Mom and Pop shop

Mom and pop bike shop doomed?

Bike Shop

Mom and pop bike shop doomed?

It’s noticeable to me the cycling industry is changing how it does business. Some manufactures have chosen to sell direct to the end user, while others are opening concept or company owned stores. Some of these changes no longer involve the local mom and pop shop.

Here are some things I’m noticing!

More and more manufacturer stores opening!

This is not a new concept in other industries, but is gaining momentum in the cycling industries. For instance, if interested in an automobile (BMW, Ford) or mobile technology (Apple), when entering one of these manufacturers showrooms, only that particular manufacturers product is sold.

This keeps the customer focused on their product in a controlled environment. Any competitive shopping will have to be done elsewhere. Tesla takes this a step further and owns all sales locations with no privately owned franchises like most of, if not all of the other manufacturers.

Not many manufactures can pull this sales off, simply because they just don’t have a broad enough product line or brand saturation. What do I mean by a broad product line, selling everything from bikes, grips, apparel, spare parts  and a lot more.

Some companies that come to mind are Specialized, Giant and Trek. These industry giants can offer one stop shopping from A-Z. Other manufacturers with smaller product lines are choosing to sell direct to the end user via their website.

I recently notice a newly opened Trek company store just miles from a mom and pop Trek distributor. I asked myself how will they work together and for how long?

On a trip to the  U.K I visited a Pinarello store that featuring just Pinarello products. Assos only apparel store located in London! Is this a first step towards working directly with the end user?

Why are these stores opening?

I’m sure there are a number of reasons, but a few that come to mind are the following.

Increase profit margins

Profit is the bottom line! Publicly traded companies with share holders are all about profit. You’ve heard it before “cut out the middle man”. Dealing direct cuts out the middle man and can increase profit margins.

Controlling the brand

A manufacturer owned store can control the look, image, marketing  and pricing of its brand. Some mom and pop shops may not be doing the best job representing a certain manufactures brand.
In a perfect world all brands should be represented to the buyer fairly, but what if one brand offers a little more profit margin then the other?

Brand Isolation

Of the top manufactures mentioned, is it better for them to offer their products side by side with competitors in a small shop or on their own? Sure some buyers would like a one stop shopping experience, but some manufactures would prefer less distraction.

Better control of product representation

Manufacturer owned stores have better control of product representation, while making sure the product knowledge and brand representation meets their marketing and advertising strategy.

The future for mom and pop shops

I’m not not sure!

How does the mom and pop shop compete with manufacturers stores just miles down the street?
Manufacturer controlled pricing structure?
Far less inventory than the manufacturer can offer on the spot
Will the manufacturers marketing and advertising benefit both?

I can see the mom and pop shop becoming even more service oriented and carrying some of the boutique bikes, but this will be a harder sell than your more popular brands.

Some manufactures seem committed to pushing traffic into the local mom and pop shop for picking up and placing orders, but does the manufacturer really need a middle man for this?

I hope I’m wrong but I don’t see the larger manufactures continuing with the mom and pop shops in the future. Why pay someone to do something you can do yourself?