Saturday, June 13, 2009

Rambling industry post...

Since I’m not “in” the bike industry any more, I rely on Bicycle Retailer & Industry News (BRAIN) to keep abreast of the latest happenings within the bike industry. My little slice of the world is too small to understand what is happening with the rest of the bike world. It's also been a while since I had a good rant.

If I didn’t read BRAIN, I wouldn’t have the slightest inkling that the high-end mountain bike and road bike markets are “drying up.” Instead I would think they are ripe markets based on the development of new, fancy carbon frames found on both mountain and road bikes. If one was to pick up the latest bike magazine, one would see ads and reviews for the latest multi-thousand dollar rig.

The fact is that full-suspension mountain bike sales are down 19 percent and that’s making bike company big-wigs nervous. These companies are busy polishing their trophy bikes which account for only a small fraction of the industry and they are totally ignoring 90% of the market. Bike companies are narrow minded in their focus of the enthusiast market – those buyers who used to drop thousands of dollars on the latest and greatest and who typically throw their bike in their car to transport it to where they start their ride.

I’ve seen some reports that claim the bike industry is immune to the current financial crisis that is plaguing auto companies. Be careful. If bike companies believe this and continue on their current path of spending the majority of their dollars developing and marketing the bicycle version of the SUV, the carbon full-suspension bike and those $7,000 road bikes that riders are afraid to ride through a dirt parking lot, they may find them selves on Congress’ doorstep asking for a bailout.

My meaning of “the bicycle version of the SUV” isn’t the literal meaning as in bikes that can carry loads (although it is debatable exactly how much of a load an SUV can carry – my Passat Wagon has more cargo space behind the seats that some of those leather clad SUV monsters. Rather it relates to the product the industry produces and pushes down the throat of the consumer whether they need it or not.

There’s a monstrous gap in the availability of simple bikes that can very effectively bridge the gap between the mass-market crap that is out there and the bikes that are priced in the stratosphere. I think there’s hope on the horizon. However, the bikes being produced for this market are still too complicated and over-designed.

I commute on a 1969 Raleigh Superbe 3-speed. It’s perfect. I park it in front of the shop during the day and invariably get folks wanting to buy it because it is simple, it’s classic, it looks like a bike. Internally geared hub bikes are becoming popular, but the are typically over-priced for what the market will bear. Or they are overly designed. Case in point is the Shimano Coasting group which is centered around an automatic shifting 3-speed hub. It’s a great concept, but the package it was wrapped in is a little too “out there.” First the hubs have these big chrome domes that cover the dropouts on both frame and fork, the hubs require a 10mm hex wrench to remove the wheel, the spoke count at 24 is too low, and the Coasting bike I’ve had in the shop has no eyelets on the frame that allow simple installation of racks or fenders. In one case, I drilled and tapped the dropout faces so a rack could be installed. I’m not going to do that again without charging an appropriate amount.

The BRAIN article states that dealers are resistant to selling Coasting bikes. Yes, we are. But it’s not because we don’t like the concept. We just don’t like the packaging. There’s a quote in the article by an industry consultant, Jay Townley that goes “Shimano’s Coasting – it’s gone nowhere because of the endemic prejudice in the industry. As an industry we don’t collectively reach out and make them (entry-level cyclists) feel comfortable.” I call B.S.

First, these “entry-level cyclists” don’t want to be called “cyclists.” I don’t even think they want to be called bicyclists, let alone bikers. They just want to ride a bike. And they don’t want to have to spend $500 to get a simple bike. Bike companies are in such a mind-set to load bikes up with “features” and “selling points” that they have neglected to realize that those features aren’t useful and only serve to jack the price of the bike up and make it heavier. I’m mainly talking about suspension forks and suspension seat posts on “hybrids” and “comfort” bikes. Get rid of those things in favor of simpler parts, drop the price – or add in some real benefits such as a lighter frame/fork or upgraded bottom bracket and hubs.

