At the present rate, consumers are plunging £9.7 billion a year into retail via smartphones and tablets, with some studies suggesting the sale conversion rate on apps is further growing an already booming online trade. According to one such study by Barclays, 42 per cent of all retail sales now involve a mobile device at some stage of the purchase.
With such a diverse array of ways to buy online, it was only a matter of time until the supply chain began to cut out the middlemen and there are now numerous ways to buy direct from the Far East. Worryingly, the cycle industry appears to be already squarely in the sights of mobile apps such as, among others – Geek – one of the emerging favourites.
BikeBiz has over the past months been keeping an eye squarely on the comings and goings of product listed on such apps, much of which has been confirmed by the manufacturers themselves to either be fake goods, or grey material. Needless to say, many are not pleased and are now investigating themselves what has been described as an "incredibly dangerous trade."
One victim of such apps is Trek-owned Bontrager.
Trek’s UK media manager Chris Garrison told BikeBiz: "The concern from our side is that when it comes to things as serious as frames, the average bike buyer doesn’t understand that not all carbon frames are made equally. While it’s true that the raw materials are the same, and the process involves some combination of temperature, pressure, and time, there are huge variances in the quality of the carbon fibres themselves. Carbon is a protected material because it’s used in the manufacture of aerospace and defence items, so only UN countries can get the highest grades, for example.
"And before you even get to the ‘baking’ part, you have to have a solid layup process for the various layers of carbon. This is when things start to vary quite significantly, along with how well those bits and pieces are moulded together. Cheap frames usually have tons of voids and lots of filler material where the joins are. Truth be told, a lot of high-end frames have that too, but it’s even worse in the copycats."
(A list of authorized Trek dealers and distributors can be found at www.trekbikes.com.)
By law, any bicycle components sold in Europe will have to pass the minimum standard EN14766 for fatigue and stress resistance.
Fisher Outdoor Road product manager Tim Bayley echoed Garrison, telling BikeBiz: "Counterfeiters don’t consider safety or standards when building fake goods.
"Earlier this year I participated in a TT race. At the start line i saw a chap’s TT build crumble into three pieces as he tried to mount to begin the race. The route featured a descent that can take you to 45mph, so it could have killed him. Sadly, people will persuade themselves that something’s genuine despite it obviously being far too good to be true. Ultimately it’s down to the buyer to ask themselves a few questions if they’re not buying from a reputable source. Aluminium and carbon gives no warning if it’s faulty, it’ll just give in.
"The biggest manufacturers in the world won’t use suspect online apps for sales, that should be obvious. The cycle industry is certainly suffering as a result of its own success. It began with the widely known Chinarello, but now extends far and wide. Such fakes are often a strong representation on the surface, but put them side by side with a genuine product and it’s often startling the differences, even before you probe below the surface.
"In the case of brands like Look, they own all of their own patents and molds. Frames such as the 795 are made up of over 1,000 uniquely cut pieces, each of which is arranged in a pre determined way. That’s five years of work for which only Look has the recipe. Such products are very hard to copy well. Certainly, as some brands actively close or reduce the profitability of the online fake suppliers they switch and focus on other brands to mimic.
"Thankfully i’m aware of shops that have a good eye for when something’s off and won’t risk being liable by servicing anything suspicious. If there’s any doubts, products will be verifiable via serial numbers."
European trademark attorneys Appleyard Lees have seen a marked increase in counterfeit activity relating to cycling in the past few years, according to Senior Associate Robert Cummings and Associate Chris Hoole, who themselves are both cyclists.
"Most worryingly perhaps, safety devices which cyclists rely on to prevent them from serious injury, like helmets and brakes, haven’t been able to escape the fake. In most cases, these products will not have been through any safety tests and may fail UK and EU regulations," said Cummings.
"Once only available to aerospace engineers, 3D printing, for example, is now available meaning consumers and manufacturers can print cycling parts at will. A cursory search for ‘bike’ in www.thingiverse.com, a computer generated image sharing platform, generates results from Garmin mounting brackets to saddles."
While unconvinced that fake goods are a big problem for the industry at present, Madison Director Dominic Langan says that Grey imports are a "different story".
"It varies by brand and type of product and how well managed the supply chain is," said Langan. "The more people who are involved, such as assemblers, regional wholesalers, traders etc the bigger the issue. The free movement of goods within the EU makes this almost impossible to manage unless you go to a completely closed distribution model where the brand owner handles all aspects of the product distribution right to end user.
"The damage is price instability as everyone fights for a slice of the action. The EU believe this is good as it is seen to offer the best value for the consumer and for some products this may well be true. But for more technical product where a trained technician/mechanic is needed to fit/service/train the product and ensure it is safe, then you need specialists. Specialists need margin to survive to pay qualified staff, premises etc.
"In addition with price instability and the destabilisation of the distributor model, there is less investment in brands. Less marketing, less technical support, less warranty support. Ultimately the brand loses out, the distributor loses out, the retailer loses out and eventually the consumer loses out too. It is all very well being able to buy cheap cycle accessories from Lidl when they run a loss leader campaign, but when all the specialist bikes shops have gone to the wall, I can’t see Lidl investing in a workshop and trained mechanic to keep your bike in good order. Without investment in brands, everything becomes commodity and the lowest possible price. There will no longer be the money to invest in product development and the advancement of technology and ultimately the sport. Sure everyone wants to get good value but great products and brands come from talented people and investment which all takes money. Keep undermining this and everyone eventually loses out.
"We spend a lot of time and resource trying to manage this and lots goes on behind the scenes but I guess our most notable success was our legal case against Planet-X when they imported Giro helmets that were never destined for the EU into the UK. Whilst we eventually won the case, the damage to the brand was significant and Madison along with many specialist retailers lost out on a lot of sales and profit, none of which was recovered."
In just one month in 2014 FSA removed over 2,000 counterfeit parts worth around €50,000 to the counterfeiters. Below is an example of just how dangerous such products can be.
APPLEYARD LEES: HOW TO PROTECT YOUR PRODUCTS
There are various measures you can take to minimise the risk of counterfeits and to enforce your rights against the fakers:
– REGISTER, REGISTER and REGISTER! Register your trade marks, designs and patents, in (1) your principal country of sale (2) any markets of present or future interest (3) your place of manufacture and (4) any country which is known for counterfeit manufacture and distribution. Not only will this help you to enforce your rights but it allows you to freely manufacture and distribute your products. If, for example, a counterfeiter registers your brand in China, it could actually stop you from manufacturing and exporting your own products! Get there first.
– You can also register your trade mark and designs with UK and foreign customs authorities. China’s customs enforcement is continually improving and with the rise of the AIC (China’s anti-counterfeiting body which employs 500,000 people), it’s now more important than ever to register in China.
– Monitor online websites and file regular take down notices. By hitting the ‘shop window’, this can deter and damage infringers. Eventually they will chase a softer target.
– Document your design processes. If any when you need to enforce your rights, you mayneed to evidence your ownership and creation of your original products.
REAL DEAL? Below left is a genuine ENVE bar. On the right, note subtle graphic differences and an obviously too good to be true price.