Reinventing myself – entering the bike industry?? Buying up NOS stock?

Home Forum Bike Forum Reinventing myself – entering the bike industry?? Buying up NOS stock?

Viewing 21 posts - 1 through 21 (of 21 total)
  • Reinventing myself – entering the bike industry?? Buying up NOS stock?
  • velocipede
    Member

    Right, just looking at a complete potential reinvention –

    Anyone ever set about trying to acquire a load of NOS stock from wholesalers?? I could be interested in bikes (mtg and road) or clothing, or parts….I’m happy to invest in the right deals if I can find them….but therein lies the problem!

    Anyone tried it?

    How did you get on?

    All help appreciated – and happy to correspond privately via email (in profile) if that’s better….

    cynic-al
    Member

    I’d be kind of surprised if you got anywhere with any decent brand without an existing relationship.

    I’ve not fone it though.

    munrobiker
    Member

    Is this essential what Pauls Cycles do? Buy up all the older models and sell at a discount?

    Premier Icon faustus
    Subscriber

    Quite a few people have done this, and have done well. Look up Campyoldy. The guy who founded it used to do regular trips to Italy and buy NOS from bike shops etc., and then sell on here in the UK and did very well. I think warehouses are more aware of the stock they sit on so may be more difficult to get a good deal on (It is what Planet X has done with all those SAB frames), whereas a small shop may have a few reasons to want to get rid of stock (bankruptcy, space etc.) Needs a lot of constant research and contacts, definitely some competition for these parts.

    Premier Icon Teetosugars
    Subscriber

    Isn’t that what One-on do?

    crankrider
    Member

    I think the ability to make money out of this kind of thing is ever diminishing….

    CRC, Bike.de etc purchase stock from OEM (o
    r conveniently own their own bike company) suppliers.

    Isn’t that what One-on do?

    On-one may have done this in the past but the majority of their market is own-brand and OEM left overs from builds.

    E.g. ‘Nukeproof’ purchase 10k avid 7 brakesets for bikes, they only use 5k so sell off the other 5k cheap through CRC.

    You will struggle to compete when CRC etc are already retailing goods at essentially overstock prices (as it is essentially overstock)

    I have thought about dabbling into this kind of thing, but after a lot of research don’t think it would be easy without a fairly substantial investment (which I don’t have)

    Anything shimano – forget it – you may have a market if you can get hold of the more nice / ‘protected’ brands like yeti, chris king, ibis etc…

    The one way you can still make money is like Superstar and others – buy cheap Taiwanese designed / made parts and sell on for a profit.

    You may think Superstars margins are small, but they are actually better than a bike shop’s by far e.g. I have been told trade price of the nano pedal is around $18.00.

    darkcyan
    Member

    This is a very tight space, and you will be joining many others with the same idea. I think you would have to go in quite big to get any return and still find yourself competing against the on line giants discounting to the same levels as you. So where’s the profit and margins in the long term?

    Go for it;-)

    crankrider
    Member

    The bike industry blows goats compared to other retail in terms of profit margin – ‘normal’ retailers expect to buy something for £4.00 and sell for £14. The bike industry buys something for £4.00 and sells it for £6-8.00….

    clubber
    Member

    Friends of mine started a bike shop off the back of one of their’s ebay shop which bought second hand bike stuff that was going cheap and selling at a good profit. That may well be a better way to do it if you know what you’re looking for.

    Fantombiker
    Member

    OK, here’s an idea to get you started, buy up all the Shimano 10 speed stuff you can find at cheap prices. Knock it out on ebay???

    butterbean
    Member

    There is easier ways to make the money. Dealing with whole sellers & distro’s UK based isn’t going to get you very far.

    The big boys have buying teams for this reason, they go directly to and are approached from the Far East, but you need huge capital reserves to buy in the quantities they sell at.

    The margins are good, but can you buy in quantities of thousands?

    crankrider
    Member

    The margins are good, but can you buy in quantities of thousands?

    The margins are not as good as you think – CRC are selling shimano parts (cassettes, chains etc) for a small margin and I bet it is the same with other items too.

    Think 25% profit (not taking into account postage, packing, cost of sale etc)

    I still think ebay to shop route as above could work.

    Superstar, uberbike and others I am sure have all got the ball rolling this way.

    On-one may have done this in the past but the majority of their market is own-brand and OEM left overs from builds.

    Still a huge part of their business. Recent Selcof wheels offer (not specced on their bikes), Carnac shoes etc etc.

    Pauls Cycles seem to have good relationships with importers and snap up all their old stock (Ive had an LBS enquire about a NOS Giant and Pauls had already got them all).

    Premier Icon mattjg
    Subscriber

    @op I know little about the bike industry other than you are almost certain to fail. But you should (while treading carefully) do it anyway because the business you end with will almost certainly not be the business you start with – it will come about as an offshoot, a conversation, a relationship, an opportunity you spot, a bluebird or something else, and you won’t find that unless you’re in the game.

