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year had too much stock, but the question on everyone’s lips was ‘how much too much?’ It’s becoming clear that some sectors have been badly affected by excess inventory and purchasing commitments, and some haven’t. We definitely have products where we have too much stock in some places, but overall, our excess stock position seems to be relatively limited. I believe this may be down to us not being a huge company with mind boggling commitments, combined with the fact that we offer quite a mixed bag of products from basic nuts and bolts through to Princeton CarbonWorks wheels, covering most cycling genres. These factors coupled with low-gearing and some well-established foundations may have mitigated some of the challenges we are facing, caused by the unprecedented market swings that Covid inflicted upon our industry. On a positive note, we have been actively reordering more stock of several key lines. This gives me faith that the underlying cycling consumer market hasn’t completely fallen away. The consumers are there, people are still riding bikes and I don’t see that really changing for the future. The type of bike or style of riding might change a little bit over the next five to 10 years but the fundamental driving force for cycling remains positive. In my opinion, the cycling industry is definitely not the worst to be involved in.
In conclusion, the general feeling of people visiting COREbike last February was very positive. Although, I think as exhibitors, we should always take that vibe with ‘a pinch of salt’, as not many folks would bother to travel to a trade show like Core to simply tell us that they’re not having a great time and don’t want to order anything. The reality is that those dealers are not likely to be attending the show in the first place. That said, the fundamentally positive mood was vindicated by the fact that so many dealers did turn up and were keen to find out what was new and exciting.
Areas of demand To a point, I believe that if the consumer knows what they want, and the product is unique enough, then it typically doesn’t matter whether ‘XYZ’ brand is cheaper or not, they’ll still desire to have what they wanted in the first place. An example is with Fidlock bottles, we’ve consistently been reordering these all year to ensure we could keep up with the demand for our dealers. Another example is with HT Pedals; 12 months ago, frankly speaking, I thought we might not be re-ordering any more pedals for quite a few years. However, we have found the need to re-order more HT pedals last year to ensure that we could maintain a reliable supply for our dealers. Even despite ourselves and several others offering alternative pedal options at significantly discounted prices. If I looked at sales in general during 2023, I’d say we’ve
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had some months that were up a tad on expectations, and some that were significantly down. In the round, frankly, we’re down a chunk on the sales levels that we’d expect to see in a normal year. During what has been a challenging time for everyone, we’ve endeavoured to try and maintain brand stability, and so we’ve avoided dumping excess stock of popular lines into the market simply to generate sales. Frankly, this strategy may have come at the expense of some short- term headline turnover for us, however, in the long-term, I believe that brand value can be an important area when dealers are looking to invest with their suppliers for the future.
It’s still quite difficult to really put a handle on what is going on right now, or when things will return to ‘normal’, but I would temper this with saying that we are seeing some positive signs.
Impact of Wiggle administration It probably depends on the sector of the market we choose to focus upon when looking at the impact. I would guess that enthusiasts would very likely often shop at Wiggle, as well as with several other large online players, or at least have referenced the online options.
I suspect huge discounts will be causing some headaches in the enthusiast’s market, particularly where some products are not necessarily that unique. However, although Wiggle may have a huge number of regular customers, there are many other folks that use a bike and have simply never heard of Wiggle or CRC, or will only ever shop at a physical bike shop, because they need the expert advice and workshop assistance that a good bike shop delivers.
There is still a market for people that just buy a bike, use it and have it fixed locally, and that’s actually quite a stable chunk of the overall market. It seems the headache for many bike shops is where larger bike companies have huge amounts of excess stock and now just need to shift it. That’s where I see major issues to solve.
I suspect we all have figured out with 20/20 hindsight that if plenty of people went out and bought a bike in Covid then frankly, they’re unlikely to go out and buy another bike right now. Someone from the BA put it correctly. It wasn’t a Covid boom, it was a spike. i.e. We all basically did two years’ worth of business in one short period.
Potential impact of Raleigh exiting P&A We’d heard some rumours that Accell was evaluating the performance of Raleigh. From what little knowledge I have, I believe some of the challenges have come from over-enthusiastic ordering. If
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