Small Bike shop owners… would you do it again??

[The Ouzo]

1 minute ago, Eddy Gordo said:

One thing most seem to forget is the cost to rent a premises. 

I have been down this road a few years ago, crunched the numbers etc, got all the same, you need a workshop, not just online business. So I gave up on the idea.

I now find myself looking at different business opportunities. One business franchise I can get, wont see me earning near to what I am earning now, after all bills are payed.

So I continue looking...

yep, the places you want to be renting in for ideal foot traffic cost a fortune. And then so many of them have a list of minimum requirements that makes a 1 man show operation a non starter.

My sister went down this road in the 90's, fortunately her business did not need retail space but rather just office space, so she landed up buying a house.

I went down this road about 10 years back when I wanted to buy a franchise operation. the store was an already established store, so most of what was needed in terms of lease requirements was there already, I still had to make lots of changes to make things work. The seller changing his mind and the last minute probably saved me much heartache. 

[Cycle Fan]

21 minutes ago, SwissVan said:

Having read all the good advice and valid comments so far, I’m inclined to ask what kind of experience / qualifications do you have in matters of a small bike shop?

Are you already able to repair bikes yourself quickly and efficiently, or will you hire the brains for this?

This for me is the thing I look for in a bike shop, someone who knows his stuff, not someone who will practice on my bike (no offence meant).

 

 

I have the business acumen and marketing ability to run the shop and fair amount of technical expertise. But I’m looking at going into partnership with a mate who is a qualified mechanic. So he would oversee the workshop

[love2fly]

43 minutes ago, Eddy Gordo said:

One thing most seem to forget is the cost to rent a premises. 

I have been down this road a few years ago, crunched the numbers etc, got all the same, you need a workshop, not just online business. So I gave up on the idea.

I now find myself looking at different business opportunities. One business franchise I can get, wont see me earning near to what I am earning now, after all bills are payed.

So I continue looking...

In my experience in most retail rental relationships, the only happy partner is the landlord. Retail rentals are just too expensive. The ideal would be a small "mini factory" but then you don't get enough passing trade........

[love2fly]

35 minutes ago, Cycle Fan said:

I have the business acumen and marketing ability to run the shop and fair amount of technical expertise. But I’m looking at going into partnership with a mate who is a qualified mechanic. So he would oversee the workshop

This is already a potential pitfall in that you have 2 partners each likely wanting a fair slice of the income vs paying a techie......In the time I was in the industry selling to bike shops, I lost 7 customers in a year and that was pre-Covid. The odd bike shop opened to replace one which closed but it's rare that one guy can make a go of it where another couldn't.

There are very few bike shops who can boast that they are operating at a high capacity and only one near me comes to mind yet I can think of 10 that are nowhere close.

I would urge you to find another industry or venture where the prospect is compelling.

Opportunity no longer knocks - It's running at full speed in the opposite direction so you have to work hard, smart and have a unique selling proposition to get Mr Customer to part with his money!

[Cycle Fan]

17 minutes ago, love2fly said:

This is already a potential pitfall in that you have 2 partners each likely wanting a fair slice of the income vs paying a techie......In the time I was in the industry selling to bike shops, I lost 7 customers in a year and that was pre-Covid. The odd bike shop opened to replace one which closed but it's rare that one guy can make a go of it where another couldn't.

There are very few bike shops who can boast that they are operating at a high capacity and only one near me comes to mind yet I can think of 10 that are nowhere close.

I would urge you to find another industry or venture where the prospect is compelling.

Opportunity no longer knocks - It's running at full speed in the opposite direction so you have to work hard, smart and have a unique selling proposition to get Mr Customer to part with his money!

That’s what’s great about the collective wisdom of The Hub - getting all the perspectives both positive and negative. 

[Eldron]

I opened a bike shop...in a foreign country....and I am no cutting edge entrepreneur gig economy genius...so it can be done 🙂

My random feelings:

1) Find a niche - being a metoo shop isn't going to win you customers very quickly. People like their LBS and won't change unless they have several bad experiences. Find a reason for people to visit you specifically.

2) Location location location - rent is cheap in lower income areas but so is revenue/profit. Go high - cycling is a high disposable income sport.

3) Have a faaarkton of liquid capital - initial outlay is pretty high - tools, shop interior, stock (as most have said many companies have minimum first order size) etc.

4) Expand your network long before you open your shop - ride with clubs, network big companies that have their own cycling teams, get to know suppliers (if you can).

5) Train hard and ride strong - I have no idea why but people seem to lend credibility in all cycling fields if you're a good rider.

5) Worst case scenario planning - you will almost certainly have a years worth of loss making/break even months.

6) Find a way to get people to your shop - events, pro speakers, rides that start/end there, beer, gran tour viewings etc. Kinda ties in to the niche thing.

7) Don't grow slowly - I went this route and regretted it. I should have just laid out more cash initially and offered much more and grown faster.

😎 Have fun - if it isn't fun you won't give it 100%.

 

 

[M L]

On 5/15/2022 at 3:18 PM, Cycle Fan said:

So mid-life crisis looms and career change is in the air. Owning a Bike shop has always been a dream but the reality is very different I hear! 
 

So, the question is for those of you who are “living the dream” and own a small bike shop, would you do it again if you know what you know now?

what is the reality REALLY like? Rough hours, stress levels, difficult customers?

