Would you fit a part that has been bought online or elsewhere, or simply turn the customer away?
There are strong arguments on both sides of this debate, but the vast majority of retailers wouldn’t turn away this kind of business: “It’s a surefire way to kill your shop not fitting internet supplied parts. We will never compete with online giants on price so we have to change strategy. Fitting internet supplied parts still gets you a cut of the pie.”
Another pointed out: “Once turned away a customer is unlikely to come back...”
Other retailers used the opportunity to explain where online can’t compete: “We often use this to our advantage with poor choice of purchase and lack of buyers knowledge.”
Backing that point, one shop said: ”It gives us the opportunity to demonstrate why we would prefer customers asked us first if we could supply the part and allows us to show we would have appreciated the opportunity. We do also have a high level of incorrect parts brought in by customers and so the customer then has to deal with whichever online operation they bought their part from to attempt to exchange for the correct part. It can be a useful lesson learnt by the customer who is then more likely to give us the opportunity next time to supply and fit the part.”
How confident do you feel about trading in 2016?
Despite what has been a tough year for retail, the nation’s bike shops are clearly a hardy lot, with most feeling confident about trading in 2016. But, it must be noted, there’s a hefty dose of realism about how much of a struggle it’s going to be. Almost a third of respondents said they don’t feel confident about trading in the coming 12 months. Compared to the end of 2014, fewer shops are optimistic about the next year’s trading (down from 74 per cent to 69 per cent). With little optimism about government spending on cycling as the Treasury continues to tighten its belt and no doubt more competitors entering the market, it has to be hoped that Rio 2016 and other cycle sporting events can help buoy the market.
Over to our respondents: “I have shut down one major side shop and if we don’t do well this year we will close. We have traded for over 20 years, but internet rules so goodbye High Street.”
“This is like the recession back in the ‘80s and ‘90s, hard but keep the faith.”
...And another thing
We received plenty of extra comments from the retailer respondents:
“Certain online retailers taking a bath outside the UK have brought intense price competition back to the UK and the adoption of price tracking software means we are all getting hammered with online prices hitting the High Street.”
“Online offer very little to consumers except on price and consumers think that IBDs can and should match the numbers. The RRPs are viewed as bullshit numbers, will it become like DFS? ‘Hurry offer ends this weekend’ and then starts again on Monday.”
“Profits have not been not great in general for about four years and in particular in comparison to turnover. Margins are reducing every year and we need to work harder/more hours to generate more turnover for a static and below acceptable profit.”
“Distributers and retailers must change and work on much lower margins to compete.”
“My bike hire business subsidises my retail business which needs to specialise but we have not yet determined which direction to point our retail offering towards. Middle market sub-£500 does not seem to be working as the internet is too strong. We sell 50 per cent of our annual bike stock at a decent margin but the rest is somewhere between trade and 25 per cent which isn’t sustainable.”
“We are continually investing in our business, it is getting tougher year-on-year. I do believe, and it has been said before, that there are too many brands, too many suppliers, too may retailers competing for the same customer. We all also need to be concentrating on trying to at least retain a sensible margin on the products we sell.”
…On trading in 2016
“You will have to be up for it and active.”
“I’m confident on 2016 trading mainly because of the investment that I have made in new brands and in stock as well as a new website.”
“It’s going to be hard, we will be squeezing out every last penny of our budgets but we will survive another year!”
“Potential huge job losses scheduled for 2016 in my already depressed area may lead to extremely hungry times for all retail locally.”
“I think the next 12 months will be the death of a lot of shops – good and bad. And those who can adapt will always survive.”
“I’m confident on trading in 2016 only because we will be diversifying drastically and making severe cut backs in a lot of areas.”
“This has been the feeling for quite a few years now but we are still here, trying to focus on positives and hanging in there...just!”
An enormous thank you to all the retailers who took to the polls for the BikeBiz Retail Survey 2015.
Have your say on the survey by emailing Bikebiz@nbmedia.com or heading to the comments below.