.

In association with The NEC Cycle Show

4

DO YOU FORESEE YOURSELF IN BIKE RETAIL IN THREE YEARS’ TIME?

EXIT STRATEGY? This time last year we posed the very same question to a pool of 74 bike retailers, so this year’s data - with 145 choosing to respond to this question – re-affirms a trend documented previously; sadly, more bike retailers are looking at near term exit strategies.

Last year 70% of our pool stated that they would remain in bike retail three years down the line. This time around 60.69% stated the same. In the same vein, last year just 4% of our tally suggested they would either seek to sell up, or be unlikely to survive as a business. This year those tallies rose with 8.28% believing they would move to sell their business and 6.21% offering a flat “no”.

In a down market, there are mixed feelings on the frontline as to the viability of the traditional bike shop model. Indeed, at the front of this magazine the viability of the traditional

bike sale model is called into question.

As a result, increasingly you may hear of the independent bike dealer (IBD) being referred to as the independent

bike service or IBS and certainly comparing our data like for like there is an uptick in workshop only outfits participating in this years’ study.

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(( INTERVIEW: RALEIGH ))

Pippa Wibberley has steered the Raleigh ship for some time, but officially became MD in November

ACCELL-ERATING? There has been much talk in the trade about the reshaping of Raleigh. Developing a household name in a fiercely competitive marketplace is no mean feat, so we speak to Managing Director Pippa Wibberley about the firm’s future direction, meeting customer demand and Accell’s influence…

S

O PIPPA, YOU’VE STEERED THE RALEIGH UK SHIP THROUGH A TURBULENT 2017. HOW HAS YEAR ONE TREATED YOU AND WHAT’S ON YOUR TO DO LIST FOR 2018?

2017 was a really important year for us at Raleigh. The team took brave steps to get ourselves in to the shape we needed to be in. We came out of the year looking and feeling fantastic having created the momentum we need to reach our full potential in 2018. 2017 was all about simplifying our business, focusing on what we are good at and then implementing our plans with energy.

What changes have you overseen thus far at Raleigh UK? We have created the digital capability we needed within Raleigh which simply didn’t exist – we’ve gone from being

behind the times to leading the way, which is a great achievement. We have implemented clear brand strategies that have seen us discontinue a number of brands and products and ensure we have the right portfolio sold through the right channels, without conflict or duplication.

We have really stepped up our game as a distributor as well. Our customers now know Raleigh UK as a ‘one stop shop’ for everything they need. We are driven to deliver the best brands, with the best availability and the best service levels. All signs show that this is exactly what dealers want and need, which is why our partnerships are growing daily.

What improvements have you made in terms of logistics, infrastructure and IT to assist the modern bike retailer?

The combination of introducing voice

pick and flexible working into our warehouse has enabled us to put our cut off times for orders out to 6pm. We were the first distributor in the UK to offer a next day delivery service for orders placed up to 6pm, and rest assured, we won’t stop here. Our independent retail partners need this to offer great service to their customers and we will continue to improve our service offer to support them in this. We are working hard to develop our offering further, so watch this space.

What investments have been made on development of in-house labels, as well as acquisition of leading labels in the market?

Being part of Accell Group means we can offer fantastic brand choice with our range of bicycles and e-Bikes. We’ve Raleigh for leisure, commuter, fun,

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(( INTERVIEW: RALEIGH )) What opportunities exist that you would recommend Raleigh accounts be aware of in 2018? Any hot seller tips or high-margin items worth a shop’s attention?

Moon has led the way in bicycle lighting in recent years introducing a range of competitive and feature-rich products designed with the consumer at heart.

2018 and 2019 will continue the trend with a road map of industry leading products to come.

Raleigh’s purpose built showroom in Nottingham

family and fitness; Haibike for E-Performance; Lapierre for performance road, MTB and e-MTB; and Diamondback for recreational MTB. Consumers want and demand a choice of brands; we can offer that choice from a single partner.

Our focus is completely on where we can win now. We have removed low-end/entry-level brands to ensure we develop and grow where we are strong - mid and high-end e-Bikes and bicycles.

On P&A, our in-house labels of XLC, Raleigh and RSP continue to grow as they offer the bike retailer a real value and margin-led proposition that doesn’t put them in direct competition with pure web players. The XLC range has been increased by 1,300 SKUs to offer everything a UK bike retailer needs and Raleigh accessories are being developed to align with the bicycle range so the consumer can get everything they need from Raleigh. A great example of this is the new kids’ range including the Mini-Burner and Mini-Sherwood which will come with matching helmets.

We also have some fantastic new P&A brand partners. Pedro’s tools and cleaning, Grip Grab, and working with Continental tyres boosts our ‘one stop shop’ offer as our retailer partners can now satisfy all their needs for tyre brands and products from the Raleigh B2B. We are also extremely proud of our SRAM Access commodity programme.

This scheme is designed to make life as a dealer easier by offering a complete solution so they can purchase all their SRAM products from one distributor, and with free next day delivery on orders placed before 6pm.

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ACCESS: HOW THE BIKE SHOP CAN BENEFIT • STRONG AVAILABILITY ACROSS CORE COMMODITY LINES • ACCESSIBLE TO ALL DEALERS • PREFERENTIAL ON-GOING PRICING • FREE NEXT DAY DELIVERY ACROSS ALL PRODUCTS PURCHASED VIA THE RALEIGH B2B WHEN YOU ADD ANY PRODUCT FROM THE SRAM BRAND PORTFOLIO TO YOUR BASKET ON ALL ORDERS PLACED BEFORE 6PM • NO MINIMUM SPEND • APPLIES TO ALL PARTS AND ACCESSORIES This month has also been full of activity from Rockshox. We have had the launch of the all new BoXXer Red Lyrik RC2, featuring the new Charger 2 RC2. The larger negative volume in the new DebonAir spring provides unprecedented levels of small bump sensitivity and mid-stroke support.

The Lyrik RC2, Pike RCT3, Revelation RC and Yari RC all get upgraded with the new DebonAir spring and new, shorter offset options to make them compatible with the confidence-inspiring (and smile-inducing) machines being dreamed up by bike designers around the world.

With the Accell Group now five years deep with Raleigh UK, how much of an influence has the parent company had on the business to date?

Being part of Accell is now really starting to be exciting. Our CEO, Ton Anbeek, is bringing a new level of energy which is driving all the right changes. Raleigh UK is leading a group-wide web platform which will take our digital capability to the next level; we are part of a pan European team implementing state of the art CRM systems and Accell Group have invested in important consumer insight research in the UK, which we are now using to drive our business decisions.

On top of this, we are working at a central level to ensure, as a group, we secure the best P&A brands for our retail partners; this ensures they can have the products their customers want, on their shelves or available to order for delivery the very next day. Being part of Europe’s biggest bicycle company has never been more important to us and will give us real competitive edge.

Following a tough 2017, Accell recently announced a restructuring of its operations. To what extent does that affect Raleigh and by the close of 2018 what efficiency improvements will we see in the business?

The announcement is great news for Raleigh UK. Clear brand positioning, investment in digital platforms, a strong and centralised innovation funnel and investment in both state of the art IT and an efficient and effective supply chain will all be delivered by Accell Group. This centralised investment and focus will take much of the hassle factor away from us as a market region, which means we can focus on achieving our plans. Our focus will be on working with our partner retailers to grow sustainable business by giving consumers great bikes, as well as the parts and accessories to go with them.

(( INTERVIEW: RALEIGH )) internet cannot and will become more important as the e-Bike market continues to grow. Designing bikes carefully with the best user experience in mind, having spare parts in stock so dealers can get their customers back on the road, having an easy, trust-based warranty process to make the retailers life easy are where we are focusing.

Raleigh retains ‘Superbrand’ status among consumers in the UK

How is Raleigh UK adapting to meet the modern shopper head on and to ensure your products are chosen ahead of competitor’s goods?

When you are growing a brand like Raleigh, the consumer is incredibly powerful. We recently talked to more than 1,200 UK consumers who have bought a bike in the last 12 months and the results were really astonishing and supported our belief in the power of this great UK Superbrand.

- 28% of consumers named Raleigh when asked to name a bike brand without any prompts. That is 12% points higher the nearest competitor.

- 52% of people would consider Raleigh when making their purchase.

