Should Bike Shops Be Selling Men's Underwear?

The world of bike retail is changing, and changing drastically. Is there anything off limits for a bike retailer?

Twenty years from now we will look back upon this decade and we'll have a name for it. Much like we named the Industrial Revolution. We will point to this time and say, "That's when it all changed." In the world of retail the way it is changing is from the merger of manufacturers and retailers. The traditional model of manufacturer to distributor to retailer to customer is dying and in many places is already dead. From now on it will be simply, manufacturer to customer.

Many would look at Target, Wal-Mart, or their neighborhood grocery store as the traditional definition of a retailer. They bring in products made by other people and sell them to consumers. Though when looking closer we realize that more than 50% of what Target and Wal-Mart sell, they manufacture. Every grocery store has their own brand of items. Even Amazon, the world's largest retailer, is a manufacturer of electronic goods, kitchen supplies, books, and much more.

What does this mean for the independent bicycle retailer? It means, more than ever, they should start looking to create products of their own. Controlling the entire value chain. Right now nearly every bike retailer is the owner (or manufacturer) of the services they sell. Going forward they will begin to own their apparel, the shoes, the nutrition, and possibly even the bikes. 

Some retailers will even expand beyond tradition and start selling items we never expected, but with a brilliant cycling twist. Look Mum No Hands in London sells their own band of men's underwear for example.

Underwear sold by Look Mum No Hands

What is the next product you really want to own?

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

Archimedes Took a Bath Before

The best opportunities to learn are when we are perplexed, when we wonder.

Archimedes was born in 287 BC on the eastern coast of Sicily, in the city of Syracuse. He was a Greek mathematician, physicist, engineer, inventor, and astronomer. He was known for his obsessive pursuit to find the solution to nearly any problem he encountered. Among his resume of works is the Archimedes’ Screw used to pump water, a collection of enormous mirrors designed to burn ships at sea, the odometer, and systems to fire catapults more accurately. Despite the meatiness of his resume, Archimedes is most remembered for taking a bath.

King Hiero II of Sicily had commissioned a goldsmith to make a votive crown, for which the King supplied the gold. When the goldsmith returned with the crown the King was suspicious that perhaps the goldsmith used some silver in place of the gold. So King Hiero II summoned Archimedes to investigate the contents of the crown but there was a catch; Archimedes was not allowed to damage the crown in any way. So he could not simply cut the crown in half or melt it down.

Archimedes knew that to solve the problem he had to determine the density of the crown. He also knew that density was a measurement of an objects mass divided by its volume. Mass was easy for Archimedes to determine, he simply put it on a scale, afterall silver weighs less than gold. When he did this he saw that the crown’s weight was correct which meant that either the crown was entirely gold, or the goldsmith used more silver to match. To test the latter Archimedes would need to determine the volume of the crown; this was the tricky part. A crown is an irregular object. You can’t measure its sides like a box or its circumference like a sphere.

Late in the evening, while contemplating the problem Archimedes decided to take a bath and then retire for the evening. As he lowered himself into the tub he noticed that when he sat in the bath the waterline rose. The more of his body he lowered in, the more water would rise. Archimedes realized that this was the key to solving the puzzle. The displaced water was the exact volume of anything lowered into the tub.

This discovery excited Archimedes so much that he ran through the streets naked, dripping of his bath water, and shouting “eureka”, which is Greek for “I found it”. By lowering the crown in water he would be able to measure the crown’s volume compared to an equal amount of gold. Archimedes now knew the volume of the crown and concluded that the King was cheated out of his gold.

Why I love this story is because Archimedes took baths before this day. This wasn’t his first bath he had taken. He had been literally immersed in this solution thousands of times before. The question made him find the answer. The question made him realize that his bathtub was the solution.

There are times when we play the role of King Heiro II giving the opportunity to others to take the stage as Archimedes. We do this by asking questions that help people rethink their bath. Whether people are looking to triple their sales, grow their community, or just implement a simple idea; the right questions will help them see the answers that have been sitting right in front of them all along. Other times we have to play the role of Archimedes, challenged to look at what we have in a new way. Finding the solution within our own walls.

When are you King Heiro II, and when are you Archimedes?

