Retail Bicycle Shop Business Plan

Retail Sales

1. Bicycles. We sell new bicycles, predominantly in the mountain bike style, retro-cruiser is a close second, and sport/touring/racing road bikes a distant third. We also sell some used bikes which we take in on trade as a service to our customers who are buying new bikes.
2. Accessories. We offer a wide variety of accessories. Locks, computer speedometers, fenders, cargo racks, comfortable seats, headlights, helmets, water bottles, panniers/back packs/messenger bags, child seats and trailers, bike storage racks, and auto roof rack systems all fall in this category. It is not possible to carry every possible accessory, so we try to carefully chose those which will be most useful or desired by our target markets. When we receive special requests for a new item, we’ll often order several to test the local demand, and if adequate, will add it to our regular stock.
3. Clothing. Clothing appeals to all cyclists, whether it is a logo emblazoned T-shirt or a piece of waterproof rainwear. At University Cycle Works, we rotate our clothing based on the season. Just before the autumn rains we stock jackets and Gore-Tex. Come winter we offer helmet covers and liners, insulated jerseys and pants, gloves, and shoe covers. And when spring arrives and the first crocus appears through the melting snow, we start displaying summer jerseys, and racing shorts.
4. Parts. Parts generally refers to pieces or materials necessary to the basic functioning of the bicycle. Generally, parts are installed during service [see below] and are an additional charge beyond the service fees. Some, like cranksets, pedals, tires, derailleurs or brakes, are both integral parts and upgrade accessories. Others, such as headsets, bottom brackets, spokes, chains, cables, and cable housings are strictly maintenance, though some will be sold to cyclists who prefer to work on their bikes themselves.

Service

University Cycle Works is a full-service specialized bicycle shop. Our service offering includes, but is not limited to:

• Free 30-day/100-mile tune up with every new bike sold.
• Quick repairs for flat tires, broken chains, brake cables, etc.
• Scheduled tune-ups, replacement of all bearing surfaces, repacking of lubricants, and adjustments of derailleurs and brake systems.
• Installation of all accessories.
• Authorized warranty repairs on the bikes.
• Custom wheel building.
• Frameset repairs by outsourcing to Via Porco custom frame builders.

3.1 Competitive Comparison

In almost any retail industry a specialty shop will be slightly more expensive than a mass retailer, due to the higher prices charged by suppliers. University Cycle Works is no exception. The prices we charge for bicycles, parts, and accessories is higher than the prices charged by a K-Mart, GI Joe’s, Target, or by mail-order.

What we do offer, which these large retail outlets cannot match, is friendly, knowledgeable service. We are passionate about bicycles. People do not go into the bicycle business because they want to get rich quickly. They enter the bicycle industry because they love bicycles. That kind of passion and committment comes across to customers when they find a sales person who can fit them to a bicycle so they feel comfortable and want to ride it. Someone who recognizes you and remembers your name is a welcome feature at a specialty store.

Local service is a major drawing factor for a specialty store such as ourselves. A mega retail can sell a bicycle, but it takes a trained service technician to keep it in fine running order. University Cycle Works staff provides the kind of personal, professional service people want, and are willing to pay for. We base our shop time fees on an industry standard, which we then adjust for our target market. This shop rate is comparable to other specialty bicycle shops in Metroburg.

Our location is a competitive advantage for us. Our customer base is predominantly university students and staff. We are almost part of the campus. They walk and ride past us every day, often several times. The convenience of local sales and service brings our customers in. They know they can get the service they need by dropping their bike off on the way to campus and picking it up on their way home: fast, convenient, reliable service.

3.2 Fulfillment

There are three mainstream bike lines and three specialty brands carried at University Cycle Works.

1. Specialized–Widely recognized national brand, full line of road, mountain, and cruiser bikes. Price ranges meet everyone’s budget. Substantial national marketing programs, as well as local co-op advertising.
2. Kona–Technology heavy mountain bike line, with features for the serious off-road cyclist. The bike nob is drawn to this line for its cache, light weight, high-end component gruppos. Priced upward accordingly.
3. Raleigh/Diamondback–Great value for the price. No glitz or heavy marketing. Some name recognition.
4. Terry Precision Bicycles–Designed and manufactured by and for women. Price varies by model.
5. Litespeed Titanium–Serious top-of-the-line bicycles of unique materials and the very best components for road racers, tourists, and mountain bikers who will spend whatever they need to get the performance enhancing machine they want.
6. Via Porco (Road Hog)–Custom sizes and framesets, fillet brazed by a local frame builder, for cyclists looking for the perfect fit and a long-term investment.

Parts for the repair and maintenance of bicycles are available from a variety of suppliers. Four that we regularly order from are listed here.

• Quality Bicycle Products
• Trek Bicycle Corporation
• United Bicycle Parts
• United Bicycle Tools–a supplier of specialty tools for the bicycle industry. They sell shop grade tools, and consumer grade tools for retail sales by bike shops.

Accessories are a huge part of the retail sales in the bike industry. Everything from helmets to headlights, panniers to computer speedometers, water bottles to locks and cables. Three of the largest suppliers are listed here.

• Bell Sports
• Specialized Bicycle Components
• Trek Bicycle Corporation

Bicycling clothing can be either technology-oriented or simple. Anything from cotton cargo shorts to gel padded, multi-panel cycling shorts is acceptable for cycling. T-shirts and moisture wicking nano-fiber jerseys ride side by side, and when the weather turns inclement, there are nylon shells, plastic ponchos, and Gore-Tex jackets, pants, gloves, and shoe covers for the commuter who needs dry office attire, or the continental tourist who needs thousand-mile protection. University Cycle Works regularly stocks these brands. We also regularly purchase small lots of other brands to test their popularity in our market.

• Burley Design
• Pearl Izumi
• Sierra Designs
• Trek Bicycle Corporation

3.3 Future Products and Services

The bicycle industry is a mix of old and new technologies. Frame sets are made of various lightweight materials: T-6 aluminum, 4130 chromium-molybdenum steel, titanium, and/or carbon fiber matrix mixes. And yet the drive train is still a linked chain moving over cog gears, on axles supported by ball bearings.

Wheels can be anything from wire spokes to aerodynamic discs. Clothes range from high-tech moisture wicking synthetic fiber jerseys and Gore-Tex rainwear to traditional wool or cotton shorts.

Each year the major component companies such as Shimano, Mavic, and Campagnolo introduce new parts gruppos. The marketing has become as strident as that of the automobile industry. This means that the bike shop must maintain replacement parts to repair old groups, stock parts for early replacements of new models, and have an inventory of high priced gruppos for the equipment-focused bike nobs who want to upgrade their bikes with the newest and greatest. Additionally, the shop must regularly order manuals and specialty tools to service the new bikes and components.

Following the trends in technology and futuristic products is as much fun as it is work for Hub and his staff. They work on bicycles because they love bicycling.