That’s 26% points more than would consider Specialized, for example.

- Raleigh customers are more likely to recommend a friend. Our Net Promoter Score is 59%. That’s 10% points higher than the industry average, and the highest in the industry.

This stuff is gold dust for independents who stock Raleigh. No other brand is more recognised, more considered or more recommended in the UK. The challenge is getting these consumers in to the store – all too often they are buying somewhere else. This is why our investment is focused on digital marketing and instore demonstration capability.

80% of those interviewed completed their transaction in store; we need to make sure that’s one of our retailer

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partners. Click and collect is not ‘going direct’, it’s getting consumers in to bike shops!

Let’s be clear here, I believe strongly that the independent retailer is vital to the success of the UK bicycle industry going forwards and our consumer research backed this up. What the consumer wants is changing and our role is to work with our retail partners to ensure we and they change to deliver the value the consumer is looking for.

It’s all about the consumer journey getting consumers in store and creating an effortless experience when they get there, giving the consumer something the internet cannot offer. So Raleigh UK retailer partners will see us invest in:• On-line platforms giving consumers the content they need to really help with their decision making. Bike configurators, live webchat answering questions there and then, new IT solutions so consumers coming to our websites can see and buy the stock our dealers have instore, video content that really answers the questions consumers have and helps them to choose the right bike for them.

• In-store experience drivers.

Consumers are telling us loud and clear that they want to see, touch, feel and try the bike before they buy and this is only possible if we are working with our retailer partners. Online booking of demonstration, dedicated demo centres and digital POS to integrate the journey are all on the way.

Great service is also going to be vital.

This is the other area where the retailer really does offer something that the

There have been rumblings of discontent from independent shops about direct sales on selected lines – most notably the Burner re-issue. What can you say on this practice to re-assure dealers they remain well serviced

by Raleigh?

The Burner re-issue was 100% a marketing campaign designed to generate leads and build consumer engagement with the Raleigh brand. Our business and that of our partner bike retailers will not survive by selling old school BMX. The Burner campaign saw 7,000 people on our site, all providing their details. These people all have children and grandchildren who want bikes; they are looking for bicycles and e-Bikes for themselves and their partners. This is what will secure success for us going forward.

NEW RALEIGH INITIATIVES IN 2018...

• We have launched our national partnership with the Caravan and Motorhome Club. This organisation has more than one million members, many of whom currently buy bikes from shopping channels or national retailers, but all of them have heard of Raleigh and would buy Raleigh. Since the launch of the partnership we have seen a real spike in our electric bike sales and our Raleigh e-Bike stockists are calling me to say that this is really working for their business. One store sold three e-Bikes to CAMC members the day after we launched – that is what you call driving footfall.

• We are planning our e-Bike Festival later with the year in partnership with Sherwood Pines Cycles. Consumers will be able to try out Haibike, Lapierre and Raleigh e-Bikes over the weekend in a real festival atmosphere. This is another great partnership of brand and retailer working together.

CONTACT RALEIGH Phone: 01773 532600 Email: info@raleigh.co.uk

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(( PROFILE ISON DISTRIBUTION ))

MISTAKEN IDENTITI? Dating back four generations, the Townsend family business today primarily functions as Ison Distribution, a wholesaler that in recent years has perhaps come to be known as a jump and gravity specialist. MD Lloyd Townsend and his team tell CI.N there’s plenty more on offer to independents opening an account…

A

s far as UK bicycle industry heritage goes, the roots of Ison Distribution are embedded deeper than most, particularly within what has now come to be the UK’s cycling capital – Cambridge. A fourth generation family business, the Ison story began in bicycle manufacture with current managing director Lloyd Townsend’s great grandfather producing the Light Blue bicycle label as far back as 1895. A build dating back to 1900 that still wows bicycle show crowds – an unmissable 100 tooth chainring clad Light Blue - sits proud in the firm’s newly created showroom as we settle to hear more about the Ison of today.

A much younger and sprightly animal at just 26 years old, Ison Distribution now offers those in the trade a

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plethora of goods beyond the BMX and gravity bikes for which it is still often associated with.

“One trend is bikepacking,” starts Townsend, whose portfolio includes goods from Passport, Miss Grape, Surly, SP Dynamo and many more leaders in the segment.

“Passport is of course our own brand and that’s solidified Ison’s place in what has become an exciting segment.

Surly were doing their own version of the gravel and adventure type thing long before the rest of the industry took note, so it’s a great brand to have in store and a particularly good base on which to build an aspirational demo unit and talking point for any dealer who’s on the pulse.”

Ison’s dealerbase has in time come to enjoy access to an 11,000+ strong SKU portfolio consisting of six housedesigned brands, along with long-term strategic partner brands including the likes of Rohloff, Dia Compe, ODI, MRP and Renthal. In practice, this means that as an Ison dealer, if you need a bottom bracket for anything from an oldschool BMX through to a PF30 - the odds are that Ison can get an option into your hands the next day.

“There has perhaps been a perception that we are something of a BMX specialist distributor,” chips in Jordan Lunn, Halo’s marketing manager, “But Ison is much more than that and the investment in our house

sector - Ison are strong advocates of merchandising customer dreams in store; as evidenced by the firm’s showroom. Placing emphasis on how the pro’s bike may look, several builds are dripping with kit.

“Given pride of place and rotated in store regularly, these dreams will sell,” advocates Steve Clarke, Ison’s Road Product manager.

“Frames on walls don’t sell,” chips in Identiti and Gusset brand manager Pat Campbell-Jenner, a former pro 4X rider. “We mark ten years with Matt Jones on Halo this year and after that length of time our riders get brutally honest with us. We all ride our products too, so those little details that make all the difference get actioned quickly. That’s a big plus for the bike shop, when they ring us there’s a strong chance they’ll end up speaking to the very people who dreamt up the products, not someone in customer service who needs to look it up.”

Serving the bike shop well is indeed in Ison’s blood.

Between manufacturing and distribution the family also still retains the Townsends Light Blue retail business from which Ison Distribution was spawned. Lloyd says this factor gives the firm a wide perspective on current industry trends – and of course an insight into the many challenges faced by dealers.

One of those that we discuss is the inescapable march of business to consumer sales.

“Consumer sales and the appropriate way to meet these demands is something we’ve having to think about.

Halo’s new website does now have a B2C option, which actually only takes up a small section of the Halo pie, but even this delivers advantages to the dealer partner as part of the sale. e.g. Our new Vortex wheels cannot be pre-ordered B2C, it’s only possible to pre-order via the local bike shop, which gives dealers a great opportunity to benefit directly from the heavy marketing investment Halo has been making,” explains Lunn.

Townsend is keen to develop the idea further and alludes to having discussed a voucher-based system whereby local retail partners can earn a rebate on online sales in exchange for free fitting.

labels in the past three years has brought through some genuine innovations. For example, to my knowledge, our Vortex could well be the only asymmetric rim to add additional material on the longer wall to compensate to the additional strain.”

We’re also shown a disc-ready Halo hub suited to singlespeed bikes currently in the works alongside a new pedal from Gusset two years’ in the making. Ison’s designers are definitely listening to the market, reacting, and paying significant attention to the finer details and features.

Noting a departure for many road cyclists into off road pursuits - in part down to safety concerns, but also as the next logical progression of a now passed ‘boom’ for the

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(( PROFILE ISON DISTRIBUTION ))

“Such a mechanism could perhaps drive the mail order customer back in-store to have their cassette fitted, for example. The customer may not even have been aware of the shop until they discover a free benefit is open to them by visiting the local dealer. This is an idea I’d like to toss around with interested dealers. I want to help them succeed in regaining footfall and maybe turning consumer preferences back towards using dealers when sales have been lost online,” says Townsend. “Ultimately, I still believe that the typical cyclist is probably better served by being advised on the right product for their needs, and that product being professionally installed and supported at a competitive price. So far, it seems to me quality IBDs on the ground are still best suited to deliver this overall package to the end consumer - but, regrettably, many consumers may not realise this until it’s too late.”

Thinking further on the future of bike retail and acknowledging an uptake in accounts turning toward service-led trading, Townsend’s team are supportive of those diversifying and innovating.

“As long as you’re running a professional business and selling via great service or a good USP then we’ll most likely want to help support you in your ambition.

