So, several things are evident in the bike trade, not least the following:

1. The online market for bikes/parts is dominated by a few large players (CRC, Wiggle, Evans plus people like Canyon, Planet X, etc doing own brand)
2. The Independent Dealers seem to be constantly squeezed. Lots of people going out of business or, if they’re smart, focussing more and more on service

(I know I’m simplifying, but bear with me…..)

This has got me thinking about opportunities to get more LBS’s online and somehow able to compete with the “big boys”.

What stops them from getting themselves a better web presence and shifting kit in direct competition? Well, a host of reasons:

1. Not tech savvy so don’t know how or what to build
2. Even if they have a decent e-commerce site, no one finds it because google is dominated by big names
3. Maybe they’ve shifted old stock/sale items on eBay and the costs seem prohibitive
4. They are working on tighter margins due to lower volumes vs bigger players
5….and so on…..

If there was a different way, with an easy to use interface for uploading stock info, free to list, SEO already sorted, ability to list stock items directly against competitors with visibility of their pricing, just a small commission to pay on sales……would LBS owners be interested?

Would you, as a potential customer, be happy to buy from a marketplace where LBS owners are shifting kit, from all manufacturers and you would have the opportunity to browse bikes, kit, spares from different brands but all in one place without having to skip from one site to another?

This is essentially a “drop ship” environment…you order from the site and the bike/kit/etc is shipped direct from the independent retailer…..

I’m working with a client who has developed a platform that delivers all of the above, currently in a different sector (home improvements) and it is delivering a really nice user experience in terms of more choice for the buyer, and allowing smaller independent businesses to “compete” with larger businesses online…..

Interested to hear what people think…..I’m tempted to explore as a business opportunity…..

One idea is to consider creating a marketplace much akin to a “Pauls Cycles” experience for the user, that is actually a large number of retailers selling off clearance stock from one place……

All thoughts welcome…….including the negative ones (not that I necessarily need to say that!)….including from shop owners and industry “insiders”

I like this idea as a client.
it sounds like an LBS Ebay. If the UI/UX is good, I could see me using this.

If the package is already available and only requires minor spec changes, then it could be made cheap to the LBS too. You would need to make it very attractive to get large volumes to adopt it though. No client is going to visit a site that looks like a Planet-x warranty clear out.

Sounds like Amazon.

What stops them from getting themselves a better web presence and shifting kit in direct competition? Well, a host of reasons:

Economy of scale. The big shops are distribution centres with very low costs in comparison to any bike shop.

What’s in it for the customer ?

At the moment I can buy from the big players safe in the knowledge that it will be delivered fast.

Its also at a competitive price.

I can also send it back no questions asked.

The big players have a (good)reputation.

What will your idea do that betters those points ?

Thanks @cokie – the package exists but the challenge will be getting a “head of steam” before going live – it needs a lot of “stock” listing on there in order to make it a viable user experience for a customer….if you rocked up and found it only had half a dozen items on there, you might not come back….

It will need retailers to sign up and list stock in some volume before launch, which will be hard work, but will result in a better customer experience…..

Thinking about your “LBS Ebay” comment…..yes, you’re right. In fact, if anything, it’s even more like a “LBS SportPursuit” where all the kit is actually shipped direct from the LBS rather than SportPursuits warehouse!

I would have to agree with velocipede, Would be nice to break up the monopoly of CRC and wiggle but without a comprehensive range of spares and parts i would struggle to see the advantage.

@Trimix, thanks for the questions…..

What’s in it for the customer ? Biggest thing is choice – for example, I’m looking for a new 29er hardtail….choices are limited at the big online players….what if I had the choice of just about every brand that’s sold via LBS’s, all in one place, with “good deals” easy to identify? So, second thing is price!

At the moment I can buy from the big players safe in the knowledge that it will be delivered fast. Ebay style feedback mechanism?

Its also at a competitive price. See comment above…..I think this is probably an environment for the LBS to move end of line/out of season/sale/clearance items (I might be wrong)

I can also send it back no questions asked. Good point. The mechanism for this needs work but returns would need to be an integral part of this.

