Bicycle Mechanics - Repair-only bike shop

This is a question for current/former shop owners and people who've got some direct insight on the subject...

I've occasionally read about small 'repair only' shops here and there so I know such things exist, but I'm curious how viable such places are given the realities of the business (to which I am not privvy)?

I've heard bike shops make a lot of their money on repairs but do most repairs come in the form of bikes that shop has sold? Or are there just not many repair only places because it takes the anchor of sales to attract people who need repairs? Or is there some aspect to it like suppliers require bike sales in a shop in order to take the shop as a client?

It seems to me a repairs-only shop would take very little capital to start and maintain compared to a full on shop, and if repairs are a cash-cow (correct me if I'm wrong), then why aren't there more repair only shops about?

I know there's tons of things I'm not seeing b/c I really don't know the biz, so feel free to educate me.

This is a question for current/former shop owners and people who've got some direct insight on the subject...

I've occasionally read about small 'repair only' shops here and there so I know such things exist, but I'm curious how viable such places are given the realities of the business (to which I am not privvy)?

I've heard bike shops make a lot of their money on repairs but do most repairs come in the form of bikes that shop has sold? Or are there just not many repair only places because it takes the anchor of sales to attract people who need repairs? Or is there some aspect to it like suppliers require bike sales in a shop in order to take the shop as a client?

It seems to me a repairs-only shop would take very little capital to start and maintain compared to a full on shop, and if repairs are a cash-cow (correct me if I'm wrong), then why aren't there more repair only shops about?

I know there's tons of things I'm not seeing b/c I really don't know the biz, so feel free to educate me.
Not a bad concept, but the problem is establishing a relationship with distributors to source parts. Most of the top line distributors won't even look at you without a retail storefront and bike lines.

That's what I was wondering. If there was some kind of catch that didn't make it very feasible.

There's a reapir only shop south of Tampa that operates out of small retail location.

The only mechanic I trust is a repair only shop. Viability though? Overhead?

I think it is more viable for him since he partners up with a shop-only shop and they refer people to each other.

Overhead, tools are pricey, especially the specialty tools, etc, but other than that, there is definitely some cash to be made.

That's what I was wondering. If there was some kind of catch that didn't make it very feasible.

There's several bike shops in the Portland area that only do repairs, and a couple don't have storefronts:
http://bikeportland.org/2009/07/20/a-bike-shop-that-makes-house-calls/

I ran such a shop for about 10 years. It was a labor of Love & Hate. The LBS in that town was run by an idiot and crook. I hated that jerk. And I love bicycles and wrenching. So it made sense to me.

The real issue is how to get your advertising out to people. Or how not to. Word of my work passed freely through others hands, and I ended up swamped. So I rolled that back a bit. And the money was decent. But I didn't really care about that - I tossed most of it back into the business.

I only closed-up shop when I moved away from that area. But I'm back again now - making a business plan.

But what about the issue of parts suppliers? Is it just QBP that will only deal with retail shops?

Repair only shops exist here and there, especially where is the business is less seasonal. The pluses are low starting capital requirements and no real barriers to entry. Some distributors won't deal with you, but that isn't necessarily because they don't sell "repair only" shops, but because with sales your volume will tend to be small and they are looking for larger orders. Many repair shops therefore also sell parts and accessories, but not bikes, and others recondition used bikes for sale.

The real problem with a repair only shop is that you're selling only the direct output of your labor, and you only have 2 hands, and so many hours to use them. That makes it hard to generate income to support overhead. Compare that with a sales oriented shop where income is generated as a return on capital invested in inventory. Larger income per hour is possible to support employees, better location and advertising.

Either business model has certain advantages and drawbacks, but in America today running even the simplest business involves significant minimum overhead for things like, liability insurance, accounting, health insurance, rent, etc. and that handicaps smaller businesses severely. It's why smaller family run businesses are disappearing in all categories, and being replaced by cookie cutter chain or franchise operations.

So, yes, you can succeed with a repair only model, but it takes a while to attract customers, and you need to establish a reputation for quality work, not available at the full on retailer. It's easier where the established shops do a poor job, and almost impossible if there's quality service available at the LBS.

There's a reapir only shop south of Tampa that operates out of small retail location.

