Bike retailers largely unmoved by Cyclescheme commission reduction

Bike retailers have cast a shadow over the announcement made by Cyclescheme yesterday, which saw the commission taken on a sale dropped back to 8.33% excluding VAT.

Reaction has been mixed, with some welcoming a little extra cash in their registers, but for the most part a collective shoulder shrug appears to have been the response on trade forums.

“Great news, but not brilliant, it’s more money in our till and more reason not to keep taking Halfords vouchers at 15%,” wrote one retailer in response to CI.N’s story.

Likewise, the newly formed Bicycle Dealers’ Association is not entirely satisfied and yesterday evening issued the following statement:

• We welcome the acknowledgment by Cyclescheme that their commission rates have been excessive and need to be reduced.
• We do not believe that Bike Shops have been adequately represented in the negotiation of this new commission structure. Meetings with bike brands and the BA have not included representation from bike shops, that have been paying for the scheme.
• There is no acknowledgement of the fundamental flaws in the current Cycle to Work scheme operation. Including, the hard to justify end of agreement costs for consumers.

We again call for

• BDA (Bicycle Dealers’ Association) is committed to working with all parties to achieve a fairer and more sustainable model for all stake-holders – UK taxpayers, consumers, bicycle-retailers, Cycle to Work providers and the UK bicycle industry. The current financial burden, on the shoulders of the UK taxpayer and bike-shops, cannot be what the UK government intended at the inception of the scheme?
• We suggest a more balanced scheme where retailers, manufacturers and the UK cycle industry share the financial burden, based on reduced or capped fees, that benefits from structured government oversight. We would further suggest that a proportion of the fees contributes to a cycling advocacy and sustainable transport initiatives.

Among those bike retailers responding to another story on how the Cyclescheme reduction came to pass, many asked why none were seemingly present during discussions mediated by the BA.

One comment read: “Are they going to name the bike retailers involved in the consultation? They’ve named bike brands, but have been unclear beyond that. A fair question that should be responded to given they cover the commission fees involved.”

The Financial Times has followed its story from last weekend with another last night, which hosts similar complaints against the US Private-equity owned cycle to work giant.

In theory, with the new commission structure in place, no more than £249.90 should be taken on any transaction going forwards, with Cyclescheme capping the sum at which it takes a cut at £3,000.