There is a real opportunity in the bike industry to meet the needs of the folks who need a bike for transportation. Folks who want to ride a bike, but are intimidated of bike shops with their rows and rows of bikes that have price tags that have more zeroes that the price tag on their car. Folks who don’t want to kit up in the costume to ride their bike. Heck folks who may not even want to wear a helmet on their bike ride.

I think I’ve rambled on enough. Time to get ready to hop on my Raleigh Superbe and head to the shop. I also won’t be wearing a helmet and I’ll be wearing jeans and a t-shirt.

(What's playing: KWMR Morning Glory)


Ben said...

Here Here!

We just gt in some bikes from Fisher along those lines. They are called the Simple Cities. 3 spd coaster brake bikes with a front brake, fenders that work, rack mounts that work, a full chain guard that works, and a seating position that's comfortable. At about $550, they work really well. I frankly don't think we'll sell many here, as $300 bikes in the shop are often a hard sell. I do think it's a sign that some companies are taking notice. I've heard that the Fisher brand even for '10 is going to be concentrating heavily on the "urban/Commuting" market. I don't think that means exclusively expensive bikes either. It's refreshing really.

BKA said...

For years my family only had 1 car. I would commute to work at the local bike shop on a nexus cruiser. It was great and simple. I am still amazed at the number of MTN and Road bikes at my LBS over $3K. As far as I can remember the commuter bikes and entry level bikes sold faster and we were able to sell more accessories with them. I would like to see more commuter friendly bikes in the shops. Unfortunately it seems the only "commuter" bikes on the roads here in So Cal are for those that can't afford a car.

Guitar Ted said...

Here! here!

I can't agree with you more. I've been saying this to anyone that would listen for three years now.

Internal geared hubs, yes. Single speed bikes, yes.

Simple, but practical and long lasting? Definitely.

Make them inexpensive. Priority.

Jay Townley hasn't got a clue on this subject.

Bokchoi Cowboy said...

Hit the nail on the head. One of the things I have seen over the years are the pricing vs. quality of bikes keeping the average consumer from getting into cycling.

It is a common rant of "real" cyclists that people should not buy those bike-shaped-objects from the big box stores, as it is well known how bad the riding/ownership experience is going to be, usually bad enough to get the consumer to swear off cycling for life.

But the alternative, getting a bicycle from a bike shop with the intent of better function and higher quality, just doesn't happen due to price.

Yeah, the trend towards offering more commuting bikes is good, but I see it as more of a marketing fad. The price of most dedicated commuting bikes is way too high for the average person to really consider changing their commute from the car to a bike.

You are so right on the health-and-fitness bikes being overloaded with stuff that just adds no value to the consumer.

I think the people making decisions at the bike companies are idiots of the highest order. You want to get more people onto a bike, the hit to the wallet is going to be the first consideration, second will always be the concern of how much quality am I really getting for my dollar. They truly seem to act as if the average consumer can afford the high-zoot stuff they are hawking.

I wish I could finally see a review in one of the bicycling magazines where they test several "value" or "Low Cost" bikes that truly are low cost. Currently, when I see these reviews these value bikes are all as high as my house payment!

Anonymous said...

I just read in Bike Magazine that mountain bike sales are up 20%. It may not be the high end stuff selling, but the sport seems to be healthy. I think those high end bikes need a natural price correction anyway. $12K for a top of the line bike made in China? Ridiculous.

Commuter bikes and mountain biking are not even in the same category. For the most part, it's a totally different type of person altogether doing either of those two activities, IMO.

blackmountaincycles said...

@anonymous: I think Bike needs to recheck their statistics. The industry only recently published 1st Q stats and the only mountain bike category that was up was front suspension bikes - up 7%.

Combine that with the fact that Shimano's 1st Q sales are down 18% I think manufacturers are lucky if their sales are flat.

Head Honcho said...

A-freakin'-men Mike! I've seen a slow steady increase in the sales of simpler bikes. Like you, I ride a simple bike (ss rattlecaned old trek) to work that gets as much, if not more attention than the $2k eye candy road bike I have.

Anonymous said...

for whatever this is worth, NSGA says "bicycle riding" is up 11% and "mountain biking" is up almost 10% in 2008: