Opening a bike shop??

bernithebiker

8 or so years ago I had an idea for an online bike shop, I even registered the name, mylitebike.com

The idea was to fill out an online form with your bike's spec, cranks, bars, pedals, etc. and send it in.

My database of all common parts would then pop out a weight for each component and highlight the heavy stuff.

The punter would then get a kind of bike 'resume' back showing his bike's component's weights and offering better replacement parts. Eg. for £100, save 130g, (stem and seatpost), £200 save 200g (bars + stem), etc.

I had quite a few suppliers on board, but I never launched it because I couldn't get all the people I wanted to supply me - Hope and FRM refused for example.

Anyway, I have no desire to do it now, so if anyone fancies it, feel free!

I reckon a new LBS needs to have some kind of USP, either like this or something else.

jane90

Coach H wrote:

YOU may want to open a bike shop with the sideline of a coffee shop however your bank manager is FAR more likely to lend money for a coffee shop in a viable location

If, by "far more likely" you mean 0.1% chance instead of no chance at all, then I would agree with you. Assuming that the OP needs to raise the capital to proceed (and he has a perfect credit score), perhaps he might be better off looking at some of the crowd funding websites, even if he was mad enough to offer his bank manager his house as collateral for such a risky start-up idea. But to have any chance at gathering the necessary crowd funding he would need a business plan that describes a unique opportunity, as well as a realistic cashflow forecast. Most new businesses that fail, don't do so because they're insolvent but because they run out of cashflow. Sadly, I don't think a business plan that says "I think it would be cool to open a cycling shop/cafe and I'm sure lots of club runs will enjoy my cake on a Sunday morning" is particularly likely to convince investors to part with their hard-earned.

Personally, I think that anyone who wants to start a business with a physical retail presence (in any sector not just cycling) needs to ask themselves two questions:

1. Can I match the margins of the large online warehouse operations with a huge marketing presence?
2. If not, why would anyone buy anything from me instead of from them? (be honest with yourself).

Slo Mo Jones

VTech wrote:

My wife is paying around £80/week for a personal trainer at the moment, she is getting fitter, losing a few kilo and feeling good about it. Its all good.

She's blatantly getting both barrels from her personal trainer.

crikey

Tis a hugely tricky situation.

I'm an aficionado of bike shops; my wife and kids know that when we go to a different town, city, country there will be an obligatory visit to a bike shop somewhere along the line. I'm lucky enough to be able to spend in said shops, and make a point of buying something, anything from the shop to help to support them.

I have favourite shops, I have shops that I will do a 50 mile round trip to visit (by bike, of course). I have shops I go to for specific items, and I'm known by name in almost all those I visit regularly.

My local shop, less than 0.5km from my front door has just closed, unable to make money largely due to internet sales, despite being a dealer for the top three or four bike brands in the UK. I use the internet occasionally; normally to buy something that all the shops I visit don't stock, or to buy another of something I originally bought from a bike shop.

I think the challenge lies in flexibility; I've just ordered a bit for my bike, but I can't be bothered ordering online, then faffing about swapping bits and then fitting the item. I went to one of my LBS's and asked him to do a deal; order the item as cheap as he could, do the faffing, fit the item and I'd pay him for the item and the faffing and fitting.

I could have done it cheaper myself, but I see it as paying someone to do the messing about, and this is definitely the way forward for small independent shops; embrace the 'net, do the service.

bianchimoon

jane90 wrote:

Coach H wrote:

YOU may want to open a bike shop with the sideline of a coffee shop however your bank manager is FAR more likely to lend money for a coffee shop in a viable location

If, by "far more likely" you mean 0.1% chance instead of no chance at all, then I would agree with you. Assuming that the OP needs to raise the capital to proceed (and he has a perfect credit score), perhaps he might be better off looking at some of the crowd funding websites, even if he was mad enough to offer his bank manager his house as collateral for such a risky start-up idea. But to have any chance at gathering the necessary crowd funding he would need a business plan that describes a unique opportunity, as well as a realistic cashflow forecast. Most new businesses that fail, don't do so because they're insolvent but because they run out of cashflow. Sadly, I don't think a business plan that says "I think it would be cool to open a cycling shop/cafe and I'm sure lots of club runs will enjoy my cake on a Sunday morning" is particularly likely to convince investors to part with their hard-earned.

