THE BIKE OF YOUR DREAMS
IN THE MIDST OF THE BICYCLE SALES BOOM
Maybe you've already experienced it this year: you saw your dream bike on Bikester, saved it in your favourites and the next day it was gone. Or you fell in love with a bike but it wasn't available in your size. Why can't the bike just be quickly restocked? When will it be back in the shop? These are the most common questions our Customer Care team received last year.
When the weather improved in the spring of 2020, and it became clear that travel abroad wasn’t going to be possible due to the Corona pandemic, more and more people decided to explore their local area by bike. Bikes also became increasingly popular for commuting, as they helped people avoid public transport and get outside in the fresh air.
This triggered an immense demand for new bikes that the bike industry couldn't have predicted. Everything from e-bikes to gravel bikes, and parts like chains or tyres that people needed to fix old bikes were in demand. The bicycle industry initially benefited from this boom: in 2020, there was a 60.9% increase in sales in Germany, according to the Zweirad-Industrie-Verband (ZIV). 5.04 million bikes and e-bikes were sold, a 16.9% increase over 2019 – and the boom continues in 2021.
In the summer of 2020, there was already a yawning void in many bike dealers' warehouses, and these are only just starting to fill back up. Anyone who wants to buy a new bike these days has to wait a long time for their dream bike at many dealers. Sufficient supplies were not ordered in time, and it's too late for that now. "Whereas in 'normal' times it was possible to place orders with suppliers six months in advance, since the spring of 2020, two years lead time has become normal", says Michael Benner, purchasing manager at Bikester.
The bicycle business is a global one. Individual parts come from different countries, all of which are affected by the pandemic. The high demand for bicycles and accessories can be seen worldwide, and we expect this boom to continue well into 2021.
Bikester also experienced temporary supply bottlenecks. This was due to shortages of parts such as suspension forks or tyres at suppliers, due to high demand. Besides stock issues, supply was slowed due to limited transport options and a lack of shipping containers. These problems affected all distributors equally.
Nevertheless, since last autumn there has been a gratifyingly large supply of new bikes in our online store. How have we managed this?
There are quite a few reasons. Compared to many other retailers, we've been risk-averse in our purchases and are more broadly positioned. We also benefit from our very reliable supplier and partner network.
Back in April 2020, we recognised the warning signs and upped our number of orders. At that time, there was still a great deal of uncertainty. Faced with the question of whether bike shops would stay open and how buying behaviour would develop, many other retailers initially cancelled their autumn orders or ordered too cautiously.
At Bikester, we rely on data-driven analyses that can predict new trends, like the gravel bike boom, much earlier. So, we usually ’stock up’ in good time and react to these developments. Of course, trusting these trends also involves a certain willingness to take risks. Since the great demand for bikes in general and robust growth of the market has already been apparent for years – due to the rise of the e-bike and the success of bicycle leasing – we purchased with corresponding confidence to be able to meet customer demand.
However, we still felt some of the supply bottlenecks mentioned above: we’re currently receiving fewer bikes than we'd initially planned. But in contrast to many other dealers, we're delighted with our choices and due to our large early orders, we have good stock levels. Also, we can still guarantee a wide range of products. You can get all styles and brands in our store, from children's bikes to hybrid e-bikes to high-end road bikes.
Bikester is a sought-after partner for our suppliers. Because of our large, stable purchasing capacities, we’ve built reliable business relationships with companies. Another plus point is our logistics centre in Lower Saxony, which can stock and ship up to 130,000 bikes at once. Everything you see on the website is actually in stock and can be delivered to your home, one of our local fahrrad.de stores, or to a service partner within a few business days. This makes us the bike retailer with the largest immediately-available selection in Germany.
From model development, to ordering and assembly in the factory, to delivery.
A bicycle is more than the sum of its parts – and yet the latter can play a major role in the current shortage.
One gap in the supply chain, missing pedals, for example, and the bike doesn't even get assembled or arrive at bike shops.
You can see how fragile global supply chains are from the recent Suez Canal blockage in March 2021. The Ever Given held up many other container ships, some of which also carry complete bikes or parts. This causes delivery delays and great economic damage, as the canal provides the shortest shipping route between Asia and Europe. Using the example of one of our top own-label products, the Ortler Bolzano Wave e-bike, you can see how many steps are necessary from the first idea to the delivered, complete bike.
The process starts with the development team, who take between twelve to eighteen months from the initial idea to the production-ready prototype.
A business plan is drawn up, costs are calculated, and profit targets are set. The next step is pre-ordering. Usually, it takes at least another six months from this point until the first products arrive in the Bikester warehouse. Currently, it's more like 24 months due to the delays mentioned above. The shipping time is not yet included.
So, it takes roughly two years from model development to delivery of a 'normal' bike in 'normal' times. In fact, for our own brands, we're already in the planning phase for 2022 and 2023. The development, production, and planning phase for e-bikes can take an extra six to twelve months.
What does this mean for our example, the Ortler Bolzano Wave e-bike? In current times, it would theoretically take up to five years for a completely new bike to be delivered to our warehouses. However, since the Ortler Bolzano Wave e-bike is a classic that requires few changes, there’s no need for this long development time. Our willingness to take risks means we can order and develop parts at the same time, to ensure we can stick to delivery times of a maximum of 24 months.
As simple as a bike looks, it can contain more than 1,000 individual parts. In this picture, you can see the most important ones:
Let's take gears: the Ortler Bolzano has a Shimano Deore derailleur. Shimano's delivery problems were a big topic in the trade press and affected many dealers and brands, leading to further delays.
Since the companies that produce our bikes usually do everything from product development to finishing under one roof and, based on our early ordering, should have already procured the components in good time, there should be no shortage of groupsets here. Saddles, stems, forks and seat posts were also in short supply last year, leading to delays in full bike deliveries. As soon as one part is missing, everything gets delayed. These parts are also manufactured by some of our supplier companies, so delays can be reduced for us here.
Bosch motors for e-bikes were (and still are) in high demand – our Ortler is also equipped with a Bosch motor. In this case, we're in the fortunate position of having the bike manufactured in Europe. There are stringent quality standards, remarkable expertise in the e-bike sector and preferential access to scarce motors.
Once the bike is complete and ready to be shipped to our logistics, further factors that cause delays can come into play. It sounds simple, but it's happened before: a shortage of bike boxes. In the case of our ’made in Germany’ Ortler, we're not affected by this shortage, but it's been a problem with other bikes or parts. We're optimistic, however, as the situation usually improves in the summer.
We can still help you! We can usually offer an alternative from our large assortment for almost every sold-out bike, possibly from a different brand or in a different colour. This is especially true for our popular in-house brands: you'll find a lot of choices, and always at attractive prices. We've got bikes for every discipline. If you've got your heart set on a specific model, it's more likely we'll get it faster than other stores because we ordered early and in large quantities. Just check our site from time to time or subscribe to our newsletter and you'll be the first to know about the new arrivals.