Author Topic: Cycle to Work Scheme Impoverishes Bicycle Retailers  (Read 1631 times)

Andre Jute

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Cycle to Work Scheme Impoverishes Bicycle Retailers
« on: January 28, 2024, 12:17:37 pm »
https://cyclingindustry.news/cycle-to-work-needs-urgent-systemic-change/

I don't know who is at fault here but from the careful phrasing of the bosses of bicycle retail chains, trying hard not to offend the politicians, it looks like the rules were changed without consulting the operators of the scheme, the bicycle retail trade itself, making a situation that was already dire worse. That is a pretty common situation in all kinds of areas that governments meddle in: they genuinely try make things better but, because they don't understand how things work, they inevitably make them worse. Americans have a saying: "The nine most frightening words in the English language are: 'I'm from the government. I'm here to help you.'"

Even if you don't read the entire article, check down the page where it is stated that the bicycle retailers still open are now working on a profit margin of 3–7 percent. The publishing trade, which I know intimately, at the literary end where I operated as an artist, is in perpetual crisis and the big names are generally subsidised by textbook publishers. In a different capacity I was once named as an arbiter by a publisher in the process of selling his publishing house to a much bigger publisher. Afterwards, perhaps impressed with the multiple of his annual profit I negotiated as the price, he made me a consultant to his next venture. One evening over dinner I said to him, "You know, if you'd asked for a loan at the [private bank] when I was a director there, as soon as I discovered you made 2.5 per cent net profit for years on end, I'd have pushed you out of the door for fear that you would infect the rest of our clientele." It doesn't matter how the bicycle retail trade fell into the dire state explained in the article, except for lessons to be learned so that they don't make the same mistake again. What really matters is that with that kind of profitability visible in an entire economic sector – and very likely falling, they will be cut off from new investment because there isn't enough fat to invest from profits or pay interest and repay loans. That's a vicious downward spiral. It describes a whole failing industry, because the retail sector's failure will in time drag down the manufacturing end as well.

I once described in this forum how I saw an LBS owner, offensively smug in good times, abuse the Irish cycle to work scheme, and his customer, by selling her a totally unsuitable bike because the profit on it would be bigger than on the eminently suitable bike also standing on his floor; she would ride the unsuitable bike twice in rush hour traffic, be frightened out of her wits, and it would gather dust in the garage at her home. I'm not saying the British bicycle retail trade is not to blame for some part of what happened to them, or that the government committee is solely to blame; things are never that clearcut. But there's a definite failure in the understanding of consequences here. Not to mention a glaring failure of vision -- note for instance the complaint that those on the minimum wage are excluded from the cycling to work scheme: surely, the young and the poor should also be helped to independent transport, perhaps even be a priority?

Further cycle retail trade decline could be disturbing for cyclists, starting with irritating inconveniences and higher incidental costs in acquiring even routine replacement items like chains and tyres and tubes, or service items like chain lube. I'm assuming here that when all this settles down, some mail order cycle components suppliers* will survive and even grow when the LBS is only a memory, as we already heard in another thread. It's no skin off me, because I've decades since stopped buying the crud the local LBSs offer, and become accustomed to paying carriage charges from distant countries for quality gear. But that is no way to grow cycling, the prerequisite to retailer growth.

Cycling which depends solely or mainly on long-range distance selling, will inevitably become an elite activity. That probably doesn't bother people who ride on a Thorn equipped with a Rohloff and other expensive components. but once more, that is no way to achieve the presumably socially desirable end of increasing cycling.

Copyright © 2024 Andre Jute. Cycling and non-profit media may reprint this piece without charge as long as this copyright notice and permission accompanies it.

*EDIT I was horrified to learn by private mail that two of the three examples of mail-order businesses I mentioned as likely to survive had in fact gone belly-up in the last few months. Ouch! I've removed that entire sentence lest it be a curse on those also named and still open for business.
« Last Edit: January 28, 2024, 10:08:06 pm by Andre Jute »

WorldTourer

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #1 on: January 28, 2024, 04:45:53 pm »
irritating inconveniences and higher incidental costs in acquiring even routine replacement items like chains and tyres and tubes, or service items like chain lube.

On the continent you find these things also in some corner of general sporting-goods shops. Sure, not the high-quality stuff tourers and avid cyclists might want, but enough for casual cyclists and many commuters. Is the situation different in the UK?

Andre Jute

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #2 on: January 28, 2024, 10:55:39 pm »
irritating inconveniences and higher incidental costs in acquiring even routine replacement items like chains and tyres and tubes, or service items like chain lube.

On the continent you find these things also in some corner of general sporting-goods shops. Sure, not the high-quality stuff tourers and avid cyclists might want, but enough for casual cyclists and many commuters. Is the situation different in the UK?