We find we are serving increasing numbers of framebuilders and mobile mechanics. On customer service and warranty we’d like to think we are well above industry standard, so don’t be afraid to enquire about an account if you’re starting out with good intentions. We aim to offer a level playing field for both small and large dealers. Frankly, it’s far more about the pro-rata level of commitment towards us than it is about your actual size,” concludes Townsend.

Those looking to open an Ison account can do so by calling 01353 662662 or log on to: Ison-distribution.com

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NEW TO ISON – SILKOLENE Eagle-eyed Ison accounts may notice a new name appearing among the brand roster in the form of Fuch’s label Silkolene.

A globally recognised label, but one that’s produced in sunny Stoke-on-Trent, Silkolene manufactures lubrication and cleaning goods for the automotive and medical markets, arena’s that demand much more in performance terms than the humble bicycle. All the same, the bike line does benefit from over 30 years’ research and development and will deliver via Ison a plethora of wet, dry and everyday lubes, alongside cleaners and greases. Aftermarket oils aside, Silkolene’s fork oils are used by some of the market’s top OEM suspension brands, so you can be sure it’s good stuff.

Silkolene fits well with Ison Distribution’s dealer focus in that Silkolene are the UK’s market leading motorcycle lubricants, and are ONLY sold via motorcycle dealers. This means that dealers who spend their time and effort switching their customers onto Silkolene’s products will see the dividends of repeat business from those same happy customers, especially so, as Silkolene isn’t to be found next to the tins of baked beans in the supermarket, or bags of wood screws at the local DIY store. A dealerbased sales strategy will be mirrored with the new range of Silkolene cycling specific products exclusively distributed by Ison.

Point of sale material is expected to be ready to ship by May, while initial products are available to order now.

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(( TRAINING ))

CYCLE MECHANIC TRAINING THE OPTIONS

F

ew would argue that the most commonly recognised accrediation of a bike mechanic’s skills is the ATG-backed Cytech qualification, though it is not the only option.

Velotech Cycling Limited, Cycle Systems Academy, Downlands Cycling and the Bike Inn all provide similarly accredited training packages. As detailed by CI.N's Independent Retail Channel Study, the workshop is deemed a money spinner worth investing in, so it makes sense to brush up on what's on offer.

Bike Inn’s founder, Alf Webb, puts forward the view that he and his wife Teresa were the first people to offer accredited cycle mechanic training in the UK. “We started teaching bike mechanics full-time in June 1991, offering a six-day course. When we applied to City & Guilds in 1994 to become an accredited provider for courses there was an insistence that the course should be a minimum of 10 days. Actually, this was good in that we had more time and could teach and assess to a higher standard with more practical skills and theory.”

Alf and Teresa must have been doing something right because in 1996 they were invited to run their courses at Aylesbury College. It was during the time in Aylesbury that the course became a National Vocational Qualification (NVQ). Alf notes that he and Teresa were the first in the bike trade to be appointed D32 and D33 (as it was then) assessors for NVQ accreditation.

Aylesbury has gone on to play a significant part in UK cycle mechanic training as in the late ‘90s Aylesbury College became the first location to run the ACT-backed Cytech courses

WORDS: Duncan Moore

using the City & Guilds (C&G) framework to access funding.

However, Webb suggests that the early C&G qualification was not relevant.

“The early assessments were so out of date as to be useless in the modern day world of bikes and components

not only for amateur mechanics but professionals too, but unlike Bike Inn they are accredited with EAL rather than C&G. The 10-day professional courses from Cycle Systems include the Level Two Certificate in Cycle Maintenance and

had to be changed. We wrote a curriculum in 2004 to accommodate this.” His rework was not taken up at the time but he was asked to rewrite and resubmit it in 2009. The result is now the C&G ‘level 2’ accreditation, which Webb feels is “as high as, if not above the Cytech level 3.”

City & Guilds is one of only three awarding bodies in the UK that acknowledges cycle mechanic training. The other two are EAL with its Level 2 (Certificate) and Level 3 (Diploma) courses and The Institute of the Motor Industry (IMI).

Similar to Bike Inn both Cycle Systems and Downland Cycles cater

Repair, which is described by Cycle System’s Sean Lally, “as preparing participants for entry into the cycle profession” and the Professional Level Three Diploma in Cycle Maintenance.

According to Lally, the latter course (the Diploma VRQ in Cycle Maintenance and Repair) is the highest quality and highest attainable qualification in professional cycle maintenance in the country.

Both of these options conclude with CSA certification. A Qualifications and Credit Framework (QCF) accreditation is available at an extra cost, too.

Should a trainee take up this addition, a new credit transfer system which has replaced the National Qualifica-

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(( TRAINING ))

Graeme Freestone King of Velotech Cycling

tion Framework (NQF), they can then transfer those credits to gain additional higher qualifications with other participating training operations. In theory, the credit could eventually be applied towards a degree.

A two-tier professional training system is also in place at Downland Cycles. The Kent-based outfit, which is well-known for its frame building courses, has the Level 2 Certificate in Cycle Mechanics and the Level 3 Certificate Advanced Professional Cycle Mechanics courses. The two options are both vocationally related qualifications (VRQ) and as such contain mandatory and additional units. The additional units are included to offer course attendees the option of continuing and broadening studies in specific areas of interest and cover areas including wheel building, hub gears and suspension systems.

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Velotech Cycling Ltd, which offers modular training programmes ranging from the basic level Red, White, and Blue modules that introduce noncyclists to bicycles, through to the Bronze, Silver, Gold, and Platinum courses for professional workshop staff. Talking about what level the modules are pitched at Velotech Cycling’s co-owner, Graeme Freestone King, says, “The Bronze and Silver awards are in many respects similar to Cytech 1, but go somewhat beyond the normal content of Cytech 1 - they include some elements absent from Cytech 1, whilst excluding some of the health and safety training and assessment provisions of Cytech 1.”

Freestone King then goes on to explain that the Platinum programme requires the same technical competencies as Cytech 2 and the standards of proof and assessment are exactly as the level 2 NVQ.

“We are working with an awarding body to move what we do from a completely internally regulated qualification to an externally regulated one,” says Freestone King talking about how the courses provided by Velotech Cycling Ltd are quantified. He then goes on to offer an explanation of the various accrediting and quantifying issues surrounding cycle mechanic courses in the UK. “Learning providers, like ourselves, can build, deliver and accredit a qualification in their own right, relying on their own traction in a sphere of industry to give that qualification validity, or they can choose to be externally regulated, normally in the UK, by the Department for Education (DfE),” explains Freestone King.

He continues, “The DfE devolves the day-to-day regulation of those qualifications to individual awarding bodies [in the case of cycle mechanics C&G, EAL and IMI accredited courses], which regulate how a qualification is delivered and assessed, as well as having oversight in the delivery and assessment process. Content has to be agreed and the route by which

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(( TRAINING ))

assessment of the candidates’ theoretical and practical knowledge of that content is made and is then defined and agreed.”

Freestone King concludes with, “Qualifications that have external scrutiny fit into the NQF. They are designed and regulated to be comparable and as a result, portable - so a level two qualification, as defined by the NQF, has specific characteristics that an employer can point to and should confer a comparable level of competence. As a result, a Level 2 qualification as defined by the NQF in cycle mechanics is like one in catering, in the same way as a GCSE in English is like one in maths... they are a representation of an expected level of competence.”

But what about the seemingly omnipresent Cytech? The range of Cytech courses and qualifications is well-known, especially among the general public, but less prominent is Cytech apprenticeship training.

Natasha Murray, from ActSmart, explains that Cytech courses, run by the Aylesbury Training Group, became accredited in 2000 to deliver government funded apprenticeships (through EAL).

Murray then notes that the difference between a standard Cytech course and an apprenticeship is “the fact that candidates go through on-thejob training alongside their learning, over a longer period of time and with the added benefit of (usually) having a secured employment by the end of it.”

She then goes on to elaborate that “with the apprenticeships delivered by ATG Training, as well as completing the Cytech qualification an apprentice will also come away with a few other qual-

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ifications around the topics of engineering, functional skills and business related modules, ending up as a more rounded ‘graduate’ and more experienced when compared with the standard 1-2 week Cytech course.”

Regardless of the qualifications gained at the end of the training and how the candidate is assessed in order

it will have 100% of training costs paid for.”

