I own a bicycle shop in Ontario. I am seeing very similar issues here in Canada. You aren't alone mate. Thank you for sharing, it is nice to hear from another shop as to what they are feeling and experiencing.
I retired in April 2020 after 30 years in the wholesale side of the bike industry. Company had its 1st major layoff right as I was leaving so I guess my timing was perfect. I then helped out part time at a local Trek shop as they were busy and it was fun work. Yes these are crazy times.
Just curious what your opinions and insights are regarding brands pushing new products/models despite the industry-wide glut? I was really surprised that I see new releases even when inventory of the older stock is still flooding the market. That previous gen bike will have to sell for even less for me as a consumer to want to buy it because "there is newer out there".
Hi @shankeong6753, thanks for the question. It's such a difficult one. The wheels of manufacturing take a long time to get going and to slow down, so I can understand why brands haven't completely stopped releasing new products. A big manufacturer like Giant has so many different platforms that they have to have a fairly strict calendar to keep all of their products up to date and feeling current. They are always going to be updating their products and not releasing anything this year will simply kick the can down the road to next year, and cause a log jam of new models from a number of different manufacturers. It would be difficult to release a new Defy AND a new TCR in the same year and give them both the full attention they deserve. That said, you could argue that releasing a new bike when people aren't buying simply means that bike will seem older when the market finally picks up. But brands certainly have cut back where they can. A lot of the overstock you are seeing isn't necessarily with the brands themselves. Take BMC for example, they are distributed by a third party in the UK, so it maybe that BMC themselves are not acutely aware of the amount of overstock in the market, and it may be that other countries aren't suffering as badly. BMC Australia may be crying out for a new model to be released, whilst BMC France may be saying "hold on, we are still trying to shift the ones we've got!" Not all brands have perfect information so there will be a definite lag in their ability to read the market. Canyon, for example should have pretty much perfect insight into the demand for their product and their volume of supply. A company that doesn't sell from its own website, and is solely reliant on gathering information from the stores it supplies will take a while to realise the scale of the problem. That said a number of our brands have held off new releases until things calm down. A lot of 2023 model year bikes are rolling over into 2024, so where there may have been a colour change but the bike stayed the same, the current colours are remaining in the catalogue. The Cannondale Quick for example, hasn't, as far as I can remember, changed for a good few years, and why would it. It is a good bike, does its job well, but there are shed loads of them around and the usual consumer for this type of product doesn't usually rate model year highly on their reasons for buying. What is going to be really important is the sheer volume of bikes landing in the country. The manufacturers have to get this right. Too many, and the problems will persist for longer. Too few, and we will again Yo-Yo back up and brands will miss opportunities to sell their bikes. It is a difficult one indeed.
Hello my man. Good video. Enjoy your commentary. Bit of advice. You need to boost your mic vol. Moving on. It is hard to compete with e-bikes that ship to a door in a a week for 700ish bucks. Also, a bike tech is a valuable asset that is a true wizard. Guess what we pay those wizards? Peanuts.
Hi @ravenragnar thanks for the feedback, I’ll make sure I pay more attention to the mic level next time. Interesting that you highlight the budget e-bikes. I certainly haven’t noticed them as any competition here - they are so badly made, most of the customers we see realise they get what they pay for, but agree about the mechanics. We pay ours as much as we can, but it should be more. I think because a lot of people can tinker with their own bike and don’t know better they put up with it working just ‘ok’ rather than appreciating how much value there is in having their bike working perfectly - usually actually saving money in the long run!
Completely agree @darongardner4294 but it will be interesting to see how the actual retail element changes. Buying a bike online wouldn't appeal to me at all, I would want to see it for real first, but it may be that this option will become harder to come by.
Hi @FrankieCooks yes they can but it is a big undertaking. They would have to set up their own warehousing for the products, their own distribution network, their own staff to deal with sales and returns. They would also have to be confident that their brand is strong enough that people will seek out their own website to find the product, as apposed to choosing their product from a selection on a retailers website or shop. Take MET helmets as an example. Great helmets (the one I’ve got is the most comfortable I’ve ever had), but are they a strong enough brand to go direct to consumer and not need shops / online stores offering and recommending them? Probably a better option for a brand like MET would be to go direct to stores, missing out distributors, but then they are up against other, very good helmet brands who are still with a distributor.
In Germany, it's a good time to buy a bike because of discounts right now, but we have to recognize that there was a massive price inflation in the last three years. So basically, prices are back to where they were in 2019/20. Signa Sports United (the parent company of Wiggles Chain Reaction) mainly operated online stores in the German market which were undercutting even the purchase prices of distributors - so there's no compassion here. I don't disagree with your major points that there's a global problem with the bike industry right now. In my observation the German market seems mostly fine. The three biggest ones aside, the majority of our distributors don't sell bikes (or very niche stuff like BMX or vintage steel road bikes) and the overflowing stock of bikes and e-bikes seems to be the main problem right now.
Hi @gpjonas6171 thanks for the insight. I had heard that the online retailers in Germany were particularly aggressive and brutal. It sounds like the German market may be a little more stable than the UK at the moment. There are certainly many bikes available at the moment here which are significantly better priced than their equivalent before Covid, but this will only be true whilst stocks last as it is mostly, as you say, a result of excessive amounts of stock.
I own a bicycle shop in Ontario. I am seeing very similar issues here in Canada. You aren't alone mate. Thank you for sharing, it is nice to hear from another shop as to what they are feeling and experiencing.