No idea about the British case in general but I don't remember seeing anything like you describe in Cambridge nor London. In Ireland the alternative to the LBS, often with better quality but limited choice of bicycle components and at least once a whole bicycle, is Lidl, the German supermarket chain, which twice a year offers an eclectic set of bicycle accessories or components on sale for 3 or 4 days; in those 7 days a year it is the quick and the disappointed. Aldi does something similar: I have a couple of pairs of eminently satisfactory long cycling tights from Aldi, super in winter under track suit bottoms, cool in summer.

WorldTourer

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #3 on: January 30, 2024, 06:56:39 pm »
A quick look at Decathlon’s website shows that they have lots of locations in England. Combined with other sporting-goods chains that will surely stock some bike stuff, I’m sure that the UK population will continue to be able to buy oil, chains, and tubes even with the demise of the small LBS. Of course, all those goods can be ordered online direct to one’s home anyway.

JohnR

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #4 on: January 31, 2024, 08:57:02 am »
Outdoor Look (Blacks, Millets and maybe others) sell some cycling items on their website https://www.outdoorlook.co.uk/ but I haven't been into a store to see what's there. Halfords, with over 300 stores, supports the C2W scheme and partners with an even greater number of retailers https://www.halfords.com/cycling/expert-advice/cycle2work.html .

Recently-deceased Wilko used to stock some basic cycling equipment and consumables but I don't recall seeing chains. It appears that The Range is similar https://www.therange.co.uk/sport/cycling/#sort=relevance&page=1&lpp=24 .

Andre Jute

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #5 on: January 31, 2024, 04:08:02 pm »
What we haven't mentioned yet is that with the demise of the LBS a lot of valuable specialist knowledge goes down the tubes, and I don't mean the esoteric stuff we used to write to Sheldon about, I mean routine LBS information the absence of which can be irritating and expensive if you can't find an answer somewhere or, worse, don't even now which question to ask, or worse still, that there are questions to be asked. Imagine asking your average sports shop salesman for advice on bicycle components:

"D'you know if this chain is good for a hub gearbox?"

"What's that, a hub gearbox?'

"A sort of fixie with the gears inside the hub where the hot polloi can't see them."

"It's the only chain we have and they're nearly all gone."

"I need the eight speed version."

[READS BOX] "Doesn't say 'eight speed' on here."

"Does it say how wide the links are?"

"What you wanna know that for?"

"Never mind, I'll just take it."

"We got some cool zipper fleeces that say 'My other bike is electric.' Buy one of those as well, and I can like open a loyalty account for you."

"Just the chain, thank you very much. When will you have bottom brackets in stock?"

"What are they?"

OUTSIDE THE STORE, YOUR WIFE SAYS,
"I never knew you were that patient, darling."

"I need a drink!" [READS BOX] "Ah, sheet!"

"What now?"

"It's a surplus 13-speed chain for a fad that never took off. The links are too narrow to fit over the teeth of any of my chainrings." [HEAVES CHAIN INTO WASTE RECEPTACLE OUTSIDE PUB]


PH

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #6 on: January 31, 2024, 09:39:01 pm »
There's some irony that the ACT are moaning about Cycle to Work schemes, when their members have been milking it for years, maybe even the same ones that are suffering now.  It always was a scam, a way for the government to claim to be doing something for active travel whilst not actually spending money. Did anyone ever genuinely think that the reason people don't cycle to work was because they couldn't afford an appropriate bike?  Or that a £1,000+ bike was required?  OK, the E-bike cost and benefit may change this, but the schemes have been running long before their rise in popularity.
The article leaves out some of the important detail, for those that don't know, the retailer doesn't receive the face value of the voucher, they lose 10 - 15%.  This was fine for many years, the retailers simply didn't accept the vouchers against discounted stock.  Even when bikes were marked up at full price a cash buyer might easily have negotiated a 10% discount which wouldn't be available to those buying with a voucher. 
Then the murky stuff - Cycle2Work (The second biggest provider behind Cyclescheme) promoted their vouchers as being usable against any bike at any price, Cyclescheme had no alternative but to follow.  Why is this Murky you may ask?  Because Cycle2Work is a division of Halfords, if you use your voucher there, then Halfords are getting it's full value!  They issue and accept, paying themselves the commission. That commercial advantage stuffed the smaller retailers, who responded by adding an admin charge to cover the loss.  It's this which they've now been told is against the regulation.  I'm surprised anyone thought it wasn't, if you add cash to the voucher the bike has two owners.

If you have any doubt about this, ask why ACT have only recently started complaining.   