There is further good news on the apprentice front as any who are aged under 19 at the start of their training – and those who are aged 19 - 24 years old and have either an education, health and care plan provided by a local authority, or have been in the care

to gain the classification, the training itself has to be paid for.

Fortunately, thanks to the current government’s implementation of an apprenticeship levy on businesses with a payroll over £3 million per annum, smaller operations can draw upon those funds to help with the cost of training staff.

Murray explains, “Smaller businesses must make a contribution of 10% to the cost of an apprentice’s training, which is normally £500 for a Level 2 Framework (£400 for ACT members) and £995 for a Level 3 Framework (£900 for ACT members).

“In addition, if a business employs less than 50 staff and it takes on an apprentice aged between 16 and 18

of a local authority – attract a grant of £1,000 paid to the employer (provided the employer has fewer than 50 staff).

Funding options also change around the country, notes Freestone King.

“Because we are not currently on the National Qualifications Framework, we don't have any funding options.

However, in Scotland, our Scottish partners (as we work with a number of partner-providers located around the UK) can sometimes help candidates access some funding through the Individual Learning Account scheme.” He also goes on to offer up the advice that some Ministry of Defence personnel can gain funding on leaving the armed services as part of their retraining and resettlement packages.

CONTACTS: Atg-training.co.uk // Velotech-cycling.ltd.uk // Cycle-systems.co.uk Downlandcycles.co.uk // Bike-inn.co.uk

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(( COMPANY PROFILE VELOTECH SERVICES ))

KNOWLEDGE IS POWER… Having recently regained the sole UK distribution of Rotor Bike Components, Velotech Services is staking a strong claim on being a must have account when it comes to performance cycling goods. We speak to Robin Corder about the charm of the small distributor and how the firm hopes to win big on customer service…

The Velotech Services team flanked by the now once-more exclusive Rotor Components

“

The smaller specialist distributors are focused on your business; we know our product inside out, you’ll get expert knowledge every time and we understand the independent bike retail business from the top of our organisations to the bottom.”

That’s a bold statement to begin with, but Velotech Services boss Robin Corder believes a justified one. In sitting down with the Stratford-UponAvon bike business it’s quickly evident that the team here have been around the block. Knowledge certainly does flow, no matter who you speak to, as does good humour about the many perceived imperfections in the bicycle industry supply chain.

Now back in full control of Rotor Bike Components, the Madrid Q-Ring and powermeter experts have clearly seen something in the personal, experience

and enthusiasm-backed business.

Corder, after all, brought in the very first offset cranks decades ago having spotted the potential for the time trial segment.

“At the time this was an over-engineered concept, but one that worked all the same and along similar principles. It had too many moving parts, a high weight and therefore a low durability. Q-Rings are a much better solution, although I’m led to believe Rotor’s owner would love to resurrect the offset crank one day,” says Corder.

Shifting to the present day and Rotor has developed a core following who wouldn’t go anywhere else. We’re told that Velotech’s bricks and mortar first approach is one that will see partner stores earn consistant margins, rather than see profits eroded by online competition.

New ground has been broken with innovative products like the hydraulic Uno drivetrain putting another string in the bow. Said to be among the most precise shifting systems on the market and incredibly stable over a long duration due to lack of friction in the moving parts, the system is adorned to Team Dimension Data’s bikes which have taken the Uno from concept to proven reality. For the weight weenie customer it’s also worth noting that the Uno groupset, including hydraulic brakes, is one of the market’s lightest, even beating SRAM’s RED HRD. It’s perhaps the firm’s oval rings that have stood the test of time best of all, explains Corder.

“For the bike shop it’s a real winner, particularly if you can take the time to explain the benefits and science behind oval rings. Pound for pound, an oval

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(( COMPANY PROFILE VELOTECH SERVICES ))

One of the very first Rotor products to land in the UK - an offset crank that came before the firm’s Q-Ring experiments

ring can be one of the best investments you can make in terms of making quick performance gains. Shaving weight is all well and good, but improving your pedal stroke’s output will translate to a much better overall ride.”

Understanding first hand the opportunity on offer to bike shops when it comes to technical brands, Corder speaks of a demo series for the brand in the pipeline, something which he hopes will assist stores in driving education and reaching potential new customers.

As an aside to Q-Rings, Rotor also has deep expertise in powermeters. On this front we’re told to look out for the 2INPower DM Road crankset, the firm’s first offering, reading output from both legs. A paired smart phone app can offer the rider real-time feedback on

each leg’s metrics, from pedal stroke balance through to cadence, as well as detail on the distribution of power through the crank’s rotation.

Aside from Velotech Services recapturing Rotor, the Stratford Upon-Avon business further distributes C-Bears, Speedfil and Ceepo, as well as having the capability to custom produce clothing for bike shops in need of anything from club kit to short runs on jackets.

“These are all available with in-house design, with no MOQs on many lines and with a five-week turnaround from design to delivery. We’ve produced runs of 500 jerseys for Cyclists Fighting Cancer, handled Rotor’s jerseys and helped out numerous bike shops.

Jerseys are a good price for a fourway stretch full zip custom design and of course the shop is free to choose

what they sell at,” says Corder.

C-Bears with its extensive catalogue of bottom brackets and bearings, are very much worth being on the bike shop radar too.

“The success of this brand with workshops has been very pleasing. It’s a time-tested product where the shop can earn full margin every time. Lotto Soudal swears by their goods and in the vast majority of cases you’ll find a unit that’s purpose built for a bike. If you want happy customers and happy mechanics, this is the brand to go with,” believes Corder.

Ceepo meanwhile continues to prove a brand favourite in what is admittedly a seemingly flat triathlon market.

Complemented by Speedfil’s hydration systems and of course Rotor, those dipping a toe into tri will find it worthwhile opening an account.

“We’ve a lot of knowledge to help those dealers exploring whether there’s business to be had within the triathlon community. More than that, as a retailer ourselves we’ve a good understanding of the challenges and opportunities shops face and are generally quite flexible when it comes to stockist terms. We want people to feel comfortable doing business with us, so there’s no silly charges and we’ll do what we can to help your stock turn,” concludes Corder.

CONTACT // Velotech Services Web: velotechservices.co.uk Phone: 0845 475 5339

TRAINING: HOW DO OVAL RINGS WORK? If your staff have yet to experience the oval ring then they can be forgiven for not yet grasping the science behind tech put to good use by pros like Chris Froome, among many others.

A round chainring, while commonplace, has its flaws when it comes to efficient power transfer. In fact, many users of oval rings claim that their stroke feels more “round” (read even) with an osymetric ring.

Particularly effective when climbing, the oval ring has come a long way since Shimano’s early Biopace concept. When putting power through an oval ring you maximise the power output beyond the top of the stroke. In the 6 o’clock spot, for example, power delivery is flat with a round chainring. When ovalised the torque remains engaged, 038 // WWW.CYCLINGINDUSTRY.NEWS

maximising output.

The net result of this is that the rider’s legs get less work to do when the output is weakest and become more efficient otherwise. This is effectively a gear change as you ride, but an unnoticeable one that instantly evens power throughout the 360degree stroke.

Particularly useful to long-distance and high-intensity cyclists, the legs are less fatigued by working smart and riders can therefore hold high power outputs for longer periods, as well as feel the need to change gear less.

Of course this knowledge and the ability to fine tune the positioning of the rings based on your customer’s power data becomes a chargeable service for the experienced bike fitter or training planner.

(( COMPANY PROFILE BLACK LION BIKES ))

A ROARING TRADE Those making the annual pilgrimage to Eurobike will undoubtedly have looked on in awe at the Gepida, Conway and Victoria booths, each many lines deep with some truly wonderful machines.

We check in with Jim Duncan of Black Lion Bikes, the specialist distributor handling those labels and more for the UK market, to learn about the scope for these leading European labels…

I

f you recognise The Black Lion Bikes name, there’s a good chance you first noticed it at The Bike Place Show earlier this year, something which Director Jim Duncan described as a “kickstarter” for a business that has quietly been operating as a specialist distributor in the electric bike segment for some time.

Indeed, Duncan brings to the table a deep background in electric vehicle technology, working with electric mopeds among other e-Vehicles prior to setting up Black Lion Bikes. Having become somewhat of a specialist in European electric bike brands, Duncan’s business boasts a five pillar portfolio of Conway, i:SY, Gepida, Victoria and Flyer.