Would love to hear you war stories. 

Only way I can think something like this would work is to only do bike services and then specialising in it, having nice tech such as an online booking website and a service to pick up and deliver bikes. And you cater this to Pearl Valley type of customers. 

[Cycle Fan]

1 hour ago, Eldron said:

I opened a bike shop...in a foreign country....and I am no cutting edge entrepreneur gig economy genius...so it can be done 🙂

My random feelings:

1) Find a niche - being a metoo shop isn't going to win you customers very quickly. People like their LBS and won't change unless they have several bad experiences. Find a reason for people to visit you specifically.

2) Location location location - rent is cheap in lower income areas but so is revenue/profit. Go high - cycling is a high disposable income sport.

3) Have a faaarkton of liquid capital - initial outlay is pretty high - tools, shop interior, stock (as most have said many companies have minimum first order size) etc.

4) Expand your network long before you open your shop - ride with clubs, network big companies that have their own cycling teams, get to know suppliers (if you can).

5) Train hard and ride strong - I have no idea why but people seem to lend credibility in all cycling fields if you're a good rider.

5) Worst case scenario planning - you will almost certainly have a years worth of loss making/break even months.

6) Find a way to get people to your shop - events, pro speakers, rides that start/end there, beer, gran tour viewings etc. Kinda ties in to the niche thing.

7) Don't grow slowly - I went this route and regretted it. I should have just laid out more cash initially and offered much more and grown faster.

😎 Have fun - if it isn't fun you won't give it 100%.

 

 

Awesome. Some excellent advice there. 
 

thanks for the input!!

[floatfox]

Your biggest challenge will be suppliers, and a bike brand or two. Believe me, if you have one or more active shops in your area, you will not be supplied. Some bike shop owners will literally threaten suppliers to keep them from supplying you. Its also very difficult to get a bike brand, as they will not supply you if there is a dealer of that brand anywhere near your location. Small bicycle shops are closing at a very high rate and unless you have a few bar to spend, you will be wasting time and money. PM me and I will get in contact with you and give you more details as I have experienced this first hand.

[Cycle Fan]

10 hours ago, floatfox said:

Your biggest challenge will be suppliers, and a bike brand or two. Believe me, if you have one or more active shops in your area, you will not be supplied. Some bike shop owners will literally threaten suppliers to keep them from supplying you. Its also very difficult to get a bike brand, as they will not supply you if there is a dealer of that brand anywhere near your location. Small bicycle shops are closing at a very high rate and unless you have a few bar to spend, you will be wasting time and money. PM me and I will get in contact with you and give you more details as I have experienced this first hand.

Thanks so much. Really appreciate the offer. Still VERY early days but if I decide to go this route then I will definitely make contact. 

[Aurora]

There are a few things to consider...

1 - Huge stock purchases to open accounts. I know SRAM is around R200 000 for a first order. 

2 - Stock shortages... this is a massive problem worldwide.

3 - Workshop... this is where you make or break a small bike shop. If you have a top mechanic with decent turn around times, you can make it work...

4 - Don't do it... Rather take R500k and set it alight. Its a much faster and less stressful way of burning through your savings. 

[Jewbacca]

30 minutes ago, Aurora said:

There are a few things to consider...

1 - Huge stock purchases to open accounts. I know SRAM is around R200 000 for a first order. 

2 - Stock shortages... this is a massive problem worldwide.

3 - Workshop... this is where you make or break a small bike shop. If you have a top mechanic with decent turn around times, you can make it work...

4 - Don't do it... Rather take R500k and set it alight. Its a much faster and less stressful way of burning through your savings. 

Or buy 5x 2nd hand 2017 tall boys with damaged forks and try to resell them!!! 🤣

[The Ouzo]

51 minutes ago, Aurora said:

There are a few things to consider...

1 - Huge stock purchases to open accounts. I know SRAM is around R200 000 for a first order. 

2 - Stock shortages... this is a massive problem worldwide.

3 - Workshop... this is where you make or break a small bike shop. If you have a top mechanic with decent turn around times, you can make it work...

4 - Don't do it... Rather take R500k and set it alight. Its a much faster and less stressful way of burning through your savings. 

R200k is really not a lot of stock at todays prices. 

[Eldron]

2 hours ago, Aurora said:

 

2 - Stock shortages... this is a massive problem worldwide.

 

This was the other thing I wanted to mention but forgot.

My profit would probably be around 40% higher if more bikes were available at the moment. Fortunately I'm mostly a service oriented shop so we're still happily in the black.

I would not open a shop before mid 2024. Most of my supplies have already presold most of their 2023 stock (Ridley, Orbea, Colnago, Eddie Merckx).

[David Marshall]

2 hours ago, ouzo said:

R200k is really not a lot of stock at todays prices. 

It is when they dictate what you have to stock.  There is a limited demand for some things and they will sit on your shelves for years.  Anyone looking for a Shimano PF42 BB brand new going cheap? Elixir rebuild kits?

[117]

Make sure your customer service is top notch, otherwise you'll have no first time customer, nor a repeat customer. Customer satisfaction is the key and it will outdo a slightly higher cost of the stock you sell them. 

Ive recently declined to do business with a small coastal LBS because their customer service was non existent. They just assumed I would eft a 6 digit amount based on one email with a few sentences.