The big players have a (good)reputation. Do they? Some do, some not so much. Totally agree that service is key

Thinking about your “LBS Ebay” comment…..yes, you’re right. In fact, if anything, it’s even more like a “LBS SportPursuit” where all the kit is actually shipped direct from the LBS rather than SportPursuits warehouse!

Except that is not going to get the margin that crc/wiggle does. If the lbs is paying more for stock than it costs wiggle/CRC to ship then how does the model work?

The people that can change this are madison/fisher/sram/shimano etc. Price better to the physical shops. Make it worth waiting a couple of days as the cost is the same as CRC and you get it fitted there.

Discount stores are there to clear stock from the suppliers as they can shift it in one, you advertise on the web for 10 cranksets its great your costs and /10 you do it by 100 and the costs make sense. Listing for 2 items? Desperation.

The issue I would forsee is that even if LBSs sold their stock at cost they’d still be more expensive than CRC/Wiggle most of the time. Unless your LBS audience is willing to buy 100s of each item at a time and sell them at 10% margin, then its still not a competitive market I am afraid.

You’re reducing competition to purely price. the pile ’em high merchants already have their infrastructure in place, why is this a clever move for a new entrant (to the online space).

Biggest thing is choice – for example, I’m looking for a new 29er hardtail….choices are limited at the big online players…

Here in Oz more distributors are banning online bike sales to support the bike shops, it stops one store doing a massive discount on tiny overheads as stores then just become display racks.

Madison did something similar a while back, Ultimate Pursuits B2C site. Too early perhaps and maybe not marketed in the right way but it was a good idea. Large distributor used a website to show product, take orders and ship parts to dealers who had a storefront within the main site. It wasn’t based on price only though, more about product ranging and reducing dealer stock-in commitments.

@Stevet1 – thanks for that.

In some ways, what I’m suggesting is just like Amazon. However…..

Imagine I decide to sell off my stock of HTII bottom brackets (to take the example from another of today’s posts on here about LBS’s!) on Amazon…I list them and I sit and wait….and wait…and wait…..

The chances of someone finding such a listing, on Amazon, is pretty low.

However, if you typed “Shimano HTII BB” into google and somewhere near the top was, for example, “UK Bike Parts Centre” on which was a listing for hundreds of HTII BB’s from many different sources…..and you choose the cheapest at the best P&P rate?? You, as the consumer, is finding what you need….the LBS is shifting stock…..

You, as the consumer, is finding what you need….the LBS is shifting stock…..

What’s in it for the bike shop? The price will probably still be above most online and consumers looking online are looking for a price. Then you sell one in the store and have to update the web store or you get another sorry can’t fulfill for 5 days message.

This is sort of what BikeExchange does in Australia. They provide a marketplace for LBS to shift their stuff. Want XT cranks in Brisbane? Search handles it. Want a Fizik saddle by mail order? Search handles it.

The chances of someone finding such a listing, on Amazon, is pretty low.

google shopping does that

@benpinnick & @mikewsmith (similar point)- thanks for this:

The issue I would forsee is that even if LBSs sold their stock at cost they’d still be more expensive than CRC/Wiggle most of the time. Unless your LBS audience is willing to buy 100s of each item at a time and sell them at 10% margin, then its still not a competitive market I am afraid.

I agree with this. Where I’m really going is thinking about the discounted items.

For example, I was recently interested in a disc braked road bike (from a good sized UK based manufacturer)….these had been discounted on a couple of bigger sites (Evans amongst others) but were sold out in my size. I struggled to find one. However, several months later I discovered that an independent shop quite near to me had one in stock at the same discounted level….had I have known at the time, I would have bought it. As it was, I bought something else…..he still has it now, gathering dust on his shop floor some 6 months later…..what this marketplace would offer him is the cashflow advantage of reaching a bigger audience, quickly……

http://www.bikebiz.com/news/read/bikesoup-com-launches-game-changing-online-marketplace-for-dealers/015936

Lol 2014 rich..