What shop is it and where exactly?

a couple of people have wanted to start a bike shop with me.
I wasnt keen so didnt take them up on it
the first man was a crook that stole some money from me
the second is a reasonable man that seems to have some capitol. Hes run a small bike hire and repair business with his dad.

Im ok as a mechanic. wish I worked faster though.

sometimes when Im coming home from town, I see a car garage in the next village. There still repairing cars at 11pm. guess thats what has to be done to get through all the work. wont be too great for the neighbours when they start up the power tools late at night.

The real problem with a repair only shop is that you're selling only the direct output of your labor, and you only have 2 hands, and so many hours to use them. That makes it hard to generate income to support overhead. Compare that with a sales oriented shop where income is generated as a return on capital invested in inventory. Larger income per hour is possible to support employees, better location and advertising.

BOOM! We have a winner! Think of a barber. He only makes money when he has someone in the chair. Vacation? Fuhgetaboutit. Not only does it cost outright, you have to figure lost income potential and the fact people don't like it when they can't get their bike fixed quickly. If you go away and they need something done and are treated decently elsewhere, they are GONE.


Either business model has certain advantages and drawbacks, but in America today running even the simplest business involves significant minimum overhead for things like, liability insurance, accounting, health insurance, rent, etc. and that handicaps smaller businesses severely. It's why smaller family run businesses are disappearing in all categories, and being replaced by cookie cutter chain or franchise operations.

True. My cost of doing business is 40%. Bike margin is 36%. See the problem?


So, yes, you can succeed with a repair only model, but it takes a while to attract customers, and you need to establish a reputation for quality work, not available at the full on retailer. It's easier where the established shops do a poor job, and almost impossible if there's quality service available at the LBS.

True. If there's a shop anywhere near you with a decent mechanic, people will pay more to deal with what they feel is a more legitimate and "bought-in" entity.

Lastly, if you aren't an absolute ACE that can fix anything that comes in quickly and correctly, you won't be there long. Word spreads quickly in the bike community and second chances are nearly nonexistent.

My cost of doing business is 40%. Bike margin is 36%. See the problem?

This is a flawed analysis that unfortunately has been circulating in the bicycle industry for years. A bike shop has three revenue streams, bikes, parts and accessories and repairs. There are different margins and costs in each category, so applying total overhead uniformly across the categories doesn't make sense and results in poor thinking.

If you apply the direct costs directly to each category, then allocate the fixed overhead not as a percentage of sales, which is meaningless, but as a cost per hour to keep the doors open, a totally different analysis results. Now the issue is to garner the greatest dollar profit (after direct costs) per hour, and that's by selling bikes.

A parallel can be drawn to the restaurant business, where the greatest profit margin is in coffee and dessert, and the lowest in entrees, especially those like steaks, where the food outlay is the highest.
The goal is to sell you a complete meal, ideally with coffee and dessert. But if you take up a table having only the coffee and dessert, he's soon be out of business, because while the profit percentage is lower on the entrees is lower the total dollar profit is higher, and the income on coffee and desert isn't high enough to make the rent.

I've been in the bike industry for 40 years, and can guaranty that focusing on percentages rather than gross income dollars is a sure way to starvation.

Good info, thanks.

- making a business plan.

Half of the battles right there....


What shop is it and where exactly?

Somewhere on U.S.301 in the Riverview/Boyette area, sorry, I dont know the name. If your looking to get some work done let me know.....I can do just about anything. PM me if you need help with something.



In regrads to obtaining parts....there are many suppliers out there and most, if not all, require some type of brick and morter location/store front. NOT selling new bikes wouldnt exclude you from obtaining parts.

I do not see why you would say the the only output of a repair only shop is labor? what about parts? also if the shop is an established business why would you not seel parts adn accesories over the counter? my biggest concern would be liability and the insurance for it.

I have often thought about buying a bunch of tubes and cheap bottles/cages and the like then taking the tools and mini van to the railtrail anyone ever tried this? I don't think I would ever get rich doing it but it might be alot of fun.

In order to make it work you would need a store front for legitimacy. You could do repairs, offer upgrades and you might could even take in used bikes for repair and resale. Having a store front would help you to source parts, gruppo upgrades and all of the accessories.

