Wiggle Chain Reaction Deal Falls Through: Mike Ashley Buys Name and IP

So would people outlaw brand sales? They seem to be part of the constant churn of life. In this case they would be denying creditors money they are owed

So would people outlaw brand sales?

In an ideal world, yes. Unless it's the same manufacturer and same product etc, then it shouldn't be the same brand name.

But appreciate that's completely naive/idealistic

Ashley is not on Frasers Group board but, almost certainly, exercises considerable influence behind the scenes.

It's clear that consumers, generally, and the stock market like what the group are doing.

He and his company are acting fully legally; UK headquartered and paying UK taxes in full.

He turned an initial investment of £10k in the early 80s into a business worth >£5 billion.

It's clear he sees value where others don't - and is willing to take a financial risk.

I have no allegiance to any part of Frasers Group but facts are important

So leaving the Mike ashley issue.
What happens to all the existing stock in situations like this?
Does it get returned to the original manufacturer?

Does it get returned to the original manufacturer?

During the fire sale I went for a ride with a Wiggle employee. I asked why road tyres weren’t cheap. He said they’d be boxed retail. They could be returned for a refund to the supplier at any point for a full refund. The own branded stuff and OEM stuff is to be sold to post off creditors. Maybe right at the end they’ll give up on their website and sell it in bigger lots.

Thank you, just wondered as they must have millions in stock at in the warehouse

Just seen a post on FB that apparently all those directly employed by the brands - Vitus, NP etc. have all been let go too.......

Do they know where Ragley is at all?

I'm wondering if I still have a warranty, would they be honoured by the new owners or are they toast?

I’m fully expecting Nukeproof to continue producing bikes and retaining some key employees. It’s a well recognised successful brand producing cutting edge bikes and with a race team. It must be one of the jewels of Ashley’s purchase. Thoughts?

with a race team

Who is on the team?

@capability

If it's anything like Evans and Pinnacle they just seemed to keep selling the Arkose, etc. unchanged until they were a bit behind the curve and then give up, no further developments.

I’m fully expecting Nukeproof to continue producing bikes and retaining some key employees. It’s a well recognised successful brand producing cutting edge bikes and with a race team. It must be one of the jewels of Ashley’s purchase. Thoughts?

Well my reading is that they’ve bought the brand and that is it. The news hear is that the design team has gone.

Whether that means continuing to buy bikes to the current spec’ from the current supplier and selling them in say Evan’s we don’t know. It might mean writing Nukeproof on generic hard tails and selling them in Evan’s. Or maybe they’ll pass the designs to the current Evan’s Team.

But I think we are still at the rumour stage

Who is on the team?

+1

There's no nukeproof factory team registered with the UCI

I’m fully expecting Nukeproof to continue producing bikes and retaining some key employees.

I’m expecting the brand to turn up on products that have nothing to do with anyone who worked at the old company. Again.

Nigel page (team manager nukeproofsram) has said it’s all over on Instagram. Assume that’s it then. Terrible news for all, nukeproof were really excelling at the moment.

So it played out exactly as I predicted in November when it all kicked off. Personally I don’t think anyone was ever interested in buying the business as a going concern as it was a huge money pit losing around £10s of millions a year it seems.

ive been hammered by emails from recruitment companies trying to find work for all the staff laid off

MA is just going to copy paste the evans website, the brand names are just traffic funnels to double his turnover with zero extra cost. I do expect all the brands to be butchered over the next few years

yes I’m sad for staff but they were working for a zombie waiting to die. I’m more upset for all the businesses killed off over the years trying to compete against CRC operating with negative margins paid for by loans they never needed to pay, see the £160 million they were “let off” by the head company.

consumers got their cheap stuff but I can assure you things are going to get a lot more expensive very soon. People were only really fans for the price IMHO. Nobody will fill the loss making void.

theres a lot of collateral damage in the background. I know several taiwan suppliers were bankrupted by it. I’m also suspecting several viable external brands to die in the process as they have sold naff all at a critical point in the year due to the fire sale of a years worth of stock in 8weeks we have just been through. So there’s a lot to digest, it’s not just crc disappearing but a lot lot more at stake.

neil SuperstarComponents

People were only really fans for the price IMHO.

After the wiggle / CRC merger id agree with you. Before that it customers were also driven by the range, fast reliable delivery and customer service (back when you could speak to someone). The recent web site changes were a complete joke.

Its not like the guy is Phillip Green ffs

He's a property tycoon rather than retail - buys a failing shop franchise, boots off the the expensive rental sites & keeps the freehold ones, then rents those sites back to his other brands. So he makes money twice on them all. High streets have died off, not due to lack of footfall, but lack of freehold and affordable rents/rates.

It’s clear he sees value where others don’t – and is willing to take a financial risk.

Buying only the IP isn't much risk in this case imo. His USP is to buy a brand cheap, stick the logo on crap and sell it cheap. He's bought marketing and brand awareness for a fraction of the cost - that's not a big risk, it's his business model.

Well that's bad news for all the staff in all the companies affected.

