raria

So you need to be careful equating with thriving to long term longevity.

The LBS I worked at seemed like it was thriving in that they were always busy. But the owner and workers knew that the sales part of the business was dying and the service side was not set up for what the customers wanted (quick turn arounds).

For those of you who say your LBS is thriving do you know that they actually selling lots of bikes? If they are not then they aren't thriving.

indyfabz

Depends on how you define "thriving." If they are turning a good profit I don't see what difference it makes how that profit is made. Green is green, whether its earned from bike sales or service. You know what I'm sayin'?

Maelochs

When you start thinking time to get to the shop form home ... turn it around to time to get to the bike from the shop ... how many jobs could you do each day? Ten to 15 max, some days four or eight?

Half-hour drive time and if you are lucky each job is close to the next ... and they guy 20 miles away doesn't call you just before the guy two blocks away.

Figure mileage (wear-and-tear, consumables, insurance, amortized vehicle cost) and wages, and then parts, and then figure mark-up on parts, and labor and the two sides have to add up with markup and labor being higher than everything else.

Plus start-up costs like forming a company, personal insurance (in case you get hurt or damage their bike or kill their little yappie dog who deserved it) plus time to research all that (I would strongly recommend spending the cash on a lawyer ... because if you don't first, you will wish you had later when you have to spend a lot more cash on a lawyer.)
If you have employees that is another 16 nightmares .....

How much do you think you can charge to go to some guy's house or office to adjust his derailleur, versus him leaving work a little early one day and picking up his bike from the shop the next day ... and they might do it for free if nothing else needs attention.

If you can pull it off, bravo. But I don't think I will be an early investor.

wphamilton

You said it here. The problem you describe is also potentially a solution:

"The sale guy (and the owner) really didn't have much to do all day. Online sales by places like Amazon/BD/Nashbar etc took away a lot of the low level sales and even some high end sales."

There is no inherent reason why the local bike shop cannot also be an online sales outlet. I know, I've heard it, the quantity you'd have to stock, storage costs, logistics etc etc, but any of these are only problems because they are outside of the typical shop's business model, beyond their experience. Those will probably have a hard time of it. But for those who fail, others may fill the niche.

The local shop may in fact be better positioned for internet sales than Amazon, Bikes Direct and Nashbar, in many respects. Not least of these is that the shop really knows retail, and these companies for all their skills and resources really don't. It's an advantage. Local access is an advantage, service is an advantage, deeper product knowledge is an advantage. Value added, the Achilles heel of online outlets. These can be utilized in online sales, just as online models encroach on local sales. The LBS won't die, not those which can adapt to online realities.

Ogsarg

I don't believe there is a single solution for a bike shop to survive/thrive. Shops will adapt depending on their clientele, their expertise, and many other factors.

The only shop in my small town is run by a Father/Son combo. I suspect they may sell a bike or two per week and those are usually the beach cruiser type. They carry Specialized and Felt but not much inventory of either and not a lot of stock on hand but enough to be able to help most customers.

They do a casual group ride every Saturday morning which starts and ends at the shop and I'm guessing that helps get people in and I suspect their rent isn't very high. Both of them are very knowledgeable and I wouldn't hesitate to have them work on a bike if I needed help. They have a fair number of used bikes and it's possible they are selling these on Craigslist or somewhere else.

Not sure if they are thriving but they've been in business a long time and don't seem to be hurting near as I can tell.

beermode

These guys don't have that sort of issue. But sure, root for pecisism I guess.

CliffordK

Inventory can be an issue for those buyers who wish to purchase 20 tires at a time.

However, it doesn't exclude small shops who might want to list say ONE of each. Throw it up on E-Bay. When it sells, replenish.

The biggest risk, of course, is if 1000 new small Mom&Pop shops start selling on the internet, then competition will get intense, and people will be dropping that one penny to be the lowest, only to find their neighbor matching and dropping another penny.

Of course, I often look at lowest price, but other things like combined shipping, and delivery times will also influence my decision.

The other issue is competing with oneself. It would be hard to justify listing a derailleur on E-Bay for $50, and having it hanging in the shop for $100. And what about those sellers that find the shop on E-Bay, and insist on paying and walking in to pick up?

Of course, having greater inventory depth would benefit both online and the local shop. So, not only choosing one line of parts to carry, but to carry everything from Tourney to Dura Ace would benefit both online customers and local customers.

Having an online shop (not E-Bay) allows loss leaders. Tempt buyers to shop based on low priced chains, for example. But, then just hope they'll also add a few tires to their order at a greater profit margin (to get that free shipping offer with a $100 purchase).