« Last Edit: January 31, 2024, 10:09:24 pm by PH »

PH

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #7 on: January 31, 2024, 09:54:27 pm »
What we haven't mentioned yet is that with the demise of the LBS a lot of valuable specialist knowledge goes down the tubes,
Maybe others have been luckier than me, but most of the poor service I've had in cycling purchases has been from those LBS's that are now being reminisced about.  From those who push their limited stock as the only option to those who don't even like you coming into their shop unless you fit their niche. The only advantage of the LBS was the L and the internet and good logistics has made that irrelevant. 
Around me, and I suspect in most places, where the out and out retailers have closed down, a number of businesses have cropped up to cover the servicing and repairs that riders don't want to do themselves, and being specialists at that rather than the more general cycle retail, seem to be offering a better service.

Just try googling "Mytown cycle mechanic" and see what's on offer.  I doubt there's many UK towns that used to have a LBS that don't now have something else.

PH

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #8 on: January 31, 2024, 10:06:50 pm »
Outdoor Look (Blacks, Millets and maybe others) sell some cycling items on their website https://www.outdoorlook.co.uk/ but I haven't been into a store to see what's there. Halfords, with over 300 stores, supports the C2W scheme and partners with an even greater number of retailers https://www.halfords.com/cycling/expert-advice/cycle2work.html .

Recently-deceased Wilko used to stock some basic cycling equipment and consumables but I don't recall seeing chains. It appears that The Range is similar https://www.therange.co.uk/sport/cycling/#sort=relevance&page=1&lpp=24 .
Outdoor Look isn't a name I'm familiar with but Go Outdoors, Blacks and Millets are all owned by JD Sports.  Go Outdoors have a reasonable range of cycle bits, I've browsed a few times but don't think I've bought anything (I do get a bit of clothing and camping gear there).  I miss Wilkos, though they'd been going downhill for a while, the inner cables used to be stainless but changed to galvanised a while back, the puncture kit used to be a rebranded Weldtite one, but was something untrustworthy last time.  My go to for consumables and small bits is Halfords,  I can order online and collect in store, at a time that suits me.   A warranty issue I had was dealt with instantly (Unlike some problems I've had with LBS's) likewise a couple of returns that were my error or change of mind.
« Last Edit: January 31, 2024, 10:10:23 pm by PH »

WorldTourer

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #9 on: January 31, 2024, 10:23:48 pm »
Maybe others have been luckier than me, but most of the poor service I've had in cycling purchases has been from those LBS's that are now being reminisced about.  From those who push their limited stock as the only option to those who don't even like you coming into their shop unless you fit their niche.

Definitely agree with you there. After service at my LBS got progressively ruder over time, I asked the manager, “What gives?” His response was that as a tourer, I simply wasn’t a worthwhile customer for an LBS. I knew how to do most of my own maintenance, and when I bought from them, it wasn’t the high-margin items they want to sell. Apparently someone coming in and buying a new carbon-frame bike and some lycra clothes made them a greater profit than all my arcane needs over the preceding several years.

I started traveling by bike in 2013, and already at that time there were abundant YouTube videos and websites showing how to do maintenance and what parts were compatible with what. That is precisely why I never had to turn to my LBS except in limited circumstances. So, I don’t share Andre’s concern that wisdom is being lost with the demise of LBSs.

martinf

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #10 on: January 31, 2024, 11:30:00 pm »
Here in South Brittany, France, my local bike shop  (less than 2 kms away from home) closed a few years ago when the owner retired. It had a huge stock of used spares and an extremely helpful mechanic who would let me rummage through them to either repair something rather than replace it or sell me a cheap but functional used part instead of new.  However, there are now 3 new "proper" bike shops. There are also some basic spares in local supermarkets and a large sports superstore with a bicycle section, but I don't use these.

One the three new specialist bike shops in town is a hybrid bicycle shop/coffee shop run by an enthusiast who seems to mainly do repairs rather than sell bikes or parts. Unfortunately he appears to have fewer tools than I do myself, though we did have a good chat when I went to ask about getting a bottom bracket shell refaced.

Another is focussed on electric bikes, with a few mopeds. I'm not yet in the market for an electric bike, and when I do need one I will probably start with a front motor kit fitted to one of my Thorns, so I am not very likely to use this shop.

The third is a Giant dealer, maybe a franchise. They weren't very interested when I tried them for a set of mid-range V-brake levers, and they charged me a lot more than either mail order or the traditional bike shop referred to just below.

The good news is that my helpful mechanic now works in a bigger town about 9 kms away, in a medium-sized traditional bike shop that mainly sells racing bikes, with a few gravel bikes, children's bikes and more recently some electric bikes. So for stuff I know this shop has in stock or that he can order fairly easily I go there. And on the rare occasions that I need a job done with a specialist tool that I don't have myself, the mechanic will do the work competently, quickly and for a good price, though he is no longer allowed to lend tools like he did in the old shop.