Personally, I think that anyone who wants to start a business with a physical retail presence (in any sector not just cycling) needs to ask themselves two questions:

1. Can I match the margins of the large online warehouse operations with a huge marketing presence?
2. If not, why would anyone buy anything from me instead of from them? (be honest with yourself).

spot on Jane90

smbm

AchillesLeftKnee wrote:

For my money (literally, if you're local to me), just one request.

BE OPEN WHEN YOUR CUSTOMERS AREN'T AT WORK.

There are now four LBSs between where I live and the nearest branch of Evans. I have to drive directly past one of them (a mere 10 mins walk from the house) in order to get to Evans. Evans gets most of my in-shop retail trade because, unlike the "local" ones, they are actually open.

This ^^^

Definitely up for coffee etc too. Again, is a no go if 9 to 5 opening only though.

Where are you planning to open?

dwanes

This goes for all local shops.
It makes me laugh when 'local' shops near me complain that Tesco is moving into town.
These same whinging shops keepers are open only 9 to 5, close half day on a Tuesday, early on a Saturday, and close all day Sunday.

ugo.santalucia

dwanes wrote:

This goes for all local shops.
It makes me laugh when 'local' shops near me complain that Tesco is moving into town.
These same whinging shops keepers are open only 9 to 5, close half day on a Tuesday, early on a Saturday, and close all day Sunday.

People have lives and maybe they can't pay for extra staff... what independent shops need to do is to sell items not available at Tesco... of course if you hope to survive selling Heinz ketchup in 2013... well it is a bit unrealistic...

rolf_f

ugo.santalucia wrote:

dwanes wrote:

This goes for all local shops.
It makes me laugh when 'local' shops near me complain that Tesco is moving into town.
These same whinging shops keepers are open only 9 to 5, close half day on a Tuesday, early on a Saturday, and close all day Sunday.

People have lives and maybe they can't pay for extra staff... what independent shops need to do is to sell items not available at Tesco... of course if you hope to survive selling Heinz ketchup in 2013... well it is a bit unrealistic...

Quite - though the problem is Tesco tries to sell everything just to ensure there's nothing left for the local shop to have as a unique selling point.

My corner shop is open 7 til 7 and sometimes I wish it was open earlier and later but if I need it outside those hours, it's my fault. As it is, the folk who run it have long days and few holidays. It provides a hugely valuable service and I probably don't use it enough. On the other hand, I've not been to a supermarket since the start of 2009. They are sh1t - I don't miss them in the slightest and I spend less time shopping since I binned them; both in terms of time wasted trogging around a grossly oversized shop that has stupidly excessive choice and in terms of time spent driving to the middle of nowhere and circulating around a vast car park looking for a space less than quarter of a mile from the shop itself. Binning supermarkets is the same sort of revelation as binning the car for the commute.

Coach H

bianchimoon wrote:

jane90 wrote:

Coach H wrote:

YOU may want to open a bike shop with the sideline of a coffee shop however your bank manager is FAR more likely to lend money for a coffee shop in a viable location

If, by "far more likely" you mean 0.1% chance instead of no chance at all, then I would agree with you. Assuming that the OP needs to raise the capital to proceed (and he has a perfect credit score), perhaps he might be better off looking at some of the crowd funding websites, even if he was mad enough to offer his bank manager his house as collateral for such a risky start-up idea. But to have any chance at gathering the necessary crowd funding he would need a business plan that describes a unique opportunity, as well as a realistic cashflow forecast. Most new businesses that fail, don't do so because they're insolvent but because they run out of cashflow. Sadly, I don't think a business plan that says "I think it would be cool to open a cycling shop/cafe and I'm sure lots of club runs will enjoy my cake on a Sunday morning" is particularly likely to convince investors to part with their hard-earned.

Personally, I think that anyone who wants to start a business with a physical retail presence (in any sector not just cycling) needs to ask themselves two questions:

1. Can I match the margins of the large online warehouse operations with a huge marketing presence?
2. If not, why would anyone buy anything from me instead of from them? (be honest with yourself).

spot on Jane90

Yes Jane you are absolutely right. When I posted 'far more' I didn't think to add that the chance of getting bank finance for ANY bricks and mortar retail is a lot closer to the No Chance end of the scale than you would like to believe.

barrybridges

Here's my thoughts. I've been thinking a lot about this recently, as a matter of fact.

