BikeBiz Bicycle and cycling retail news
ActSmart’s monthly market research for December, produced exclusively for ACT and BikeBiz, witnessed 2010 ending on a real low. While that was obviously snow-inflicted, the cycle trade fared worse than many and the real question is ‘what’s next…?’
Specialist cycle retail sector sales shrank by 13.5 per cent in December, less than Halfords’ recently reported shortfall, but the impact was significant.
December’s performance reduced core IBD like-for-like sales growth to just 1.6 per cent for 2010, compared with 5.7 per cent in 2009.
After allowing for other sales revenues, particularly cycle to work volumes – which have also suffered in the second half of 2010 – and sales achieved via cycle finance – which remain buoyant – like-for-like total IBD sector growth figures are estimated at c2.5 per cent for 2010 compared with c7.5 per cent in 2009.
We can’t ignore that currency driven price inflation had a significant impact upon 2009’s performance, with retailers attributing over 50 per cent of volume growth to inflation; a factor that didn’t have the same impact in 2010.
The sales growth graph for 2010 reveals the rollercoaster ride we have endured throughout the year, but the big question is ‘where do we go from here?’
January sales are reportedly sluggish as we begin to feel the real impact of consumer caution in the economy and a new bicycle is without doubt a big-ticket, considered purchase for the majority.
However, nearly one third of businesses who participated in our December research reported a sales growth in the month and c20 per cent of participants reported a sales increase in excess of 20 per cent like-for-like vs. December 2009!
Anyone who has followed ActSmart’s market research over the past few years will be aware that two thirds of the market has seen continued and often exciting sales growth. This continues, with the growing businesses in December reporting a combined sales increase of 28 per cent vs. 2009.
Although the impression peddled by the national press that participation in cycling is growing exponentially is clearly far from the mark, there has been a steady growth in committed cyclists, generating continuous repeat business for repairs, upgrades, clothing and accessories.
The sun will shine again shortly and even if Easter is late this year, once the weather improves so will cycling participation.
The IBD sector has to get the year off with growth vs. the snow ridden January 2010, then we just need to keep it going through good retailing skills, like the top 20 per cent of businesses in December.