You could call it "Re-Bike" Repair and Upgrades Our Specialty.

I am an A&P/IA and a few other things, I also went to a bike trade school program so I am a professional mechanic. I had a wonderful bike mechanic in Houston and even though I could do the work, I let him because he did it better than I could for a fair price and I preferred to use my time for other things. When we moved to Phoenix the "guy" everybody recommended butchered my Pinarello so much it cost me a 1,000 dollars to make it 100% right again.

Now, if I walk in a place and even see a pair of pliers or a "Cresent" wrench and Harbor Freight tools on the bench I am gone. Real mechanics invest in quality tools so they can do quality work. No pliers on the Pinarello please and thank you.

Good work will get you good buisness.

...

Either business model has certain advantages and drawbacks, but in America today running even the simplest business involves significant minimum overhead for things like, liability insurance, accounting, health insurance, rent, etc. and that handicaps smaller businesses severely. It's why smaller family run businesses are disappearing in all categories, and being replaced by cookie cutter chain or franchise operations.

...

True dat. Excellent analysis :thumb:
Here's an article on a local guy that has a seasonal business without that pesky rent thing (http://www2.canada.com/calgaryherald/news/swerve/story.html?id=b713d93d-25b5-4a5e-9284-142b4f5fc228)

I am in the process of doing this very thing and do have the small storefront with a great location, the skills, the tools, and the contacts... my client base is building as people know I do some fabulous work at very reasonable rates.

My overhead is very low and although I am not selling new bikes it is something I am looking at and will do if I can cover a niche no-one else has covered... I am also dealing with several suppliers who offer unique hand made products.

I build a lot of wheels and that composes a good deal of my business.

Right now it is a part time venture and at present I work by appointment only which works well because of some chronic health issues I have.

Next year I expect that this will become a full time venture over the peak of the season.

I've occasionally read about small 'repair only' shops here and there so I know such things exist, but I'm curious how viable such places are given the realities of the business (to which I am not privvy)?


Ask these guys: http://www.vecchios.com/

Of course being on Pearl Street in Boulder helps.:D

BTW One of the guys can be found at www.cyclingforums.com posting as "Peter@vecchios".

I do not see why you would say the the only output of a repair only shop is labor? what about parts? also if the shop is an established business why would you not seel parts adn accesories over the counter?

Because you can't compete with the internet on parts most of the time.


I have often thought about buying a bunch of tubes and cheap bottles/cages and the like then taking the tools and mini van to the railtrail anyone ever tried this? I don't think I would ever get rich doing it but it might be alot of fun.

You already answered this!


my biggest concern would be liability and the insurance for it.

Should you try to "help" someone out and they crash and get hurt because of a malfunction with the bike, without insurance, you could be in big trouble financially.

I have often thought about buying a bunch of tubes and cheap bottles/cages and the like then taking the tools and mini van to the railtrail anyone ever tried this? I don't think I would ever get rich doing it but it might be alot of fun.

There're a few mobile repair srvices in my area. One of them is always parked at the local riding spot on weekends. I cant see how he makes a decent profit sitting there for hours on end.

As far as obtaining parts....there's more than 1 way to skin a cat. The local flea market has 2 vendors that sell parts.

You are not going to get rich doing this and,in today's economy, you might not even be in business after a while. Depending where you are located in the U.S. , the business might be very seasonal or, if you are in a nice warm area, pretty steady. You need a good amount of capitol to pay your fixed expenses- overhead-rent, electricity, water, heat, etc. Insurance will be costly but you must have it, in case someone gets hurt after you do some work on their bike. Remember, Americans are very litigious ( I hope that I spelled that correctly). You will need to have a good amount of $ tied up in parts, because today's customer wants the bike fixed ASAP. A lot of parts become obsolete very quickly, so your investment will also shrink. The bike business is difficult to make a living in even during a good economic cycle. Think about your neighborhood hardware store. He/She is having the same kinds of problems as your local independent bike shop. The big box stores are open 7 days a week, 12 to 14 hours a day. They are sometimes selling goods at or below your cost, because they are buying in such large volume.
Whew. Well, you can make a bit of money, but you are not going to get back much for your investment.

