OPINION
Cheap Stock is Expensive! T
By Dominic Langan
his next opinion piece is a real bugbear of mine, which I touched upon in the recent BikeBiz Podcast with Pedro Couto Lopes and during the discussion
panels at iceBike*. It is also very much linked with a conversation another time, about trust between retailers and distributors. So here goes! Over the past few years, the industry
hasn’t been short of “opportunities.” Excess inventory regularly finds its way into clearance channels. The barrier to entry in the cycle market is low, and launching a brand is relatively easy. Sustaining one is not. Manufacturing product can be done cheaply. Building a brand, with credibility, support, marketing and aftersales infrastructure cannot. More often than not, new entrants underestimate that reality and fail. The consequence is predictable: the stock is dumped, and then someone calls you offering deals that sound irresistible. In a tough market which we have endured for several years
now, it’s understandable. Cash is precious. Footfall is inconsistent. When someone offers product at a headline margin that looks generous, it feels proactive to say yes. But the real question isn’t “Is this
inventory a real bargain?” It’s “Is buying this inventory going to help my business?” Margin without sell-through is just an illusion. A 50% plus margin on something that sits on the wall for months or years is
worse than a 28% margin on something that turns four or five times a year. Slow stock absorbs cash. It consumes space. It complicates merchandising and confuses customers, and eventually it distracts you from the products that actually build your reputation and actually makes selling harder for you. This is further compounded by the general retailer mentality or reluctance to ever run promotions or clear slow-moving stock. The cycling industry has always had a relatively low barrier to entry. Open-mould frames, private-label opportunities,
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May 2026 | 37
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