We’ve heard how the demographic has shunted steadily down to include all ages, as well as which territories are being the most proactive about developing their markets, but can a bike dealer really turn a decent profit with the electric bike trend?
We ask a panel of international experts:
Ray Verhelst: While the e-bike sector of the bicycle community is enjoying double-digit growth, the traditional bicycle industry is either flat, or on a negative turn.
Initially many got burned by some poorly thought out early product. Now with the major brands behind the bikes and committed technology from companies like Bosch, Yamaha, Brose, and Shimano, shop owners are once again willing to take the risk.
The unfortunate part about profitability is that much of it is based on volume. Higher volumes generate better margins and overall discounts. Building an electric bike business model around the potential of selling 5,000 to 10,000 units nationally a year in the current market does not begin to tap into next-level pricing structures for many of these companies and their suppliers.
Compare this to European companies that see strong opportunities when they distribute 2,000 to 3,000 units annually within a one or two country audience. The numbers don’t extrapolate, at least not yet.
Niko Lindner: How is the situation for those who chose to forgo the e-bike trend in the past few years? That’s the question.
Meanwhile, every important manufacturer developed their own e-bike segment. We should not forget that e-bike development is expensive. You need to do a lot of fundamental research and the development time is longer than a normal bike.
Clive Gosling: I feel a bit sorry for some of the pioneering e-bike brands because with every brand incorporating e-bikes in their line, the ones who had E as a USP just lost their U. With e-bikes having a relatively high average selling price, I think any brand doing well with them is seeing some great revenue and average price increases.