Thanks Brian, it’s amazing how similar many of our experiences are despite the vast differences in location. Best of luck to you!
I retired in April 2020 after 30 years in the wholesale side of the bike industry. Company had its 1st major layoff right as I was leaving so I guess my timing was perfect. I then helped out part time at a local Trek shop as they were busy and it was fun work. Yes these are crazy times.
Just curious what your opinions and insights are regarding brands pushing new products/models despite the industry-wide glut? I was really surprised that I see new releases even when inventory of the older stock is still flooding the market. That previous gen bike will have to sell for even less for me as a consumer to want to buy it because "there is newer out there".
Hi @shankeong6753, thanks for the question. It's such a difficult one. The wheels of manufacturing take a long time to get going and to slow down, so I can understand why brands haven't completely stopped releasing new products. A big manufacturer like Giant has so many different platforms that they have to have a fairly strict calendar to keep all of their products up to date and feeling current. They are always going to be updating their products and not releasing anything this year will simply kick the can down the road to next year, and cause a log jam of new models from a number of different manufacturers. It would be difficult to release a new Defy AND a new TCR in the same year and give them both the full attention they deserve. That said, you could argue that releasing a new bike when people aren't buying simply means that bike will seem older when the market finally picks up. But brands certainly have cut back where they can.
A lot of the overstock you are seeing isn't necessarily with the brands themselves. Take BMC for example, they are distributed by a third party in the UK, so it maybe that BMC themselves are not acutely aware of the amount of overstock in the market, and it may be that other countries aren't suffering as badly. BMC Australia may be crying out for a new model to be released, whilst BMC France may be saying "hold on, we are still trying to shift the ones we've got!" Not all brands have perfect information so there will be a definite lag in their ability to read the market. Canyon, for example should have pretty much perfect insight into the demand for their product and their volume of supply. A company that doesn't sell from its own website, and is solely reliant on gathering information from the stores it supplies will take a while to realise the scale of the problem.
That said a number of our brands have held off new releases until things calm down. A lot of 2023 model year bikes are rolling over into 2024, so where there may have been a colour change but the bike stayed the same, the current colours are remaining in the catalogue. The Cannondale Quick for example, hasn't, as far as I can remember, changed for a good few years, and why would it. It is a good bike, does its job well, but there are shed loads of them around and the usual consumer for this type of product doesn't usually rate model year highly on their reasons for buying.
What is going to be really important is the sheer volume of bikes landing in the country. The manufacturers have to get this right. Too many, and the problems will persist for longer. Too few, and we will again Yo-Yo back up and brands will miss opportunities to sell their bikes. It is a difficult one indeed.
Hello my man. Good video. Enjoy your commentary. Bit of advice. You need to boost your mic vol. Moving on. It is hard to compete with e-bikes that ship to a door in a a week for 700ish bucks. Also, a bike tech is a valuable asset that is a true wizard. Guess what we pay those wizards? Peanuts.
Hi @ravenragnar thanks for the feedback, I’ll make sure I pay more attention to the mic level next time. Interesting that you highlight the budget e-bikes. I certainly haven’t noticed them as any competition here - they are so badly made, most of the customers we see realise they get what they pay for, but agree about the mechanics. We pay ours as much as we can, but it should be more. I think because a lot of people can tinker with their own bike and don’t know better they put up with it working just ‘ok’ rather than appreciating how much value there is in having their bike working perfectly - usually actually saving money in the long run!
@@wecycle384 Thanks for your reply. I agree with the quality control. That is good to hear about your mechanics! Looking forward to more insights.
Shops will focus more on servicing bikes,when people buy bikes they are always going to need to be serviced or repaired.
Completely agree @darongardner4294 but it will be interesting to see how the actual retail element changes. Buying a bike online wouldn't appeal to me at all, I would want to see it for real first, but it may be that this option will become harder to come by.
can the brands that have been dumped by distributers just go direct to consumer?
Hi @FrankieCooks yes they can but it is a big undertaking. They would have to set up their own warehousing for the products, their own distribution network, their own staff to deal with sales and returns. They would also have to be confident that their brand is strong enough that people will seek out their own website to find the product, as apposed to choosing their product from a selection on a retailers website or shop. Take MET helmets as an example. Great helmets (the one I’ve got is the most comfortable I’ve ever had), but are they a strong enough brand to go direct to consumer and not need shops / online stores offering and recommending them? Probably a better option for a brand like MET would be to go direct to stores, missing out distributors, but then they are up against other, very good helmet brands who are still with a distributor.
In Germany, it's a good time to buy a bike because of discounts right now, but we have to recognize that there was a massive price inflation in the last three years. So basically, prices are back to where they were in 2019/20.
Signa Sports United (the parent company of Wiggles Chain Reaction) mainly operated online stores in the German market which were undercutting even the purchase prices of distributors - so there's no compassion here.
I don't disagree with your major points that there's a global problem with the bike industry right now. In my observation the German market seems mostly fine. The three biggest ones aside, the majority of our distributors don't sell bikes (or very niche stuff like BMX or vintage steel road bikes) and the overflowing stock of bikes and e-bikes seems to be the main problem right now.
Hi @gpjonas6171 thanks for the insight. I had heard that the online retailers in Germany were particularly aggressive and brutal. It sounds like the German market may be a little more stable than the UK at the moment. There are certainly many bikes available at the moment here which are significantly better priced than their equivalent before Covid, but this will only be true whilst stocks last as it is mostly, as you say, a result of excessive amounts of stock.