Trends in the bike trade 2020 -2021
It’s been an exciting time in the bike trade and is the most positive outcome for business and peoples health, with the UK having the fastest growth in bicycle and e-bike sales in all of Europe.
Following on from: It’s not a business unless you are paying yourself………..
“Your business needs to be more than a lifestyle – There is a lot of potential and opportunities by generating a successful bike business that works for you and you can prepare for a longterm future that you can rely on. There is a lot to do and learn, to start your bike business and get ahead. There is no better way to start and run your own bike business, than being part of a network of bicycle mechanics, who have become specialists.” – Martin Founder & Owner Cycle Tech GroupHow to get started and the costs. See HERE
- The biggest boom in cycling – Reports of more miles done by bike than by car with an added increase in woman taken upcycling
- Sales of e-bikes – Growth of e-bikes has for the first time grown faster than Europe, combined with a shortage of skilled mechanics has increased demand for more mechanics and business owners
- Every bike needs a mechanic – High-end and e-bikes not only need assembling correctly with a hand-over to the customer but also ongoing maintenance by highly skilled mechanics
- Value – Mechanics time, knowledge and skills need to be charged according to the value they offer, with a minimum charge put in place. Also mentioned by a long-term mechanic and business owner ~ Graham Freestone King of Velotech Cycling Ltd
- E-bikes sold online – Require backup and support to reduce returns
- Click & Deliver – Cycle Tech UK has teamed up with BMW, BH Bikes, Econic One and Cairn Cycles to offer at-home service & support. And in talks with insurance companies and large online bike shops, to offer personalised service and a better customer buying experience.
- Training – A higher level of skills and tooling, combined with product knowledge by making it ongoing ~ As discussed by Graham Freestone King of Velotech Cycling Ltd and Sean From Cycle Systems Academy latest podcast.
- Networking – Cycle Tech UK has teamed up with The Bike Inn to offer our new mechanics the skills to start their bike business and ongoing training. Cycle Tech UK offers inhouse training to start and run a business and now e-bike training of the 4 biggest e-bike motors.
- The future – Keep an eye for what’s going on around you to make your decisions and let others talk about politics, while you benefit from a growth in cycling
2020 The year I drank the most coffee
I’m already a coffee lover, I have even spent a lot of time high up in the Andean mountains of Colombia, learning where good coffee comes from. Staying with the small farmers has given me a real insight into Colombian life. Colombia probably the cycling capital of the world!
To help me get through my day in 2020, of online meetings, with potential new mechanics/business owners, Cycle Tech Members, manufacturers and brands, as well as fixing bikes and doing all the job’s of a business owner; booking jobs in, looking for those parts that had limited stock, invoicing and so on, I got through a lot of coffee. Colombian blend. I would have not changed the extra hours spending my time fixed to the bike business, as I can see a positive outcome for the next 10 years in the bike trade. But like any business, it’s subject to the business owner; with money management, pricing, investing, customer care and what the government/central banks do next could put a spanner in the works. So be ready, by ditching the TV and mainstream media news and find out how the world works so you can stay in front, not only to survive but to prosper.
I also managed to get my level of fitness up as I was cycling twice a week exploring my own back yard in the Chiltern Hills. “Still need to make time for cycling” I have kindly been loaned a gravel e-bike from Cairn Cycles, that uses the Fazua motor, for demo and training purposes. If you live in the Chilterns then do contact me, for a test ride and chat, plus a coffee stop. Or if interested in Fazua training, then do get in contact.
The 2020 crisis accelerated the shift in the bike trade towards more consumer direct. We could soon see the demand increased for new bicycles, this was the first time bike shops were selling at the RRP and not in competition to sell at the lowest price to get the deal. We also see the price of parts increase as old bikes were made good, as more people took to cycling.
As the supply dwindled, we started to see an increase in bikes coming in from Europe. Many consumers did not realise bikes come flat packed in a box and we soon started to see an increase of ‘mishaps’ bikes not assembled correctly. This included cross-threaded pedals, stem bolts rounded off, brake cables/hoses raped around the head tube, wheels not fitted correctly and those bikes from Europe and from the UK’s well known online retailers who were sending bikes out with the brakes the wrong way around for UK roads. This was not a good experience but the cyclist excepted it as there were no other bikes available. Many cyclists new and old did not even know there were issues with their bike making it more dangerous until a mechanic pointed it out.
Many people compear the cost of an e-bike with a motorbike and that includes the quality. They expect it to last as long and be as reliable, unfortunately, this is not always the case.
