Having bought the Kona brand from the founders just two years ago, owners Kent Outdoors have announced they are abandoning the bike market altogether and have put the Kona brand on the market. Kent Outdoors owns a large portfolio of 15 outdoor brands with a specialism in watersports.
The alarm bells first began to ring this week at the Sea Otter Classic event when Kona employees were seen taking their stand down and leaving the site just a day after setting it up.
One insider, who wishes to stay anonymous, told us Kent believe the global bike industry is unlikely to show signs of recovery for 18 months to two years and they are simply not prepared to wait that long. Instead they are exiting the bike market to focus on their water-sports brands where a recovery is already underway. It’s also an open secret that Kent have been presenting Kona as a possible target for a sale for quite some time now.
In a press release yesterday Kent Outdoors stated, “…In connection with the investment of capital and the management team coming onboard, the Company performed a strategic review of its operating units and determined that it would continue to seek a buyer for its bike business, Kona. This move allows the Company to direct its resources toward investment in its key water sports businesses. The bike industry has faced very significant challenges in the post covid world and Kona has not been immune to these headwinds“.
As for the staff at Kona, they are currently being very tight lipped as to what they have been told at a ‘Town Hall’ style meeting on Thursday. However, a source has told us there are extensive job losses as the company is being wound down completely while Kent looks for a buyer for the brand. Kona as a going concern essentially no longer exists. It’s likely any sale agreed of the brand will be for the intellectual property (IP) only. We understand that Kent are looking to offer some staff jobs within it’s other brands although this number is very small with the majority of staff being let go.
We are still waiting for an official announcement from Kent Outdoors regards the levels of job losses and we will update this story when we have more information.
This leaves a number of factories in the far east with a large quantity of unpaid for Kona bikes, which brings us to part two of this story…
Meanwhile in the UK, Kona supplies continue
Kona distributor Mount Green Cycles, based in Bacup, Lancashire have today told us that they intend to continue importing and distributing Kona bikes into the UK market via it’s network of dealers, which kind of sounds really strange with the brand winding down. In a press release sent out to all dealers Mount Green Cycles boss Scott Taylor puts Kona’s problems squarely at the feet of the brand owners and not the state of the market or general Kona bike sales.
In the coming hours Kent Outdoors will put live a press release announcing they are pulling out of the bike business, alongside more positive news for the rest of their portfolio of brands.
This means, through no fault of its staff, its amazing product or its global network of loyal fans, Kona USA and its EU entities will cease trading in the coming months.
Scott Taylor – Mount Green Cycles
Taylor claims that due to Kona owners Kent Outdoors slowing down their supply chains over the last year while they decide what to do with the brand that rather than the typical glut of stock in the system there is actually a shortage of some Kona models with some dealers actually putting in back orders for certain models. Taylor told us he intends to try and satisfy that demand and get some of the stock currently sitting in factories moving into the UK. He can do this due to a quirk of how Kona as a brand has historically dealt with distributors.
Taylor explained to us that rather than distributors buying stock directly from Kona they instead have traditionally paid the factories directly for their orders. With distributors being the customer of the factories Taylor is in the position to be able to deal directly to source his supplies of Kona models. What he can’t do is order more bikes beyond what have already been manufactured so his supply of Kona models is finite although be understands that their is plenty of stock of most models including some as yet not released ranges.
Of course this may all completely change if a buyer is found for the brand, but for the short to medium term at least, UK riders should still be able to buy Kona models with full warranty even if the global brand shuts down completely, claimed Taylor.
While there is a plentiful supply of stock of Kona bikes available, including a whole new range, Taylor cautions that unless a buyer is found for the global Kona brand, ultimately there will be no future for Kona once all currently manufactured stock is sold.
He also explained that his plan is not unique and other distributors around the world with similar direct customer connections with the Kona factories may also decide to buy up and sell some of the the existing stock currently sat in the factories.
So in short, Kona will still have an ongoing presence in the UK via its existing 60+ Kona dealers with full warranty being assured by dealers & Mount Green Cycles with the caveat of ‘While stocks last’.
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