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This website has been created as a resource for bicycle importers, manufacturers, exporters, and enthusiasts from around the world who share an interest in bike and bicycle imports. Our goals are to:
  • Provide our readers with the most relevant and timely news stories, industry data, and other relevant bike import facts and information
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From the magazine: Hero looks to rescue IBDs

Editor's note: The following article appears in the April 1 issue of Bicycle Retailer & Industry News.

By Steve Frothingham

LONGMONT, CO—One of the largest bike manufacturers in the world, India’s Hero Cycles, is looking to start small in the U.S. market.

Former Schwinn president Kevin Lamar is heading up U.S. operations for the Indian giant, which produces 19,000 bikes a day at its Ludhiana factory and dominates the Indian and African bike market.

The company has supplied Wal-Mart stores in India for years and recently cut a deal to supply the retailer’s U.S. stores with bikes, likely to be marketed under a Wal-Mart house brand.

Meanwhile, Lamar wants to supply American IBDs with Hero-branded juvenile and youth bikes that he said will allow shops to compete on price with mass merchants.

Lamar said many specialty retailers have ceded the low-end kids’ bike market to the mass merchants because most IBD suppliers can’t come near matching their prices. The result is that specialty shops have lost an opportunity to become cradle-to-grave sellers to families, he said.

Lamar has set up shop in Longmont, Colorado, just north of Boulder. Longmont also served as headquarters for Schwinn when Lamar ran the company in the 1990s. Besides Lamar, Hero now has three employees in Longmont. “We are starting small,” Lamar said. “We are likely to be a niche supplier for a while, while we perfect our craft.”

Lamar said he hopes to start delivering Hero bikes to U.S. dealers by this summer, starting with a handful of stores whose owners he has known since his Schwinn days.

Colorado offers a central shipping hub so that Hero will be able to cheaply provide just-in-time shipment to dealers nationwide. He said he’s hoping to help improve dealer profitability by reducing their inventory levels.

To date, Indian bike manufacturers have had little impact outside their own country, Africa and Indonesia. Though the country is capable of pumping out thousands of bikes for those markets, it lacks the bike industry infrastructure of China and Taiwan. Most notably, Indian factories would have to import Shimano parts and pay a duty on them, making it hard for Indian brands to compete with China and Taiwan on price on IBD-quality adult bikes.

Still, industry consultant Jay Townley believes Hero’s move into the U.S. is significant. America’s largest retailer sourcing bikes from a country that has been a non-starter and virtually unknown to the bulk of the industry could signal the start of an eventual shift in production.

“This is potentially a sea change in the U.S. bicycle market from the supply side,” Townley said. “It opens the door to carbon fiber bikes in India. China’s evolving and it may be that China, like Japan and Taiwan, will not be attractive from the standpoint of the low-end bikes. Maybe in the U.S., the shift is to locally made bikes. There’s a huge dynamic going on here and this is just a capper to it.”

Though U.S. brands have sourced low-end Indian-made components from time to time, no company has ever operated frame factories there.

“This is the first time there’s been a major move of India coming to the floor as a major supplier” and represents a statement from Wal-Mart that the mass retailer wants to stay in the bike business, Townley said.

Indian-made bikes are subject to the same U.S. import tariff as Chinese bikes: 3 percent for youth bikes and 11 percent for 26-inch and 700c bikes.

The Ludhiana factory can easily supply juvenile and youth bikes where customers do not require Shimano parts, Lamar said.

“I have never seen a factory so vertically aligned,” he said. “They make spokes, spoke nipples, seats—everything. The only thing they bring in is tires.”

Hero claims its bicycle factory is the first in India to have mastered just-in-time manufacturing, a practice that began in Japan and is common at many Taiwanese and Chinese factories.

Except for some low-value aluminum, Hero makes almost all its bikes from steel, but Lamar said company owners are very interested in moving into higher-value aluminum and carbon fiber manufacturing.

Lamar said he felt comfortable with Hero in part because it’s a family-owned company with a long history, much like Schwinn was when he joined that company in Chicago in 1989.

Lamar was president of Schwinn/GT Bicycle from 1998 to 2000 and then was with Nautilus for four years and Lamar Fitness for three years. Most recently he was vice president and general manager of the consumer products division of Star Trac Health and Fitness.


Source: Bicycle Retailer & Industry News
Published: 04/18/2012
Numbers show: Thank the weatherman

MONTEREY, CA (BRAIN)—As retailers marched through the month of March, one of the warmest on record, it appears that bicycle sales were relatively flat, but the average selling price per unit was up.

Still, overall operating costs are on the rise putting downward pressure on margins. That was the overall assessment of bicycle sales through the first quarter of the year, said Charlie Cooper, president of Leisure Trends Group.

Cooper told attendees at Wednesday’s Bicycle Leadership Conference that the big story this year can be summed up this way: “Let’s all thank the weatherman.” A warmer than normal weather pattern has, in general, been a boon, whereas snowsports retailers had what Cooper called “a brutal year.”

