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Survival on the high street: how the local bike shop has had to adapt to survive

Can the venerable local bike shop compete against the internet giants? We spoke to three different shops to find out

The independent bike shop has never been under such pressure.

The superior buying power, stock holding and delivery offered by the internet giants have decimated entire areas of the independent bike dealer’s business.

Elsewhere, a growing trend for mobile mechanic services, themselves formed in reaction to the commercial dominance of online retailers and their inability (so far) to turn up and fix your bike, is threatening workshop income for businesses that typically trade in an expensive high-street environment.

We spoke to the owners of three independent bike shops – the Sigma Sport ‘destination store’ in Surrey, shop-cum-club 700 Cycles in Windsor, and the the soon-to-close Ben Hayward Cycles in Cambridge – to gain an insight into the landscape of the local bike shop: its challenges, opportunities, and chance of survival.

The destination store

Sigma Sport raised the bar for independent bike dealers when it opened its flagship store in Hampton Wick on the London-Surrey border in 2011.

But even a shop as successful as Sigma – built over nearly a quarter of a century by Ian Whittingham and Jason Turner from a bedroom-based mail order outfit – was not insulated against the chill wind blown through the sector by online retailers.

Whittingham says Sigma Sport has invested heavily in its online offering in recent years, scrapping plans to open more premises and even closing its Specialized Concept Store in Kingston.

Instead, Sigma’s focus in recent years has been in developing its online offering alongside strengthening the position of its Hampton Wick premises as a ‘destination store’ to which customers will travel from far and wide. With the lease coming to an end on their first premises in 2010, Sigma Sport’s owners decided that their next shop would need to redefine expectations of an independent bike dealer if it was to compete in the modern age, with the Hampton Wick site chosen as a result.

While two-thirds of Sigma’s sales now come online, the store has grown to include a bike fitting service, while the workshop, staffed by eight mechanics, has a waiting list throughout the year

“We were coming to the end of the lease at the old shop,” Whittingham says. “We were determined  that rather than renew the lease, we would find a retail space that would be suitable for the next 10 years and for our shop to be relevant going forwards. We had to do something different.

“We realised that the model for the regular bike shop would change, and that to make it a destination store, it had to be a cut above the rest. We took investment to purchase the building that our shop is in now, and spent £1m fitting it out.

‘Destination store’ is an accurate description of Sigma Sport’s premises in St John’s Place, and while other stores, notably Cyclefit’s Manchester outpost and Bespoke Cycling’s bijou but stylish premises in Jermyn Street share similar aspirations, the Hampton Wick store remains an impressive example of what an independent bike shop can become.

Significantly, both Cyclefit and Bespoke operate from multiple premises. Whittingham and Turner realised soon after moving into St John’s Place that growth and expansion lay in online sales, rather than in opening more bricks-and-mortar outlets.

“For us, at the time, it [opening the flagship store] was part of a plan to open shops in other parts of the UK,” says Whittingham. “We thought we’d go north of London, to the west, to Manchester. That was the plan. A year into the project, we realised that the move to online sales was happening at a faster rate than we’d imagined, and we revised our plan.”

Whittingham says the shift in spending habits was clearly visible in certain categories, notably in clothing, despite Sigma stocking a comprehensive range of brands in St John’s Place.

“We do a really good job with clothing, but we’d noticed that sales weren’t keeping up [in store],” Whittingham says. “Having taken investment, we were committed to growing the business. We realised that online [expansion] was a far more effective method of doing that than opening more stores.”

“We realised that online expansion was a far more effective method of growing the business than opening more stores” – Ian Whittingham, Sigma Sport

This is not to be confused with taking the easy option. Sigma Sport has made a successful job of balancing sales from its shop and its website (now two-thirds online; one third from St John’s Place) but it has required commitment. Whittingham puts it bluntly: “We’ve invested every penny we’ve made and more to make that transition.”

Such a radical change has not come against a backdrop of stasis in the shop. This too has evolved. The third storey has been converted to expand the bike fitting facility and a new member of staff, trained at the respected Cyclefit, has been recruited to run operations; a reaction to increased demand, Whittingham says.

Sigma’s ultra-modern workshop  – an almost clinical environment, concealed from the public, and staffed by eight mechanics – continues to deliver a constant revenue stream. Whittingham says there is a waiting list throughout the year – longer in summer, but still oversubscribed in winter.

Thousands of people gathered at Sigma Sport on the day of the London 2012 Olympic time trials, with the route padding the store’s route door

Things have changed beyond the environs of St John’s Place too. Sigma Sport used to run a Specialized concept store in nearby Kingston, but made the decision to close it. “It wasn’t losing money, but it wasn’t making money,” Whittingham concludes.