I’m failing to see what the benefit is.. supporting your LBS will fall by the wayside in favour of price, otherwise we wouldn’t be where we are now.

Unless you happen to strike it incredibly lucky and find a local person stocking what you want, it won’t be any quicker than ordering from the major players.

You’d also struggle with customer service – with multiple companies using one portal the customer experience will be varied depending on the actual retailer, so you end up with the lack of consumer confidence that places like ebay struggle with.

I think the best chance of it working would be with a niche as you suggest like previous years models, or maybe even retro kit that has been hanging around in stock covered in dust for years…

http://www.bikebiz.com/news/read/together-we-ride-to-offer-click-collect-with-smaller-bike-shops/018855

Slight;y more up to date Mike 🙂

Also can you imagine the admin nightmare you will have as the operator. Dealing with loads of LBS all trying to update their stock accurately and deal with returns on time.

The bigger the collection of parts to this retail machine the more chance of it going wrong – which it will.

Leave the big players to chase each other to the bottom of the price/margin race and the LBS to survive on service.

Businesses will / can only survive on what they are good at.

The future for LBS’s will only be on things the internet cannot do.

thanks @richiethesilverfish…..

Interesting that BikeSoup isn’t what it set out to be….now just appears to be an online marketplace for second hand stuff (Pinkbike clone, but less content)….and togethweride looks like it never took off…..

Both of which are interesting points of feedback!

Yeah I’ve no idea the route that led Bikesoup to where they have ended up but they certainly tried a very similar thing to what you describe for a number of years.
I guess the fact that no one on here already knew of it says a lot.

Regarding Together We Ride – they did get up and running and I think were doing so for around 12 months but ultimately just didn’t see the footfall that they needed.
Its a shame, the guys behind TWR were good guys.

I’m sure there’s been others too but the names elude me right now.

I agree it sounds a lot like Amazon, probably without their horrendous 15% sale fees…

From a bike shop point of view, unless your listing is the cheapest within the list of any given product, why would the consumer buy off you? Would it not just create a race to the bottom on any given product, further hurting the LBS who wasn’t the cheapest?

it was Dragons’ Den mentioning Bikesoup as one of Touker Suleyman’s businesses that reminded me it was a thing. Just visited it and it looks like its now just a low-rent version of gumtree/ebay, but just for bikes.

what this marketplace would offer him is the cashflow advantage of reaching a bigger audience, quickly

So, eBay marketplace then? If your LBS had an eBay account and listed that reduced bike you were after, it would have popped up in your search (if you’re looking for a bargain you know how to use filters like “new” and “lowest price” on eBay).

@ Trimix – the admin bit is a function of the technology platform & not as difficult as you might think. From a tech point of view, this has been cracked to a certain degree.

Returns are a different issue – I’ll be looking into that – thanks for making the point.

Agree ref your point on “playing to strengths” – this platform would only enhance one small part of the LBS’s business, improving cashflow by helping to shift stuff….if that’s all their business is about, then clearly they are in more trouble than I can help them with….but if they have stock they can’t shift, or simply haven’t found the market for, this will help

I visited an LBS that I was passing with work a few weeks ago to pick up some parts and ended up chatting to the owner…..he said the business was doing well in that he was keeping his head above water. He sold a couple of niche, high end road bike brands in and amongst more run of the mill stuff from the usual brands….he had a couple of fabulous bikes in the £8-12k price range from rare Italian brands….when I asked if he sold many, the answer of course was no and that he was only likely to shift them when the distributor let him discount them towards the end of the year……

….wouldn’t it be nice for him to find a bigger audience for his niche stuff……and equally wouldn’t it be good to know, as a consumer, that this stuff was available and sitting ons someones “shelf”……

wouldn’t it be nice for him to find a bigger audience for his niche stuff…

As mentioned above that nice bike suddenly has its price set by somebody else now when they discount theirs. Is the bike trade crying out for this?
On bikes and the bike exchange model above 90% of the bikes won’t be allowed to be shipped a d must be collected in person. Might be a little advertising but that is it.
Do you collect your fee if the item doesn’t sell or is sold in store?