Falling under the Hartje brand portfolio, Victoria, Conway and most recently i:SY too have a deep heritage in not just pedal-assisted bikes, but wider cycling. Victoria, a producer of bicycles dating back as far as 1886,

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brings forward what Duncan describes as high value for money, as far as the electric bike segment goes at present.

“What the market is seeing at the moment is much of the lower-end Chinese products dropping out of the market and potential for change of anti-dumping rules will only accelerate this. I tend to find that consumers are having less aversion to spending more on electric bikes nowadays, especially if they see household names like Bosch stamped on the motors. It reinforces that this is a different product to your standard bicycle in the consumer’s mind and justifies the often higher price tag they’d pay in other industries represented by these labels.”

Price has proven a barrier for many customers who desire a 15.5mph tailwind, yet for those who have had a go at introducing electric bikes to new customers, it’s a wall that’s easily broken, explains Duncan.

“The key thing is to first get customers out on the bike. Have a quarter mile route from your door ready for your customer. Ours is a Sustrans route running out back, but it need only be a decent opportunity to ride out with the client and show the advantages and functionality. In selling electric bikes this is the chance to develop that relationship and witness the customer’s ‘e-Bike smile’. When the topic of cost does arise, I will very often break it into thirds; the cost of the frame, cost of the motor and cost of the battery. Once the customer grasps that this is a different proposition – and one that can substantially change their transport and leisure then price become secondary.”

There is, we’re told, a wide variation on what will sell and for what price across the UK and Ireland, yet 80% of Duncan’s trade straddles the £2,000 to £3,000 price bracket; with the bestselling Gepida retailing at £2,099.

Those with a Black Lion account have access to bikes all the way up to £6,000+ Conway mountain bikes capable of tackling some of the most rugged mountain terrain available.

“Conway, in particular, is not widely known in the UK as yet, but next year their bikes will be all that’s being talked about,” enthuses Duncan of the off-road, tour and trekking bikes coming through. “Then there’s i:SY which proved immensely popular with the caravan and motorhome crowd due to its compact and sturdy build. It’s only weighing in at 22.9kg, so it’ll happily sit on bike racks and go along for weekends away.

We’ve had a lot of interest from hotel groups in this bike too.”

Duncan, like countless others in the electric bike segment, strongly advocates that it’s not only your customers that should be slinging a leg over. If you’re to effectively sell electric bikes, staff should be popping to the shops on each model, he outlines.

“It’s worth paying staff to use the bikes as each is different in what it can offer a potential customer,” he says.

Looking at the bigger picture and drawing further on his background in the electric vehicle business, Duncan suggests that, with a little Government support, the eBike revolution could significantly ramp up in the near future.

“When I was working in the electric vehicle trade it was a Government subsidy that made people look seriously at the Nissan Leaf. Incentives to shift your transport habits help. If the Government looked seriously at say – a £500 subsidy – this market would leap forwards. And why not?,” he concludes.

Interested in Black Lion’s brands?

The distributor is seeking representation in each postcode, offers low MOQs and is able to offer short lead times with same day dispatch on orders placed before 2pm. For a further £10, shops can have their bikes by 10am the following morning. What’s more, the firm backs its stockists with staff training at its headquarters on a bimonthly basis.

Contact the team on: 01823 241000 or email info@blacklionbikes.co.uk

KEY LINES I:SY Nuvinci 360 spec Considered one of the pioneers of the unisex double A-Frame, i:SY packs in a wealth of cycling tech into an apartment-friendly package.

A particularly useful bike for space limited bike stores, only one size of the i:SY need be carried as the clever geometry ‘grows’ to fit riders spanning 150cm to 190cm in height. A shallow seat tube angle gives the rider an upright perch from which to deliver optimal power output when pedalling uphill.

For the build featuring NuVinci’s stepless N380, riders will experience seamless shifting through the gears and do so without hearing a clunky chain.

Clad with a Gates CDX belt, the high spec i:SY will deliver low maintenance assistance up to 15.5mph via a Bosch Performance engine and 500Wh battery. Tipping the scales at just 23kg, the i:SY has been immensely popular in urban areas of Germany, scooping a number of consumer test awards.

Gepida Alboin LX10 With its sleek hydroformed 6061 alloy chassis Gepida’s Alboin LX10 is carefully thought out in terms of saddle comfort and versatility.

Well equipped for city use and available in both men’s and women’s iterations, the build comes preequipped with integrated lighting powered from the available battery, which in tandem powers a Bosch mid-motor. Carrying full length mudguards, a kickstand and rear racking, the LX10 comes ready to roll in four frame sizes.

Retailing at £2,399, the LX10 sits within a popular price bracket for Black Lion and has proved one of the more reliable sellers year-round. What’s more, it’s earned fame in group tests, scoring e-Bike Rad’s top Bosch-driven bike on test.

Conway EMF 427+ If your customer is looking for an efficient mile shredder for the mountains they’d do well to sling a leg over the Conway EMF 427+.

Finished with a suspension combination pairing the Rock Show Judy Gold RL SA fork to the Monarch R rear shock, the EMF enables free flowing trail use that is engaging on the descents and assisted on the climbs by a Bosch mid-drive Performance CX motor. Enabling more mileage than one can muster under their own steam, a Purion display will feedback to the rider the flow of juice from the Bosch lithium-ion 500Wh battery, as well as other metrics to assist progress.

Robust Shimano SLX and Deore XT drivetrain, paired with 203mm and 180mm hydraulic disc rotors ensure there’s both adequate propulsion and braking power when required. All in, the bike tips the scales at just 22.4kg, making it competitive on the trail against rival’s products and with geometry to keep the rider in control as the ride gets bumpy.

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Home of the finest European eBikes UK based stock, with excellent connections across Europe Fair minimum stock requirements and great dealer opportunities Here to support the UK’s Independent Bike Dealers t 0800 612 3448 / 01823 241000

e info@blacklionbikes.co.uk w blacklionbikes.co.uk

(( INTERVIEW ASSOCIATION OF CYCLE TRADERS ))

ACTing on change Many of our readers will already carry the ACT’s badge on their shopfronts and may well be utilising the plethora of preferential services achieved on behalf of members by the long-standing non-profit. Cycle retail is however rapidly changing, so is our trade association keeping up? We ask marketing and comms contact Natasha Murray…

MOST OF OUR READERS WILL BE FAMILIAR WITH THE ACT, BUT FOR THE UNINITIATED, WHAT DO YOU DO AND WHO DO YOU DO IT FOR? The Association of Cycle Traders (ACT) is the largest cycle trade association in the UK, in existence since the early 1900s.

The ACT is a not for profit, wholly owned by its membership, operating with a voluntary board of directors. However, the day-to-day running of the ACT is managed by ActSmart, a small team who are responsible for delivering all the business support services available to members.

The range of services and support available is always being modified to suit the ever-changing retail landscape; from our Ride it Away service to meet consumer demand for finance to our brand new online ‘Guide to e-Bikes’ to cater for the electric bike phenomenon, it’s all been designed with the modern day cycle business in mind.

We are also now seeing a lot more workshops and mobile mechanic businesses coming on board, so we've adjusted our offering by including an introductory membership package to suit smaller business needs.

Businesses can now access our services and support online at a time to suit them, pay membership, manage their account and even start their Cytech journey with the online Theory One course.

SO WHAT DO MEMBERS GAIN FROM YOUR SERVICES? Through our partnership with ActSmart we want to give businesses more than just a badge to say ‘you’re an ACT member’, so we set out to add more value to membership by providing a range of services with each subscription level.

Gold subscription is by far our most popular package.

When businesses join as a Gold subscriber they’ll become a full member of the ACT and gain access to some of our most popular services, including Ride it Away retail finance, discounts on business insurance, discounts on Cytech training and much more (as well as an ACT window sticker and certificate for display in-store).

For smaller businesses that don’t necessarily need to access all these services, we offer the Bronze subscription package, which provides key business support services such as access to 24-hour legal advice helpline, tax investigation protection, preferential card processing rates and more.

Subscriptions can be upgraded at any time and membership fees can even be paid monthly to help cashflow.

