Cell Bikes out of business

BobtheBuilder
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Re: Cell Bikes out of business

Postby BobtheBuilder » Mon Apr 30, 2018 11:05 pm

Thoglette wrote:That's unusual.


Yeah, I'd heard good things about them. Was two weeks ago. Maybe just one that slipped through or went to spam.

maillot jaune
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Re: Cell Bikes out of business

Postby maillot jaune » Mon May 07, 2018 4:02 pm

A sad day indeed when Cell closed.
Cell was a great local company and I have regularly used them since the 1990s.
I used them as a first point of contact for equipment and bicycles that I have needed.
Cell was for me a LBS (local bike shop) as well as mail order supplier, another of my LBS has closed recently and I fear that the economy is not tracking as well as we are told by the politicians. The state government's anti cycling stance must also be a contributing factor as figures show less trips being made by bicycle. Unfortunately the future is not looking bright for the cycling fraternity of Australia and NSW in particular.

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mikesbytes
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Re: Cell Bikes out of business

Postby mikesbytes » Wed May 09, 2018 6:11 pm

maillot jaune wrote:A sad day indeed when Cell closed.
Cell was a great local company and I have regularly used them since the 1990s.
I used them as a first point of contact for equipment and bicycles that I have needed.
Cell was for me a LBS (local bike shop) as well as mail order supplier, another of my LBS has closed recently and I fear that the economy is not tracking as well as we are told by the politicians. The state government's anti cycling stance must also be a contributing factor as figures show less trips being made by bicycle. Unfortunately the future is not looking bright for the cycling fraternity of Australia and NSW in particular.

Hi maillot and welcome to the forum

Which is the other LBS that closed?
If the R-1 rule is broken, what happens to N+1?

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AUbicycles
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Re: Cell Bikes out of business

Postby AUbicycles » Fri May 11, 2018 6:56 am

A few things to look at when understanding closures:

• Is the rate of bike shops opening and bike shops closing the same? i.e. is there an equilibrium or change?
• When a shop closes, are there other bike shops in the same general area? - i.e. was there too much supply for the demand
• Are other shops with comparable strategies closing? By strategy I mean, are other discount shops, or premium shops or specialist type shops or local bike shops having the same fate?

Often the changing industry with internet competition is cited as a problem by some shop owners BUT most businesses need to able to adapt and change to a changing market - plenty in Australia do and are successful. It could mean selling something that isn't competing or evening doing things (like growing a loyal customer base and reputation) - the proof is in a number of successful shops that operate successfully.

And what is going on behind the scenes - in Melbourne, BSC bike went through rapid growth and then closed all stores and went into liquidation owing a lot of money to suppliers. They were popular with customers and appeared to be going well but the management didn't check-out and this is actually a very common theme that there are spiralling problems but also owners sometimes down have the necessary skills to run a business successfully.

To summarise, it is not always just simply online competition or a decline in cycling. Something these may play a role but a business has to be in tune with their customers (and staff) and getting that bit right is also important.

--

Mikesbytes, recent other Sydney closure was Cheeky Monkey. Perhaps that is the one that was meant.

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Re: Cell Bikes out of business

Postby zebee » Sun May 13, 2018 7:40 am

Bike shops are also not great money spinners. If rents go up then a shop can be just not viable. That's what happened to Cheeky Monkey: the kind of work they did couldn't keep up with the increasing inner city rents. Worhshop work and niche bikes couldn't bring in enough.

Happens with the kind of motorcycle place I prefer too. They don't get the volume of business. Mate of mine was a motorcycle mechanic at a small old fashioned sort of place and quit to work at a bike barn closer to home. The new place was all about moving motorcycles through the workshop as fast as possible, so exactly what was on the card and don't take any extra time. If you find something else needing doing you tell them when they pick it up and they get charged another base fee... That and the churn of bikes and loan/insurance kickbacks kept the place going.

Small shops don't sell the small high margin stuff like accessories much anymore either, the internet did kill that revenue stream.

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