We could see the warranty on the motor with better brands. extended from 2 years to 4 years, as they develop and riders demands with higher-end bikes. Once the manufacturers build larger factories, that can increase production, by having all the parts manufactured close by and stock levels increase, we could see a drop in prices. We will have to wait and see as the world will go through a Great Reset from all the currency and debt accumulated from years of borrowing. Known as the fourth industrial revolution, being played out one step at a time and there is no going back, as electric vehicles become our future.
If a new brand or e-bike shop is about to hit the market, they will soon find out they are entering a very crowded market where even huge bike manufacturers are competing with fast-growing e-bike companies. This ends up meaning selling cheap or with high discounts to compete, then offering no backup and support.
Automotive and motorbike brands are also getting in on the action. This will bring more new riders to cycling. They will also expect the same aftercare service they are accustom to. It will mean these brands will have to seriously decide to train their own mechanics and supply the tools or find a service provider. Simely put, the bike trade needs more trained mechanics who are also motivated and business-minded, as bicycles aren’t as simple as one first thinks.
“There is definitely a cycle revolution coming, that e-bikes will change the bike trade, there is no getting away from aftercare service and service schedule similar to the motor trade” – Martin Founder & Owner Cycle Tech GroupDirect to consumer with backup support or returns from consumers wanting their money back.
One thing is very clear; The good brands who get this right, they know what the customer expects when buying a new bike online. By offering good back up with customer care and support. And not saying, “just fit the pedals and turn the bars” and when there is an issue, not saying “take your bike to the bike shop” The good brands have a plan in place to take care of the customer.
The minimum is a bigger stronger box and the bike rolls out from the side. Some are going a step further by using recyclable packaging
Bikes cost more to return it or a mechanic to visit. As customers soon become cheesed off, with issues from bikes not set up correctly or not handed over to show the features and how to use the gears. From top to bottom of the UK, mechanics are very busy, making it hard to find someone to work on an e-bike, especially when not trained or with any spare parts to diagnose and be able to offer a first-time fix. This is why it costs more. It would make sense to have the bikes first inspected and handed over. A first service at 30 days, to check the gear cable adjustment, brakes, motor bolts and that everything is working correctly/or cycling related issues and then a yearly service, to help reduce returns and keep the bike running smoothly. Most customers are not going to be cyclists, or it’s been a long-time since they last rode a bike, let alone an e-bike and will need guidance and except a service schedule the same as their car that is chargeable to the owner.
What I have discovered in the last 15 years with selling bikes online ‘On Yer Bike’ for the consumer and a ‘Race to the bottom’ selling at discount for the online shop. Bikes that are sold online, in a box and the consumer is not a mechanic, when there are issues, they soon want their money back. And electric bikes are proving to have more issues, even with warranty, the distributor does not want to know/help, it’s all down to the dealer.
Some dealers/brands recognise this and have started offering next day home delivery with the bike ready to for £99.00 or are linking up with a network of mobile mechanics to offer this service and to deal with manufacturers warranty issues.
Bike shop of the FUTURE…
Cycle Tech UK has taken great steps, making it easy, offering demo bike days, try before you buy. See our post: Ever wondered what an e-bike is all about? Coupled with a home visit to handover the new bike. This helps give value to the brand, reduces returns and most importantly the customer has had a great experience and will cycle more often. Isn’t that what all bike companies want? Happy customers on their branded bike! “Word of mouth is the best advertising” Customers will soon tell their friends and their partner will also want to join in the fun.
I think we can all agree if we are to secure future sales, customers need to have a good experience and know there is aftercare available. All bicycles and e-bikes sold require a PDI by a competent bicycle mechanic, including setting up the bike to the rider and a handover to show the gears, how to look after the battery and what to do between serving, to reduce any returns and to encourage the rider to cycle more.
You can have a handbook with instructions, how-to video, a few tools in with the bike. The bike box has an arrow ‘This Way Up!’ but all too often no one reads it and people are less mechanical minded.
The PDI and hand over is a service and should be chargeable to the customer. 2020 has demonstrated that consumers are willing to pay as it adds value and peace of mind. It’s also the time to recommend any accessories and give cycling advice. You can’t just send a bike out and hope for the best. Consumers will soon ask for their money back.
New business owners have also struggled to set up in time for the boom as there were long waiting times for training and for the full set of tools to arrive. As the demand for skilled mechanics grows. As lock-down continues, some bike schools are producing online training, but there is no experience like hands-on.
