Is there space for non franchised bike shops ?

[The Ouzo]

With the closing of my LBS I'm pondering the question, is there space for non franchised LBS ?

Or are they going the way of the corner cafe and simply cannot compete with the big franchises ?

 

On service I'm sure they have the upper hand, but so many people shop on price, and the buying power of the big franchises alows them to buy and therefor sell at better prices. Plus having the backup for the franchisor they are probably able to secure higher end merchandise.

 

What say the hub?

[parrcat]

This is an interesting question. I have frequented lots of shops over the years, from all those around Somerset West where I now live, and back to Jo'burg and the North West where I lived for 9 years. From what I hear most shops make very little on selling new bikes, even the franchises, and rather make their money on other merchandise, and the service side of the shop. I think there are some though that do make money on bikes, those that are able to pay for their bikes in cash up front. They get good discounts from the suppliers, and are able to pass these on while smaller enterprises buy on terms and have to sell at full sticker price. Dealing with the guys who pony up front, and there is a very well known bike shop in Rustenburg who I still transact with that does just that, it's amazing the difference in the price of bikes. 

But saying all this, having a good relationship with a bike shop that services one's bike properly, doesn't try to rip you off, gives good technical advice and is always there for you is invaluable and I always go back to them. Fortunately the shop in Rustenburg was exactly like that, and down here in Somerset West I have found 2 shops that are great, while there are one or 2 others that can leave a sour taste at times. Case in point, I needed to replace a brake lever on my son's bike broken in a fall. Shop1 - assures me Shimano don't supply just the lever, you'll need to buy a whole set. Oh, and we just happen to have a set right here. Didn't sound right to me so off to another one down the road - no problem we can order the lever from Cool Heat for a 1/4 of that price, except Cool Heat couldn't deliver in time for a race. One phone call later, shop in Stellenbosch has it, rush there but the wrong side. Phone around, land up at Chris Willemse in Durbanville and buy the lever over the counter for a good price. 

So, long story short, LBS's can compete, just get it all right and you will keep your customers.

[Sparky and the Warden]

Me ten cents is probably not, as you pointed out big guys have big buying power however I myself don't care for the smoke and mirrors for me it's the guy working in my bike.

 

A good relationship with your mechanic goes far and it's awesome hanging out talking about everything bike and not just treated like an ATM.

Edited May 22, 2018 by andrewdh

[The Ouzo]

so then much like a car dealership the doors are kept open by the service and parts departments.

But is there enough business to go around ? is there enough profit in it to keep the doors open ?

Do the majority of people get their bikes serviced regularly or is it just a select group ?

 

i take the hub for example ? most of us will prefer to service the bikes ourselves, so the "hardcore" guys dont service, the other end of the scale is the seldom riden bikes. The owners of these probably cant be bothered as they never ride.

 

With a car they have the market almost captured. Dont service your car at the regular intervals and your warranty is cancelled. So people have to service annually or after x km .

[pista]

Dont service your car at the regular intervals and your warranty is cancelled. So people have to service annually or after x km .

That's on the way for bikes.

[GLuvsMtb]

That's on the way for bikes.

Add to that proprietary tech and specialist tools and skills required (all in the name of marginal gains of course) and it is becoming increasingly more difficult to do services at home.

Remember helping your dad out pumping brakes while he would bleed them or with an oil change on his Ford Escort?

Very few people attempt these jobs now.

 

 

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[HdB]

I'd say, yes absolutely - as long as their service is great, but also they get involved in the local cycling community by helping to organise group rides etc.

[Grease_Monkey]

My opinion: Yes - absolutely.

 

This is my experience, so it may be different for everyone, but I have only experienced crap service at the like of Cycle Labs, big Spaz Concept Stores, and other chain stores. Yes, their prices are good, but I feel like I don't matter to their business (and I probably don't).

 

On the other hand I have experienced amazing service at the likes of Trailtech Cycles, The Hanger Bike Co, Stoke Suspension Works, Cogent Industries, Tool Up Cycles, Trailwolf. Guys that take an interest in what I say, therefore listen to the problems I have with my bike, and resolve the issues. I find it's often the owner of rhe shop working on my bike and he therefore cares about the quality of service he gives (it is his reputation on the line afterall). At the big shops they simply could not give a rats ass, and most of the time I have had to take my bike back to the shop 2 or 3 times with a recuring problem.