@mikewsmith – no fees if not sold via the site…..

Then you just lost any local fees.

If I was a big online retailer it wouldn’t take more than a few months to squash any new competition.

If LBS have stock they cant shift this is because the bought the wrong stock and paid for it up front.

They would be better stocking on a sale or return basis. But its unlikely the main importers / suppliers would do this as it would upset their current customers.

I think your swimming against the tide. It would be simpler and better for LBS to stick to what they are good at. Let the crap ones die and the innovators innovate.

I’m not really a LBS any more, but I was one for a while – and to be honest it sounds like a recipe for going out of business.

One central site where bike shops all upload their stock, and then compete with each other to be the lowest priced? all the while knowing that CRC etc will still be cheaper? And paying you a commission?

The non-web-savvy shops went bust years ago, and lots of shops have signed up to http://www.i-bikeshop.com/ or similar for a turnkey online presence.

It also sounds like a recipe for you going out of business yourself – you’d need to have a big marketing push to get enough shops signed up, enough advertising to compete with CRC, and all on whatever commission you can squeeze out of the shops.

LBS need to capitalise on what they can do best – service, added value, support and patronage of the local cycling community. Your suggestion just turns the products in the a commodity to and they are never going to win that one.
Perhaps there is something that could be done to publicise better end of year stock clearance sales but ebay does this to a certain extent.

Change the law to prevent “volume discounts” to large resellers ?

Add an online sales tax with all proceeds going to reduce business rates / tsx bills of small shops ?

Bike Exchange?

Is a bit bigger in Australia and has been going for a while.

I’ve used bike exchange twice in 5 years here. Once for a end of line bike which I had to fly and collect the other for a lid.

It’s an expensive 2nd hand platform for bikes that in reality facebook groups are killing these days.

For local stuff the shops will get a lot more from a facebook campaign with their end of year/line sales on it than anything else. Giant/Spec etc could help their dealers with that sort of thing too through their social media.

I’m trying to be realistic here, to get something like this to work you need to have the sellers on board and it needs to be a solid financial proposition to them. If their product appears online and it’s 3rd from the cheapest what are you going to do? Conversely if you see it there and you go into the shop that means every one of those items is now the discount price.

This is sort of what BikeExchange does in Australia. They provide a marketplace for LBS to shift their stuff. Want XT cranks in Brisbane? Search handles it.

That sounds much more useful. There’s been a few times I’ve needed something on a Thursday or Friday before going away for the weekend. Often end up on Evans or Cyclesurgery sites rather than calling indie LBS as I can see immediately which shops have stock.

Maybe they all form a co-op / not for profit and build a single online platform with shared logistics / marketing costs where the sale/profit for any item is attributed to the shop closest to the purchaser (maybe another for advanced model to ensure sale / revenue attribution is fair). Tie that with click and collect network with value add fitting / servicing / ability to upsell where 100% margin goes to each shop.

They will essentially end up as a giant Evans under a complex franchise model. Maybe many will view running costs as a tax. All good fun.

Then they realise that to get the sale the have to pay for content / seo / ppc / retargetting alongside any other affiliate model and / or voucher code being used. Alongside developer salaries it all adds up quite quickly but could work….

Closest today is Fulfilled by Amazon / eBay or custom Shopify / ecommerce platform like Magento / BigC / Woo etc. None are perfect. Bike shops could create around / on these platforms if they are willing to invest.

If I ran a small independent bicycle workshop I’d actively encourage customers to purchase parts from CRC etc. A LBS just can not compete in terms of price/multiple industry standards ie: stock/delivery time/returns/ease of perusal & access to purchase.

I’d charge a % (eg: 10%) handling fee, and possibly a 5% consultation fee if they need advice on what item they need. They could then have the item delivered to my shop on their behalf (no more missed deliveries for customers who are usually time poor). They’d then pay usual workshop fee for fitting said parts.

I can’t see why this isn’t a service already offered.

As a LBS I’d also be looking to buy my service items from CRC etc if cheaper than the distributor, and make them aware I’m doing so and why. The undercutting of price needs feeding back up the supply chain.