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

Bike Shop's Customer Care Can Be Measured In Floor Pumps

I often find that the simplest metrics will tell me more about a bike retailer’s business than any profit and loss statement. Total sales and margins can provide an estimate of the overall health of a business, individual sales will tell me who the top performers are, and measuring turns will show which products are moving. Conversion rate will show the proportion of customers that purchase. However, none of these metrics will tell me if the retailer is doing right by their customer. Most people believe that the only way to do this is by conducting customer review surveys or by measuring impressions on social channels.  However, I can get a clear understand of how a bike retail business treats their customers simply by looking at some simple metrics.

I will preface that these metrics are based on some foundational assumptions, and where the true data geeks in the world may scoff at this, I have still found these metrics to be helpful and telling.

The Floor Pump Metric. The number of new bikes sold compared to the number of floor pumps sold. There is a collection of bike models that are almost always sold to people who are buying their first bike in a very long time. Some of the bikes in this category are kids bikes, adult bikes under $1000, flat bar road bikes, base model mountain bikes, and comfort or hybrid bikes. For these new bike buyers chances are very good they need some basic instruction on the maintenance and operation of the bike. They will have to be taught how to shift, how to lube their chain, and how to inflate their tires. If the person working on the retail floor didn't take the time to show them how to use a floor pump to inflate their tires, then chances are really good that 3-5 days later this person will be riding on tires that are near flat. Control will be compromised and they will be susceptible to a pinch flat.

How many of these bikes were sold? Compare that to the number of floor pumps sold. If there a discrepancy it is likely the customers were set up for a horrible cycling experience.

Tune Ups To Bike Sales. How many bikes sold in a year compared to the number of bikes return for a tune-up in the next year.  Many will agree that a bicycle should have at least one tune up every year. This tune-up will help keep the bike shifting and braking properly plus will give the technician the chance to replace a tire before it becomes too worn to ride safely. If we can agree that a bike should have a minimum of one tune up a year then comparing bike sales to tune up sales will be a sign of how often people who buy from the store and return for service.

If a retailer sold one thousand bikes in 2011, we should see one thousand tune ups in 2012. Ideally more because they’re capturing some new market from competitors. If they sold another thousand bike in 2012, then they should see 2000 tune ups in 2013. Since a tune up is a recurring service it is easy to see how a bike retailer that has been open for 5-10 years should be doing far more services than the number of bikes they are selling.

In 2012 I tested this assumption with 25 retailers in the US and asked them to give me the number of bikes they sold and the number of services that they would classify to have needed annual service. The result was a dismal 4/10. For every bike sold they were seeing only 40% of them return for a tune-up.

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

Can Brick & Mortar Beat Online Retail? IBM Thinks So

In a series of recent studies IBM predicted the future of retail saying that in five years physical retail will beat online. With a bike shop as the example they also said:

"In five years local stores will merge digital with the instant gratification of physical retail to offer a more immersive and personalized shopping experience and make same day delivery a snap."

"Local stores will bring the web right to where shoppers can physically touch it, by enhancing the immediacy of physical retail with a magnified digital experience."

"Cloud based technologies will give both sales associates and shoppers rich product information and reviews and help buyers tailor store inventory to customer demand."

Their prediction is clearly biased as IBM makes several of the solutions they are predicting will be used, but that doesn't make it untrue.  The difference I see is that these solutions are primarily built for manufacturers who are also retailers not for independent retailers. I see two ways these solutions are going to be useful for the neighborhood bike retailer:

1. The independent retailer becomes a manufacturer of something, owning the value chain (manufacturing, distribution, and presentation)
2. The independent retailer partners entirely with a brand. Meaning that they open up the POS, inventory, and all sales data to a specific brand. Essentially becoming a distribution center for the brand they carry.

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

5 Things From 1977 That Changed Everything

In my opinion, 1977 was one of the greatest years in human history for five reasons. 1) It was the year I was born, April 5th to be exact, born in Des Moines, Iowa. I was adorable. 2) Star Wars opened in theaters and introduced us to the force, the evil empire, and the Wookie. The definition of nerd would change forever. 3) Atari 2600 was released and we were moving things on the television screen with our hands- it must have been an absolute mind melting experience. 4) Britain changed the way we think about music with Nevermind The Bullocks Here’s The Sex Pistols and number 5) Lyrca shorts.

Lycra was the name for a highly elastic fiber from Dupont that combined elastene and spandex. Both Assos and Castelli claim to have been the first to make and sell a pair of Lycra shorts, and the moment they were on sale the factories could not make them fast enough. Lycra was a runaway hit because up until that point cyclists were riding in heavy, itchy wool shorts, which meant that when Lycra was available the choice was easy. Lyrca was tight, thin, and looked absolutely wonderful (conjecture). Lyrca made such a cultural impact on the sport of cycling that even today, when shorts are made of all sorts of artificial fibers, people will still call them Lycra.