For hub gear spares and some other stuff difficult to source locally such as decent dynamo lighting equipment I use mail order, mostly from Germany.

For Brompton parts I usually order from the UK, a little easier now than just after Brexit as the customs rules seem to have settled down. My nearest Brompton dealer was until recently in a town more than 100 kms away, I only used them once when I needed a main frame hinge pin replacing, one of the jobs that requires a specialist tool that I decided wasn't worth buying. I have only needed this job done once in more than 40,000 kms of Brompton use. I did invest in the tools and spares to do the seat sleeve and rear pivot replacement jobs as these two parts wear more quickly, on average between 6,000 and 10,000 km. The relatively high cost of the tools was offset by the cost in time and (less important) train fares for the 200 km round trip. But as Bromptons are getting more popular here, there is now a specialist bike shop that sells cargo bikes and Bromptons about 13 kms from home, which might be useful for Brompton spares and maybe even repairs if they are competent enough not to bodge the job. 

And there is a fairly recent bike shop 11 kms away that sells recumbent 2 and 3 wheelers, they will also hire them out. May be useful if I develop balance problems as I age.

And finally there is a cooperative about 12 kms from home that recycles, repairs and sells used bikes and provides maintenance classes and use of a workshop for an annual membership fee. Not been there yet.   

So all in all there are quite a few choices for people who need spares and repairs.

The one thing that isn't easy to find nowadays is someone who will do brazing repairs. Not very surprising now that most expensive bikes have carbon fibre or aluminium alloy frames. Rather than going through the hassle of finding someone willing to do brazing work, sending or delivering the frame end then picking it up or paying the return shipping, it is now probably cheaper to throw away most modern steel bike frames if they break, and just buy another cheap steel frame bike, this is even more true with an old second-hand bike. The last four I bought were all under 50 euros complete, two were bought to replace steel frames that had started to fail after many years of use. 

Danneaux

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #11 on: February 02, 2024, 05:35:51 pm »
Quote
The one thing that isn't easy to find nowadays is someone who will do brazing repairs.
A pity we aren't neighbors, Martin, or I would do them for you. :)

I last had a local bike shop service a bike I owned in 1977 and they messed it up so badly, I decided I was better off learning and doing on my own and my repairs expanded from there to design and hobbyist framebuilding. I'm happy to say none of my bikes has been in the door of local shops for repairs since, given their generally high level of sheer rudeness and condescension coupled with the abysmally poor state of repairs they made on friends' bikes for decades dating from my own childhood through my univ years and beyond. Things seem to have improved in the last 30 years or so as a bike cooperative thrived for a number of years, failed, then was replaced last year by a "community" cyclery that seems to in be the right place at the right time, owned and staffed by caring people whose hearts are in the right place, though I can't comment on their skills. I think I last visited a local shop 8 years ago to by a frame pump I saw on sale in jumbles basket out front.

When I "went independent" I also went elsewhere for parts. Early on, I found a town 65km away where shops were polite and happy to sell me parts or order what they didn't have on hand in those pre-Internet days. I remember striking gold when mail-order giant Bike Nashbar began in Ohio, followed after awhile by Performance Bike, started in a basement as a family operation. Both those firms grew to giants, then merged within the last decade to become very generic and less useful to me. I've got a fleet of older bikes to maintain, so nothing really new is very relevant to my drivetrain needs and I don't go through consumables very quickly, chains being the prime item. For anything European in terms of IGH and lighting, I source what I need from overseas, typically Germany, France, and Spain as I've found the American distributor to be very overpriced even with distant shipping costs included.

Best, Dan.

martinf

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Re: Cycle to Work Scheme Impoverishes Bicycle Retailers
« Reply #12 on: February 03, 2024, 08:23:07 am »
A pity we aren't neighbors, Martin, or I would do them for you. :)

I did consider learning how to braze and build bike frames, but, unlike wheelbuilding, I decided it wasn't worth the time and effort, plus the expense of getting the necessary equipment. On an expensive steel frame I have only needed brazing work once, all the other interventions were on old second-hand bikes.

I last had a local bike shop service a bike I owned in 1977 and they messed it up so badly, I decided I was better off learning and doing on my own

I've been lucky in that I have always found at least one competent bike shop reasonably close to home, both while I was living in the UK and after I moved to France. My initial motive for doing my own repairs and maintenance was to save money when I was a student. Later on, it was more the idea of being able to repair something on long bicycle tours. And once I started I gradually acquired the tools to do most jobs.