ASI (Performance and Nashbar) files chapter 11
11-18-18, 11:03 AM
#26
Senior Member
I think it simply comes down to... Kids don't ride bikes anymore. In 1970, 1980, 1990.. EVERY kid, whose family was above the poverty line, had bike. Today, EVERY kid has at least one game console. That industry - video games - is doing quite well, coincidentally.
Note to hostile nations seeing our future physical weaknesses: Yes. As a people, Americans will absolutely be a lot fatter and weaker in the coming years. But, and this is important, we will be amazingly adept at flying drones and other unmanned machines from the comfort of climate controlled recliners. ;-)
Note to hostile nations seeing our future physical weaknesses: Yes. As a people, Americans will absolutely be a lot fatter and weaker in the coming years. But, and this is important, we will be amazingly adept at flying drones and other unmanned machines from the comfort of climate controlled recliners. ;-)
11-18-18, 03:29 PM
#29
Senior Member
11-18-18, 04:49 PM
#30
well hello there
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I tried ordering some fizik bar tape this morning and the discount did NOT apply.
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Two wheels good. Four wheels bad.
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Two wheels good. Four wheels bad.
11-18-18, 05:15 PM
#32
Senior Member
I've been eyeing a pair of wheels that have been $899 for months. This morning I saw the big sale and was sure to buy them...$849.
Never mind.
Never mind.
11-18-18, 07:30 PM
#34
C*pt*i* Obvious
This could be a win for the traditional LBS.
Not that there are many worth supporting anymore.
The secondhand market is still an option, for those who have enough time to hunt.
Not that there are many worth supporting anymore.
The secondhand market is still an option, for those who have enough time to hunt.
11-18-18, 08:35 PM
#35
Senior Member
Well, you guys do know that they have filed for bankruptcy right? So, just finished my existing points at least on a pair of shoes that I don't need.
11-18-18, 08:36 PM
#36
Senior Member
Performance bikes - Bankruptcy.
Well, you guys do know that they have filed for bankruptcy right? So, just finished my existing points at least on a pair of shoes that I don't need.
11-18-18, 08:37 PM
#37
Senior Member
Performance Bikes filed for bankruptcy
Well, you guys do know that they have filed for bankruptcy right? So, just finished my existing points at least on a pair of shoes that I don't need.
11-18-18, 08:52 PM
#40
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Triplicate threads merged.
11-19-18, 06:51 PM
#42
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I think it simply comes down to... Kids don't ride bikes anymore. In 1970, 1980, 1990.. EVERY kid, whose family was above the poverty line, had bike. Today, EVERY kid has at least one game console. That industry - video games - is doing quite well, coincidentally.
Note to hostile nations seeing our future physical weaknesses: Yes. As a people, Americans will absolutely be a lot fatter and weaker in the coming years. But, and this is important, we will be amazingly adept at flying drones and other unmanned machines from the comfort of climate controlled recliners. ;-)
Note to hostile nations seeing our future physical weaknesses: Yes. As a people, Americans will absolutely be a lot fatter and weaker in the coming years. But, and this is important, we will be amazingly adept at flying drones and other unmanned machines from the comfort of climate controlled recliners. ;-)
11-19-18, 07:37 PM
#44
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Will this impact warranty and service work on their various bike brands? I've got a Fuji cross bike that I hope to have well past the three year obsolescence period. 
11-19-18, 08:24 PM
#45
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From what I've read, the bike brands are safe, it's just the retail side of the business that is hurting. Stopped by my shop today, they haven't heard anything yet, but hopefully they'll be ok. I hope so, since I just bought my Transonic and got the two year maintenance plan. Plus, I just like the folks there, service has been fantastic. I would guess they're probably one of the profitable shops, they're always busy and there's a pretty big bike scene here, road and mtb.
11-23-18, 11:44 PM
#46
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This does not mean they are going under. Time will tell. Personally, I hope they make it. I like their stores and the products they sell. I have never purchased a bike there but I have purchased clothes, helmets, grip tape, food and bike racks there. The store in Jacksonville is run by good guys. The inventory has been lousy for recently so this does not surprise me. Hopefully they pull it together.
Last edited by Shuffleman; 11-24-18 at 05:48 PM.
11-24-18, 02:10 PM
#47
I eat carbide.
