Bicycle workshop as a business

[dirtypot]

This is what I'm doing.  Myself and business partner started small - he was initially working from his garage, then moved into my warehouse.  We outgrew that and now have a shop.

We don't do new bikes (well very very few, and it's not a core of the business at all) or kit, just mechanical work and spares.

Every single day we're adding new customers to our database, and more bikes keep coming through the door.

We're lucky in that we have a niche location with high viability, but I think that having the guys who own the business working on the bikes makes a huge difference.  We can see the amount of trust that people put in us, and it's great.  

Financially, you're not going to get rich doing this!  Every time that we think we've had a good month all of the money just gets reinvested into more stock.  It's a never ending cycle.  

Our workshop and displays need a lot of work - maybe one day when we have some time...

 

But it's got to be said - there are worse ways to make a living! 

 

 

 

 

[madmarc]

Would you be fitting Shimano as well 

Was wondering when this would be asked, this is the most difficult decision to make 

[madmarc]

Joburg, east rand. Or in Germany for work.

If it was Germany, it would work in a heartbeat. thats where the idea of OEM certification or certified training comes from - its a requirement over their if you fix any modes of transport

[droo]

Would you be fitting Shimano as well 

 

Unlikely. You've got to jump through hoops to be able to buy from them.

 

OP - you're going to work your moer off. It's not an easy game to make money in. Work out what you'll need to charge and see if it's an acceptable figure for the average bike owner. If it's a premium price, you'll need to make sure the service matches and is consistent. If you sell yourself short on price, you'll start to resent it very soon and you'll close your doors within a year, and if you go in low and raise your prices later you'll lose your client base pretty fast.

 

And you'll need to sell spares, unless you want to become your LBS's biggest client. This means you'll need a standalone store, since most suppliers won't sell to home workshops.

[David Marshall]

I'm with Dirtypot and  Droo.  You won't make anything like a corporate salary running a workshop even if you are the main mech!  The closest to what you are describing is what JB had at Yellowsaddle and I worked for him for a couple of years.  He made a living but without the income from his classes it would have nothing to write home about.  What I earned would not have kept me there long term either.  If you threw in a commercial rental without the classes it would hardly have been worth it.

 

As to getting direct from the importers - they are the agents and you deal on their terms.

 

Stick to mid/high end bikes.  Kid's bikes and cheap commuters are charity work.  Even the cheap parts they use will push the service cost above the new price as soon as the bike is a year old.  They take proportionally much more labour time as well.

 

As to specialists like wheel builders I don't think many can survive without doing general work as well, so most will offer the full range of services.

 

Don't knock the Google mechanics.  The range of products and marketing driven changes in this industry are a bit like the IT world.  Who programs in the language they learnt a varsity?  OEM trained personnel would be great but don't finance it yourself.  You would be on a hiding to nothing.  The one man shows survive because they are passionate about bikes.  The moment they take on staff who are doing it as a job the problems start.

 

The investment in workshop equipment is pretty heavy.  To do the job you need more than a Park Tool starter kit.  Just an example my spoke cutter/threader took the labour component of 80 wheels to pay for it.  In addition that I have a hell of a lot of other specialist tools as well.

 

Bit like the farmers say - to make a small fortune start with a big one.

[HeyYou]

I'm building a business plan for a stand alone Bicycle Workshop to see if its is a economically viable business. I been repairing and rebuilding bicycles for a fair amount of time for no economic gain for mates and colleagues.

So now i'm thinking of doing this as a business for someone who is about to retire or just generally gatvol of the corporate world.

 

In summary the idea is to have a professional workshop with a proper financial investment that only caters for rebuild, repair and service.

No retail of new bikes or kit and all the other paraphernalia you would find at a normal LBS.

All brands and bike forms will be repaired, from high end to kids bikes with fairy wheels.

Any type of work will be done on any component, not just specializing in say wheels and shocks

Access to components and spares direct from the importer, without having to purchase them from a LBS. The workshop would be able to offer both the labor and the spares / component of the transaction at competitive prices.

Mechanics with OEM qualifications and approvals to carry out service and repairs. i.e. properly OEM trained mechanic/s of which might even have to be trained at the OEM overseas.

 

A lingering question is, would such a workshop be financially viable without being a retail outlet on new bikes and kit ? 

 

And

 

As a cyclist I know what i would expect from such a business if they wanted my support. What would you expect for your support.

 

And 

 

Any further input, suggestions or ideas from all and sundry on Bikehub would be appreciated.

 

I think the most important question your business plan misses, is WHAT THE MARKET CAN AFFORD / BE WILLING TO PAY.

 

I restore CLASSIC European bikes as a hobby and I love it. But, it can take me between 30 and 100 hours, depending on whether I have to rebuild wheels, loosen seized seat posts, respring brake calipers and many other variables, which I'm sure you can imagine.

 

I've been asked a couple of times to restore bikes for other people, but when I tell them it might take me 30 hours @ R200 an hour!!!!!

 

I don't see them again.

[Bobbo_SA]

Will also depend on location and the facility you have available.

 

JB (Yellow Saddle) used to do this from his house and unless his wife was subsidizing... made it work supplemented with some Fork and other maintenance courses.

 

I bought his place and have a moerse garage as a result

 

You do realize that now 3/4 of hubland knows where you live....

