I was made redundant at the beginning of the year, but I got a good redundancy package and I’ve been doing some freelancing as well, so I’m not on the breadline just yet,

I think there will be enough freelance work going over the next 12 momnth to allow me to pay the mortgage, but I can’t get the idea of opening a bike shop out of my head.

There really aren’t any good mountain bike or road bike shops in my immediate vicinity (although there are a couple about 30-40 minutes drive away), so there’s definitely a gap in the market, and commercial rents have taken a nosedive in recent months, so the start up costs wouldn’t be too excessive.

It seems like an attractive proposition, or it does at this point where I haven’t looked at all the pitfalls, and there must be some pitfalls or we’d all be doing it.

Is it worth looking into this further, given the current economic climate?

is the reason that there aren’t any shops of that sort near you because there wouldn’t be sufficient demand, though?

Do you like working really hard?
Do you like not having weekends to go riding with your mates?
Do you like having to lose your love of cycling because you’re immersed in it all day?

etc. etc. etc.

Don’t get me wrong, I loved running a bike shop, it was great fun, but I really do have a lot more fun and ride a lot more now!

The issue with a bike shop is that there is a large capital outlay for purchase of stock. Stock that you have to shift to earn you way/pay off advances. Stock that you need to attract custom as some people would rather drive 30-40 minutes rather than accept ‘I’ll order it in, Sir. It;ll be here tomorrow’.

I’d love to do similar too.

Might be worth majoring on servicing at first, building up custom and slowly build up stock.

Good luck

Biggest pitfall for most I would say is not having the money or the balls to do it. You don’t say where your based – have you got good local trails nearby or is the area flat – hence more roadies? Do you see many mtb lads out riding? I live in Newcastle, Staffs and even considering how bad the area is pay/work wise we still have some decent shops – Sideways/Rourkes/Swinnertons plus BETD and Longstaffs so maybe worth it in your area. Do your homework and have a good think. And if you do – all the best

You’ll also need a good mechanic, repair and maintenance of bikes will be at about 40% of your business, possible more…

I always thought about it too (I used to work in one) but it’s tough to compete with the internet based companies.

Do you like working really hard?

I am a bit of a workaholic by choice, so this doesn’t bother me. And, to be honest, I’d still see more of the family that I would if I went back to what I was doing before.

Do you like not having weekends to go riding with your mates?

Not such an issue, due to mates not really being into riding, with the result that I normally end up riding on my own anyway.

Do you like having to lose your love of cycling because you’re immersed in it all day?

This might be a bit of an issue.

Might be worth majoring on servicing at first, building up custom and slowly build up stock.

This isn’t such a bad idea, as the only real alternative near to us is Halfords!

You will need alot of capital to start with, lease will usually want at least 12 months up front. Then there’s rates, staff, insurance etc. Do a business plan and some homework.

The other issues maybe be stock, being new you would be very lucky to get credit accounts, pro forma for usually the first year, also you may not be able to obtain the brands you want if there are other dealers nearby.

You will be looking at minimum £30k in cash to start up.

As Ziggy said a big consideration would be what bike brands you might be able to get at your chosen location. Getting the correct ones can have a massive impact on your success. Also think about what other local(ish) shops are doing badly and concentrate on that. e.g. do they have a good range of clothing and shoes, do they do good quality kids bikes.

Thanks for all the advice. I’m definitely going to look into the possibility of doing this, and I’ve found quite a bit of useful information on the web already.

While I’m collecting all the information I might do a certified bicycle mechanics course, as I’ve got a bit of time on my hands at the moment.

Thanks for your input.

I’ll let you know how I get on.

Ok, they are a bit useless most of the time but your local Business Link will be able to give you info re starting up a business – use their planning documents as they will help you identify all the things people are posting on here.
You are dead in the water if you don’t have customers, identify who you are targeting – MTBers, roadies, commuters, family pootlers – you will struggle to serve all of them straight off and some will be put off by the others.

You can get easy in easy out lease agreements that don’t involve 12 months up front so ask B Link they will know all the landlords offering this type of premises.

Either get a book, friend or pay a small local accountant to spend half a day with you working out a cashflow forecast – it will be worth paying for the help up front.

Remember, stock kills your working capital and a lack of cash flow will kill your business, retail is all about turning stock.

Can you offer services that others don’t – what about pick up service and drop for commuters whilst they are in the office? Check out your competition see what they are doing and see what works.

Write lists, and stick them on a wall, stare at them, check them write on them – when you pull all this together you should have the start of a hands on business plan and you should by now have a pretty good idea if it will fly.