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I'd be interested in hearing. It's always all just rumors until they make public announcements anyway.
I can tell you I haven't seen any enthusiasm or even basic smiles from anyone in the industry the last few years. SRAM has been having a tough time for quite a few years now. Closed a plant last year or the year before that they had just opened in 2013. Basically it's been a steady downhill for them since around the time they were publicly discussing going public with the company. Trek - Everyone in the factory there seems like a zombie at this point. I would not be surprised if they all of a sudden announced a dire financial issue...but....you can't forget they are the $1B behemoth in this industry. Cannondale: if they aren't currently going out of business then they are just recovering from nearly going out of business. Has been that way since the 90's. Specialized - who knows - it has always been a black hole.
The Performance Parent company filing for Chapt 11 - Everyone seems to be making this into whatever serves their own narrative in the industry. I can tell you without a doubt that it is the final canary in the coal mine. The industry as a whole is barely on life support. If the economy hits the recession that is being discussed on top of the tariffs then you're going to start seeing big names rolling downhill really fast.
At the end of the day it's a stupid industry that continually tries to serve a customer base that always mistrusts them and demands to pay less on everything -> forcing everything of manufactured value into a commodity with no price elasticity regardless of where that product is on the spectrum. At this point I kind of don't care. I'm going to ride it into the ground.
I can tell you I haven't seen any enthusiasm or even basic smiles from anyone in the industry the last few years. SRAM has been having a tough time for quite a few years now. Closed a plant last year or the year before that they had just opened in 2013. Basically it's been a steady downhill for them since around the time they were publicly discussing going public with the company. Trek - Everyone in the factory there seems like a zombie at this point. I would not be surprised if they all of a sudden announced a dire financial issue...but....you can't forget they are the $1B behemoth in this industry. Cannondale: if they aren't currently going out of business then they are just recovering from nearly going out of business. Has been that way since the 90's. Specialized - who knows - it has always been a black hole.
The Performance Parent company filing for Chapt 11 - Everyone seems to be making this into whatever serves their own narrative in the industry. I can tell you without a doubt that it is the final canary in the coal mine. The industry as a whole is barely on life support. If the economy hits the recession that is being discussed on top of the tariffs then you're going to start seeing big names rolling downhill really fast.
At the end of the day it's a stupid industry that continually tries to serve a customer base that always mistrusts them and demands to pay less on everything -> forcing everything of manufactured value into a commodity with no price elasticity regardless of where that product is on the spectrum. At this point I kind of don't care. I'm going to ride it into the ground.
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11-24-18, 03:13 PM
#48
Banned
Another person offered this...
One Thing QBP does : nothing ships on credit.. it's paid for up front..
Dealers use their credit card account, to order the parts and bikes.
..
Performance has been in trouble for a long time. The acquisition by ASI was a debt for equity swap. Simply stated, Performance was one of the largest dealers of ASI bike brands (like Fuji); Performance owed ASI enough that instead of paying ASI in cash, ASI became the owner of the shops.
This scenario is something ASI is grossly familiar with, because they are partially owned by the bike factory they contract with for the manufacture of their bike brands, with that "investment" coming from a similar debt for equity swap.
Since ASI acquired a chain of stores that were in financial difficulty, change was inevitable, and declaring Chapter 11 was always a possibility.
Having a (mostly) nationwide functioning chain of stores and a mail order operation suddenly in ASI's portfolio presented them with an interesting opportunity; they could sell consumer direct via on-line and retail (as several other brands are doing) in short order, rather than having to invent the whole thing. With the Nashbar division, they had a location to serve as an in-house clearance operation (and ASI has a warehouse full of old bikes).
Of course a move like this will piss off their existing dealers, who would then be in competition with their supplier, but this is nothing new in the modern bike industry.
But all of this takes time and money to implement, and they wouldn't necessarily want to rebrand a known chain of stores.
Not to say they are definitely doing this, but this could be the result...
This scenario is something ASI is grossly familiar with, because they are partially owned by the bike factory they contract with for the manufacture of their bike brands, with that "investment" coming from a similar debt for equity swap.
Since ASI acquired a chain of stores that were in financial difficulty, change was inevitable, and declaring Chapter 11 was always a possibility.
