Will Fripp, CEO of Extra UK, updates BikeBiz on the latest developments at the Northamptonshire-based distributor
This piece first appeared in the December edition of BikeBiz magazine – get your free subscription here
How has 2022 been for Extra UK?
I’m confident from all my conversations with other industry colleagues that our year has been similarly challenging to theirs, at every level of the supply chain. At Extra we’ve had a lot more to deal with, due to so many changes within our business around the start of the year.
In March we announced our new ownership in the form of Storskogen. This followed my appointment as CEO at the end of 2021 and the reorganisation of our leadership team.
We have also expanded our team, including the addition of three in-store retail specialists, plus added loads of new talent and experience to Extra’s already great foundation, bolstering and breathing new life into an already established and respected business.
We’ve been highly focused on supporting our retail and brand partners this year, all the while keeping calm and cracking on, polishing the business, our systems and our processes, plus I guess a little settling in!
Lots has changed at Extra, but all progressive stuff for the good of our business as well as our brand and retail partners – all the time surrounded by a really tough economic climate.
We all know the challenges, and they are shared by us all (within cycling and well beyond): energy, fuel, food, the cost of living crisis in general, goods and raw material inflation, war in Europe, weak sterling and that’s before we even get started on Brexit and its acute effect on the UK cycling market – all leading to the lowest consumer confidence since records began, back in the 70s.
From one unprecedented time to another and its effect on UK consumer behaviour, which is challenging as always to keep your business in line with. Despite this, it seems things are really going in the right direction at Extra and our Irish subsidiary Cyclex. As a business, we have outperformed the UK cycling market data we have seen by some margin.
We recently surveyed the customer base of both our businesses and achieved an NPS score of 8.1 and 8.4 out of 10 for Extra and Cyclex respectively which is considered great, as well as a plethora of good, constructive feedback that has helped us prioritise our plans for the coming seasons.
We thank all our retail partners for their business, their feedback and for their ongoing partnership and business.
What do you see as the biggest challenges and opportunities for 2023?
We need a better, clearer crystal ball! It’s super tough to see when we can expect a stronger recovery, primarily because it’s affected by so many things bigger and beyond the remit of our little industry.
Supply chain resets take a significant time to filter through. Even when demand recovers from consumers, there is so much stock to sell through in retailers, then within distribution before it hits manufacturing levels. Lead times have significantly shortened across this industry, but order frequencies and fulfilment are still ‘normalising’.
We all pray for a strong recovery of course, with so much stock within the marketplace, for its ongoing survival in the shape it is today, in reality, I guess next year will be key for many less stable players.
Ultimately, although people are holding the line right now, some will be under more pressure than others to clear stock to survive. We have already seen some casualties along the way; in addition to some other market shape changes as the bigger bike brands have paced up their deeper involvement with direct retail.
It’s not all doom and gloom, far from it, just less certain than it has been for some time. The broader outlook for cycling remains very positive, especially at the enthusiast level, and environmental tradewinds only support our industry further.
What new brands have you added to the portfolio, and what opportunities do they present?
In all honesty, we have probably trimmed more than we have gained over the past 12 months. Extra is well known for its curated ‘stable’ of strong brands and we want to stay really true to that, equally we have very few significant category gaps that are not already supported within our existing portfolio.
We appreciate that dealers are consolidating the number of supplier accounts that they work with, so are mindful to keep our range as complete and broad as it is, across key soft goods, parts and accessories as well as workshop supplies.
We like to work with brands that fit Extra, that fit our market, brands we believe in, we ride with, brands we can really support, add value to, develop and work in close partnership with. I guess we are kind of picky, but that’s a good thing.
We’ve had quite a few approaches over the past season that we have opted to decline for lots of different reasons. All this said, we haven’t been resting on our laurels in this regard and expect to have at least two brand additions to announce in the new year.
How have dealers been reacting in the current climate?
I think it’s fair to say it’s been a mixed bag. I think although still facing the same challenges, if not more so than bigger businesses, the IBD has experienced a bit of a renaissance – in part due to their accessibility during the pandemic, in part due to the continued growth of the e-bike – but certainly, IBDs have been more resilient this year than most businesses, especially those that have capitalised on their rediscovered local customer base.
As the industry data shows, it’s been the larger and in some cases less specialist retailers who have had the toughest year thus far, especially those previously more involved in international retail, so dented by Brexit and other factors. Ongoing change remains within the marketplace, from those that haven’t been able to cope with these tougher times, to those who have really continued to grow their business, despite the economic climate.
Our dealer feedback shows how appreciated our team on the road are. Where lots of other companies have reduced their in-store support and presence we have chosen to strengthen ours; people do business with people. Extra remains a close familial supplier, who supports our partners where we can, however we can, in good times and bad.
What are the upcoming plans for Extra?
As is normal for this time of year, lots of planning and preparation for the coming season is in progress. We have loads planned over the next 18 months, with greater investment and development of our IT systems and service levels, especially around our B2B platform.
Our brand partners haven’t stopped innovating either, so we have so much that’s new to show in the coming months. A key pillar in our yearly calendar is the COREbike show, this year being held from 19th – 21st February in the familiar surroundings of Whittlebury Hall. We love this event and it’s great to see so many of our customers in one place, with so many of our suppliers in attendance also.
We have a really strong promotional and marketing plan all set for ‘23; building consumer demand, and supporting our retail partners by driving footfall, for 2023 we are investing deeper into retail support, in-store and sales support activity. Other than that, we keep doing what Extra has always done so well, adding value to the supply chain, with expert local market knowledge and great service.