It’s also been a time of picking what bikes you want to work on with the high demand and knowing there is little stock of parts for the older bikes. Having a number of bikes waiting up to months for parts takes up a lot of space. It was great at the start of the lockdown as a lot of dead stock was soon sold off. With the shortage of new bicycles and the demand to get cycling, people were also happy to pay more than the bike was worth so they could get out with their friends and family. It also meant we could not get to everyone, whilst we want to help everyone there is a time in business you have to learn to say no. A mobile mechanic is not going to travel 10 miles to fix a puncture. This is the time to say “when was your bike, last service sir?” It’s an upsell, as we often find the bike has been in the shed for 3 years and the customer wants it ready yesterday or it’s never been serviced. We use a contact form to gain insight and we can ask for photos before we commit to the job. Whilst most jobs are for enthusiasts, those who need their bike for commuting means the same day service. Whilst this sounds good in practice the bike is worn out. To deal with lower-end bikes, flat tyres and commuters, I restarted the Saturday bike clinic the popup bike shop, to support local and try to help as many cyclists as possible.
- Halfords report a staggering 230% increase in e-bike and scooter sales
- Electric bike sales have jumped by 88% in the UK and a new 100-acre Cycle Valley in Ludhiana India will be the biggest and most advanced bike making centre in the world. With the capacity to produce around 9 million bicycles and e-Bikes each year
2021 is the time to become more personalised and not just numbers.
Think quality and quantity, yes you can have both. It means knowing the market and what the consumer needs. Then have an organised workshop, booking system and sales team, so your business can run more efficiently. Investing in tools and training to keep up with the demand and changing technology. We see more and more e-bikes that are changing peoples view of ‘It’s just a bike’ More people are now understanding it also needs maintaining regularly as well as a means of transport. (A fun way of getting around)
At the time of handover is the time to explain how often a bike needs servicing and this is the time to book in the first service. Whilst a first service is quick and straight forward, it means you can ask the customer how they are getting on and give them some advice and sell them a track pump, as all too often they have not checked their tyre pressures or even know-how. The basics of being a cyclist.
Once the demand of bicycles returns (High-end bikes already sold for 2021, orders now for September) in the lower end sector, then it will become a throwaway society, as it will be cheaper to go online and replace for a new bike than an uneconomical cost to service or repair it.
Some bike shops sell e-bikes but don’t do the repairs! When they sell an e-bike and get a comeback (a warranty issue) they don’t always get the support from the manufacture or are expected to fit parts for free and can be time consuming to diagnosis and for the manufacture to send a new motor, battery, controller. It’s time the manufactures warranty cover the labour. 2 years is a long time and 10 out of 10 bikes could return with warranty issues (Especially lower end e-bikes) and the shop owner will be well out of pocket. The way to reduce returns, is to inspect the bike first and hand it over, book in the 1st service and give advice. I know I keep bagging on about customer service, but its what they except!
Some bike brands will hedge their bets, sell through bike shops and online shops as well as from their own website. Some are even cheeky and list Cycle Tech UK as a service partner without our permission to gain credibility. All too often we hear:- “I bought this bike on the back of the xxxxxxxxx Brand therefore expected a bike which would reflect that standard. The bike hasn’t lived up to your statements, and the customer service has been the worst I have ever experienced in my life. ( Just look at the timescale from when I received the bike, and added to that, the communications have been poor). My wife has an electric bike ( lesser known brand and much cheaper) which makes a mockery of the range on mine“
“BOSCH will look forward to e-bike motor sales to triple for 2023.”
Networking is good for every business and working with local businesses is more important in our uncertain world. We can share ideas, support with tech issues, sell the same brands for better product knowledge and pricing. Cycle Tech UK support local with national coverage, we know the importance of building a strong foundation for years to come. Anyone new coming into the bike trade also needs the right support and right mindset that bikes should be sold with the customer in mind and not as a toy.
New e-bike brands coming into the market have the right idea. Harly Davidson Serial 1, has its own division for their e-bikes. So they can fully support the brand. Anyone can open a bike shop and sell bikes without any knowledge or mechanical training, but can they make a business that pays? I have been contacted by the well-known e-bike motor manufacturer to help support shops when they have an issue. I do help as we support the brand and have been working with them for over 4 years, It’s enabled us to do a first-time fix, as we know the common faults.