Chris Speyer, president of the Bicycle Products Suppliers Association, opened the session by pointing out the “huge” amount of data available today from companies like Leisure Trends. “But the most interesting question we have to ask is, what do you with the data,” he said.

Speyer quickly reeled off numbers noting that between 2008 and 2011 units sales sold through IBDs ranged between 2.5 million to 2.6 million units. “As a specialty group we’re not growing,” he said, “although some brands within the industry may be growing.”

Part of the problem the industry faces is how people spend their time. Those over the age of 16 now spend 7.4 hours a day in front of a screen, whether it’s a computer, tablet, laptop or smartphone. “That should be an overwhelming figure for the industry,” he said.

According to Cooper, last year IBDs sold approximately $3.3 billion worth of bikes and accessories with an additional $300 million in Internet sales that appear to be IBD related. Chain stores and sporting goods outlets accounted for about $550 million in sales, while mass merchants sold another $2.45 billion worth of bicycles and cycling accessories making cycling a $6.6 billion industry.

He also offered a snapshot of gross profits and average margins for three categories of bicycles:


For IBDs it’s become more important for retailers to aggressively sell the activity of cycling—along with a bike—if they want to see business grow. “We think the bikes bought at specialty are ridden more frequently than those bought in the mass,” Cooper said. The more frequently someone rides a bike, the more dollars they spend, and the more often the come into the store. “You have to invest in new riders,” he added.

Robin Thurston, founder of MapMyRide.com, said retailers need to make sure customers know where to ride, encourage them to sign up for an event and try to sign them up for a class.

“Don’t let them leave the store without getting them signed up for something,” he said.

Marc Sani

Source: Bicycle Retailer & Industry News
Published: 04/18/2012
Import duties set to rise in India

LUDHIANA, India (BRAIN) Monday April 16 2012 7:57 AM MT—A proposed 20 percent increase in duties on bikes imported into India from China stands to raise retail prices in that emerging market, according to local media reports.

In his 2012-2013 budget, India’s finance minister calls for a hike on duties on bicycles from 10 to 30 percent and imported parts from 10 to 20 percent, as reported by the Press Trust of India.

The import duty increase is designed to protect local manufacturers from cheaper China-made bikes, although the hike in duties for imported parts could hurt those same manufacturers.

Prices of imported bikes range from 5,000 to 20,000 rupees ($100 to $390). Domestic bicycle makers in Ludhiana reported that an increase in customs duty might decrease the overall imported value of bicycles and components, but the quantity will likely stay the same.

The rise in import duties could affect brands like Merida, Cannondale, GT and Schwinn that have entered the Indian market in recent years.


Source: Bicycle Retailer & Industry News
Published: 04/16/2012
UCI to bike makers: publish or perish

BOULDER, CO (BRAIN) Friday April 13 2012 10:34 AM MT—If you noticed an unusual number of new road racing product introductions in the media this spring, there may be a contributing factor — the international racing union is requiring manufacturers to publish information about new bikes before the bikes can be used in international competition.

Last year the UCI introduced an approval process for new frames and forks that requires the equipment to be certified and labeled before it can be used in competition. The UCI also required that the equipment be available for sale before it can be raced.

Earlier this year, the UCI changed the rule, clarifying that the equipment can be raced before it's available for retail sale, as long as it is available for sale within nine months and the manufacturer "publishes" information about the product. The information can be published in a catalog or the manufacturer's own website, said Julien Carron, the UCI's technical coordinator.

Specialized distributed some photos of Boonen's bike two days before Paris-Roubaix

"This rule was changed, because previously it was required for new equipment to be available on the market before it was used in competition for the first time. (The prior) rule was impossible to enforce and did not correspond with the reality," Carron said in an email to BRAIN.

"We would prefer if the equipment was available on the market, but at least all competitors should know when a new equipment is used for the first time," Carron said. "This rule can also guarantee that the new equipment is a finished product, in the condition that it will be marketed, because the testing of a prototype in competition is prohibited."

On the eve of last week's Paris-Roubaix race, Specialized marketing employees hustled to release some photos of its new Roubaix model, which was raced by eventual winner Tom Boonen. The new model is not currently available at retail but has gone through the UCI approval process. Specialized sent members of the cycling media 10 photos and a short description of the new bike on the Friday before the race.

Trek also launched its new Domane model a week before Paris-Roubaix, although RadioShack-Nissan-Trek pro Fabian Cancellara had been racing the bike for several weeks. Unlike the new Roubaix, the Domane is available in stores already.

"The UCI's regulation regarding "communication" is a little ambiguous," said Eric Bjorling, Trek's media relations manager. "But it is our understanding that for new bikes to be raced, the acknowledgment of their existence has to be confirmed by the company in a consumer-directed marketing tool like a website or catalog."

