Looking to ditch my career and be around stuff I love. It can be anywhere in the world, just not in the heart of a big city. Thanks…
I do… I will PM you
you’re my hero
.
Island Triathlon and Bike in Waikiki is up for sale. Cool shop and great owner. Seemed to me like it was pretty reasonable price.
Looking for a partner?
thanks for the 2 leads…its a start.
Are there any business publications which most bicycle stores subscribe to?
thanks for the 2 leads…its a start.
Are there any business publications which most bicycle stores subscribe to?
Bicycle Retailer and Industry News
Most shops are for sale, for the right price. 
Found this online:
Want to Start a Bike Shop?
The National Bicycle Dealers Association (NBDA) regularly receives requests from people interested in starting their own retail bicycle businesses. Our message can be broken into two parts: Good News and Bad News. We’ll start with the “bad.”
THE BAD NEWS
We’d be remiss if we didn’t try to scare you off from the difficult task of starting a retail bicycle business. So here goes: Retailing is difficult, and it’s getting tougher. If we told you that you’d go broke within the first three years, we’d be right 70% of the time. The United States is in the midst of a revolution in retailing, with mass merchants, mail order, chains, and other forms of selling having momentum, and small independent stores under tremendous pressure. Today’s consumer wants high quality, great personal service, and a super-low price. There isn’t much room for error, and the small store’s costs are usually higher than the big guy’s. The competitive battle is won through excellence, and excellence is not always easy to achieve.
The number of independent bicycle dealers is dropping, from a high of about 8,000 in the early 1980s to about 5,000 in early 2004. The bicycle retail industry typically loses about 1,000 bicycle dealers each year, mostly start-ups, but gains that many back because of even more start-ups. However, the overall number of storefronts has been declining in the last few years. Many people have lost their lives’ savings in the retail bicycle business because they loved bikes, but didn’t have a similar zest for the art of retailing. Bike shops run by people who are only bicycle hobbyists, and not business people, typically find the going tough in today’s competitive market.
Add all that to the overall slim profitability in the bicycle industry, and you can really get depressed. NBDA studies show the typical bicycle dealer needs about a 36% profit margin to cover the costs of doing business and break even financially. Studies also show the average realized profit margin on bicycles to be around 36%, which is a break-even proposition devoid of profit. Fortunately accessories products generally carry a higher profit margin than bicycles. Still, the average bike dealer’s profit is less than 5% at year’s end – about $25,000 for an average size store of $500,000 in annual sales.
If you’re still reading this, maybe you’re ready for…
THE GOOD NEWS
The level of innovation and diversity has never been higher in “dealer-quality” bicycle products. The number of entrepreneurial companies designing and manufacturing appealing products for the public is high, both in bicycles and accessories items. There isn’t any part on a bicycle which hasn’t been improved in the last five or so years. The bicycle is tied to health, vitality, fun and exercise. The bicycle is one of the least-expensive transportation choices available, as well as a wonderful tool for fitness and fun. The bicycle affects peoples’ lives in very positive ways, and its use contributes to the betterment of the environment.
Cycling participation is solid. There are approximately 45 million adult “cyclists” today, and cycling ranks fifth on the list of most popular outdoor recreational activities. The government has started to include bicycles in transportation planning. And for the retailer, the opportunity to successfully operate your own business in this very special field can be personally very satisfying.
SOME ADVICE
Look closely at yourself before taking on the difficult task of starting a bicycle business. Enthusiasm is important, but it’s not enough. Make sure you can muster excitement and creativity for merchandising, buying strategies, accounting, inventory control, advertising, employee relations, and sweeping the floors. You must want to serve people of all ages, types, colors and creeds. You’ll need some mechanical inclination and a strong constitution — not flinching from long hours, hard work and setbacks.
Use all the resources you can find to learn about small business basics. “Seat of the pants” business management principles can get you into a lot of trouble. Above all else, take the time to do your research and build a sound business plan (see article in the newsletter section of this web site). Planning, organizational skills, and high energy are prerequisites for success in the bicycle business.
The most successful dealers in the country stress personal service, and developing personal relationships with customers based on caring and service. Quality and personal attention are powerful ways to differentiate yourself from the various discounters and mail order outfits competing for the cycling dollar. The owner and key managers must truly want to help customers and the community, and be truly concerned about and involved with them.
This model of service affects almost every decision made by a retailer. Each time a customer steps into your store, he or she is judging the experience. You and your store are performing, and the showroom is your stage for showing product in interesting ways, where you interact with customers, and try to find out what they need and want that you can provide. The successful dealer pays very close attention to the quality of the customer’s “retail experience.” Customers don’t like to be ignored, or taken for granted, or manipulated, or bored. Attention to detail, good selection, knowledge, a caring attitude, good product presentation — these are all keys to giving the customer that good experience. The store must be identified as “the brand” in the community – not just the products they carry. Relying on the specific products you sell for your identity is extremely risky because others can also sell those specific products.