Many years ago I worked for Huffy Service First. The model they used consisted of doing mobile bicycle builds and repairs at retail locations.

The model I thought I would consider would be to partner with a local bike shop. I would buy a used van and provide a mobile service for repairs and pick-up and delivery for the bike shop for warranty work. The LBS would be my source for parts.

Ask these guys: http://www.vecchios.com/

Of course being on Pearl Street in Boulder helps.:D

BTW One of the guys can be found at www.cyclingforums.com posting as "Peter@vecchios".

Peter would be very surprised to learn that he doesn't sell bikes, parts, and accessories (in addition to his legendary repair and wheelbuilding services).

Peter would be very surprised to learn that he doesn't sell bikes, parts, and accessories (in addition to his legendary repair and wheelbuilding services).

Yup. Other than Moots, Parlee, Look, Calfee, Mondonico, Waterford, Gunnar, Merckx, Blue & Torelli , no bikes to be found there:D

Now, if I walk in a place and even see a pair of pliers or a "Cresent" wrench and Harbor Freight tools on the bench I am gone. Real mechanics invest in quality tools so they can do quality work. No pliers on the Pinarello please and thank you.


That's 99% of the shops out there. You seem to have a prejudice against tools that are used instead of the mechanic using them. May I remind you how absolutely ridiculous off your notion of a quality service shop is?

It's the mechanic using them, not the tools in their repetoire that gives a good or bad result. You wouldn't know a quality shop or mechanic if it bit you in the ass (no offense) if you think the way you sound from your post.

If it was my shop, you wouldn't find cheap Harbor Fright tools. I only buy/use top-quality. That's my choice. But I also don't care what someone else uses. I'm with operator in this respect - it's the mechanic who is making the work done to be good or awful. Not the tools.

That's 99% of the shops out there. You seem to have a prejudice against tools that are used instead of the mechanic using them. May I remind you how absolutely ridiculous off your notion of a quality service shop is?

It's the mechanic using them, not the tools in their repetoire that gives a good or bad result. You wouldn't know a quality shop or mechanic if it bit you in the ass (no offense) if you think the way you sound from your post.


No, tools count also. As a former airframe mechanic / bike mechanic the correct tool for the job means a lot.

Now, if I walk in a place and even see a pair of pliers or a "Cresent" wrench and Harbor Freight tools on the bench I am gone. Real mechanics invest in quality tools so they can do quality work. No pliers on the Pinarello please and thank you.

This is snobbery! I have a tool cabinet full of great tools, but you would dismiss my service because I have a pair of pliers on my bench? What do you expect me to use on the Nexts, Mongooses, and other BSOs? Sometimes a pair of pliers is the perfect tool to tweak a steel front derailleur back into shape! It always surprises people that the majority of what most LBSs see are mass merchant bikes. That Campy tool kit ain't much help when you've got Junior's full-suspension 44lb Walmart special in the stand. I often find the only way to free up a seized derailleur or brake is to hit it with a hammer. The skill is in knowing where and how hard to hit!

Frankly, if all I ever worked on were nice bikes, I wouldn't need half the tools I have....

You A&P guys don't have to deal with the kind of low-spec junk that people drag into their local shop, with flimsy stamped steel parts that only seem to work after being carefully bent into vaguely functional shapes by things like pliers, channel locks, hammers and cold chisels....

Now, if you see someone heading for your Pinarello with nothing but a pair of pliers and a smile, I will admit you have cause for concern, but.....


Good work will get you good buisness.

Which is far more important a consideration than whatever tool I may happen have on my bench.:thumb:

that's 99% of the shops out there. You seem to have a prejudice against tools that are used instead of the mechanic using them. May i remind you how absolutely ridiculous off your notion of a quality service shop is?

It's the mechanic using them, not the tools in their repetoire that gives a good or bad result. You wouldn't know a quality shop or mechanic if it bit you in the ass (no offense) if you think the way you sound from your post.

+ 1

No, tools count also. As a former airframe mechanic / bike mechanic the correct tool for the job means a lot.

Which again, a good mechanic will not use a tool that was not correct. Just because the incorrect tool is there doesn't mean you use it.

No, tools count also.

Sure they do but the 'Park' name doesnt make a tool better.

Gotta agree on Park making better tools... or not.

