The Bicycle Association is to act as a mediator in talks between the bicycle industry’s leading brands and cycle to work giant Cyclescheme in a bid to find a structure that is deemed commercially sustainable for the trade at large.
Bubbling away for some time, bicycle retailers, in particular independents have long complained of margins being eroded by third-parties in cycle to work contracts. Back in August CyclingIndustry.News started a dialogue with the industry on the subject and last week the issue came to a head with national press coverage, the formation of a new retail group and a statement from Cyclescheme promising to address its side of the arrangement.
Now four of the UK’s leading brands have come to the discussion table, calling in the assistance of the Bicycle Association as a mediator in discussions between the trade and Cyclescheme in particular. Giant, Raleigh, Specialized and Trek are among those that have called for discussions to begin in a constructive manner on behalf of their retail customers.
Steve Garidis, Bicycle Association Executive Director, told CI.N that the BA’s role is to remain as a neutral and guide talks based on all parties’ wish lists.
“We recognise that many sectors of the industry are involved in selling and supplying bikes and equipment via the cycle to work scheme, from benefits providers who offer the scheme to employers and employees, to suppliers and retailers who provide and maintain the bikes and equipment. Each plays an important role and the Bicycle Association wants to see all parts of the supply chain working together in a way which is profitable and sustainable for each.
“After several months of discussions, we’re pleased that the parties have successfully agreed a new approach. The discussions have focussed on how to build trust and support for the scheme, and how to fairly reflect the value and costs in the commission structure.
“The parties themselves will provide the commercial details. However, we are pleased that the outcome will lower, cap, and equalize commissions for retailers who work with Cyclescheme.
“Whilst these talks were between a group of our members, we believe the outcome is positive for the whole industry, and for cycling.”
Garidis outlined to CI.N that, while the talks thus far have no retail representation, that is no to say that they cannot. On that note, we’re told the BA may toward the tail end of this year seek to establish a representative retail panel of its own to get across frontline concerns and aspirations.
Since proposing to launch a new trade body representing retailers, The Bicycle Dealers’ Association has been rallying support on Twitter with numerous new shops pledging to back the upstart’s efforts to lobby on issues facing bike retail. Support has apparently come publicly and behind closed doors where shops have been weary of creating upset.
When approached for comment earlier today, the Bicycle Dealers’ Association told CI.N: “We are surprised there has been no retail representation in this dialogue opening, in particular as we have had contact with BA for many months prior. We got back word they had taken things as far as they could; Cyclescheme were said to be unmoved and so we opted to go alone as we now have.
“At the moment all of the Cyclescheme charges are being paid for by the retailer. All of it. I welcome the fact that manufacturers are being invited into the talks, but why are retailers not at the table? It should be the retailers inviting the manufacturers in, rather than this way around. The BDA thought our position statement gave an olive branch for negotiation, to be excluded is a shame, but we remain open to dialogue.
“Shops have been going hand over fist in recent years, including big chains, disappearing off our high streets as margins have been eroded. If this schism is to be healed has to be by negotiation not by diktat.”
Quarterly meetings will monitor the progress of talks, according to the Bicycle Association. A round of talks occurred only recently, though a dialogue has been progressing for months behind the scenes, we’re told.
This tax break was created in law in 1999 and not a single employer used it until 2006 when Cyclescheme was founded.