    Corny but true: the journey starts with a single step.

    Premier Icon peteimpreza
    Subscriber

    “Anyone ever set about trying to acquire a load of NOS stock from wholesalers??”

    You should look up Vente Privee.

    andyrm
    Member

    I work with a lot of excess inventory clearance specialists in a number of verticals – it’s a shadowy world of people with big cash pools, and also people who will bankroll a deal for a return.

    You need to have the finance, the connections and the cashflow to sustain it if it runs slower than expected.

    Margins in this game are tight – net margin can be as low as 4-5% so you need to be sure on it before you buy – and if you are sure, there’s good odds someone else is sure as well, and if they are already established, they’ll probably have heard of it before you have.

    Also think about who you plan to sell it to. If it’s online, where’s your database coming from? Consider 10% email open rate a decent average and a 1% conversion rate a decent guesstimate.

    TiRed
    Member

    I think the margins are very tight and the risks high. I bought some new Shimano DA hubs from Evans recently, and my wheelbuilder told be to buy them there because the price was basically trade plus VAT. He couldn’t source them any cheaper.

    Of course there is always Sport Pursuit who have started selling frames, wheels and a few bits. And clothing, of course. Would you like to do the same for components?

    gogg
    Member

    Sport Pursuit = shower of …..

    Too many unfulfilled orders IMHO and too much delay in sending the good out.

    Premier Icon mboy
    Subscriber

    I’ve done (and continue to do) a fair bit of this wherever possible.

    My advice… Don’t give up the day job!

    It can be a useful way of supplementing your income a bit, or making your hobby a bit cheaper. But even if you get hold of “killer” deals on stuff everyone wants, chances are that give it a week and everybody else is selling the same products too, and suddenly the general public knows to expect to pay stupid prices too… Ergo, your margin is shredded instantly…

    Stick with brands (as already mentioned) that protect their prices better than the likes of Shimano, and you can make a few quid ok. Trying to make money on Shimano, or other similar OEM specced brands, is financial suicide though.

    Oh, and cash is king… Margins are going to be very tight I’m afraid, don’t expect to reasonably return much more than 10% gross IMO as long as you’re turning things over quickly… So start with £1k, and you may have £1100 by the end of the month. Which isn’t feasible as a living. Start with £100k, and you could turn it into £110k by the end of the month, which is vastly more feasible (though a lot more work too obviously).

    Chain Reaction for instance, don’t make significantly more profit than many smaller companies do. They turn over huge numbers of products at very tight margins though, so trying to compete with them you’ve got to have your wits about you and not try to tackle them head on (unless you’re prepared to invest hundreds of £millions into stock!).

    andyrm
    Member

    I’ve done (and continue to do) a fair bit of this wherever possible.

    My advice… Don’t give up the day job!

    It can be a useful way of supplementing your income a bit, or making your hobby a bit cheaper. But even if you get hold of “killer” deals on stuff everyone wants, chances are that give it a week and everybody else is selling the same products too, and suddenly the general public knows to expect to pay stupid prices too… Ergo, your margin is shredded instantly…

    Stick with brands (as already mentioned) that protect their prices better than the likes of Shimano, and you can make a few quid ok. Trying to make money on Shimano, or other similar OEM specced brands, is financial suicide though.

    Oh, and cash is king… Margins are going to be very tight I’m afraid, don’t expect to reasonably return much more than 10% gross IMO as long as you’re turning things over quickly… So start with £1k, and you may have £1100 by the end of the month. Which isn’t feasible as a living. Start with £100k, and you could turn it into £110k by the end of the month, which is vastly more feasible (though a lot more work too obviously).

    Chain Reaction for instance, don’t make significantly more profit than many smaller companies do. They turn over huge numbers of products at very tight margins though, so trying to compete with them you’ve got to have your wits about you and not try to tackle them head on (unless you’re prepared to invest hundreds of £millions into stock!).

    ^^This.

    You’ll really need to find something that will make you some money along side it.

    There is after a reason why 100’s of established business’s have passed this stock by, Its the dregs. Its not as glamorous as finding a box load of chris king threaded headset that years of stock takes have forgotten.

    You’d need to invest heavily in google and other search engines as stocking random old unwanted parts would need a wide catchment to make sales or ebay (good bye another % of your margin)

    Sports Pursuit have a similar model to what you are saying BUT they also work with new up and coming brands to get some exposure to bring other items with more of a return. I can’t really see sports pursuit’s model lasting long as more and more general retailers will be putting pressure on suppliers not to deal with them.

    Also good luck getting decent suppliers to deal with you without a shop. Some will but the majority will turn away.

    But thats not to say it won’t work, decide on what you want to do, plan it all out and don’t put all your eggs in one basket.

Viewing 21 posts - 1 through 21 (of 21 total)

The topic ‘Reinventing myself – entering the bike industry?? Buying up NOS stock?’ is closed to new replies.