None of which is to suggest a dwindling in demand for Specialized bikes (Whitingham describes Specialized as “far and away our most important brand”) or indeed for bicycles (Sigma Sport has experienced double-digit growth in road and triathlon). Rather, it seems, customers want the ‘destination store’ experience, or prefer to shop online.

Whittingham’s advice to other IBDs is simple: don’t fight the internet – embrace it. He adds this is “easier said than done” and he has learned by his own experience that simultaneously operating online and from a physical premises is no easy task, but insists that it is the only way. “The key thing is that the internet isn’t going to go away,” he says.

In addition, he believes that bricks and mortar shops should hone their stock holding to “vital commodities”, invest in  successful brands, and focus on services that the internet can’t provide, such as workshop services and bike fitting.

“As we spoke to more of our customers, we realised that the move to online sales was absolutely underway and wasn’t going to slow down any time soon,” Whittingam says. He and Turner had the ambition and investment to respond, but it says much for the scale of the challenge that even they were forced to effectively reinvent a business as originally successful as Sigma Sport.

Whittingham is the first to admit that the path to a competitive stake in the physical and online sectors has been expensive to follow, but Sigma Sport can now offer something approaching the best of all worlds – a ‘destination store’ experience at St John’s Place to rival any, and a competitive and reputable presence online.

The road specialist

Dave Butcher, like Whittingham, has served his time in the bike trade. Having begun by running a franchise of Action Bikes, Butcher owned and ran DNA Cycles in Maidenhead for 15 years, until it closed last year. Since 2011, 700 Cycles in Windsor has been his sole concern – a shop focused solely on road cycling.

Butcher’s initiative in setting up a British Cycling-affiliated club after 700’s shop rides became “ungainly”, such was their popularity, is further evidence of the vital role independent bike shops play in their local cycling communities. Club members receive a shop discount, alongside a host of other perks including workshop priority and off-season turbo sessions, but not everyone “gets it”, Butcher maintains, with many among the 100-strong membership of 700.cc still choosing to shop online.

700 has established itself as a road cycling specialist in Windsor (Pic: 700 Cycles)

“I’m not sure a lot of people coming into a retail premises – bike or anything else – understand what it costs to be on the high street,” he says.

It’s important to state that Butcher’s tone is not condemnatory: he concedes that the shop will not be for everyone, while others, as we’ve noted, are unaware of the additional overheads a bricks-and-mortar business incurs, especially when compared to its online rivals.

Stocking components has become a waste of time, Butcher says; so too eyewear and tyres. The level of discount 700 could offer to his customers he admits would be “minimal”.

“I focus on products that have their margin protected by suppliers who go out of their way to keep the product ‘uncontaminated’,” he says.

Butcher refers to the ‘contamination’ of internet distribution. A brand which also sells its products through the online giants risks cutting off its dealer network at the knees. Butcher offers a well-known Italian clothing brand as an example: his customers don’t care if the garments are old stock, so long as they are cheap and bear the brand logo.

Should suppliers (also known as distributors – the middle men between the brand and the shop) do more to protect the margin of the independent retailers they rely on? Or are they too engaged in a war with the voracious online giants, who themselves are fighting to meet targets imposed by their backers?

“I’m not sure a lot of people coming into a retail premises – bike or anything else – understand what it costs to be on the high street” – Dave Butcher, 700 Cycles

Butcher says that all distributors “make noises” about protecting their retailers’ margins, but the reality is that “some do, and some don’t.”

“Suppliers like Velobrands [distributor of brands including Kask and Chapeau), who come from the industry and are still quite small, they ‘get’ it,” Butcher says. “There’s been so much noise from retailers that distributors have had to sit up and take notice. It’s getting better.”

Cafés have given many independent bike shops a new lease of life, strengthening the shop’s unofficial role as club house for an itinerant sport. To open a new bike shop without a café now would seem like an own goal.

The 700cc cycling club is the beating heart of the shop (Pic: 700 Cycles)

Butcher concedes the point (he has been a close friend since university of Sam Humpheson of Look Mum No Hands), but says a café “wouldn’t work as an option” at 700 Cycles. The shop has a coffee machine and Butcher occasionally “gets his hands dirty with baking”. There are already a few cafés reasonably local to the town centre shop, he adds.

Despite 700’s success and the community Butcher has built – his training camps near Calpe are another success story – he remains realistic about the future in a market that has become saturated.

“A lot of places opened off the back of the boom [initiated by British Cycling’s success at the Beijing Olympics in 2008] and I think some of those will disappear, mostly because people have got into the trade believing that it’s a great way to make money, and it isn’t – unless you’re a big hedge fund.