For 2021 Cycle Tech UK is making e-bike’s number one for knowledge and training all our mechanics will be ahead of the competition. Giving the Cycle Tech E-BIKE technician confidence in working on all good makes of e-bike systems. Not only with training, but with tools, stock and having the suppliers ready. Coupled with network support from those who have done it, who have a wealth of knowledge. We have also been working with some existing new brands who like what we do and have a similar vision.
Will 15.5 mph restrict the sales of road bikes? You will have to try one and judge for yourself! The manufacturers have developed lighter motors, with smaller batteries and no resistance when pedalling past 15.5 mph.
Time to offer an upgrade – The quality of parts being manufactured and fitted to off the shelf bikes is of poorer quality, not lasting as expected and defiantly not being able to repair many items in a cost-effective way. Will we see parts available for 10 years, to keep your bike running or will it be a new design for you to keep buying every few years? People expect parts to last and e-bikes need specific parts that last from the extra load and power that comes from a motor.
As well as e-bikes the growing electric moped market globally is on the increase. BOSCH is also involved with NIU Electric mopeds
Cycle Tech UK has grown the number of its members and we are working with good brands that have spare parts and support. Our mechanics/business owners are also doing further training and investing in tools, particularly towards e-bikes. We have been working with BMW for two years and in September we have been fully assisting BMW final user with potential manufacturers warranty cases and aftercare service. Our Cycle Tech Group includes Cycle Tech DIRECT where the consumer can buy online or through our partners with the convenience of having the final assembly and setup done by a professional at your home.
Performing checks and testing components to diagnose e-bikes, that requires; knowledge, tools and a case of working parts to test. It does not matter the make of the system, whether you can plug in and test or have fault codes to work with. There are times, the only way to check a faulty component is to test with a known working one. By working to a procedure, step by step you will find the fault much quicker. Start by asking the customer for more information (Can the customer clearly explain the error? And demonstrate the error?) do a visual check; of wiring, speed sensor and other components for any damage or miss alignment, then a wiggle test; of the battery, wiring, display/controller to check for a loose connection and so on. I can show you how. For e-Bike training as a business. See: https://www.cycletechconnect.com/e-bike-training.
If you are planning on selling bikes on line, why not first chat with me? What I have discovered in the last 15 years with selling bikes online, it’s ‘On Yer Bike’ for the consumer and a ‘Race to the bottom’ selling at discount for the online shop. Bikes that are sold online, in a box and the consumer is not a mechanic, when there are issues, they soon want their money back. And electric bikes are proving to have more issues, even with warranty, the distributor does not want to know/help, it’s all down to the dealer. If you like to know the solution, The Way Forward with what works and what does not work, then I suggest you arrange a meeting with me, so we can talk through a continuity plan, before investing your time and money.
Growing interest in an e-bike’s as a repair business
Most of the enquires I receive each week, are from those who are interested in starting their own bike business, who are more interested in starting an e-bike service and repairs, rather than a bicycle repair business. Which is great news, as we have a shortage of e-bike mechanics.
Only sell what can be fixed. Like BOSCH & Shimano Steps
Many retailers are selling e-bikes with no backup. If no one can or wants to fix it, the customer will return and ask for their money back or worst still, don’t ever enjoy cycling.
Coupled with the customer can’t get their new e-bike to the shop to get sorted. Means a home visit by a Cycle Tech mobile bicycle repair specialist, but we won’t work on cheap bikes and e-bikes.
Each e-bike should be ready to go and fit for purpose to each rider’s intended use.
If a cyclist doesn’t have a good buying experience and sends the bike back, we won’t have a job as fewer people will enjoy cycling. Let’s work together and give the new and the old cyclist the opportunity to be the one thing that is positive in our world – Cycling revolution.
If you thought 2020 was a crazy year!
We need to understand there is no going back to how things used to be and we need to look hard for the opportunities that are available.
It’s good that bike shops could stay open, as the economy was closed. Well, we are going to see a response to closing the economy, simulants and TAX/mortgage payment holidays. playing out in 2021. Especially any business that does not get its finance’s in order or continues borrowing to make ends meet. We may start to see some banks not lending and more regulations coming in, as history shows, governments start off with low tax and borrowing that increases over time, so have a plan in place. As we will see tax rises and the cost to do business will also rise as we become digital. The vaccine will not stop the economic crisis (It’s not over till it’s over) it may be good for the stock market, but we have got to support the real economy, by supporting local and not Amazon. Convenience has a cost – The first step is to stop feeding your mind with TV, mainstream media, Facebook and all the distractions, by spending more time cycling, so you can find a balance between work and clearing the mind, to have the time to think ahead.
