This article is short and sweet, perhaps bittersweet. There are five trends that I see likely to emerge after the discounting cycle carnage of 2022 to 2024 in the Bicycle Industry. What I've listed below are those five trends in no particular order:
TREND 1: The premium that Global Bicycle Brands have managed to achieve in the past 2 decades over Regional or National Bicycle Brands will be diminished for years to come. The Global Brands have shown that when the Law of Supply and Demand is skewed that they can sell their products to consumers at a price no different for the same specification as Regional or National Bicycle Brands. The only exception will be the exotic brands like Santa Cruz, Colnago, Pinarello and a few others that are purchased for status.
TREND 2: Cycling Industry companies that paid their Suppliers within agreed credit terms will cultivate much deeper and stronger relationships and strengthen their relationships of trust within the Cycling Industry and with their Suppliers. If there is one thing I know it's that people forget many things, but what they always remember is who paid (or didn't pay) them.
TREND 3: Cycling Industry companies that never went through rounds of retrenchment or who did not short pay their staff during the slowdown will attract the best talent in the Cycling Industry, and this will drive their market share and drive their innovation Leadership.
TREND 4: CEOs, CFOs, and General Management will not be recruited solely for their passion or that they were a great BMX racer in the 1980’s, or road in the Tour de France etc. Passion and a love of the Cycling Industry will still be important, but upper management of the largest cycling companies will come with Chartered Accounting qualifications, CFA’s, or similar personnel trained in dealing with the management of high working capital investments, in the same way as the engineering departments are now filled with post grad level engineers in composites, physics, mechatronics etc.
TREND 5: Human nature will mean that in 10 or 15 years from now the Cycling Industry will not heed the lessons of 2022 – 2024 and the same mistakes will be made by the new Global Leaders of the Cycling Industry as they will again mess with the Law of Supply and Demand.
That’s it. I have been in the Cycling Industry for 35 years this year and that’s how I see it for now. As my views change, I will revisit this article.
Now to put up my feet for an afternoon on the couch, watching LeTour!