WWW.CYCLINGINDUSTRY.NEWS // 043

(( INTERVIEW ASSOCIATION OF CYCLE TRADERS ))

by launching a dedicated online community by the end of the year.

Away from Cytech, the ACT has also got behind a number of key initiatives this year; partnering with TfL on the recent e-Bikes.london project which is encouraging more Londoners to try and ultimately buy e-Bikes, to lending our support to Local Bike Shop Day.

WHAT DO YOU CONSIDER THE MAJOR WINS SEEN BY RETAIL MEMBERS WITH THE ACT’S HELP? We put a lot of time and effort into educating retailers on retail finance, as this service is one that retailers are really in control of and it gives the all-important top line a boost. The more they make of finance, the better their sales. We provide online educational resources to help maximise finance for individual stores and our support team are always on hand to give advice. Last year Ride it Away accounted for £100m sales in the cycle sector.

One good example of how we’ve helped save members’ money is through LSI, our partner energy provider. Last year one retailer saved themselves £700 p.a. by switching their electricity contract.

We always urge retailers to come to the ACT first, whatever service they are looking for. Each of our service providers has been handpicked by us to ensure retailers benefit from economies of scale, save time, hassle and more importantly money.

WHAT INVESTMENTS IS THE ACT MAKING TO ASSIST THOSE BUSINESSES CURRENTLY STRUGGLING? We’ve seen many store closures over the last couple of years but going forwards it's going to be the shops that adapt to the changing retail environment who will thrive and we want to give them the tools needed to do this.

As the battle to compete with Internet players continues, service will be a big winner. This means that the workshop is more important than ever. It’s vital that small businesses are investing in their biggest asset their staff – by giving them access to top quality training, so we in turn are always investing into the recognised international industry qualification for mechanics – Cytech.

The e-Bike course was launched in order to cope with demand for this increasingly important part of our sector. We have also been busy developing the new apprenticeship standard, alongside a selection of industry organisations, to better prepare candidates for the bike trade.

There are also plans to move one of the Cytech training centres to a bigger, dedicated location, creating a flagship for Cytech training and bike mechanics.

On top of this we are looking at ways to make it easier for mechanics to access technical information, as well as further champion and promote mechanics

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USING FINANCE TOOLS WHAT OPPORTUNITIES EXIST TO SHIFT MORE BIKES IN THE PRESENT CLIMATE? The businesses using finance properly are reaping the rewards, but there are still lots of businesses either not offering finance, or not making the most of it. Retailers should be looking at how they use finance as a sales tool, not just a payment option. This year we are on a mission to educate all retail staff (not just the store managers) on how to use finance to attract new customers, to upsell and bundle products, mixing APR’s to protect margin and much more.

We are always on hand at trade shows or at the other end of the phone to provide additional training to any retailers who think they could be doing more with finance. Plus, keep an eye on the CI.N finance workshops throughout the year.

WHAT INVESTMENTS ARE DUE FROM THE ACT IN 2018 TO FURTHER BUILD ON THE MEMBERSHIP PROPOSITION? Over the coming year we are looking to strengthen the ACT service portfolio even further to meet the demands of our members. One of the services we are looking to re-introduce is free business banking. Having offered this service many years ago it is now making a comeback following demand from members and being offered preferential terms from one of the world’s leading banks.

We are also currently working on bringing a brand new initiative to the cycle industry in the form of a gift, loyalty and marketing app. Keep your eye on the ACT website for more details on this.

Contact the ACT Email info@theact.org.uk Phone: 01273 427 700 Web: cycleassociation.uk

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(( OPINION URBAN MOBILITY ))

WHY THE E-BIKE TRADE MUST LOBBY GOVERNMENT Electric bikes are considered to present an immense opportunity to the market, but do we truly understand just how impactful these mobility machines could be? University of Westminster transport researcher Rachel Aldred puts the Propensity to Cycle Tool to use, analysing the potential of the segment; asking could it be greater with Government backing?

B

y 2014, according to the European Cyclists’ Federation, Germany had spent €1.4bn (£1,23bn) of public money on R&D for electric cars, announcing in 2016 another €1bn (£0.88bn) of subsidies. All this effort helped put 25,500 purely electric cars on German streets.

Meanwhile, 2.5 million e-Bikes (pedelecs) appeared, without fanfare and almost without subsidy.

While e-Bike sales are growing in the UK, they’re still a niche transport mode. Yet they could play an important role in growing cycling. In the Propensity to Cycle Tool project (pct.bike) my colleagues and I looked at cycling potential in England and Wales, based on commute trip characteristics.

One scenario, ‘Go Dutch’, calculates how many commutes would be cycled if English and Welsh commuters were as likely as the Dutch to cycle trips of a given length and hilliness. This would mean a mode share of nearly 20% seven times higher than current levels, with hotspots of up to 40% in compact, flat, and urban areas.

Rural, less dense, or hillier areas are lower, though (Cornwall’s on 10%) and it’s here that e-Bikes will matter most. The PCT e-Bike scenario adds to ‘Go Dutch’ an assumption that people use e-Bikes for some longer or hillier trips, based on data from Dutch and Swiss travel surveys. In the e-Bike scenario, Cornish commuter cycling potential jumps to 19%. In some authorities cycling potential more than doubles, with Caerphilly rising from 8% to 18% of commuters cycling (currently 1%). Supporting e-Bikes will help us get best value out of new cycle infrastructure; which could see substantial use even outside dense cities.

Yet little is done to encourage e-Bike use here, barring a few laudable local small-scale programmes, and the limited help of the Cycle to Work scheme. Only some employers offer it, so most people – all those not in paid work, and many workers, miss out. It’s regressive: a maximum saving of £420 for higher-rate taxpayers but only £320 for standard rate taxpayers. Meanwhile, the Government gives people up to £4,500 to buy electric or hybrid cars.

Other European cities and countries are starting to redress the balance and do more to support e-Bikes.

Sweden offers citizens (not just selected commuters) money towards buying an e-Bike. Cities do too, Munich providing up to €2,000 and Vienna up to €1,000 towards an e-cargo bike, recognising the potential of these bikes for freight. E-Bikes will increasingly feature in dockless bike hire. Uber has bought up e-Bike hire firm Jump, seeking to integrate e-bike hire into the Uber app.

If we enable it, e-Bikes will be core to sustainable mobility. But government still sees ‘low emission vehicles’ as being cars, vans, and lorries, meaning most ‘green’ spending goes to the most wasteful types of vehicle, and e-Bikes are marginalised. This is despite air pollution experts like Professor Frank Kelly stressing the need for mode shift, and the many advantages of e-Bikes over cars, including health. There’s growing evidence that e-Bikes replace car trips, maintain cycling at older ages, and allow people who might not otherwise be able to cycle to participate. Far from being ‘cheating’ they will help enable maximum use of the bike infrastructure we need to be building, for both personal and freight transport.

WWW.CYCLINGINDUSTRY.NEWS // 047

(( FOCUS ON... AFFILIATE MARKETING ))

LEVEL PLAYING FIELD ONLINE? If you’ve spent five minutes on almost any of cycling’s main consumer sites you’ll have noticed ‘daily deals’, often seemingly favouring the online giants.

Can independent stores also play on the same pitch? CI.N asks the experts…

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ou’ll undoubtedly have heard the term affiliate marketing and if you’re in the cycling market, you’ve undoubtedly seen it in a number of forms. If you’re an independent bike retailer, it’s more than likely left a bad taste in your mouth, with sites seemingly preferring to work with the online giants.

Misconceptions do exist on the topic, however, so we set out to ask: must the tech-savvy independent with an online shop be left out in the cold?

“Ultimately affiliate marketing is totally open to all, but uptake in the IBD sector is low, probably due to a perception ‘it’s not for us, the big boys dominate’, when in fact the big tech savvy players dominate because the IBD’s don’t participate,” explains Immediate Media’s Group Advertising Head Andy Nelson. “It’s the classic ‘you’ve got to be in it to win it’ scenario, but with a bit of education there’s no reason whatsoever that an IBD can’t play.”

Though policy and prices will vary from publisher to publisher, at a time when traditional avenues are in need of adaptation, it’s common sense for publishers to thicken their revenue streams, so why wouldn’t they want to work with friendly bike shops?