I don't think you should focus on stocking too many 'non-general' products. What I mean by this is that there is absolutely no point stocking bikes, for example, as you won't have a wide enough range of appeal to the high end customers (who want to compare/contrast) and you won't have a wide enough range of appeal to the casual browser (e.g. the low end users who'll go to Halfords).

My LBS is a good example of this. Because it's a small shop, they essentially only have 2 road bikes and around 20 MTBs in there, all from Scott. So, if you don't want a Scott bike, you won't go in there.

You simply can't compete with online, where the range is - in effect - unlimited.

For that reason, any good LBS needs to offer service, not products.

I still think you should stock 'general' products like pumps, cartridges, saddle bags, tubes etc - things that are pretty much of a muchness. But around that, the service, servicing and human touch are what would get me to visit your shop.

For example, the fact I can get you to order something for me online - or order it myself - and have you fit it, would be great.

The fact that you advertise yourself as a free place for any cyclist to stop off and top up their water (in return for a donation maybe), would be great.

There are so many LBS trying to be a 'cafe for cyclists' but the demand is difficult to sustain a business.

rolf_f

Coach H wrote:

Yes Jane you are absolutely right. When I posted 'far more' I didn't think to add that the chance of getting bank finance for ANY bricks and mortar retail is a lot closer to the No Chance end of the scale than you would like to believe.

Given the number of cupcake shops that seem to be sprouting, it must be possible to get finance even for the most ridiculous retail idea!

Bar Shaker

VinnyMarsden wrote:

To the OP..

There was an article about this very thing yesterday on the BBC....apparently shops are suffering from customers "showrooming" as they called it.
Basically go look at the item in local shop..whatever it may be...pump the poor sales assistant for all the info they can give you...promise to return...then go buy it cheaper off the web...armed with all the knowledge your local shop have given you.
It really is a cut throat world......there was a post on here about "gatecrashing" a sportive, basically tagging along for nowt...so you see the mentality you are up against....I'm not slagging off anyone at all, it's just a VERY VERY difficult time to start a specialist business in my opinion, but personally...if you did set it up, in my area, I for one would love the cool cafe idea, maybe as the other poster said...channel yourself down that route, because it is true....a decent coffee shop WILL attract customers..provide a secure bike area, some kind of entertainment and you are away, the roller comps sound a great idea...don't be put off, but think about the overall profit related to effort thing....3 or 4 hours coaxing/nurturing a sale on a £2000 bike might make you about £100 profit, after all your costs/time etc...a good coffee machine and 1 or 2 staff will do the same!!! Go for it!!!

£100 profit??? You are kidding, right? Approx 30% of the retail price of a bike will profit and approx 50% of the price of accessories.

This is what a shop will need to make, in order to pay rent, rates, fit out costs, staff, insurances, interest on stock purchases, credit card fees, electricity and, hopefully give the owner an income.

I buy everything I can in bike shops and mostly my LBS. I only go on line if they don't sell what I want, or they can't get it in. If you don't support your local shop, you can't moan when they are gone.

AchillesLeftKnee

Rolf F wrote:

Coach H wrote:

Yes Jane you are absolutely right. When I posted 'far more' I didn't think to add that the chance of getting bank finance for ANY bricks and mortar retail is a lot closer to the No Chance end of the scale than you would like to believe.

Given the number of cupcake shops that seem to be sprouting, it must be possible to get finance even for the most ridiculous retail idea!

Never, ever underestimate the levels of insanity that can be reached when a large redundancy payment \ spouse looking to manage their company's tax bill is combined with the sort of person who finds the idea of owning a shop romantic, and has the sort of friends who'll happily claim they'd just love to buy stylish £100 romper suits for their children... if only they could find somewhere.

No idea what it's like elsewhere, but round these parts there are a depressing number of these non-businesses. They usually last a couple of years, then shut, only to be replaced by some other insane attempt at making a small amount of money by starting with a large amount of money and an unshakeable conviction that everyone in the home counties is chomping at the bit to buy ethically sourced* African art.

tl;dr The notion that small business funding is always entirely external is false.