If I'm honest, and I've used CRC/Wiggle, the last few years of underpriced selling and aggressively putting LBS's out of business was not sustainable or positive for the cycling industry. It was a race to the bottom on price, constantly. I'm a huge bargain hunter, but I'm wondering if this is a good thing for many others in the business.

 Nobody will fill the loss making void.

Some one will. Maybe not immediately, but one of the larger on-lines will get to the point where it'll be a target for investment, and before you know it...

Lbs is the way forward

It hasn't been the way forward for me for 20 years as they a) never have anything I need and b) have less knowledge about the things I want than I do

I will continue Google searching for the items I want and buy from whatever shops come up that stock them, all online. No LBS is ever going to be able to stock the things I want.

What happened to the Pinnacle brand? They seemed to have just carried on selling what existed before with no more development.

The tricky thing with nukeproof is they've just developed the bafang ebikes. Not sure how they'd continue selling or supporting those?

I agree with Neil here, I also didn’t expect a buyer to come forward for the group as a going concern.

Unless Nukeproof is sold separately and quickly to a third party it’s also gone along with the other in-house brands, MA doesn’t do bicycle engineering and design.

All likelihood is the brands either die or become budget offerings like muddy fox etc.

It’s all a huge shame, some good people and lots of work down the drain.

@Ribena - I am almost certain you won’t ever see another high end nukeproof bike for sale unless they sell the brand externally.

Not sure how they’d continue selling or supporting those?

“they” don’t exist anymore. All that exists is a name.

So does this mean the mega I recently bought is now a Genuine End of Line Limited edition

I do wonder what the value of the CRC or Wiggle brand names is as an IP to Ashley. The associated product brands yes - like Karrimor were 20 years ago. But the retailer brand names....

Unless he plans to upscale the current Evans warehousing operation and just make cut and paste websites labelled CRC and Wiggle.

until it breaks in 2 weeks, then it's just 'end'.

🙂

Unless he plans to upscale the current Evans warehousing operation and just make cut and paste websites labelled CRC and Wiggle.

That’s what Neil suggests. A simple way of sending more traffic to something you already have. Presumably it’s brand recognition and leveraging their track record on google

If CRC\Wiggle administrators have let all the staff go it seems odd the website is still open for orders. Who is going to be picking/packing those? Do staff get given notice in this situation and are still working for a week or so? I would have thought the website would have been closed. There could be a fair few people not receiving their orders if they are not aware of the announcement.

I think it’s exactly that.

Ready made e-commerce expansion for Evans, and possibly NP, Vitus brands etc will continue in some guise via the ‘group’.

Existing infrastructure/warehousing is all in place so a cost effective way of expanding market share.

It hasn’t been the way forward for me for 20 years as they a) never have anything I need and b) have less knowledge about the things I want than I do

I will continue Google searching for the items I want and buy from whatever shops come up that stock them, all online. No LBS is ever going to be able to stock the things I want.

I couldn't agree with this more.

Loads of people go on about LBS and how we should all be using them but the reality that I've found is that they're generally either non-existent or a bit shit. The last three places I've lived over the past 20 or so years have fitted in to one of these two categories. Once you're talking about a 30+ mile round trip to get to an LBS then online will win every time.

Bad news for any staff connected to CRC/Wiggle/Hotlines etc.

Admittedly I was part of the problem as I used Wiggle fairly often both before and after the CRC merger, but the reason I used them was they offered what I was looking for, stock was actually in-stock when it said it was (unlike many other online companies or indeed LBSs), and delivery was quick. I'm northern/Scottish so of course I'm a huge bargain hunter also.

I just see all the great brands they had going down the pan or being slapped onto utter shite products in the same way as has happened with most things Mike Ashley touches. Sad times.

If the Fraser's group gets the brand I hope no one buys them any more. Only the name wil remain the quality and customer service will turn to nothing, just like what happened to Evans cycles etc.

I think the bike business should take a look at what the bookshops have done to stay in business against the might of Amazon. I can go to my LBS (Local Book Shop, the excellent Warwick Books) order pretty much any book that is still in print, and get a phone call the next morning to say that my book is ready to collect. I don't know what miracle of logistics lies behind this, but if they can do it for books I can't see why it wouldn't work for bike parts.

If CRC\Wiggle administrators have let all the staff go it seems odd the website is still open for orders. Who is going to be picking/packing those?

According to Cycling News they are keeping on a handful of staff to clear out the existing stock

I placed an order yesterday and got a dispatched notification at 11pm

I try not to buy anything from any Mike Ashley related businesses, but sometimes you have no alternative. I haven't used Wiggle/CRC for a long time as the website(s) is utter bobbins and half of the items listed are incorrectly listed in terms of detail or stock status, and the headline prices are rarely what you get for the derivative of the product you want.

But, I also think a lot of LBS are shite. I know some good mechanics based in shops who I use for more complex stuff, but the shops don't really hold parts stock anymore, they can get stuff in, but it's all at high prices and takes a long time, plus I've got to drive the 15 miles there etc. I get why, they can't afford to hold stock when there are so many 'standards', but it seems to be a vicious circle.

