Ask the trade: Are bike businesses fearful of Brexit? Is uncertainty deflecting consumer spending?

It’s three years since the UK went to the polls to vote on EU membership. While parliament is overdue on working out exactly what that means, and the leave date has been delayed once again, is the toll growing on cycle retailers? Are suppliers reassuring retail partners on supply, post-Brexit? Or is Brexit a trifling concern compared with retail’s big period of transition? We went to the polls to conclusively find out… 

One recent poll found that a quarter of small businesses in the UK are fearful of Brexit. Do you feel it is a concern for your bike business?

Neil Holman, George Hall Cycles
No, I’m sure it will have an impact of some description but not enough for me to worry about. I think that if we have another summer like 2018 it will be good. A lot of people have not booked European holidays this year
because of the uncertainty (according to travel agents) so people will look to do things at home.

Paul Lynn, Mountain Mania Cycles
For our Wallingford store, Rides on Air, we look only at the positives, the objective being to offer a wide selection of cycling solutions from sales to repairs and event support. The target is to improve on last year’s sales and margins and monitor the variables along with customer service. The biggest impact on the cycle industry every year is weather and the other previous potential impact was the recession but we have only seen sales grow during this period. I guess the question on Brexit is will it ever happen? But I don’t believe whichever way it goes it will impact us.

John Hamlen, Flag Bikes
Yes. Almost everything in the bike business is produced outside of the UK so will usually be priced in US dollars. The aftermath of the Brexit referendum saw the pound drop sharply against major currencies making imports more expensive.

Scott Snaith, 50cycles
I am not concerned about Brexit or actually leaving with ‘no deal’. It is the indecision of the Prime Minister which is the problem. This has caused more damage to the UK economy than a bad decision to leave on 29 March ever would have. Indecision and slow action is not what we expect of a modern day economy and can only put it down to very poor governance that questions the very values of democracy.

The EU has already told us there is ‘zero negotiation’ until we leave the EU. Our strongest position is to leave with no deal and go on WTO trading rules and simply opt for ‘free trade’. To be competitive the EU would have to offer the same if they wanted to maintain the volume of cars, washing machines and electric bikes sold to the UK. We also offer the same for immigration and open the doors to the whole world of talent based on their criteria and not from where the passport says they are from.

Our BH distribution would have been the last of its kind in the EU as we signed on the day before departure. The result either way to remain or leave has no consequence to our relationship with our counterparts in Spain. It is business as usual to drive the market and establish BH as a leading UK bicycle brand.

Have you seen the uncertainty affect the spending of cycle consumers? Have they spent less, or maybe been more careful about their purchases? Or is that a general trend?

Neil Holman, George Hall Cycles
Shoppers haven’t bought from bricks and mortar shop properly for years so this is hard to say. Talking to my accountant the other day, over the past five years my turnover has stayed within £10,000 and my net profit has been within £2,000 so they are still spending, just in a different way. Less in the shop front and more in the workshop and online in the specialist stuff I do.

Paul Lynn, Mountain Mania Cycles
We complete our financial year at the end of April and we have seen a sales increase over the previous financial year along with consistent margins. Hence we have not seen any impact. We have a customer base that requires us to offer low cost bikes and services, but we also have the upper scale who don’t made spending on their hobby.

John Hamlen, Flag Bikes
Yes. Customers are definitely spending less per person and putting off purchase and bike servicing decisions. Therefore, we have maintained growth in the business only by working hard to get more customers through the door rather than increasing average order value.

Scott Snaith, 50cycles 
The situation that Theresa May has put us in as a nation has caused the greatest uncertainty on the retail front. It has been slow for everyone this last six months. We should be planning for the future success of our businesses, not wondering ‘what if?’. Indecision costs the economy far more than a poor decision ever would. We as businesses would have adapted very quickly to a No Deal. This would have put us on our front foot looking for a solution instead of looking back and living with the fear of change which is the position we now find ourselves in. Make the break quick and clean and the solutions will follow.