Racing Dan

I believe there is room for both e-shops and the LBS. For years it was predicted that the internet would kill off all the local shops and that has in certain instances been true, but not the bike shops. At least where I live, in Scandinavia. Here there are many bike shops, more than ever I think. I believe the LBS and the e-shops cater to different customers and Wiggle or Amazon is not going to out-compete the local shops any time soon. Many customers still like to try before they buy and many either cant or cant be bothered with maintenance.

San Pedro

Having your mechanics be sales guys too might help. No point in having sales guys sit around when you could have them doing service jobs, especially simple ones, as needed.

The same people I but my bikes from are the ones who help me if I bring in a bike.
@CliffordK I for it into one of your commuter groups. When I got to my LBS I am almost always rising there and almost always expecting to leave on my bike.

Maelochs

Unless you actually do get successful ... even for a day.

Get a day's worth of repair jobs and eight different people looking at bikes and at the end of the day half the people coming to get their bikes are told, "Maybe tomorrow."

Suddenly your shop isn't the place to go for quick turnaround .... and if none of those folks bought a bike, then you have successfully killed both revenue streams with one day of business.

In a small town with not much competition you can get away with it .... if there are a couple other places people might go, then hearing either "I will be with you in a couple minutes, I can't put this job down right now" or "I know I said your bike would be ready but we got really busy" are both potential deal-breakers.

San Pedro

I don't think that makes it a bad idea to have people serve both functions. Unless you only have one person working. Definitely there are times and jobs that people can't expect a quick turn around. There are times when someone can put down there tools, wipe their hands, and go talk to a customer.

People also might appreciate having the guy who sold the bike to you be the one who services it as well.

Of course, nothing can work out perfectly. I know that I would like it if I went to my LBS and saw two guys sitting around, and then be told I have to wait a week for the to true my wheel or something. Maybe this why I keep going back to the mom and pop place.

Drew Eckhardt 

That beats the $2,500 a month you'd pay for the least expensive retail space near customers I was able to find in a cursory search (853 square feet at $3.75/month).

Which all exist for retail.

$75 - $100 for the visit, billed in advance. Obviously what you can charge depends on what sort of money you customers earn and how painful dealing with traffic would be on either end of normal business hours.

You could also do a bike repair concession on a large employer's campus like laundry services, massage therapists, hair stylists, dentists, oil change people ...

wphamilton

Inside, you're going to install it for them. You'll tell them if it's the right deraileur, and so on, what the sales types call "warm fuzzies". Some people like to pay for that.


You're looking at it the wrong way around. Walking in to pick it up saves you the shipping and packaging, and the time taken by a couple of steps in the typical online transaction. You would encourage that, advertise it as an extra service. It's one of your advantages over Amazon or BD.

I don't believe in loss leaders but this is getting into the spirit of it. That's certainly something that a real shop can do that's difficult or impossible on-line. AND, similar to above, you can use online sales to get people into the shop, and vice versa to an extent. Each side can help the other, rather than competing.

San Pedro

I have a similar situation. I work all week, and when I get home I'm taking care of family obligations, and the same on weekends. So, I have ended up learning some new skills, but not having a house (apartment) or garage makes it hard to keep some tools and do certain things, which does mean at times it is good to have an LBS to go to.

As for Sundays, I was very surprised when I went back to America for a visit either last year or the year before. I wanted to visit a bike shop, and figured that of course it'll be open on Sunday. That is when people have the time to go, but then I was disappointed to find that it was closed all Sunday, and every other one was closed or only open for a couple hours. It was a little bit of reverse culture shock. Sunday is probably the busiest day for any LBS in Japan, and often the only day a lot people can actually go.

J.Owen

I think this is something that is getting lost in the LBS or even pushed out by online shops shrinking margins against the brick/mortar. There are plenty of consumables that the LBS could match online pricing and use as a loss leader. Unfortunately, they seem to forget this and hold higher prices hoping customers will continue to visit for the "warm fuzzies" as mentioned above.

Sullalto

F&B is a terrible business to be in and legendary for how it eats up new locations.

Dave Cutter

I did my 1st Amazon return the other day.... what a quick, easy, flawless operation they've built.

I the late 1950's my Dad sold his lawnmower shop. Lawnmower, and TV repair shops were relatively new and popular concepts in the 50's. And where both still exist in some numbers.... in reality both are relics.

Dad blamed Sears and Roebuck for killing off the lawnmower (and TV and appliance) shops. Later.... others blamed "Mall's" for killing the downtown businesses. Then the little local downtown stores blames Samuel Moore Walton and his "Walmart" creation for killing small stores. Lately.... it seems that business failures are blamed on Amazon.

The fact is..... earning profits in a stand alone (or small chain) of businesses is one of the hardest things that can be done.