“In many ways I wish that it was as simple as the old days where we just ran display ads online and in print for everyone, but those days are gone. Data is now the key

metric in almost all business success and affiliate schemes provide plenty of that for everyone involved,” offers Singletrack publisher Mark Alker.

A long-term advocate of the independent bike shop, even Singletrack has had accusations of disproportionately “supporting the big boys” levelled at the team in recent times. You will of course find what are deemed to be the “best deals” for readers as part of the Daily Deals Facebook page. This, according to Alker, is something Singletrack aims to balance out with the £50 a month Premier Partner scheme for independents.

“That channel is not just for affiliates,” we’re told. “We do offer to use it to promote posts from our Premier Partner dealers and businesses, regardless of if they are part of an affiliate scheme or not. Our Premier scheme is designed to support smaller businesses that don’t have the affiliate connections in their online shops or have large marketing budgets to be able to book a few hundred thousand ad impressions. It’s a suite of benefits from mag sales, to traditional banner advertising and more up to date social media sharing campaigns. It’s a proactive system and it does take some work on the part of the dealer to get the most out of it.”

SO, HOW DOES AFFILIATE MARKETING WORK? The basic idea of affiliate marketing is that you, the retailer, let others market your products and generate traffic to your website and in return, you’ll pay a percentage of sales that stem from those clicks. These are very often tracked by customised hyperlinks that ID the source of the traffic.

Nelson offers up an example where smaller businesses have squared up well against the big names.

“A really good example is something like our regular deal features, which are SEO and search driven. We’ll pick up on trends in the marketplace and what users are searching for, and then run a feature on that hot product topic, populated by searches our team run on the affiliate network. We recently saw a spike in searches for Oakley sunglasses; we ran a ‘best deal on Oakley’ feature with links through the network, populating the best deals. Far from it being just the usual suspects there’s a wide spread of retailers. The performance

WWW.CYCLINGINDUSTRY.NEWS // 049

(( FOCUS ON... AFFILIATE MARKETING ))

sector is completely seller agnostic, so if a one man operator has the right product at the right price, he’ll perform better than a huge box shifter who isn’t on point with pricing.”

Of course the commission paid will stem from your margin, so it might be wise to calculate just how much you can afford to lose before you start ringing the publishing houses, or weigh up the spend against your marketing budget and redistribute. It’s also worth bearing in mind that you aren’t just gaining a sale via this method, you’re very likely acquiring a new customer and their data.

“If a small shop goes to the top of the affiliate ranking on our site and sells loads of product, we make loads of commission, just the same as we would if it was CRC/Wiggle/Bike Discount or whoever,” adds Nelson.

From a publisher’s point of view, with traditional revenue streams not delivering the flow they perhaps once did, affiliate marketing is a necessary evil of sorts.

In Singletrack’s case, we’re informed of one eyebrow raising stat that the publisher’s forum users actually generated £1.5 million in affiliate click sales in 2017, something which helped pay wages of an expanding team.

“We don’t have any obligations or commitments with any of the businesses we promote on our Daily Deals page and we genuinely look for good deals that we think our followers will be interested in,” concludes Alker. And that can very much include the independent store, if they so choose to get involved.

AquaBlue: level the playing field?

AquaBlue Sport are another option bike dealers have to bolster their online fire power, should they lack the tools or resources.

Nearing 100 accounts across the UK and Ireland, the umbrella site lists the products of each store, utilising a store’s subscription funding to provide the marketing and Google search firepower that ensures products from small businesses show up in searches. The business also has a professional cycling team sporting its colours and promoting the online marketplace. Again, a bike shop would have to do the margin maths to decide whether this is the best fit for their business.

Director Jamie Delaney told CI.N: “We don’t sell ourselves, bar a little teamwear, instead the Aqua Blue platform is designed to level the playing field for resource-slim bike shops and small brands that struggle with the demands of online retail and marketing.”

Bike shops listing and selling on Aqua Blue are said to receive payment on sales within seven days.

What’s more, in order to get to grips with the platform, the first three months are free. aquabluesport.com

HOW TO SUCCEED IN AFFILIATE MARKETING IF YOU’RE AN IBD: 6 TIPS PROVIDED BY ACTIVELYOUTDOORS Competition is fierce, in order for you to succeed you will need to follow the models of successful affiliate marketers while thinking differently and being original.

1

INVEST IN YOUR EDUCATION

2

THINK LONG TERM

3

TRACK EVERYTHING

The best investment you can make as an IBD is to invest in your knowledge and skills. Accept that there is a learning curve and take it one lesson at a time.

Quick money dries up... well, quickly. So it’s important to plan your affiliate marketing business for the long-term and to take each day step by step. The sales inertia required in the beginning is immense on your part, but momentum picks up and the returns (cash) will steadily grow.

Track where your traffic is coming from and where it is going, monitor your campaign ROI every step of the way.

050 // WWW.CYCLINGINDUSTRY.NEWS

4

FIND A NICHE AND FOCUS ON IT

5

TAKE THE PLUNGE

6

PROVIDE VALUE

It’s important that you find a cycling product niche to focus on so that you don’t spread yourself too thin. Concentrate on marketing to a small group or segment of consumers and winning that battle before expanding into other areas.

Allez, allez! If you haven’t started yet, the best time is now. You can adjust and tweak as you learn and grow. The reason so many people fail in Internet marketing is from not taking action.

Focus on building high quality websites that provide value. This step is crucial and often overlooked, long term high quality websites will always trump those made for quick money.

The Global Platform

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DISTRIBUTED IN THE UK BY:

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(( PROFILE WELDTITE ))

WELL

OAILCHEINDE M

In the hot seat only for a matter of months, Weldtite is now under the guidance of Paul Davis in the UK

With a new boss at the helm, growth in exports and a steady trickle of specialist new lines, CI.N talks to Weldtite’s Carl Davenport about how bike shops can maximise their ride care business as we enter a (hopefully) drier period…

What’s the best way to effectively set up cleaning and lubrication products in store?

Flexibility and positioning is key. You know your customers and their riding style; so position the products in high footfall areas with easy access. Our modular stand has just been re-designed for 2018 to make them easy to assemble and eye-catching with a small footprint. They work well as individual merchandisers hung on a slatwall or as free-standing full-range merchandisers. The stand showcases the whole range and positions products in logical groupings.

What indicators on Weldtite’s packaging are there to educate the buying customer on intended usage?

We aim to orient our products around customers and their intended use. The TF2 range, for example, has simple infographic for the type of weather – rain clouds for wet lube, sunshine for dry lube, etc. The same goes for our Jetvalve CO2 Inflators; there are images indicating valve compatibility (Presta & Shrader), cylinder size (16g, 20g or 25g), and the maximum compatible seatpost size. We sell products in 50 different countries around the world and get consistent feedback on the importance of good quality simple imagery.

For shop floor staff, can you share with us some key knowledge to assist staff in selling such goods?

The public appreciate engagement with informed staff who can share their knowledge in a jargon free or non-condescending way. Work on how you make your sales people non-technical but interesting. Don’t take it for granted that a customer knows the difference between wet lube and dry lube, or a degreaser and a frame cleaner; if they do, they will tell you. Wax is a really good recommendation for a mountain bike rider as it’s fantastic in grit, gravel and sand and not as sticky as an oil. Road cyclists typically don’t consider wax, but it’s equally at home on the road to keep dust and debris at bay while keeping a chain and the riders legs clean. We choose to add Teflon to our TF2 lubricants due to its unique ability to penetrate and coat surfaces other products do not reach.

What training material is available to help staff?

We produce product spotlights on all new lines that highlight the features and benefits as we put them into the marketplace. We also supply information sheets on specific applications or additives. For instance, we’re often asked why we assert that Teflon remains the best additive for chain lubes, and so developed a specific leaflet and datasheet.

WWW.CYCLINGINDUSTRY.NEWS // 053

(( PROFILE WELDTITE ))

You've a new managing director, Paul Davis, at the helm; what’s been on his to do list since joining?

Paul is only two months in and has an ever-growing list of things to do. He brings a wealth of experience in manufacturing as well as brand development, customer service and sales and marketing. Paul’s challenging many of the things we take for granted and bringing along some really fresh thinking. It’s too early to share the developing plan, but suffice to say everyone’s level of enthusiasm and engagement has stepped up a gear in the last few months.