Their cone wrenches are like buttah and my old Sugino wrenches are actually strong enough to handle pedals (although I won't do that) and Park cable cutters are a waste of my hard earned money.

You will see a little blue in my shop but when someone makes a better tool that is what I will buy.

I own a mom-and-pop repair business (not bike repair), and there is definitely a difference out there between shops like mine and those that only sell new equiptment. I try and fix things and keep them going until they just can't be fixed anymore. Replacement is the last option. (Although, with current regulations, this is probably going to be a tougher and tougher business model.)
When I repair bikes, I approach it from the same angle. I specialize in fixing what the LBS can't or won't do. Install a Bendix single speed hub on a 700c aluminum rim? No problem. Tear apart and service freewheels? No problem. Building a mix-and-match bike for a student with very little money? We can handle that. Taking old rusty bikes and making them rideable is what I like to do. I make parts if I have to, and sometimes I make the tools to make the parts. (Honestly, sometimes I MacGuyver it.) Make tons of money? Nope. Sleep soundly at night? You betcha!

It always surprises people that the majority of what most LBSs see are mass merchant bikes. That Campy tool kit ain't much help when you've got Junior's full-suspension 44lb Walmart special in the stand. I often find the only way to free up a seized derailleur or brake is to hit it with a hammer. The skill is in knowing where and how hard to hit!....

....the kind of low-spec junk that people drag into their local shop, with flimsy stamped steel parts that only seem to work after being carefully bent into vaguely functional shapes by things like pliers, channel locks, hammers and cold chisels....


Good for you, BikeWise! And Bikemeister, too. I volunteered as a "mechanic" for a few days at a local nonprofit shop that mainly catered to the homeless guys downtown and I just couldn`t cut it. I thought I knew enough from working on my own bikes, the kids` bikes, the neighbors, etc and found out that I was mistaken. It`s damned tough to get that flexy stretchy flimsy stuff going in any sort of acceptable manner and resist the temptation to start changing stuff out. On the other hand, I imagine I`d be equally lost on the Pinarello walking into the shop. STI, Ergo, outboard bearing BBs, no way I want to take a chance on screwing up the big money parts!

Sure they do but the 'Park' name doesnt make a tool better.

Agreed!

I am pretty sure a repair only shop wouldn't stay that way for long. You would start to build an inventory of used bikes..you wouldn't be able to stop yourself..and of course you would start to carry accessories that you know you could move quickly and make a profit on.
A repair oriented shop would be a good approach in any case especially if you, or your help, actually knew how to do the job.

And about tool snoberry (is that a word?). I do a very technical kind of work (small geothermal heat pumps used in a marine environment) with a collection of crap jammed in a ripped tool bag. What I have found is I can do more precise diagnostic work by using my bare hands and 30 years of experience than most of my newby competitors do with a rack of gauges and electronics. I can almost see my customers blood pressure dropping when I show up.

Mike

I'm thinking of doing this. I'm doing repairs for folks in the neighborhood currently, and I'm also collecting, restoring and selling used bikes.

I saw the website of the guy in Portland with a van. That sounds like an attractive next step, but I wonder what the business model looks like. I like the van rather than the storefront because there's no rent. But of course, it's not as visible, and I'd have to market myself harder than I would with a storefront.

I would park at parks and other places which sees cyclists.

I might be able to rent some space in a store window and pay the store owner to refer people to me. That would be money well spent.

And if it all goes well, I'd already have a following, and then the concept would be proven, and I could then take the risk of opening a shop. I am just too scared to open a shop right now. I have the skills and knowledge, but the hours scare the cr*p out of me, plus the expenses and liabilities.

Buying parts is no problem. There are suppliers on the web with low enough prices. I'm buying cables, inner tubes, handlebar tape, etc already. I don't need to be deemed a legitimate retailer to stock parts.

I talked to the owner of a new bike shop, in Jersey City, about 15 miles from here. When I told him about the idea, his eyes brightened up and also wondered if it would work. I guess his rent is already killing him.

Yep - the two major impediments to opening a repair business is the rent of a store-front, and if you work out of the garage or such - zoning laws. Some towns will throw you in jail if little Buddy & Sis set up a lemonade-stand.