Retail bike shop and service centre business

A continuous increase in the fuel prices results in the fact that more and more people turn to alternative means of transportation, used on a daily basis. The fuel expenses of at least few hundred pounds a month cause people to seek for some cheaper solutions. Consequently, it comes as no surprise that the bicycle industry develops steadily with a growth rate of more than ten percent a year. Such a dynamic development of this economic sector makes the idea of running a retail bike shop and service centre especially worthwhile.

Market analysis
Currently the bicycle industry in the UK is worth nearly 3 billion pounds and its value is still growing. Undoubtedly, what stimulates the development in this area are high prices of fuel as well as bus and tram tickets. Furthermore, people tend to buy branded goods more often, which is also reflected in our preferences regarding bicycles.

Numbers do not lie – it is estimated that the total amount of bicycles sold in the UK in 2011 exceeded 4 million units. Moreover, there is also a huge upsurge of interest in used bicycles and bicycle repair services. These data also indicate, that the market is becoming more and more competitive, especially in big cities.

Plan the scope of your offer

Launching a bicycle shop should be preceded by a detailed business plan. First and foremost, our offer should contain the most popular models currently available on the market. The diversity of assortment is crucial, since it provides our potential customer a greater range of options to choose from. The most demanding customers are, obviously, those with a longstanding experience in bicycle riding. Such customers will probably know exactly what they are looking for and which model is suitable for them. Nevertheless, we should be prepared that the majority of our customers will need some assistance regarding the choice of a bicycle.
To become more competitive, in our offer we can also include equipment servicing. In this case, it is a good idea to cooperate with a reliable company specialized in this area. Such a solution, apart from being very convenient, is also viable from the economical point of view. Equipment servicing would be a particularly attractive option for the owners of high-end bicycles.

Estimated costs of business
The major cost of the investment will be connected with the purchase of different models of bicycles and accessories. Additionally, if we plan to launch a service centre, we need to spend some money on the set of high quality, professional tools. Moreover, if we do not have enough experience and practical knowledge, employing a qualified repairer is a must.

To minimize the risks, spare parts should not be bought in advance. Instead, we should buy them systematically, whenever they are needed. An important matter is also offering a short repair time, which, from the customer’s point of view, may be a decisive factor when choosing a service centre. In the case of more complex repairs, the delivery of specialized spare parts can take up to a few weeks. Therefore, it is vital to keep the customer informed about the progress of the repair.

Finally, to be one step ahead of the competition, we have to find an attractive location for our business, as well as develop a proper marketing strategy (e.g. outdoor advertising, professional website etc.). Additionally, we have to take into account that running a retail bike shop and service centre is a seasonal business, with the peak falling between spring and autumn.

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