Dutch IBD group eyes up UK invasion; may team up with Bikeforce

Euretco Tweewielers is said to be evaluating a UK launch. The 290-member IBD marketing organisation is part of Euretco NV, founded in 1936, and with an annual turnover of over £600m. Ivan Dunn and Stephen Thomas of Bikeforce were introducing Euretco Tweewielers MD to suppliers at Cycle 2002 today and Bikebiz.co.uk caught up for a chat...
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Euretco Tweewielers BV was set up in 1994 by Ron te Riele, the current MD, pictured above.

The holding company was founded in 1936 by a collection of independent fashion stores.

Today, Euretco NV has interests in furniture, home decoration, fashion, books, as well as bicycles. It's 40 percent owned by a Dutch merchant bank. It owns 300 of its own shops, including 13 bike stores.

The company is not just a buying group, said Riele, it's a "full service retail organisation."

IBDs who sign up to Euretco become part of the Profile The Bike Specialist IBD brand, and their stores have Profile fascias and benefit from 2.5m print-run Profile promotional newsletters and Profile-branded consumer advertising.

Reile has been in discussions with Bikeforce for six months. A decision on whether Bikeforce will be collapsed and a new company formed will be made by the end of October, Dunn told bikebiz.co.uk. The new company, should it be formed, would be called Profile The Bike Specialist UK Ltd, with Dunn as MD and Stephen Thomas as sales director.

Euretco Tweewielers members account for 35 percent of the Dutch bike market in turnover terms and are said to be growing, against the trend.

The Dutch cycle market is 7 percent down to date this year whereas Euretco Tweewielers has experienced 16 percent growth.

Riele claims that before Euretco got into the bike market, Dutch IBDs had a 72 percent market share, now they have nearly a 90 percent market share.

"We're beating the multiples," said Riele, who wants to roll-out the Profile IBD retailing formula Europe-wide. A sales manager has already been appointed in Belgium, run from the Breda HQ of Eurecto.

When asked whether UK IBDs are intrinsically more independently-minded than Dutch IBDs, Riele says no.

"It was the same in the Netherlands when we started. But independents are fighting a losing battle if they think they can beat the multiples by themselves. We have to need each other."

Dunn believes that if the Euretco model was taken up in the UK, the market share of IBDs could double within a decade.

The Profile formula is for IBDs to nbe stocked with 70 percent "A" brands, and 30 percent private label brands. Profile's exclusive brands are Altra city bikes (made by Sparta and Giant) city bikes, and Kenosha MTBs (made by Giant). Euretco members retail 400 000 bikes a year in the Netherlands.

Profile acts as a marketing platform and lobbying group rolled into one. Euretco is not currently a member of Stichting Fiets, the Dutch bike levy scheme. It was a member until three years ago.

"We want to be a member again but there are disagreements that have to be sorted out first," said Riele.

"On the Stichting Fiets board there are seven suppliers and six retailers. This is not fair. At one guilder a bike, we would have to pau 400 000 guilders. That's a lot of money. We sell more bikes than anybody else in the Netherlands. We will be talking to Stichting Fiets and maybe by next year we will be members again."

When asked whether Profile The Bike Specialist UK Ltd. would pay into the UK 'fighting fund' Ivan Dunn would not be drawn:

"It's under review," he said.

Nor would Dunn be drawn on whether Bikeforce has a future if no joint venture is agreed with Euretco:

"That remains to be seen. But Steve [Thomas] has worked his nuts off these past two and a half years to make [Bikeforce] a success. We've found the going difficult. However, we're not people who give in easily.

"[Profile] has an excellent chance of being very successful for all concerned, retailers, suppliers, and consumers. It could be a win-win-win situation."

http://www.euretco.net/.../jaarverslag_page2001_UK.htm

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