 

I support my small, non franchised LBS as far as I can. And in cases where prices are just too high I support someone like Chain Reaction Cycles, EvoBikes, and CWC - who are big, but actually deliver on their promise of service. If I do end up buying from one of the online stores I do end up paying labour at my local LBS anyway, and a coffee or beer after the ride.

 

The LBS will always have a place if they provide excellent customer centric service, have competent mechanics (who actually listen to their client), and generate alternative streams of income like selling coffees and organising social events.

Edited May 22, 2018 by Grease_Monkey

[rudi-h]

That's on the way for bikes.

 

i'd like to see how they'd motivate / enforce that...

 

the warranty parts on bikes are pretty much the frame, fork and shocks...  no way anyone can waive a warranty on a frame because you don't get your brakes checked from an accredited LBS every few months...  In terms of the forks and shocks, well if you want extended warranty terms then the need maintain adequately is obvious.  But then again, I don't think the warranty terms on any fork is more than 6 months or so, so you won't even reach your service interval by the time the warranty expires.

[GLuvsMtb]

My opinion: Yes - absolutely.

 

This is my experience, so it may be different for everyone, but I have only experienced crap service at the like of Cycle Labs, big Spaz Concept Stores, and other chain stores. Yes, their prices are good, but I feel like I don't matter to their business (and I probably don't).

 

On the other hand I have experienced amazing service at the likes of Trailtech Cycles, The Hanger Bike Co, Stoke Suspension Works, Cogent Industries, Tool Up Cycles, Trailwolf. Guys that take an interest in what I say, therefore listen to the problems I have with my bike, and resolve the issues. I find it's often the owner of rhe shop working on my bike and he therefore cares about the quality of service he gives (it is his reputation on the line afterall). At the big shops they simply could not give a rats ass, and most of the time I have had to take my bike back to the shop 2 or 3 times with a recuring problem.

 

I support my small, non franchised LBS as far as I can. And in cases where prices are just too high I support someone like Chain Reaction Cycles, EvoBikes, and CWC - who are big, but actually deliver on their promise of service. If I do end up buying from one of the online stores I do end up paying labour at my local LBS anyway, and a coffee or beer after the ride.

 

The LBS will always have a place if they provide excellent customer centric service, have competent mechanics (who actually listen to their client), and generate alternative streams of income like selling coffees and organising social events.

All the shops mentioned are associated to a bike brand (and some to a few). In a few years the likes of Giant, Scott, Trek will be HQ controlled in a similar way Specialized is currently. Consumers want clear standardized retail prices and stock available on the interwebs, there are very few agencies that are matching the stock and service levels of real local representation. Agencies simply cannot carry the stock levels in all the sizes and models offered by the big brands internationally, so it is logical that the big brands will be doing their own brand management locally in the near future. Stores will get consignment stock that needs to move in a certain time, or risk it being reallocated to a different dealer (much like the motor industry) which will free up capital for these owners, but it will come at a cost. They will have to conform to the brand identity they are selling and will have to agree on a pricing model, service levels and exclusivity to a certain extent.

 

 

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[Traveler]

Seems like a straightforward question, but the answer is certainly more complex in my opinion. I’d hope that smaller bike shops do survive; but in short my take on it is unfortunately NO – if they want to offer the whole hog.

The reason why I am so gloomy on the subject is because of the incestuous relationship of cartel dealers with some bike brands and product importers. These larger cartel groups do have the buying ability to tell importers to either stop supplying a smaller standalone LBS, or they do dictate to the importers the prices at which to sell their product to the single LBS. This is not only historic behaviour, this is current behaviour in Gauteng. Some of the smaller shops in Gauteng find it nearly impossible to get certain products, while it is readily available from the bully dealers and then you will see it available at virtually identical prices.

If you are an independent dude with a workshop and perhaps selling one bike every month or two, you will find it virtually impossible to survive as you are throttled for either price, or availability or both. For him/her the only option is to offer an unbeatable quality workshop.

And personally, I shall rather import my own parts and take everything to my LBS workshop to be fitted and fine-tuned.