DO NOT listen to MBA qualified advisors, the MBA will be the death of the entrepreneur as the successful ones do not fit the models they are used to working with, ie Branson, Stellios, Dyson – not suggesting you will hit those heights but they think too radically for the average B Link MBA advisor.

Started 4 businesses, sold 2 and still run 2 so have been through the mill, happy to offer any help if you need it just email me.

Good luck, starting your own business is bloody scary, long hours, hard work but if you structure it correctly it can be the most satisfying thing you can ever do.

rogerthecat, many thanks for the very useful information.

You’ve certainly given me a few things to think about, but I’m definitely going to look into the possibility of doing this.

I’m lucky in that it wouldn’t be an all or nothing deal, as there is probably enough freelance work in motorsports PR and Marketing to pay the mortgage while I sort things out.

Sure, it will mean some long hours, but so did the last job – 220 days away from home and 10 hour days when I was home – but then I’ve always been a bit of a workaholic.

I’ll let you know how I get on.

do it! i did it 5 1/2 years ago,i bought a shop which had customers/turnover/profit etc….that was the best idea i had! i can’t imagine starting a shop from scratch…

ive done well,ive expanded,trebled the turnover,sigend some great brands and enjoy it every day.its tough to though! cashflow is hard to maintain,staff are the biggest nightmare and a partner/family can remind you how obsessive it can be…

my background maybe helps as i worked for a bike supplier for 5 years/bike shop for 5 years(try and work in a bike shop,even halfords would be valuable) and bottom line trust your instincts..take all advice and only use the good stuff.its only people without a business who seem to think its really risky…get in touch if you want to talk about it

Once again, thanks for all the very useful information.

I went to have a look at some potential premises today, and one place really stood out. Reasonable size, reasonable rent and enough parking right out front. Not directly on a main road, but I’m looking at more of a ‘high-end’ type shop, so will be aimed at enthusiasts rather than people walking in ‘off the street’ as it were.

Will be booking an appointment on Monday to go and speak to the Business Link people about business plans and financing, so I’ll see how that goes.

Once again, thanks for the information and for the encouragement.

The margin is made on the ‘low-end’ stuff that you sell every day. Don’t make the mistake of opening a fresh high end shop – you will have your work cut out convincing people to use you with no reputation- the high end customer are discerning and typically very loyal to existing shops.

Selling Acera and Deore makes you more profit than XTR.

Hmm, another very good point. I can see I have a lot to learn!

One positive, is there just aren’t any high end shops close to us at the moment, especially for dark side kit.

Forget high end just now, you’ll make your living selling cheap bikes. When I worked in the industry our Christmas Club was a good earner. About 1000 bikes going out a couple of days before Christmas. Was hard work, we’d be building through the nights but it was brilliant! The majority of those bikes were around £100 – £200 bikes. That’s where you make your living though. The nice high end stuff is a pleasant bonus, but the turnover of it is much much much less.

I have to say though, if I had the cash to start up then I probably would…..

markd makes a very valid point ^^. My LBS (Sett Valley Cycles, excellent shop) makes most of his money on servicing and cheapo commuter stuff but he has a very loyal following of customers (mostly roadies) who regularly buy high end kit; Cervelo/Pinarello, Dura Ace etc. Interesting and slightly bizarre mix seeing bags of cheap chains and brake pads then a £1500 groupset.

Think about what brands you want as well, some companies are a nightmare to deal with, some have much higher mark ups than others, some are wonderful people who will really go the extra mile. Obviously not going to say too much on an open forum but mail me if you want more details.

Just go for it, I couldnt stand the IT world anymore and set up a shop a few years ago, its the best thing I ever did.

Last weekend I wet into 3 bike shops in Milton Keynes. My feeling was that the recesion hann’t hit cycling, well in to of them

Evans was flat out busy. Loads of people asking about colllect from store bikes. Every price point covered on the floor. But even they can’t carry wide side ranges. They also don’t carry Trek or Specialized as another dealer was their first (in MK). Brands will look after themselves

Roy Pinks is a classic good local bike shop. Hard tails upto 1200 quid. Some road stuff, utility bikes kids bikes and bmx. Had to wait to get served it was so busy

I also went into 23c which is new. A few cheap MTBs but not really enough to count as choice. Then everything was high end road stuff. The place was empty, the owner looked stressed. But he has got 2 good shops with high end road bikes near by. But ultimately I don’t know what his market new whaer he was.

I know little about business but clearly the key is to make money. You don’t want to make it the bike shop you’d like to visit unless you are 100% sure that this is the most profitable bike shop you could open

I did use to work for the Outdoor shop in MK. Stock value was an issue, as was max insured value on site.

