With almost 450 retail outlets in the UK, Halfords’ recent vow to focus greater energy on top-quality bicycles will no doubt spur cycle specialists to defend their territory. Mark Sutton asks around to find out where the biggest threats to the independent are coming from...

INDUSTRY OPINIONS: Competition under control?

“We’ve been selling bikes online since about 2001, and we shall continue to do so. Some of our brands have been heavily discounted online this year, but in most cases it’s just passing on supplier discounts. So anyone can price match them if they want, providing they bought well when they had the chance.

We’ve been accused by some of ‘price shagging’ this year, but again we’re just passing on savings we’ve made. Some people always want to blame someone else for their own problems. Bottom line is, there will always be someone cheaper than you. Always. If you get stressed by them, or allow them to set your retail prices, you’re doomed!

I’ve never paid attention to what other cycle retailers are doing. If they want to worry about what we’re doing that’s up to them, but it’ll never be the other way round. We do what we do, and we do it well, that’s all that matters.”

“Focusing on the repair aspect of the business, there’s limited competition as we’re not bogged down with the stock and sales of various types of bikes. Bikes are no longer just two wheels, some pedals and a handlebar. You have to specialise in specifics if you’re to compete nowadays.

There’s a Tesco not far down the road from us, which provides our stiffest competition. But I’m not concerned, because at 40p for a puncture repair kit you really do get what you pay for.

I’m happy to go down the repair route as there’s plenty of work to be had and the margins are a little higher than those of many sales.”

“My thoughts are that there are people who like small shops and then there are those who like Halfords and surfing the web for purchases. One is probably never going to change that and as long as I’m getting a good share and the non-specialists do a bad job, then our business will be okay.”

“Competition opening up on your doorstep can be worrying, although it can be a good thing and definitely keeps you on your game. Where this has happened to us in the last couple of years we have found our own business has increased.

Halfords’ statement to concentrate on quality, as well as quantity, shouldn’t really change the market. They have had GT and Kona for years and its Carrera bikes have been heading in that direction for a long time now. One of the frustrating issues for us with Halfords is their Cycle To Work scheme.

First off the Government tax break has been a great benefit to the cycle industry as a whole and Halfords has done a great job running their scheme and grabbing market share, but they will supply all brands at any cost. This comes at a cost to IBDs taking pounds from them for very little profit. This is very disappointing and makes brand territory and protection difficult.

Online is getting stronger although cut-throat pricing seems to be easing off a bit as companies realise they need margin to make money. There will always be something out there you can’t compete with, but that is business.

Other than that you have to look at product availability and price point bikes being harder to find. Pricing may be an issue come Christmas, especially with kids’ bikes.”

“The online stores are really starting to cause our business problems, mostly because of the extensive and diverse range that is available nowadays.

The developments at Halfords are another pressure, but hopefully we will be able to keep our heads above water.”

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