I don't see what Mike Ashley did to Karrimor is any different to what CRC did to Nukeproof. Both are nothing like how they started out. As soon as Nukeproof became an in-house CRC brand the cache was lost.

the shops don’t really hold parts stock anymore, they can get stuff in

Of course they don't hold the parts. Because for years now they couldn't compete on price with a loss making deliver to your door company when it came to those parts.

I don’t see what Mike Ashley did to Karrimor is any different to what CRC did to Nukeproof. 

Fair comment. And now he might end up making some Nukeproof BSOs - or he might just be buying the CRC & Wiggle brands.

He's just doing what he does picking up the dead brand IP, but it's a massive shame nothing could be carried on as a going concern. I guess they were just too big for anyone to absorb/afford on that basis.

Of course they don’t hold the parts.

They never did. They'd steer you to buy the thing they did have in stock. It's inconceivable any small family owned shop could ever hold all the stock needed. But the range of different components used now has risen exponentially in the last 30 years. Regardless of the rise on Chiggle etc I don't think the LBS model could ever have kept up with consumer needs and expectation.

The only LBS model I could envisage working would be a franchised screwfix style model with some stock and a lot more available next day and a mechanic to do the spannering.

I don't really get the LBS vs online debate, surely there's space for both?

I never visit an LBS as it takes more time/hassle than fixing my own stuff at home. But equally there's friends I ride with who get everything done at the LBS, and if they buy something online (2nd hand or new), they get the LBS to fit it. I don't see either approach being wrong.

The absolute scumbag, buy the IP and bin the rest. Words fail me as to how this has been able to happen, complete and utter greed from all of them

It's just business.  CRC/Wiggle have gone bust and he's taken the element he sees the greatest value from so that the creditors can get back some of the money they are owed.  He didn't make them go bust nor is his business a charity that keeps people in work.

Let's not forget that the reason CRC/Wiggle existed is because of our insatiable appetite to have things cheap.  How many LBS have gone bust because of our buying habits.  Ultimately, much of the responsibility of the situation in the bike trade sits with us.

Unless I am missing something, I don't get why people are so against the IP being sold? Obviously it would have been better if the staff kept their jobs and it was sold as a going concern but that was a big ask. If evil Mike makes a BSO and puts a Ragley/Vitus/Nukeproof sticker on it, nobody who had one of the CRC Nukeproofs is going to think it's the same bike. People who buy a £200 bike from Sportsdirect more than likely don't care what it says on the sticker either, they certainly wouldn't have been aware of the history behind a brand.

It also opens up a gap in the market for other brands to move into.

They never did.

True. I remember even in the 90s I'd get a bike shop to order in the part I wanted. Meant two trips to the bike shop... and two chances to chat bikes and look at bikes.

Unless I am missing something, I don’t get why people are so against the IP being sold?

Mostly I think becasue Mike Ashley is a lazy "all somewhat successful High-Street businessmen must be soulless rapacious bogeyman" trope?

I mean if the baddies would just wear a topper, and hide behind a cape raised to just below their eyes, and perhaps even a maniacal laugh;  it would all be much much simpler

the-muffin-man - I’m sorry but that may the case for you but Nukeproof was a brand held in fairly high regard and did it not win a ‘most desirable’ award?

’cachet’ - sure they aren’t a titanium single speed made in Gary Fishers garage but a mile away from what sports direct did to Karrimor.

I don’t see what Mike Ashley did to Karrimor is any different to what CRC did to Nukeproof. Both are nothing like how they started out. As soon as Nukeproof became an in-house CRC brand the cache was lost

Nukeproof continued to develop bikes and adding to their range. They offered some more budget models along with high end specs and sponsored teams and riders at a world cup level. That's very different to using a historic reputation to sell a substandard product.

There was some quality issues with the latest Mega which tarnished the reputation, but aside from that I really like Nukeproof. I hope they get sold off so they can continue.

People who buy a £200 bike from Sportsdirect more than likely don’t care what it says on the sticker either, they certainly wouldn’t have been aware of the history behind a brand.

This is totally muddled thinking. IF the people buying the Ashley bike with the 'Ragley' sticker on it don't care what the sticker says, why did Ashley pay money for the right to put 'Ragley' on it rather that 'Padley'? 20 years on the Karrimor stuff that Ashley knocks out is still dining out on the reputation the brand had in it's halcyon days when it's stuff was designed and made in the UK.

Though I do take the point that CRC Nukeproof is already nothing like the original Nukeproof brand so this is only the same thing happening again for it.

I'd say it'd be good to see Nukeproof, Vitus or Ragley purchased and continued by the staff involved, but since their main selling channel will be gone that probably doesn't make much sense.

Is Brant asking about Ragley with a view to picking it up though?

So does this mean i can get more options than Muddy Fox from sports direct in the near future?

What happened to the original business that started off CR? Only been playing Mtb for a relatively short time compared to many of you.