We kept on thinking, 'Why is nobody doing this in South Africa?' Like protective gear… and you know, you go to the store and you can't find anyone to speak to - it's rather frustrating. And guys are going overseas to CRC (Chain Reaction Cycles) to buy… and it's killing the whole industry... You're not seeing the events that you used to, or the riders.We put together a business strategy and marketing strategy for the year and we did a whole bunch of polls and a lot of investigation as well… And then we started chatting in the riding community, because I feel that with business, it's great to have something you love, but who says the other person is going to love it? So we started asking a lot of riders, 'what brands do you want to see in South Africa that aren't here, and why?' We got a lot of rider feedback… and we look for help in every aspect we can to make the business grow to help the sport. We got a lot of feedback and it was about three weeks of intense negotiations with Six Six One. Everybody's on the internet, it was the easiest choice to just go online. Nobody was doing what we were doing.
Andrew Backstrom // Image credit: Ewald Sadie
Price and Availability Buying online is often much cheaper than at your LBS. Often times it's because the online shops are importing the products themselves, either as a distributor or by getting grey imports and cutting out the local distributors. Because the middle man is often cut out, it is easier to charge less than a LBS would. It's for reasons like this that manufacturers in particular give online shops a hard time with selling their products, and sometimes downright refuse to let them. But what's often mistaken is that online shops are cheaper to operate than LBS's because they don't have a store front and so have less overheads. This isn't always the case, though.Overheads may not be as high as an LBS, but it's not to say that costs are nill. Marketing and events are a huge part of Dial'd and just giving back to the sport in general. Events like The Night Harvest and sponsoring riders takes up a lot of time and money, so it is not only an online store, but an investor into gravity cycling in SA.
We are in a year and a bit of operating, so cash flow is very tight and I monitor that heavily... We didn't want any form of loan... we put a lot of our own money into this business.Overheads are nice and low, we put a lot of money into the website and the developments of those things. The backend is really cool, it manages stock, it does all the sales. And obviously marketing budget and things like that, we do a lot of marketing, a lot of design work. And that's all in house.
It was initially difficult convincing manufacturers to allow them to sell their products, but not for all the same reasons as other online shops. Once they managed to secure Six Six One (a protective gear company), their first goal was complete and other companies could see that they were capable, "We knew Six Six One…we knew the brand, we used it ourselves; that's kind of where it all started. If we could get Six Six One, the rest would follow," said Andrew. Because Dial'd holds the position of the only gravity oriented online shop in the country, they are in a very niche market, and based on that, did not have an issue with getting certain manufacturers' permission to sell their products after they had established themselves as a legitimate retailer. In fact, they have the distribution rights for many products and distribute to LBS's as well. It's not to say it was easy to begin, however, because concerning Six Six One: "companies have done it before in South Africa and have messed it up." That wasn't based on the online status of Dial'd, but because of past issues.
"The only problem we've gotten is from locally based suppliers here in South Africa. They were like, 'No, our deal is, the other stores won't like it.' And they say, 'you can't provide the service.' We get at least three messages a week, via Facebook or Twitter or email saying, 'best service we've received in South Africa.'
Andrew went on to say that no one is really doing the enduro, downhill or dirt jumping products in SA and so people look elsewhere for what they need. He said that the local distributors don't like to support online shops because online has the ability to list products that aren't actually in stock. Since Dial'd are the distributors of most of their products, they distribute to LBS's too, but, "It's a problem of convincing stores, like, 'hey, this is a growing market, invest more into it.'"
We did a poll online just to ask questions, nothing related to us, it was just a poll running to riders: what type of riding do you do? We spoke to friends and they were like, 'you guys need to consider trail'. And we said, 'everybody's doing that'. They just didn't get the idea, it was so frustrating.So we ran the poll, and trail riding was 300-odd. The other disciplines were dirt jumping, all mountain, downhill and freeride. We showed our mates and they were like, 'Yeah but look, trail, you should be doing that.' And we said, 'add up the other ones' and they were like over 400. Nobody's competing for that 400. Eventually they got the idea.
Service and Convenience Surprisingly, service is one of the main areas where some of the online guys want to excel. Not only with service to the customer, i.e. giving them the information and expertise they are after, but also after sales.Dial'd take a very hands-on approach to their customer service and even their involvement in the sport. "That is very key to me: relationships with our customers and with our suppliers… If something does go wrong with our customers then we can help them as soon as possible, instead of them just being a number… At the end of the day if you're just here to get a sale, where's the customer service gonna come from? Cause that costs money as well." There's also an issue of suppliers not believing that online shops can provide the necessary service to customers. "It's a toy we are selling here, no matter how old a person gets, you can't wait for a toy. So we respond to mails immediately," said Andrew. In terms of grey imports: "Ethically, we just can't do that… to me service is so important…we'll never do it." And that decision is based on the fact that the manufacturers or distributors in the country won't back up the product if anything goes wrong. Dial'd refers customers to LBS's that they have developed relationships with that they feel are competent enough to help with the actual work on the bike and also with service to the customer. Not only that, but Dial'd takes responsibility for the customer's treatment at the LBS, if something doesn't work out or if the service isn't up to scratch.
Stores have their place - it's something we are looking heavily into: an idea of having a storefront. We can't just go 'we are only going to be online'.
But this is a long term idea with much to consider. For the time being Dial'd Bikes is an online store focussing on gravity riding and working to promote gravity cycling in South Africa through sponsoring events and even riders. Dial'd Bikes: dialdbikes.co.za
Part 1: CWC Part 2: Evo Bikes Part 4: Conclusion