[JXV]

Your only sources of income will be selling your time ( rate per hour.... no hours no income) and markup on spare parts - the turnover of which is linked to the hours you put in. So this plan has fundamentally limited potential. It may be viable but can't grow past a certain point because you have limited hours to work and customers will only travel so far before a closer LBS becomes more convenient.

 

So, supplementing that potential with a stock of retail items just makes sense. At the least it will be worthwhile to keep popular spares, consumables like tyres, tubes, brake pads, lubes and maybe some sports nutrition items

 

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[Eddy Gordo]

I have been struggling to start my own part time workshop. Time is a major factor. However the small amount of customers that I have, I am happy with. Its not really a business either.

[Joeboy69]

Is Tork Zone not one of these businesses?

Agree with this

 

http://www.torqzone.co.za/

[popcorn_skollie]

I have a friend who did this out of his garage for the longest time. Also worked on bikes for friends for years and years. Whenever I was there. He could easily have had 3-5 bikes that needed seeing to on any given day. He worked alone mostly with hired help but he was the only mechanic. At some point he decided to take a mechanics job at a lbs. For a more steady income. It wasn't long before he realized that he preferred managing his own time and working for himself. But part of his problem was undercharging friends and too many favours for people whom he thought he owed for continuous 'support'. Most of us just went to him because we knew we could get things done for cheap or even free. Word of mouth was good for him. But those people kinda expected the same thing too. It happens when you walk into someones garage. You feel like they owe you for being there instead of some bike shop. That they should show their appreciation with dirt cheap pricing and good service. When he got fed up and started charging decent prices support started to dwindle. His workshop was pretty decent with all the right tools. His work also spoke for itself and could also get creative with solutions. But being a nice guy was his ultimate demise. Its a business. So charge what people charge these days. For everyone. You can start dishing out small discreet discounts for the most loyal returning customers after the first year. If your work and turnaround time is good. If your prices are fair. If you keep your overheads low. There's no reason you can't make a success of it. 

[Eddy Gordo]

I have a friend who did this out of his garage for the longest time. Also worked on bikes for friends for years and years. Whenever I was there. He could easily have had 3-5 bikes that needed seeing to on any given day. He worked alone mostly with hired help but he was the only mechanic. At some point he decided to take a mechanics job at a lbs. For a more steady income. It wasn't long before he realized that he preferred managing his own time and working for himself. But part of his problem was undercharging friends and too many favours for people whom he thought he owed for continuous 'support'. Most of us just went to him because we knew we could get things done for cheap or even free. Word of mouth was good for him. But those people kinda expected the same thing too. It happens when you walk into someones garage. You feel like they owe you for being there instead of some bike shop. That they should show their appreciation with dirt cheap pricing and good service. When he got fed up and started charging decent prices support started to dwindle. His workshop was pretty decent with all the right tools. His work also spoke for itself and could also get creative with solutions. But being a nice guy was his ultimate demise. Its a business. So charge what people charge these days. For everyone. You can start dishing out small discreet discounts for the most loyal returning customers after the first year. If your work and turnaround time is good. If your prices are fair. If you keep your overheads low. There's no reason you can't make a success of it. 

Thats just it, your friends never want to pay and everyone expects a favour. Hence why unfortunately you have to rent space for this type of business.

Unless you can have another building on your property with separate access. Maybe then it can work.

[dirtypot]

Thats just it, your friends never want to pay and everyone expects a favour. Hence why unfortunately you have to rent space for this type of business.

Unless you can have another building on your property with separate access. Maybe then it can work.

That's why we have a strict policy: you must bring bunz* for at least one solid week before any discount is given.

 

*bunz = chealsea bunz, hot cross bunz, triangle bunz (samoosas), spicy bunz (spicy Mc Feast), meaty bunz (pies),chocolate bunz, coffee bunz, liquid bunz (beer), etc...

[madmarc]

Well thanks for the insight and varied comments. One of the biggest risks i noted even before i made this post, was the supply of spares and components direct from the importers. I am well aware of their attitude when approached by these types of businesses. If one cannot get access to prices to compete against LBS prices then you will be relying on labor hours to make money.

 

Scale of economics between an acceptable hourly rate and the amount of hours you have to sell, just won't fit in the formula, unless you have 5 or 6 mechanics working for you, and even then i'm skeptical.

 

Another point is the high cost of training. I've had my chirps before on this sight direct with mmmmm well lets not mention names !!! but the high cost of local certified training makes it very difficult to for any business to get a ROI on mechanics that they send for training. I have no problem spending the money on myself, even paying to go to the OEM for training, But when you send and employee, who ups and leaves after a year of certification, well you might as well piss the money up against the wall.

 

I think this type of business would have to be an add on business as an additional income stream to a business already doing something related to cycling or sport eg. bike touring or bike rental.

 

Thanks once again for your input

[myveonix]

THIS - One of the biggest risks i noted even before i made this post, was the supply of spares and components direct from the importers.

[Khronis]

That's why we have a strict policy: you must bring bunz* for at least one solid week before any discount is given.

 

*bunz = chealsea bunz, hot cross bunz, triangle bunz (samoosas), spicy bunz (spicy Mc Feast), meaty bunz (pies),chocolate bunz, coffee bunz, liquid bunz (beer), etc...

 

Do you accept  koeksisters ?