It would be interesting if the competition commission was again to investigate the cycling industry to see how some cartels are using a position of influence to make it impossible for smaller individuals to be viable in the market.

[The Ouzo]

All the shops mentioned are associated to a bike brand (and some to a few). In a few years the likes of Giant, Scott, Trek will be HQ controlled in a similar way Specialized is currently. Consumers want clear standardized retail prices and stock available on the interwebs, there are very few agencies that are matching the stock and service levels of real local representation. Agencies simply cannot carry the stock levels in all the sizes and models offered by the big brands internationally, so it is logical that the big brands will be doing their own brand management locally in the near future. Stores will get consignment stock that needs to move in a certain time, or risk it being reallocated to a different dealer (much like the motor industry) which will free up capital for these owners, but it will come at a cost. They will have to conform to the brand identity they are selling and will have to agree on a pricing model, service levels and exclusivity to a certain extent.

 

 

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Motor car dealerships buy in their stock and when doing stock swaps the different dealers buy and sell to each other.

[The Ouzo]

Seems like a straightforward question, but the answer is certainly more complex in my opinion. I’d hope that smaller bike shops do survive; but in short my take on it is unfortunately NO – if they want to offer the whole hog.

The reason why I am so gloomy on the subject is because of the incestuous relationship of cartel dealers with some bike brands and product importers. These larger cartel groups do have the buying ability to tell importers to either stop supplying a smaller standalone LBS, or they do dictate to the importers the prices at which to sell their product to the single LBS. This is not only historic behaviour, this is current behaviour in Gauteng. Some of the smaller shops in Gauteng find it nearly impossible to get certain products, while it is readily available from the bully dealers and then you will see it available at virtually identical prices.

If you are an independent dude with a workshop and perhaps selling one bike every month or two, you will find it virtually impossible to survive as you are throttled for either price, or availability or both. For him/her the only option is to offer an unbeatable quality workshop.

And personally, I shall rather import my own parts and take everything to my LBS workshop to be fitted and fine-tuned.

It would be interesting if the competition commission was again to investigate the cycling industry to see how some cartels are using a position of influence to make it impossible for smaller individuals to be viable in the market.

So what you're saying is big workshop with a couple of bikes and accessories as the side business.

Make sure the shop has excellent technicians and put out top quality work.

[Edge_Design]

Of course there is - there are quite a few "independent" shops that appear to be doing very nicely.

 

Unfortunately there also isn't space for every single person who once rode in the A group in the Argus to open their own bike shop with R100k they borrowed from their parents. You need to be passionate about running your shop and servicing your clients - you probably can't compete on price but there are a lot of people who will pay a little extra for good service. Who you know is probably also a big factor so you aren't starting by just opening your doors to the street and waiting to see if someone walks in.

 

I have been to quite a few of these shops over the years and there are some that I would go out of my way to use again (Stoke definitely deserves a mention here as the best I've found yet) and many that are considerably worse than any of the big franchise stores.

 

At R350+ per hour, you can theoretically make around R60k in income per month per technician you employ in labour alone so you just need to find enough business to keep 2 or 3 good people busy full time. Even if you only recover 4 hours per day you're off to a fairly decent start.

[Thomo]

Of course there is - there are quite a few "independent" shops that appear to be doing very nicely.

 

Agreed, but will ad that many of these have also been around for a long time.

Rather than asking if there's place, perhaps we should ask if there's place for more.

I think opening a "non franchised" store could be quite challenging albeit not impossible.

The big brands have largely gone concept and that's where most will flock.

Edited May 23, 2018 by Thomo

[Grease_Monkey]

Agreed, but will ad that many of these have also been around for a long time.

Rather than asking if there's place, perhaps we should ask if there's place for more.

I think opening a "non franchised" store could be quite challenging albeit not impossible.

The big brands have largely gone concept and that's where most will flock.

 

I agree in theory we should ask if there is more space, BUT, with a large number of the existing stores that have been around for so long resting on their laurels and giving quite frankly terrible service to their customers, I think there is there is the potential for new guys to move in and take over that space by simply providing excellent service.

 

The majority (not all) of stores I have experienced excellent service at are young stores (<5yrs old). Let's just hope they keep up that initial momentum.