High quality retailing is not possible without being profitable, having the resources to meet customer expectations and wants. A common scenario of a struggling dealer is one who fails to maintain appropriate profit margins that allow financial viability, but instead uses unrealistic low prices across the board to attract customers. This can lead to what some refer to as the “death spiral.” The retailer may appear busy and successful at first, but if revenue doesn’t cover operating costs, failure is inevitable. The NBDA urges all dealers to keep records and know what their true cost of doing business is (rent, utilities, salaries, etc.) The numbers here are from the* NBDA Cost of Doing Business Survey*, reporting dealerships with expenses shown as a percentage of gross sales. It’s simple arithmetic — if your sales don’t cover your cost of goods plus your expenses, you’re losing money. Know what YOUR break-even point is. Be in control.
AVERAGE EXPENSES FOR SPECIALTY BICYCLE RETAILERS
(From NBDA Cost of Doing Business Survey,
expressed as a percentage of gross annual sales)
Payroll Expenses — 20.5%
Occupancy Expenses — 7.7%
Advertising/Promotion — 3.%
Auto and Delivery — 0.5%
Depreciation — 0.9%
Insurance — 0.8%
Licenses/Other Taxes — 0.5%
Professional Services — 0.5%
Office Supplies/Postage — 1.2%
Telephone — 0.6%
Travel/Entertainment — 0.4%
Other operating expenses— 1.3%
TOTAL OPERATING EXPENSES — 37.7%
NET INCOME BEFORE TAX — 4.2%
GROSS MARGIN ON BICYCLE SALES — 36%
GROSS MARGIN ON CLOTHING SALES — 43%
GROSS MARGIN OTHER EQUPT. — 48.1%
We can recommend some additional resources to you:
– The NBDA Cost of Doing Business Survey, from the NBDA for $150 ($75 for NBDA members). Detailed financial study of bicycle retailing, complete with average costs, profit margins and more.
– The book “Principles of Bicycle Retailing III” by Randy Kirk. Available from Info Net Publishing, with discounts for NBDA members. www.infonetpublishing.com
– The Complete Guide to Bicycle Store Operations with CD ROM, by Ed Benjamin. A comprehensive system on how to operate a bike store. Available from Info Net Publishing; phone 949-458-9292. www.infonetpublishing.com
– The Bicycle Retailer and Industry News Industry Directory, a complete directory to industry suppliers, $75, from Bicycle Retailer and Industry News, www.bicycleretailer.com, or phone 949-206-1677.
Interbike Trade Expo, held in September in Las Vegas, Nevada (phone above), or Web site: www.interbike.com. This show is open to the trade only.
– Trade magazines:
-Bicycle Retailer and Industry News, 25431 Cabot Rd., Suite 204, Laguna Hills, CA 92653, 949-206-1677. Internet: www.bicycleretailer.com
- Outspokin’, member newsletter from the NBDA.
– Join the NBDA! For only $125 per year for dealers, the NBDA offers discount programs, lobbying, education, monthly newsletter *Outspokin’ *and more. National Bicycle Dealers Association (NBDA)
777 W. 19th Street, Suite O
Costa Mesa, CA 92627
Phone: 949-722-6909
Fax: 949-722-1747
E-Mail: info@nbda.com
Web site: www.nbda.com
I have heard that a bike shop is a tough business to be in. Not a big pofit margin on a bike. Is this true? Or am I full of bunk?
Bicycle Retailer and Industry News always has some shops for sale in their classified section.
Remember, you’re doing it for the love of the sport, not for the money.
Jeff
I’ve known a handful of people who have owned their own shops. None of them where able to ride, train, or race much at all while they where running a bike shop. It is extremely time and energy intensive.
it seems to me that there needs to be a new creative way to attract customers to a bike shop in order to compete are against the super large stores. Something like a Starbucks (just an example) and a bike shop. Something unrelated, but appealing to bikers to attract them to the store.
Random ideas:
Oil change/bike shop
book store/b.s.
massage/b.s.
hair cut/b.s.
strip club/b.s.
what else you got out there?
A work closely with chain of bike & ski shops in Ontario, and the owners word of advice about opening up a shop are as follows: “In the bike business, the best way to end up with a small fortune is to start with a big one.”
That sort of puts a damper on everybody’s dream.
It depends on the bike company and the retail level the shop sells at. There are often “advertised” reatil and “suggested” retail. Advertised being higher. The article above shows an average of 36% mark up on bikes. I would say that is average. So considering most retail is marked up 45% or so, it is low.
so it seems you need a town that has a disportenant number of cyclists (high) to the average income level of the town (low).
What about these guys?
Cadence Cycling
cadencecycling.com (in Philadelphia)
Don’t know if the money is any better.
