So far sales have been steady, but without sunshine the impulse purchases of cycles will lay dormant in the garages and sheds –which won’t help the 'add-on' or repair trade.
Lead times seem to be all over the place at the moment. It is difficult to know if the Taiwan factories are busy or just lack funding. Many small builders have gone, and apart from the bigger factories, many of the frame and wheel building sheds have closed. The dollar has improved slightly, but raw material seems to creep up on each invoice, so prices will stay on par this year.
I believe it will be a good few years when we’ll we see the dollar match old rates of 2008 at $1.80 to the pound. With the Euro also bad for exchange, I can’t see a start up of European companies being able to penetrate Far Eastern prices or even having the capability. Transporting product from Italy is more expensive than bringing in containers from Taiwan.
The recent news of MPs fiddling expenses beggars belief over the huge claims that have been made, from dry cleaning to the purchase of a tractor. To those reps out on the road, are you fiddling mileage to get free miles for the family weekend?
Many years ago, when we still manufactured bikes in this country, I had a call from my MD telling me the books would be closing on a certain child’s bike for the Christmas market. I shot over to the Isle of Wight to sell my quota before deadline. Leaving the island with a 200-mile drive home and with my quota sold I treated myself to a slap-up meal. Weeks later the MD called me into the office to explain the pricey meal. Explaining that I had left the island after 5pm, and having sold more than a further 50 of said bike, I deserved a good meal before the drive home. He said okay and paid the £14 meal. Two months later the company went into liquidation. I never did get my expenses paid.
After following the Tour de France last year it became clear that our roads are terrible compared to even country lanes in France. It would seem they spend their tax collections on their own country, rather than fighting other nations’ wars, as we seem to.
END OF THE REPUBLIC
It is interesting that Halfords has dropped the name Bike Hut and Republic. I said last year that whoever thought up the name had to be nuts. It’s a terrible name, just reminds me of third-class bikes, with third-world manufacturing. No doubt they eventually agreed.
No multiple selling food, clothes, or car accessories will ever compete with a specialist, who understand the product and provide great service. Those shops that have put effort into the female side of the market will be way ahead of anything Halfords will be able to offer.
As this credit crunch continues to bite, the cycle industry has to go from strength-to-strength, never falling back to those silly price reductions that never enhanced the profit margins. Profit is not a dirty word, it pays the bills.