If there is a buck to be earned... ANYWHERE... expect competition in earning it. And... if YOU haven't figured out a better way to earn the customers business.... you can be sure your competition will.

Whatever LBS business model is successfully being used today.... don't expect it to work tomorrow. And what works tomorrow.... won't work forever.

San Pedro

It's capitalism, go BIG or go out of business. Bike stores are actually a little better off than a lot of the examples you posted. I have a feeling the area and the use of bikes are important. Maybe in a bike heavy city, like Minneapolis, an LBS would have much more business from commuters and things on the low end that keep up revenue streams and provide a service that is needed that they can't get from online or even a big box store.

Sullalto

Or vertically integrate like hell, such as performance bike. Combine the manufacturer and LBS, cutting your margins.

Alternatively, improve your margins by selling direct, such as Canyon and Raleigh/Diamondback. When Raleigh/Diamondback first debuted their wholesale accounts, you were getting a genuine wholesale price, often 40-60% off. New models are as low as 20%.

B. Carfree

Uh, no. The Performance shop was literally right on the bike path network. However, the underpass between it and the river paths proper has been taken over by an army of aggressive homeless and their pit bulls. If one makes it through that gauntlet, there's always the thugs living under the DeFazio bridge to deal with. Worse yet, if one is coming in from the north the ride is simply awful no matter what route you use. In short, it was a lousy location, but not because the bike paths aren't right there.

You also missed some of our closures. Simply Cycle moved out of town. Paul's (worst bike shops ever) closed two of their four locations. Wheelworks closed down this past fall. Red Barn closed a few years ago and Revolution went bankrupt less than a decade ago. However, in that time a few shops did move in (Arriving by Bike and LifeCycle).

Overall, we're down several shops and, if you get them to trust you enough to answer the question of how business is going, they will all tell you that they are very concerned. This is no surprise. Eugene has lost 43% of its cyclists since 2009 according to the US Census American Community Survey (gathers quarterly data on commute modes and publishes annual numbers each September). That's a lot of missing bike purchases and repairs, and there's no indications this trend is going to reverse itself absent some sort of oil market disruption. (Should I be rooting for a war between Saudi Arabia and Iran just so people will ride bikes? I don't think so.)

mister

In all honesty, I skipped the vast majority of replies, so apologies if this was already covered.

I manage in the retail environment and a vast majority of the leadership in many companies is very concerned with how to stay viable, so the LBS is certainly not immune to the fluctuations of market. There are many moving pieces to this equation besides offering a new or different service. Having specialized employees in an assembly line fashion is a HUGE overhead cost. Let’s take CA as an example... have 3-5 employees on your line working 40 hours a week at $11/ hour minimum, you’re looking at $1300-$2100 in payroll per week. Or you could pay 2 top notch mechanics $20/ hour for 40 hours a week and your payroll budget lands at $1600 per week. Take that $500 savings and invest it back into the business somehow (ongoing education to stay current, better equipment, etc.).

The owner of a couple of the shops near me recently opened a coffee shop/ bar near the confluence of many local trails. They have a small, but well stocked shop in the back with a quality mechanic. They rent out road and MTB bikes. They recently put in showering facilities too. It’s a family friendly place that even has games and coloring books for the kids. All with cycling races of one variety or another playing. It’s flipping brilliant. Honestly, I think that model is the way to go.

raria

Are you saying the homeless and thugs on the trails meant people gave up cycling? That's sad and so unlike Eugene (or Oregon in general).

kbarch

Since bikes are truly durable goods, as long as people buy them, ride them and subject them to use and abuse, and as long as kids aren't taught to use their hands for anything more than manipulating a keyboard or touchscreen, there will always be a need for repair shops. Also, as long as fit is an issue, people will always want to take advantage of a showroom. This is why brick and mortar bike shops haven't disappeared altogether. The question isn't whether they can continue to exist, but how can they be most profitable.

By the way: my bike shop has a tip jar. Are they commonplace? I don't recall seeing one at other bike shops, except when they have a coffee bar, and those are rarely so full of cash as this one.

Sy Reene

Actually, I'm not certain what hurdles need to be overcome to have an online presence. A couple cases in point, both of which have actual storefronts. I thought I've read somewhere that websites like these are basically (at least the Brand's example) just re-presenting the distributors/QBP (?) offerings/stock thru their own site and taking the markup?

https://brandscycle.com/

https://www.bicyclebuys.com/

raria

So I get it that those most of us over 50 appreciated warm fuzzies etc. but I think this is what is hurting LBS now and in the future.

Expecting people to pay for service and tip (whether it be in cash or beer) just rubs the new generation the wrong way and they just don't understand or value it.