Having a (mostly) nationwide functioning chain of stores and a mail order operation suddenly in ASI's portfolio presented them with an interesting opportunity; they could sell consumer direct via on-line and retail (as several other brands are doing) in short order, rather than having to invent the whole thing. With the Nashbar division, they had a location to serve as an in-house clearance operation (and ASI has a warehouse full of old bikes).
Of course a move like this will piss off their existing dealers, who would then be in competition with their supplier, but this is nothing new in the modern bike industry.
But all of this takes time and money to implement, and they wouldn't necessarily want to rebrand a known chain of stores.
Not to say they are definitely doing this, but this could be the result...
Dealers use their credit card account, to order the parts and bikes.
..
11-24-18, 05:19 PM
#49
I eat carbide.
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Hmm...is that a recent change? At various times even within the last few years I have had house terms with Q. They most definitely extended credit although almost no one in this industry is still using credit extended by the suppliers/distributors anymore.
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11-24-18, 06:09 PM
#50
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At the end of the day it's a stupid industry that continually tries to serve a customer base that always mistrusts them and demands to pay less on everything -> forcing everything of manufactured value into a commodity with no price elasticity regardless of where that product is on the spectrum. At this point I kind of don't care. I'm going to ride it into the ground.
Cycling enthusiasm comes and goes. During the last waxing period, the industry tried to sell exotic bikes annually, with "upgrades" to bikes that were far better than most of their riders already.
But ... people who could afford ti, bought frequently, and people who could only afford one bike, went for the good stuff. Your basic "Schwinn Varsity" everyman's bike held no appeal.
Of course,the "dentists" and the enthusiasts often sold some of their older (two-year-old) high-end bikes to finance the second or third-generation AmazingBike, which meant that peoplpe who wanted a Really good bike could get one used for less than an equivalent model would be new ....
Then as cycling enthusiasm waned, people started to notice that their 11-speed 18-lb CF Wunderbikes were plenty good enough, and the 17.8-lb version being offered as the "next generation" wasn't really better in any way that was meaningful to most riders ... and the folks with the $6K or $8K bikes started noticing the same things.
Even people who could afford and justify a series of $3K to $5K bikes soon had an aero bike, a gravel bike, and an endurance bike (plus their "old" two-year-old racing frame) .... and it was hard to justify buying more and paying more for increasingly less "more," when they really had more than enough already. At least, that is what i see around me, in the very limited circles I travel.
The industry went big, had a few good years, racked up some cash .... but when the business slowed, the R&D had already been spent, the next wave of bikes was in the pipeline, the prices on parts and complete bikes kept rising (everyone wanted a piece of the pie) and suddenly they shareholders who were hoping for endless 12-15 % return were only getting 8 or 10 ... or some other fairly reasonable number (compared to inflation.)
Suddenly servicing all the debt amassed making next year's "super-mega-wunderbike" looks bigger .... and the company execs get scared because the board is scared because everyone wants massive RoI, unreasonable RoI .... So they fear takeovers, mergers, forced acquisitions ....
Most of the consumers I know (the folks I ride with, or interact with online) really do trust the manufacturers. Plenty of people are buying Giant Contends, the whole lower two-thirds of the range of Trek models, Cannondale Synapses ... and the Al-framed Cannondale racers are always satisfying. people know they are getting a good deal when they by a CAAD.
Plus the whole MTB market isn't exactly crashing .... The problem isn't the customers don't trust the retailers or that the customers won't spend the money .... the issue is, bikes last a long time and after some point, because of cycles in the economy and in enthusiasm, people realize they have enough bikes ... and jerseys, and shoes, and gloves, and bibs and .......
But in today's "grab that cash with both hands and make a stash" world, no one is satisfied to sell Schwinn Varsities and run a company at a steady ten-percent RoI .....
But I also don't see any of the major manufacturers going down soon. They might close factories but i don't see them going out of business. most are global businesses and there are a lot of people in the world who might like a bicycle.
Maybe "Trek India" or Trek Nigeria" will start producing an Al-frame 7-speed IGH bike with 1.75-inch solid tires, drilled for racks and multiple water bottles, and pick a price point where suddenly a lot of people aspire to owning one.
A company like SRAM ... i could see going down simply because if times get tight and prices rise, there is no way they could compete with Shimano---and the high-end market might not be big enough to sustain them at a comfortable level. But Trek, Spec, Giant, Cannondale? i don't see it.