You make selected lines in the UK – will we see more of this in the future?

It’s actually really important to us that our products continue to be made in the UK. We are continually challenging ourselves to produce more sub-components inhouse. Our factory is part automated and part manual operation which gives us a very high level of throughput and flexibility.

Will we look at bringing even more manufacturing in-house? Definitely. By controlling our production process in-house, we assure service and quality. We take pride in Weldtite’s excellent reputation, especially with wholesalers and IBDs. Why outsource something this important?

How is Weldtite developing its lines to be eco-friendly?

We care about the impact our business and products have on the environment. We have even developed a range of products called PURE that are extremely environment friendly. Ingredients are from sustainable sources, with no propellants, fragrances or colourants. What’s more PURE is 100% free from petroleum-based solvents and human carcinogens, and is classified as readily biodegradable by internationally recognised standards. The bottle is made from recyclable material and unusually, the label is made from the same material allowing the empty bottle to go into household recycling. When reviewing the products in the marketplace we found many products have paper labels meaning the products have to be placed in the less environmentally friendly mixed recycling.

What key lines are landing at present that retailers should check out?

In the TF2 range we have our Advanced Ceramic Wax which is the best performing chain lube we have tested.

In the Dirtwash range, we have our Maintenance Starter Pack with mini versions of our best-selling lines, an Expanding Sponge + Microfibre Cloth double pack, plus Frame Wipes for easier cleaning; new sizes in our Chain Degreaser range and a reformulated hand cleaner which excludes microbeads. In puncture repair we have a brand new tyre mounting gel for easier fitting, and after such a huge demand for our 75th Anniversary puncture repair kit back in 2015, we've produced a vintage repair kit in a weathered metal tin. The new shop stands are also getting great reviews.

054 // WWW.CYCLINGINDUSTRY.NEWS

"We are continually challenging ourselves to make more in the UK," says Davenport of the manufacturing

What point of sale material is available to assist stores?

The big news for 2018 is our shop stands. Elsewhere, we have over 100 items in our point of sale range, so many in fact, that we publish a catalogue specifically around POS (available at www.weldtite.co.uk) that covers everything from slatwall headers, merchandisers and desktop catalogue dispensers to window stickers, workshop wear and branded carrier bags. We even produce larger items such as gazebos, flags and banners for outdoor events.

You’ve added e-Bike care goods too. What’s available?

The eCare range is a bottom-up development that has been produced after consultation with e-Bike riders about what issues they have had. The range includes an electrical contact cleaner, waterless frame cleaner, a chain degreaser, chain lube and a wax polish. Presented in a handy multipack, they make a great low-cost upsell.

Completing the range we have a puncture repair kit and frame wipes that make the e-Bike rider’s regular maintenance and basic repair much more manageable. Range sales to date and customer feedback has been excellent.

How can retailers take stock of Weldtite and what are the minimum requirements?

In the UK, we deal with virtually every wholesaler making our products widely available to the market place and we would recommend discussing stocking quantities with your preferred wholesaler. Outside of the UK we have a wide network of dealers that stock our products. Anyone requiring Weldtite products or support can also call our office is Barton-Upon-Humber on 01652 660000 and we will happily advise.

SIMPLE, FAST AND TRANSPARENT.

LIVE-QUERY ON AVAILABILITY MORE THAN 3000 ARTICLES INDIVIDUAL CUSTOMER DISCOUNT LOW SHIPPING COSTS New Dealers can register online.

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Tutorials to help you keep your customers happy...

PROBLEMS WITH YOUR NUTS?

Suggestion by Ellis Blackman

FOLLOWING on from the last instalment of “Stuff your workshop should have but probably doesn’t” we have a homemade product, the rivnut tool.

What is a rivnut you may ask? Well, for the most part on bikes they’re used in frames where you’d mount a bottle cage, although they can be used for rack mounts and, industrially, anywhere you'd like a nut but have no access to the back. Mounting an LED lightbar to a bumper? Use a rivnut.

With all that said and done, CI.N’s own Editor mentioned that his bottle cage bolts were spinning on his road bike, a not uncommon occurrence, but certainly not an everyday issue. You’ll be pleased to hear this doesn’t warrant a bike shop buying the ‘correct’ tool; you can make something that works out of components you probably have knocking about in your spares tubs.

YOU’LL NEED FIVE THINGS: 1. Bolt sized to rivnut (M5 in the case of bottle cage bolts) 2. Nut 3. Washer 4. External locking washer 5. Rivnut Once you’ve combined the parts as per the picture, thread it into the rivnut, hold the bolt still and tighten the nut. Done!

SEARCH: CYCLING INDUSTRY CHAT TIPS FROM OUR FACEBOOK GROUP Steve Baskerville, Bike Spanner “A bent flat head screwdriver (bent to 90 degrees about 10mm from the tip) used to be essential for me to adjust the front mech and all those weird and whacky full suspension designs.”

Mark Hudson, Gone Biking Mad “When you pull the forks out of a bike, use an old broom handle with a top cap screwed to the top in the space. This saves the handlebars flapping around and holds the headset together, also allowing for a faster re-install.”

WWW.CYCLINGINDUSTRY.NEWS W WWW WW.CY CYCL CY CLIN CL IN ING NGIND GIND GI NDUS USTR US TRY TR Y.NE NEWS NE WS // 05 0577

ask the boss Bikemonger

CHARLIE HOBBS, AKA THE BIKEMONGER

This is typically the space where you’d flick to find out which industry boss has pearls of wisdom to share on the future of the business. The thing about bosses is they’re all rather busy; so we’ve drafted in Charlie Hobbs, aka Mr Bum Butter, instead to drop wisdom pearls on some unsuspecting bargain hunters he found online. Buyer beware…

Work hard, six day weeks, fixing other people’s problems, having enough money to buy a new Jaguar and a KTM motorbike tied up in stock... and then rather than thanks, we get called every name under the sun for daring to charge almost the recommended retail price.

This has been a constant niggle in my business life, and no doubt other people’s too. This week on Facebook, a popular nationwide car parts and bicycle chain were called “robbing bastards” because they priced a Schwalbe 27+ freeride tube at £9. The consumer was furious as he believed the tube was £4.50 at Wilkinsons. Facebook users joined in en-masse, calling the store thieves in one form or another.

I commented and asked: “When evaluating this and labelling them thieves, how much did you allow for staff, VAT, corporation tax, legal, marketing, rent, rates, distribution, storage, electricity, training, and toilet roll? And hey it’s a £11.50 ‘freeride’ tube, so what are you moaning about”.

Where does this complete lack of comprehension come from? Why don’t they teach this at school; a basic breakeven point analysis, alongside a simple profit/loss calculation? Every kid is taught how to calculate the area of a triangle, which after 30 plus years has proved to be thoroughly useless. Let’s teach them how to make and retain money instead.

VERY POPULAR SADDLE

TOURING BIKE

FULL SUS USA BRAND

RRP

£95

£1,299

£4,000

Trade

£49

£866

£2,700

VAT

£16

£216

£666

Fixed costs at 12%

£11

£156

£480

Shipping out

£4

£20

£20

Total Costs

£80

£1,258

£3,866

Profit

£15

£41

£134

This is at RRP. If you compete online there can't be any profit. Fixed costs are all the running costs; rent, rates, staff, toilet roll, accounts etc.

Prices correct at 04/04/18

058 // WWW.CYCLINGINDUSTRY.NEWS

Then there is the “But it’s only £8 at...” a mail order outfit that is not on the same island, several days and a £3 postage charge away. They have a flat tyre right here and now. My response to that: “Look here sunshine, you are standing in my shop, and it’s going to cost you £11.50.”

That’s the ranty bit over. So, what can be done? I now have a print out to hand that shows example costs with numbers, and the total stock value. A loose mock up of that you’ll see on these very pages; feel free to cut it out and staple it to the tyre of the next customer asking silly questions.

“Hey, take a moment, sit on the sofa and let’s absorb this,” I may say when confronted with this customer.

They can now see the £8 end-of-theday margin on a £100 handlebar and can see that I have spent thousands on stocking the bars. Simple things like breaking out the VAT on receipts and mentioning it helps too. Ranting and shouting might work. I should have asked the ill-informed Facebook guy “Oi, where’s my bloody KTM, you robbing bastard?”

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