* As in, the bloke in Nigeria who made it £2 for it, which is £198 less than it's now on sale for, but at least he wasn't being bayonetted while making it.

thegreatdivide

I’m surprised Ronde hasn’t been mentioned here yet – but then again, since it’s in Scotland most of you won’t have heard of it ;-)

It’s pretty much the ultimate bike ‘shop’ and exactly what the OP is trying to do – and what Rapha have ended up doing too (Ronde is one of Rapha’s retail partners). It just got voted best cycling cafe in Cycling Weekly.

It’s a bike shop.
It’s a superb cafe.
It’s a gallery.
It screens races and movies.
It looks cool as feck.

http://www.rondebike.com/

laurentian

Running a new business is hard. I'm trying to do it right now!

Reading the above, it struck me that perhaps you could sort of combine all of the elements above.

If something goes wrong with my bike I have, I think, three options:

1) Go to LBS, get them to supply and fit.
Result/consequence/hassle: Part more expensive than on-line, labour obviously more than me doing it myself, and I have to take and collect bike to and from shop.

2) Buy part on line and take to LBS to fit (I've never done this)
Result/consequence/hassle: Part purchased as cheaply as possible, labour more expensive than me doing it myself, I have to take and collect bike to and from shop.

3) Buy part on line and fit myself
Result/consequence/hassle: Part purchased as cheaply as possible, labour free, no travel. BUT big potential for F@ck up and further expense and lack of equipment/knowledge etc. means I may not be able to do it anyway.


Option 3 is business you will never get (unless following f@ck up!) so how about combining options 1 & 2? with the customer benefiting from both scenarios?

If you offered a telephone/online service whereby client calls or e-mails telling you exactly what they want, could you buy the part online at cheapest possible price, collect their bike, fit part and return?

Advantage to customer:
a) Even if you took a small mark up on the part it would be cheaper than buying at normal LBS prices
b) Customer pays for labour - a cost they would bear anyway with options 1 & 2 (and I guess you would offer a guarantee on the work)
c) Collection and delivery back to customer takes the hassle completely out of their hands. (Obviously you would have to have to factor these costs in and have zonal charging but collecting say, 4 bikes in one run on a Sunday night would keep costs down).

I believe the above offers something that neither on-line or LBS offer at the moment.

One bit of advice regarding your business plan. Have a look at it, double your overhead and halve your revenue. if you still have a plan after that, it might work!

VTech

The problem is that you have to view it at 2 levels.

1) As an enthusiast with a love of the sport (more likely to want a LBS)
2) As a general member of the public who doesnt give a hoot about a LBS and simply wants to save £££

Money talks, it always has done and always will do. I like nice cars and am willing to spend whatever to get them, its all relative as many here love bikes and will spend whatever to get them.
The world turns just the same no matter what the item in question is but we would be classed as the "passionate ones", the ones who will do what it takes to get what we want but you cant build a business on that basis because passionate customers do not bring in enough revenue to sustain business yet alone growth.
The average customer is a priced based consumer, (there is a reason tesco, wallmart, pantaloon etc are the biggest in the world) we want a bargain and as mentioned above, many are willing to go to a store, ask questions to find answers and then leave, go home, google the product and buy it cheaper elsewhere.
Its kind of like copy-write fraud, downloading an album online illegally but without the illegal bit.

Its wrong but its what people do.
Its a tough market, it always has been and is now very difficult and is going to get much worse so life for a store owner is only going to get tougher.
How can you compete paying rates, wages, taxes, expenses, stock etc etc when all you have to do is get a web designer to build a sweet site, get a unit in a regeneration or council run industrial estate and essentially have a distribution network. Take orders, once paid you simply pay peter and send to paul.

Its not difficult either, if I wanted to build a great business I could do it in 3 months and generate high turnover/decent profits which begs the question.

Why would anyone want the hassle of opening a shop ?

The answer will almost certainly be because they would love too.

There's the danger, you cant run a business just because you love it, love isnt enough.

Headhuunter

I haven't trawled through all 4 pages of this but there's a shop called Cadence in Crystal Palace which does something like you suggest. They have a very good cafe which attracts a lot of cyclists - Crystal Palace has become a bit of a mecca starting point for club rides out of London into Kent and many people meet or end their rides there.

The shop part focuses on small, impulse type purchases rather than supplying entire bikes. They also have a training centre and mechanics - these are the sort of things that internet retailers can't supply, people have to go to an actual physical location for proper VO2 max calculation and bike fixing or whatever it is they do...

http://www.cadenceperformance.com/

djm501

I love all the posts on here that think running a coffee shop is much easier. Everywhere I look there's a coffee shop, oh not, not a saturated market at all. Lol!