Jeff
This thread from another forum might be worth a read if you’re thinking about this:
Good luck. I took some time off from my career when I wasn’t sure what I wanted to do and I spent a year working at a bike shop. Now the shop I worked in was a large high volume shop here on Long Island. Virtually every weekend day from May to September we would sell in excess of 130 bikes. The only problem is 125 were kids bikes which cost around $75 - $100 or adult mountain or hybrid bikes in the $250 range. The other 5 were one mountain bike over $1,000 and 4 road bikes between $500 - $1500. Maybe once a every week someone would come in looking to drop a couple grand on a bike (we had everything Litespeed, custom Seven, bunch of italian brands, on top of Trek, Specialized, Giant, Cannondale, everything except Cervelo which I repeatadly tried to convince them to get in but for some reason they wouldn’t budge). Now the owner of this shop did very well despite his 20 year old mini van he drove to work and very down to earth attitude and appearance (he has a house in the Hamptons, he played the poor role to get a way with paying so poorly and relying on the discount of 10% above cost to get people to work there). So he did well but I (being an accountant) can see how difficult owning a shop could be. The margins as far as retail go on the bikes are horrible. Now the number of bikes it ordered this shop had the best vendor rating from all suppliers, meaning it paid the lowest possible wholesale cost, if they ordered fewer bikes/year from a manufacturer they would pay more per bike. Even with the preferential costs the profit on all except the > $1,000 bikes was about 30%. That is a horrible mark up. The store made most of its money on the accessories which they had a really large selection of and had mark-up’s over 100% (tubes are unbelivable like 400% mark up) and on repairs where they absolutley killed you ($75 for a basic tune up that takes a 16 year old mechanic making $6/hr to do in 15 minutes). Again this shop makes good money but it is located in a wealthy packed suburban area and has been there for 30 years and this is where you were brought to get your first bike and it is where you’ll bring your kids for their first bike.
As an accountant I looked at the possibilities of running my own shop and it would just be brutual. I’ve visted the smaller shops around here and most look like extremely tough ways to make a living. At a small shop you have to concentrate on either high end or try and do volume you really can’t do both. So ultimately you have to decide if you can get by on 1 sale of a high end bike per week which will leave you with some weeks of basically no sales or if you can make enough selling bikes on 30% mark up. Also with limited resources and limited customers your sales of accessories will be down. So that leaves repair work. With all these limitations it will be up to you to be there every hour the store is open. Could be 8am to 9pm 6 or 7 days a week during the season, the same season you are now racing in. You’ll have to have the mechanical aptitude to work on and build up high end bikes as well as the public speaking ability to sell them and by sell them you may need to convince someone a bike is for them even if it isn’t as perfect as we say it needs to be on this site. Trust me your consceince and wallet will be at odds all the time when some one is wavering between buying the 56cm you have had in stock for 5 months and the 58 down the road.
Everything I’ve read in the Bicycling Retailer magazines point to how tough of a business it is. Definately get a subscription to this magazine before getting into this. Lots of insight.
With that being said good luck in your adventure. I can’t let you go without saying GO FOR IT (I too want to take up a career that everyone on the internet says is impossible)but just know what you are getting into and the high rate of failure. After all this has to work as a career for some people.
-computrainer lab (à la Tom Demerly)
-fit studio (eesh, look at SignatureCycles)
-in-store physiotherapist (haha, imagine?)
-rental services (I WISH I could rent race wheels here!, wetsuits are easier to find, but if you do it one shop 
-packing/shipment services for races (partner-up with another store, and offer packing and assembly services for athletes racing - believe me, I know plenty of people who would pay for it)
I think the computrainers are a great way to keep cyclists coming during the off-season. I live in Montreal where some stores close for the winter, and others switch to hockey equipment etc. Keep the bikers in, and they’ll see new toys on the wall and probably buy something.
One thing I haven’t seen - a store focused for young families?
Many times I have seen parents of fairly keen bikers walk into a store looking for a way to bike with their toddlers. Few stores carry those jogging strollers, backpacks, trailer bikes etc. If you go along this theme, bike racks for cars are a must too. I know that if/when I ever have kids, I’ll probably get a CCM for my kid but maybe I’ll want to splurge for something a little nicer. (but not a 1000$ bike - I have no idea who these spoiled kids are). Its like my dentist; he has a loyal following of patients who he treated as kids (like myself) and its gotten to a point where he treats the adults AND their children.
Accessories are definitely the killer. I think its the same as the computer retailers. A few years ago profit margins were extremely thin and only the places with volume survived. Most people can build/service a computer or know a “kid” who can do it for next to nothing. I think the advent of custom cases, leds, wireless devices, gaming devices have let the little guy come back again. Like the person before said, its the cheap stuff that’s marked up. Think of the dollar store, and how may of those items I’ve seen at other stores for up to 10x as much.