Steve Frothingham

Source: Bicycle Retailer & Industry News
Published: 04/13/2012
Norco opens third partnership store

ABBOTSFORD, B.C. (BRAIN) Wednesday April 11 2012 6:24 AM MT—Norco Bicycles has opened its third partnership store, Norco Cap’s Abbotsford in British Columbia.

Under Norco’s partnership program, shop owners receive assistance with startup or renovation costs, marketing support, priority in inventory fulfillment and an enhanced web presence on Norco.com in exchange for dedicating 75 percent of retail space to Norco brands, which include proprietary labels Axion and Adams Trail-A-Bike in addition to Norco’s bicycle line.

Grant Hobbis, owner of Cap’s Abbotsford and another Cap’s Bicycles store 25 miles away in Langley, British Columbia, said he was drawn to the Norco partnership because it offers deep product knowledge and “the support to raise the game of the store, to bring it to a more professional level.”

Cap’s Bicycles Langley also has a lengthy track record with Norco, having carried the brand since the shop opened in 1964. That store sells six bike lines in addition to Norco, but the 5,000-square-foot Abbotsford store will carry only Kona in addition to Norco, Hobbis said.

“In Abbotsford we focus on Norco because it’s as B.C. as anything out there. They have all the models that anybody wants,” said Hobbis.

A grand-opening sale is planned for April 27, and Hobbis plans to hold summer events featuring Norco-sponsored riders.

“We are very excited to partner with the Norco Cap’s Abbotsford team,” said Paul Nielsen, Norco’s national sales manager. “We are confident that Cap’s new shop will provide a dynamic and service-oriented environment. Abbotsford is one of the fastest growing communities in western Canada and deserving of a bicycle retailer that can deliver a quality shopping experience.”

Norco opened its first partnership store in August 2011 with Cap’s Westwood in Port Coquitlam, British Columbia, which is under different ownership than Cap’s Abbotsford.


Source: Bicycle Retailer & Industry News
Published: 04/11/2012
Leisure Trends: February shop sales up 12%

BOULDER, CO (BRAIN) Thursday April 5 2012 9:45 AM MT—The research company Leisure Trends is reporting that bike shop sales in February were up 12 percent over the same month in 2011, likely due to warmer weather nationwide this year.

Leisure Trends bases its reports on data from a sampling of retailers.

The company reports that average retail-selling prices bumped up 3 percent and units increased 8 percent over the same month last year. The average bike sold for $885 this February as compared to $817 the same time last year.

Road bike sales shot up 13 percent in the month, according to the report. Twenty-niners sales increased 46 in dollars, while 26-inch sales slid 3 percent. Aftermarket part sales were up 16 percent. Service and rentals jumped 33 percent.




Source: Bicycle Retailer & Industry News
Published: 04/05/2012
Shimano Europe buys bike fitting business

NUNSPEET, Netherlands (BRAIN) Wednesday April 4 2012 9:16 AM MT—Shimano Europe Holding has bought Bike Fitting BV, a 25-year-old Dutch company that develops bike fit measuring instruments.

“With Bike Fitting’s professional measure systems Shimano offers also a new service to the dealer network," said Marc van Rooij, president of Shimano Europe Holding. "As service is getting more important in retail we give dealers the possibility to analyze cyclists and customize their bike (frame size, saddle, handlebar, seat position, etc), this way the IBD can show their expertise.”

Bike Fitting products are used by 1,700 dealers in 44 countries. Former owners Hay Janssen and Cisca Scipio will remain working for the company.

Janssen, Bike Fitting's CEO, said the purchase will allow the company to expand internationally. “For Bike Fitting this is an excellent opportunity to secure its continuity and expand internationally through Shimano excellent world- wide dealer network. Of course there will be no change for our existing dealers, we will keep on servicing them as they are used to.”



Source: Bicycle Retailer & Industry News
Published: 04/04/2012
Accell in talks to buy Raleigh

HEERENVEEN, Netherlands (BRAIN) Tuesday April 3 2012 7:27 AM MT—Accell Group is in talks to buy Raleigh Cycle Limited, the owner of the Raleigh, Avenir and Diamondback brands.

The company announced Tuesday that "it is engaged in exclusive discussions ... which, if successfully concluded, could lead to the acquisition of Raleigh by Accell Group."

Accell Group owns a wide array of bike brands, including Batavus, Koga, Sparta, Winora, Hercules, Hai Bike, Ghost, Lapierre, Atala, Redline, Tunturi and XLC. In North America, it owns the distributor Seattle Bike Supply and most recently acquired e-bike supplier Currie Technologies.

According to Accell, Raleigh has approximately 430 employees, had sales of over $260 million last year and sold approximately 850,000 bicycles.

Please check BRAIN again today as we report more details of this developing story.

Source: Bicycle Retailer & Industry News
Published: 04/03/2012
 
 
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