Also I am reminded of something I saw Richard Branson say when he launched Virgin trains. He said he was sure he could hire a 1000 accountants who'd tell him how much money he'd lose if he did it. Instead he just did it.

Go for it dude, if it fails then learn the lessons and try it again.

I would however echo the comments about Evans. I have one near me, it opens from 8 am to 8pm whereas all the LBS's are closed except when I'm at work... guess who gets all my business...

the playing mantis

the only way this could work is if you have enough capital to survive a lean year or 2, and if you get local clubs onside. that is key. likewise you cant be all things to all men, you have to focus on a certain bracket i think, at least at first be it road, mtn, tri. u cant spread yourself too thin. likewise you have to offer something that people cannot get locally, (so maybe stock something differnt to th usual brands) and perhaps aim at some of the high end boutique stuff. as for bike brands, perhaps if you can get trading ontracts, aim to sell brands that cannot be bought online, look and time. for example (i think they cant anyway).

good luck if u go wiv it.

itboffin

I think there's some great advice on here but dont underestimate the importance of serving a good coffee, i'm a huge Monmouth fan, their coffee is second to none in my opinion and anyone who starts a shop selling that outside of London will have a viable business but also there's the likes of Notes who put effort like i've never seen into the prep, I asked the chap preparing mine yesterday why he'd used digital scales to measure the beans to which he said some "stuff" about water to "something" ratio at which point I glazed over :shock:

erm yes thanks v much, nice it was but Monmouth is better.

Opening a shop what a good idea, talk to your local business guild or equiv. you'll be surprised how many incentives there are for people to start local trade, even back in the yuppy 80s in the heart of Fulham where I worked there was a parade of boutique shops who paid no business rates and tiny rent, several of these went on to become very successful.

Good luck and never underestimate the importance of a good simple website.

giant_man

Headhuunter wrote:

I haven't trawled through all 4 pages of this but there's a shop called Cadence in Crystal Palace which does something like you suggest. They have a very good cafe which attracts a lot of cyclists - Crystal Palace has become a bit of a mecca starting point for club rides out of London into Kent and many people meet or end their rides there.

The shop part focuses on small, impulse type purchases rather than supplying entire bikes. They also have a training centre and mechanics - these are the sort of things that internet retailers can't supply, people have to go to an actual physical location for proper VO2 max calculation and bike fixing or whatever it is they do...

http://www.cadenceperformance.com/

Yeah I visited Cadence last year for an Italian day, nice little place, serving food and drink but also some good italian marques. Different, I'll give it that.

Bar Shaker

This is how it's done.

http://bianchicafecycles.com/

Coach H

AchillesLeftKnee wrote:

Rolf F wrote:

Coach H wrote:

Yes Jane you are absolutely right. When I posted 'far more' I didn't think to add that the chance of getting bank finance for ANY bricks and mortar retail is a lot closer to the No Chance end of the scale than you would like to believe.

Given the number of cupcake shops that seem to be sprouting, it must be possible to get finance even for the most ridiculous retail idea!

Never, ever underestimate the levels of insanity that can be reached when a large redundancy payment \ spouse looking to manage their company's tax bill is combined with the sort of person who finds the idea of owning a shop romantic, and has the sort of friends who'll happily claim they'd just love to buy stylish £100 romper suits for their children... if only they could find somewhere.

No idea what it's like elsewhere, but round these parts there are a depressing number of these non-businesses. They usually last a couple of years, then shut, only to be replaced by some other insane attempt at making a small amount of money by starting with a large amount of money and an unshakeable conviction that everyone in the home counties is chomping at the bit to buy ethically sourced* African art.

tl;dr The notion that small business funding is always entirely external is false.

* As in, the bloke in Nigeria who made it £2 for it, which is £198 less than it's now on sale for, but at least he wasn't being bayonetted while making it.

Mainly this, but to answer Rolf a bit more; the business plan for a cup cake shop would be far more robust than a bike shop. Small(ish) start up costs for kitchen equipment counter etc, relatively small retail space required, very low inventory capital, large margins. You probably still would not get bank finance but you would have a better case than many. Not so ridiculous after all when you break it down.

I still think its a great idea and would love to find that you have done it anyway and made it a success!