INTERVIEW: Zyro

Over in the wilds of Thirsk in Yorkshire, Zyro’s purpose-built offices and warehouse are testament to the success of the firm. Despite having only spent five years at its current site, expectations have been exceeded to such a degree that the company is already being forced to look at a bigger warehouse and larger offices to cope with growing demand.

In June, the distributor saw growth reach 36 per cent, and went on to follow that up with a 38 per cent rise in sales in July. Zyro is now the globe’s largest distributor for many of its brands including Ashima, Bodyfit, Cateye, Genuine Innovations, Intake, Minoura, Panaracer, Tortec and – naturally – its biggest own brand Altura.

Zyro is also amongst the largest of world customers for ABUS and CamelBak outside their individual home territories.

One member of the Zyro team who has seen the company’s rise firsthand is sales director Andy Budd. He began his career in the bicycle industry after taking a summer job as a frame builder, then went on to work for a number of bike retailers, including Rob Chappell’s ‘On Yer Bike’, and then moved on to work with Zyro’s joint MDs, Julie and Simon Ellison.

Having been there from the beginning, Budd explains that customer communication has always been the bedrock at the distributor: “I spend a week on the road every month and have probably visited about 80 per cent of all the bike retailers in the UK and Ireland. I think it’s one of the reasons why Zyro has such a good feel for the marketplace – we spend lots of time listening to retailers.”

CHANGING CURRENCY
Zyro’s recent impressive performance has backed the industry’s recession-proof reputation. Budd explains: “We’re on track to reach our target for the year despite the fact that at the start of 2009 there was much talk of the recession. We have found that retailers are still
getting the footfall and that sales have fared well.”

Budd adds: “We’ve seen real growth that hasn’t been delivered just through price increases. June and July have been up massively – with the former up 36 per cent, and July up 38 per cent. And August is expected to be up too.”

As the trade is only too aware, wild currency fluctuations have been a major obstacle to price stability in the UK, and Zyro has put plenty of resource into absorbing those changes: “While some of our rivals put prices up at various points, we’ve tried to keep ours as steady as possible. We have a good relationship with our retailers and we’ve tried to help by absorbing as much of the fluctuations as we can.”

The short-term costs have been high for Zyro: “It has cost us £1.5 million to keep prices stable. We appreciate that repricing is a huge job for retailers, and by taking away some of that burden we’re showing support for customers.”

Budd believes Zyro’s set-up has meant it’s been able to offset price rises where others haven’t: “We have no external shareholders to worry about, which frees us up to support our retailer partners. We have been able to keep prices steady, which helps the consumer too. When they see a product changing price, I think they are put off buying into it. Whilst we’ve had to increase some prices, they’ve been minimal – not just applied to everything across the board.”

DRIVING GROWTH
What is behind Zyro’s growth? Budd explains: “There’s more to it than selling. We work with our customers and help with all things like merchandising and staff training. Listening is really important; we try to help explain and educate them about new products and lines –not just close another quick sell.

“Many of our brands have been driving growth, including Altura, Cateye, Abus locks and helmets, Ashima and PowerBar. And many of those have performed beyond expectations, particularly Abus, which is really realising its potential now.” Budd adds: “You might think I would say this, but I believe we have the best team in the cycle industry.”

That team has recently expanded, with the appointment of senior commercial manager Chris Davis. He switched to the cycle industry after a 12-year stint in the investment management sector: “The momentum is there behind the industry. With the Government and trade working in tandem, increased media coverage and the good work of all the associations, you can really sense that change in the trade.”

Davis adds: “Last year our sales were £20 million and this year our target is £24 million and we’re on target to achieve that. All brands are contributing to that growth and we expect to have a very good Q3 and Q4, with very good early indications for the autumn/winter sell-in.”

Davis reveals that Zyro constantly raises the bar and drives long-term expectations: “We’re aiming for a 30 million turnover next year and then to double that over the next three to five years. Our medium term plans are to grow organically and to add key partners. Growth brings challenges, but we’ve met them in the past and will in the future. On average we’ve hit 20 per cent plus growth annually since inception. While that’s tough to maintain we’re building the team and infrastructure to achieve it, without compromising on providing the best service to partners.

“We work closely with our brand partners, having a focussed approach for each. It is a partnership built on trust, respect and investment on both sides with the appropriate service, sales and profitability there for both. Our brand management team is very strong, commercially aware, and made of enthusiasts – passionate about their brands and the service they provide.”

BUSINESS GEM
The continuing successes have led Zyro to expand its team, offices and warehouse, but the firm is the first to admit that it hasn’t always shouted about how well it is doing.

Jane Watson, Zyro’s first dedicated marketing manager, explains: “We’re now working to promote our brands and the Zyro brand itself. It’s something Zyro has been shy of doing in the past. Zyro is definitely one of the hidden gems in the trade. The company’s achievements are incredible, and it’s now the largest privately owned P&A firm in the UK cycle trade. It has the feel of a family firm, but with remarkable controls, just like a corporate.”

After 11 months in the role, Watson has seen in the introduction of brand new marketing initiatives, including The Orange Pages – Zyro’s first printed trade catalogue: “Previously we’ve only issued price lists, but this year we launched our first directory, The Orange Pages. We believe it has grown sales over 10 per cent. The reaction has been so good we’re now issuing it biannually.”

Zyro’s online offering has also been significantly ramped up, continues Jane: “The impending B2B site will enhance our service. We still want to speak to our customers – it’s essential to help us understand the market. B2B offers out-of-hours order servicing for retailers, in addition to phone, fax, email, face-to-face, and carrier pigeon!”

“The launch of the consumer site in April was a big thing for us. 83 per cent of visitors are direct hits, not coming via search engines, and 72 per cent are new visits browsing zyro.co.uk, which is impressive.”

Watson concludes: “We’re all very passionate about cycling. We work hard, always striving for excellence and the next big improvement, investing hard cash as well as positive energy to make our partners proud to work with us.”