“The peak has plateaued for us. Our turnover has steadied over the last two years and that’s a problem because of the number of people now in the trade. You’ll see a slight shrinkage. You need to be a specialist. That’s why we’ve been ok. We just do road, to the point where we don’t even do triathlon.”

Despite signs of recovery for the mountain bike sector, Butcher believes the interest in road cycling will continue.

The venerable – and soon-to-be-closed –  bike shop

Rob Turner will spend the final days of 2016 closing the last remaining outpost of Ben Hayward Cycles, the 105-year-old bike shop he has run for 32 years.

Turner is pragmatic, and seemingly determined to make the best of a difficult situation, even if he describes the closure of his business as “devastating”.

Ben Hayward Cycles has been operating for more than 100 years but will close its doors in January (Pic: www.benhaywardcycles.co.uk)

His first priority is to wind up matters in “a proper manner”. Only when the necessary Is have been dotted and Ts crossed will he will search for a new career (“one where I have to work five days a week, rather than seven”). With such obvious concern for his customers, one wonders how the closure of a once thriving business come to pass.

“It’s devastating really, but you’ve got to be rational about it, to look at history and see what has happened over the centuries,” Turner says. “Great technologies and industries survived, but something changed that made them less attractive, and we’re not attractive enough to the people who would make it work. I’ve been selling bikes for 32 years and the shop’s been open for 105, but we’re not exciting enough to get people in to spend their money.”

“I’ve been selling bikes for 32 years and the shop’s been open for 105, but we’re not exciting enough to get people in to spend their money” – Rob Turner, Ben Hayward Cycles

 

He tells a depressingly familiar story of changes to city centre retailing, the pressure of the internet, and customers who enjoy the shop’s “extracurricular activities”, such as maintenance tutorials and guided rides, but who spend there only when they need an item immediately.

Turner is not bitter. He wonders how a shop with limited physical space and set opening hours can compete with the breadth and convenience of an online retailer. And chain stores, businesses he describes as “the nationals”, have not been slow to offer those additional services to customers that IBDs once used as their principle weapon against the internet giants.

“Suddenly a site that had been brilliant for 100 yeas didn’t fit in with people’s access requirements. It just became a site that didn’t work,” he recalls.

“We closed down the city centre site and came to a garden centre site, about 4.5 miles outside Cambridge, that had good footfall, but in the last six months, we’ve seen a sudden drop off in sales. With seven national bike shops in the centre of Cambridge, and a total of six within 35-mile radius of town, it’s just saturation.”

Ben Hayward Cycles closed its Cambridge city centre store in 2014 and the Horningsea site is now set to close its doors (Pic: Cyclescheme)

“It’s all stuff we do and enjoy doing,” Turner says of the additional services that Ben Hayward Cycles has laid on for its customers. “Most people in independent bike shops are passionate about cycling, both as a means of transport and as a sport. But there does seem to be fewer people who make core purchases from you. They come out on rides and they are supporters, but they only buy things when they are in a hurry.”

Turner cannot be accused of not fighting the good fight, nor of failing to adapt. Trade at his premises in Cambridge city centre dropped sharply around five years ago, but he battled only gamely, only moving out of town two years ago when the council closed an access road and scrapped nearby parking.

The changed landscape

Online retailers have transformed the cycle industry, and independent bike shops, for so long a mainstay of local cycling communities, have seen their businesses changed immeasurably; rendered uncompetitive in entire categories of product, from groupsets to tyres.

By focussing on community and services – maintenance evenings, guided rides, bike fitting etc. – the IBD can fight back, even if workshop services are still under threat from a new generation of mobile mechanics, or specialists based far from the high street and its often crippling business rates.

Why should we care? If the online giants can offer better prices, broader choice, and faster delivery, don’t they deserve our business more than the bricks-and-mortar bike shops, who at a glance seem to belong to a bygone age?

We should be careful what we wish for. The merger of the two biggest online players – Wiggle and Chain Reaction Cycles – will, to a large degree, remove the vital element of competition for both. To focus solely on product, however, is to somehow miss the point.

The online megalith will not come and ride with you at an ungodly hour of a Sunday morning. It will not change your cassette the day before you’re due to fly out for a mountainous riding holiday. It will not put on the kettle and banter about your performance on the previous week’s club ride. It will not introduce you to new riding buddies, or warn you of the condition of some anonymous country lane that happens to be on your training loop.

“You don’t know what you’ve got til it’s gone,” Joni Mitchell sang. We should all take care that the ‘ballad of the IBD,” does not become some future song.

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