A good game would be get a spread sheet and try and value the shops starting stock cost

eg

I’ll do Maxxis tyres. How many models, sizes and compounds should I have on the shelf and how many of each. Chain Reaction do wellover a 100 different Maxxis tyres. 10 different tyres 2 of each would say cost 300 quid trade, ere 100 different woud cost 3000. You know more about bikes than so you can probanly choose a reasonable selection, but an estimate needs to be made

Then repeat for cables, tubes, brakes bikes etc.

I really hope this works out for you, but plan it first

As others have said I also know little about business but I think that if you are into PR & Marketing you should know that most of your clients will have started at the bottom and worked their way up. As you have done to reach your current freelance position.

I know someone who did what you are suggesting, starting out at the “top end”…..he failed. He was given sound advice from Mike Bony(sp?) from Orange and failed to heed it.

My lbs has been in business for over 50yrs selling mainly run of the mill bikes. They have tried to offer “high end” bikes and have got their fingers burnt. They have little or no competition btw. The shop policy is to stock bikes up to a value of £500 and order the better stuff if required. Having said that they have a good choice of the Genesis bikes. That is what works for them.

What do you consider to be a “good” bike shop btw?

Locally there is a bike shop for sale and if I was in your current position I would go for it. It id a good old fashioned back street bike shop with a good rep and “ordinary” clientele, you know, the ones who can`t fix a puncture, tighten a spoke etc. Has a real olde world feel.

Just remember bling may look good on the shelf but thats where it is likely to stay.

if your on about wortley just down the road from me theres lexs mountain bike heaven in penistone just along from wortley

Aim to stock bikes initially between £300-£800. Forget low end as you might make £20-£30 on a bike at a hundred quid but you spend a few hours on building the bike, PDI, dealing with the sale, processing the invoices, paying a book keeper, etc. You need to drive very high volumes to pay the bills and you will be extremely busy earning little money.

just aim to get involved in the local bike scene at all levels and enjoy the work

Have regular open days, club nights, weekly group rides, organise events, etc. You can also really boost the local scene.

Hi there

just stumbled on your forum posting from last year – how did you get on ?

did you go for it ?

in a similar position myself, and am keen to learn from anyone who has recently 'gone for it'

cheers
simon

i think that it is a great ideia. yeah. good luck guy. i'd like to do it once in my life.

start of doing online/mail ordering stuff for niche bits, build up then make the jump to a physical presence as well?

That's exactly what some friends of mine did – started internet only selling excellent value imported carbon frames, keeping stock in their houses/garages/etc and as it took off they now have a 'proper' shop which is doing more business than they can easily cope with…

http://www.thecyclingexperts.co.uk/opening-a-bike-shop/

"The reality:
There is a popular saying in the industry which goes something like this: "If you want to make a small fortune in the cycle trade, start with a large one." "

*skips to the end*

Sorry, has the OP said whereabouts he is? Might be handy to hear from locals/potential customers?

Can you sell?
http://www.geoffburch.com/?page_id=36

Great advice going here

I would just add

Try and be a bit different to other shops you know and think of a way to deal with the tyre kickers who come in the shop. Scoop up advice and ideas then scuttle off to buy s couple of quid cheaper on tinternet

Good luck with the venture

tyre kickers who come in the shop. Scoop up advice and ideas then scuttle off to buy s couple of quid cheaper on tinternet

I do that, only due to my LBS never having the component that I need (I always try them first) and it takes them 2-3 days to get it, so I usually end up going online with next day delivery.
We're not going to be your ideal core customer base. People like my boss are: buys a Whyte E-120 MTB (likes the colour) and a Giant TCR Advance 3 road (also likes colour) from the same shop, (totally loyal customer) only takes the Whyte to trail centres, in constant competition with his mates about who's got the "best" gear, but would be scratching his head if he got a puncture. Don't get me wrong he's a nice guy, he earns his money and he can buy what he likes, it's people like him who the marketing people target and it's people like him you want in your shop.

I have discussed opening a shop with friends and the conclusion is its a good way to turn a large fortune into a small fortune

It's not the best trade at all but I like it. Ours is a very new shop so please don't hesitate to email me if you want to know the pitfalls!

I suspect that as it's been a year since th thread was started the venture has either happened or it hasn't!

He's now so poor he can't afford net access any more?

Here's an interesting article: Clicky

It shows how a bike shop can operate below the £70k VAT threshold.

You will always come up against a lot of negative comments from people when starting a business. Its just human nature people saying its too expensive, too much hard work etc. If its something you want to do and are passionate about then you will make it work. I say go for it and good luck.

no reply from the op? im on my second shop…(open today! yippee!) just do it i reckon…