Lycra shorts, like Star Wars and Atari 2600, was a great idea. It was an idea that changed the way people thought, spoke, and acted. Right now you might be stewing on your own great idea. An idea for your bike shop, that if you implement, will change the way people think and speak about you. Perhaps you want to change your product offering, maybe open a second or third location, or completely revamp how you do service.

Whatever your idea may be it is important to know the six stages of growth a business idea goes through. being aware of the stages will allow you to plan for the future and help ensure your idea gets traction.

1. Idea Buy-In. If you are not the owner or decision maker in the bike shop you have to get buy-in on your idea. You may have an absolutely brilliant idea, but if your idea lies outside the abilities or desires of the bike shop’s owners, then your idea will likely fail. The folks at Assos and Castelli could easily get buy-in on Lycra shorts. It was a brand new product in a clothing category than had gone unchanged for years. The price was reasonable, the demand was there, and the potential profit was high. If you need to get buy-in on your idea be sure to show how it affects the bottom line. Cost, time investment, and potential upside all need to be in your calculations. You can’t make something amazing and then your bike shop can’t sell it.

If you are the manager or owner of the bike shop then you may be able to skip this step unless you need to get buy-in from third parties such as vendors, local associations, the bank, or governmental agencies.

2. Empathy. Having empathy and understanding of your customer needs is crucial. Ideas that will make life easier on you but more confusing or complicated for your customer can be detrimental to the business. We have to put ourselves in our customers shoes and ask, “how can we make their lives’ better?” Wool shorts were itchy, heavy, they smelled bad, and they stretched over time. These were the pain points that Lycra solved.

Be sure to look at your idea from your customers point of view. What pain-point are you solving? Some examples of ideas that consider the customer needs: Faster turn around on a repair, worry free delivery and pickup, buy online and pick up in store.

3. Stickiness. How will our ideas inspire customers to use your services regularly? Perhaps you want to build a service booklet for your customers to track when they need services. Or take it a step further and record their miles through a social fitness app. Perhaps you have a follow-up survey you do will all customers 2 months after they purchase a bike.

4. Virality. An idea is only as good as its market. How will people learn about your business? How will your idea spread? Are new customers acquired entirely by marketing strategies or do you have a referral model in place. Lycra had massive virality, primarily through word of mouth and endemic marketing, but everyone who wore a pair of Lycra shorts got asked the question, “What are your shorts made out of?” They were conversation starters.

5. Revenue. How do we take some of the money you’re now earning from the product or service and pour it back into future customer acquisition? Both Castelli and Assos are still around and thriving businesses today. The sales of Lycra shorts were a groundbreaking moment for them in their growth, from those sales they were able to reinvest in the company, create new products, and blossom into the brands they are today.

For your idea how will it feed growth into the business. An idea that gets launched, sees a profit, and never changes again is a one hit wonder of business. Your ideas should foster future opportunities.

6. Scale. At some point in the growth of your idea it will grow beyond your capabilities. The high demand for Lycra shorts meant hiring more project managers, seamsters, and back of house logistics to get everything shipped. No one person can handle great ideas, it will take a team of people. As your idea grows how can it grow without you having to be involved every step of the way?

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

This Isn't For Professional Cyclists Anymore

I am still looking the bike retailers that are willing to take a risk and purchase the paper and printer to do pro-level name stickers for their customers' bikes. Retailers who did this could surprise each customer by labeling every new bike and tune-up with a name sticker. Complete with the customer's name, flag of choice or your logo.

Thanks for taking the time to read this. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny

Uncommon Service, 2012 (Audio)

In 2012, during the Specialized Dealer Event in Colorado, I presented idea on process, scheduling, sponsorship and more to over 400 independent bicycle retailers. It's 45 minutes long.

Bicycle Retailer and Industry News covered the presentation as well and in full disclosure I borrowed the "brevity, levity, and repetition" from Daniel Pink. 

Topics covered:

• David Lee Roth and brown M&Ms
• Being anecdotal vs being analytic
• Data on the cycling industry
• How much is your tune-up?
• Job design and checklists 
• Scheduling staff
• On the fly repairs vs check-in repairs

Thanks for taking the time to read this far. If you found value in this piece would you please consider sharing it on social? Thanks again. Donny