Cycling retailers profit margins

[Andrew_P]

A quick Google of Wiggle, and they are cetainly pretty profitable, Evans too. Evans is bit more difficult to see as they sold out to an Equity fund so the asset value & cash in hand could well be from that.

 

[subaqua]

an easy way to make a small fortune as a ...(insert whatever type of shop here) .... shop owner is to start with a large fortune.

 

[Andrew_P]

an easy way to make a small fortune as a ...(insert whatever type of shop here) .... shop owner is to start with a large fortune.

Very true of a single LBS, they must survive by generating a club feel, with club rides etc.

 

[NotthatJasonKenny]

You may be wise to take your own advice

That was a copy/paste off Google here:

http://www.wikicfo.com/Wiki/Default.aspx?Page=Margin vs Markup&NS=&AspxAutoDetectCookieSupport=1

 

[dellzeqq]

a

Very true of a single LBS, they must survive by generating a club feel, with club rides etc.

absolutely - but part of this is discounting to regular customers. Which is why Susie's cassette came with a free chain (retail £45) and why I pay three quid for Spesh red packet inner tubes. It's about turning out for school fetes with silly bike rides, running an e-newsletter, maintaining a website, remembering people by name, and, above all, getting a reputation for good service and friendliness - and that doesn't necessarily come naturally to people who go in to the business because they love bikes.

 

[Rapples]

You might want to look at a more reliable source. Google isn't always your friend.

Gross margin is the profit expressed as percentage of the selling price. ie the percentage difference between the cost price and selling price. What that idiot has written is the percentage that is the purchase price, ie the difference between profit and selling price.

Edit, he's done his sums right, but the terminology he's used is less than helpful

 

[Andrew_P]

I was taught very early on in life to work on POR rather than mark up. It is amazing how many people work on mark up as opposed to profit in % terms.

 

[NotthatJasonKenny]

I run a new and used car sales dept, the terminology is moot really, it's all about retained money in actual pounds!

 

[Scruffmonster]

a
absolutely - but part of this is discounting to regular customers. Which is why Susie's cassette came with a free chain (retail £45) and why I pay three quid for Spesh red packet inner tubes. It's about turning out for school fetes with silly bike rides, running an e-newsletter, maintaining a website, remembering people by name, and, above all, getting a reputation for good service and friendliness - and that doesn't necessarily come naturally to people who go in to the business because they love bikes.

I wish I could find a place near Swanley/Hextable/Sidcup/Dartford(oh poo that place got demolished) that could provide this.

Recommendations inside a 5-10 mile radius. (the closer the better, I can run home)

 

[Scruffmonster]

[QUOTE 1859354, member: 9609"]That's surprising, in most forms of retail the more upmarket you go the bigger the margins, or at least the more chance of being able to negotiate bigger margins.[/quote]

It depends at what level of the process you're talking about.

There is zero chance that the manufacturing sale cost of group sets correlates with the retail sale cost. They cost very little extra in production costs, but the market for after market high end groupsets is bigger than that of low end groupsets.

 

[dellzeqq]

I wish I could find a place near Swanley/Hextable/Sidcup/Dartford(oh poo that place got demolished) that could provide this.

Recommendations inside a 5-10 mile radius. (the closer the better, I can run home)

it's up to you to do the work. Find a bike shop that suits you. Purchase stuff from them. Be nice. And, maybe, they'll come to think of you as a valued customer.

 

[dellzeqq]

[QUOTE 1859354, member: 9609"]That's surprising, in most forms of retail the more upmarket you go the bigger the margins, or at least the more chance of being able to negotiate bigger margins.[/quote]
there's another aspect to this. Bikes take a while to set up - or, to be more accurate, bikes take a while to set up if you do it properly. Cheap bikes take just as long as expensive bikes. That makes cheap bikes less profitable still.

 

[Andrew_P]

And, maybe, they'll come to think of you as a valued customer.

That is so right and is also why a lot of Bike Shops over cook the club feel, isolating potential new customers.

 

[Scruffmonster]

it's up to you to do the work. Find a bike shop that suits you. Purchase stuff from them. Be nice. And, maybe, they'll come to think of you as a valued customer.

I was genuinely after a recommendation. Sidcup Cyles have been hit and miss, Bromley Bike Co slightly better. Beyond that it's a schelp out to Sevenoaks unless anyone has a suggestion. A friend recommended a place in Stroud but it's a little too far away.

 

[Smokin Joe]

I was genuinely after a recommendation. Sidcup Cyles have been hit and miss, Bromley Bike Co slightly better. Beyond that it's a schelp out to Sevenoaks unless anyone has a suggestion. A friend recommended a place in Stroud but it's a little too far away.

For anyone sarf of the river, Pearsons would be my recommendation.