damnable

Hi,
I was just wondering where LBSs make the most money.

Is it from new bike sales?
Servicing?
Components?
Accessories?

I suppose to a certain extend I want to know my level of guilt if I shop around at different places, and which one deserved my money the most.

deraltekluge

Yes.

Machka 

Markup.

Panthers007

With the advent of one-finger shopping on the internet, component sales at most LBS's are dropping off. People complain (the owners of the LBS) that this will drive many out of business. But this phenomena is here to stay. Like the telephone. So this presents a challange to the intelligent shop owner: How to make up the money being spent elsewhere.

Anyone got any ideas for diversification? I have a few, so I'll roll a few out - offer courses in various aspects of cycling. Such as basic mechanics, how to prepare for a tour, and good meals for someone who loves riding.

Next?

JPradun

Service is the bread and butter, though.

PlatyPius

Service is #1
Accessories are #2
Bikes are #3

At our shop, at least.
We do $150,000+ in repairs per year with a staff of 4 (2 mechanics).

Doohickie

You know how to get a million dollars out of a bike shop? Start with two million.

jimblairo

Anyone got any ideas for diversification? I have a few, so I'll roll a few out - offer courses in various aspects of cycling. Such as basic mechanics, how to prepare for a tour, and good meals for someone who loves riding.


My LBS lets me work on my bikes using his repair stands and tools. I always tip the head mechanic and I buy a lot of components and accesories from them. Last winter, in the slow period, I trued my 9 sets of wheels and I really enjoyed doing it.

Doohickie

Yeah, our LBS is doing similar stuff. As far as diversification, I think the key is niches. There are several LBSs in town and they all seem to do okay. The one I hang out at specializes in commuting, value-priced (but good quality) brands, and recumbents. They've been open just over a year and are moving into a bigger space next month. They are talking about things like allowing people to use their workshop area & tools for an hourly fee (and charging a little more if you want to be able to ask the mechanic questions), training classes, that kind of stuff.

This shop is a little unique in that the mechanic's area is open to view, and in fact even has seating around so you can shoot the breeze with the mechanic as he works on your bike. I've already learned a boatload from him and any money he's missing out on by me working on my own bike are offset by the tools I buy there. Everyone wins.

PlatyPius

"Back in the Day" (ie: before the new owner bought the store last year), we had a sofa in the repair area. There were ALWAYS people in the back talking to us while we worked. We were more of an "everything" bike shop then. We had a lot of fun, but we didn't make much money.

The shop is a little more "professional" now. We only sell road (including randonneur and commuting bikes) and triathlon bikes (with a few token hybrids....I think we have 3 total at the moment). We dropped MTBs, BMX, and comfort bikes. This past year we came close to doubling the previous owner's best yearly gross.

There's still work to do, and there are lots of things we want to implement. It's just difficult at the moment, since there are only 4 of us. Eventually we want to have organized rides (in the spring), theme parties (Kona Ironman party, for instance), classes on various things, and other cool stuff. We were planning on opening a second location downtown with showers, bike storage, and bike repair for commuters until the economy REALLY started sucking.

StanSeven

A LBS opened locally here and have an amazing business. They specialize in high end bikes, including tri and tt, but also offer mountain, hybrid, and city bikes. They carry the best brands (Cervelo, Pinarello, Specialzied, Cannondale, Wilier, etc.) and have many sizes in stock. They also carry many of the best components and they are in stock. I'm guessing this provides them enough cushion to maintain a staff of service and mechanics so they can fix everything on the spot.

As opposed to this, a local Performance shop has a two week wait of tune-ups. This LBS can do a tune-up while you wait.

Employees include several serious racers, a BAA finisher this past year, and a number of competitive triathletes.

You can walk in, talk to someone knowledgable, and walk out with what you need. The price might be more than what I could get from doing a google search, but I am very happy with them.

Rowan

My gut feeling is that this is an overstated scenario.

The internet remains the domain of middle-class white-collar workers in most parts of the world. Even then, there are many, many people who don't have a clue about buying on the internet, or don't trust the system because they fear getting duped.

Bike shops do their business with more market segments than that.

One of the biggest and best bike shops in Alberta, Canada, (in Edmonton) has a sister shop right next door that is snow and ski-based. The off-season for each is covered by the other.

Specialisation in one area is fine, but having the flexibility in the business plan to move on to other things when the fashion fades distinguishes the wise shop-owner from the foolish one.

wahoonc

Buy the man a beer One of the major reasons many smaller stores go out of business. If you remain flexible, know your market and respond. The other major reason being lack of capital.

Aaron

Garfield Cat

If any of you ever been to a pro bike fitter, a fitter outside of the local bike shop, then you know that the knowledge and information gained is worth the price. That fitter knows a lot about your body geometry, about your riding style, about your injuries. Maybe some bike shops do have certified fitters but there's always that feeling about the service and the bike. Inhouse fitters will favor inhouse bikes.

I would like to see a greater rift that has been started by the internet sales types. I would like to see a mostly service oriented shop.

PlatyPius

The owner of our store was an independent fitter for years. Prior to that, he helped start NIFS in Indy and was there for several years. Now he owns a shop. We want to sell our bikes of course, but his reputation is so good that people drive from the 4 neighbouring states for fits/advice from him. I never would have thought that there would be that much business in fitting.

Lebowski

the guy at my local bike shop said he made a killing repairing crappy department store bikes every spring

cetmefree

Where is the shop moving to? We have no good LBS's down here. I travel to Arlington frequently, so going to Ft.Wroth wouldn't be much of a problem.

Doohickie

That's BRILLIANT!!! I think that would work in Fort Worth. There is a lot of new growth in the downtown area; a lot of upwardly mobile people are moving downtown to the lofts and condos, so the shop part would do well. Parking is problem and there are two or three different MUP approaches to downtown, so I think having a secure place to park your bike AND be able to take a shower could actually be worth some money to people.

The LBS I go to is expanding into a larger shop next month, so they probably can't open a new location just yet, but they said they've had an outstanding January so far; business is pretty good for them right now and they're hoping once they can actually display more stock things will really get moving. Fort Worth has not seen the same level of economic downturn the rest of the country is seeing.

Panthers007

If Obama goes through with an influx of capital to our citizens, that would be an excellent time to advertise sales on bicycles and promote bicycles in general for their many (hit 'em all) benefits to person, planet, and pocketbook.