Not every e-bike manufacturer is ready with a reliable system in relation to the value of the e-bike, but are keen to get their e-bike system out there, as they don’t want to miss out on the e-bike boom.
It’s like e-bike technology is going backwards as new brands hit the market, we are seeing the same old problems from 5 years ago, with lose fitting batteries that give poor connections and water ingress that damage the electrics and bearings. It’s going to be ongoing development and investment before we see even more people investing in the high-end e-bikes who are not cyclists as they will be expecting reliability and backup.
Many shops selling new e-bikes generally have a no policy return and do the repair free of charge (Warranty claim) or tell the customer they have abused the bike. It’s more difficult selling online as many online shops can end-up running at a loss if they have to deal with returns and give refunds, sometimes with the customer can end up keeping the bike. Many don’t have backup support to offer the customer any help, as they have a little margin to work with.
They don’t all see the asset of the mechanic who when properly trained can add value to the bike shop – Some shops can’t pay their mechanics a decent wage, let alone teach them the skills to work on e-bikes and end up changing parts in the hope they have fixed the issue when many of these bikes soon return. This is a big issue for those selling online, with no support in place.
Cycle Tech UK puts a lot of effort into learning new systems that hit the market and working closely with the brand or manufacture. A lot of these issues can be put right before the bike is handed to the rider.
With India building, a cycle village of bicycle manufacturing factories that will work together to build the parts and frames so bicycles can be assembled more efficiently. Combined with empty factories being brought up in Taiwan with the established bike brands who are expanding production and China with the established Bafang e-bike system becoming more popular. Will mean by the end of 2022 with the 2023 model year bikes will increase the supply, competition and, the cost will come down for the average cyclist. The demand for new bicycles, particularly electric bikes will be high, as the low-end e-bikes will become cost-effective to buy new than to repair and more people using e-bikes every day to commute.
Smart Cities 2030
As more people are now working from home during the crisis, that could move to a permanent measure. As many buildings become empty in our cities, coupled with European cities moving to expel petrol and diesel cars by 2030 and high unemployment from the economy shutting down, could mean governments develop our Cities into Smart Cities, creating jobs, with the empty building becoming apartments, with more people living in cities and using electric vehicles that are tracked by 5G network. Known as Agenda 2030. Also, Check out The World Economic Forum and ID2021 to see what plans the global elites have for the 99%. While there will be up and downs, there are opportunities, as the good bike brands will invests and develop and grow the number of e-bikes.
Data from the electric scooters that are hired in cities, will be used to build the cycle lanes in the Smart Cities and will increase the number of cyclists, mainly riding e-bikes. In the past, baby boomers have been the ones spending their money consuming goods. In the next ten years, we will see a growing number of e-bikes being used by the millennials around the cities, but few will be buying them, they will lease or more likely have a contract like a mobile phone and replace the bike every two years. The contract will include basic servicing and the bike will be connected to the internet, so milage use will be recorded and the rider sent a notification when their bike is due a service, replacement parts and any firmware updates will be done over the internet, just like your computer.
The way forward for your business
Is staying ahead of the competition, you will need to invest time and energy into product knowledge, training and tooling. No one is going to tell you how or read the books for you. Only you can learn and build a business that pays. Then you must realise it’s an ongoing journey of learning, educating yourself and not a convenient lifestyle. We are already working with BOSCH and Shimano Steps. To keep ahead we are working directly with e-bike manufacturers and brands to sell DIRECT to the consumer. This not only gives us a commission (A fee to make the bike ready to handover) its to help us get on board with developments, training, tooling and enabling us to buy e-bike motors and components at trade prices, all with the backup and support. Also its been fun, test riding e-bikes, taking the bikes apart and learning how – inhouse training.
“Work only with brands that offer manufacturers warranty ‘they pay you to fix the issue’ with support of parts sent to you. If you cover the warranty issue with your time than you have lost the profit from the sale” – Martin Founder & Owner Cycle Tech Group
Brands we are working with this year:
Starting and running a bike business in 2021 is going to be challenging and rewarding for those who know where they are heading. Prepare yourself, by getting your debts under control and hope for the best, by doing what you believe. Helping more people to cycle in your local community and take time to go cycling.
The brands we work with and the online shops we support will need the mobile mechanic more and more as selling direct to consumer is how buying a bike counts for sales of e-bikes, especially the high end of the market.
Electric bikes are our future. Never stop learning, take time out to cycle in the great outdoors and help others to cycle more.
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