Signa Sports United opens “Europe’s largest bike parts hub”, brand stores and D2C partnerships due

Signa Sports United – the parent company to Wiggle, ProBikeShop, Chain Reaction Cycles, Fahrrad.de and Bikester – has announced that it will move into a new state of the art, centrally located European warehouse.

Built from scratch, the 20,000 square metre plot will become “Europe’s largest bike parts hub”, according to the retail giant. The facility has a starting capacity of five million orders within the first year it is operation, with capability of reaching 21 million orders by 2025/2026.

The site is to be operated by Rhenus Warehousing Solutions, a global company focused on warehousing solutions, fulfilment services and finding the skills to manage large scale distribution facilities such as that of Signa’s. This third-party logistics partnership will help the group manage efficiently shipments to the various markets its serves and also effectively scale the business within a facility that is more than large enough to allow for further mergers or acquisitions.

CI.N spoke to Signa Sports United CEO Stephan Zoll today and he said that having room to grow into will give the business the capacity to seize acquisition opportunities as they arise; this, he says, will include outright buying brand names where there is a synergy.

“One of our three strategy pillars is to acquire brands in our categories and help them manage a transition into the direct to consumer journey, as many aspire to do. There is a shift from classic wholesale distribution to a model that complements the wide reach of our web shops. Some discussions are already underway here.”

Another of the trio of strategy pillars will come in the conversion of www.fahrrad.de to become a brand marketplace for labels to collaborate on and reach a wide audience. “We will have many modern retail services that help consumers with new ways to see brands,” said Zoll.

Is the objective to become the Amazon of bikes?

Zoll answers this question very precisely by stating that 80% of the products Signa Sports Uniteds’ platforms sell are not featured on Amazon.

“We remain very specialised in how to serve the customer and the products are distinct,” he says.

Undoubtedly the recently flurry of activity does point to a plan for sustained growth and market leadership. Zoll adds “In the context of bike industry supply chain turbulence and geopolitical turmoil it is important to note we continue to invest in the business, be it the new CEO for InternetStores, or this new facility. We are very confident on the mid-to-long term bike industry prospects. The big drivers are the mega trends of eMobility and active lifestyles – we aim for the leading position.”

It is here that it is revealed brand stores for the house labels are under consideration. Whether they are Nukeproof branded, or a combination that also houses Vitus and other brands, that is still to be decided, but physical retail outlets are likely to come, we’re told.

“Previously Wiggle shipped over to the US, but now we aim to establish an on the ground presence and we have recruited well to build this. In the next six to 12 months we will likely have inventory in our own warehouse in the USA,” says Zoll.

Having Listed on the NYSE in December, the firm’s exposure has quickly grown in the USA. Zoll says that the decision to head to New York was a deliberate one.

“This is a very attractive growth market business for investors. Being in the U.S. increases our visibility and other benefits will come in time. Over the next few years it will be beneficial to be supported by the deep liquid capital markets that the U.S. provides,” he explains.

With so many divisions of the business spread across the globe, some further consolidation of operations may happen and therefore the idea is to better align operations to localised shipping, rather than shipping products across borders and oceans, as has been the case before. In the USA the process has begun to source an on the ground fulfillment partner.

“We will localise inventory to home markets in time. In Europe our partner helps with this strategy,” says Zoll.

Markus Knöller, head of logistics and fulfillment at Signa Sports United, adds: “We are thrilled to partner with Rhenus on this first step in a 3PL strategy for our international expansion. This partnership will serve as the playbook for other regions globally as we work to be even closer to our customers.

“The site and the increased capacity will support organic growth and allow to efficiently integrate further M&A targets over the coming years. The site also gives us flexibility to integrate further sectors such as tennis or outdoor, creating cross-sector synergies. We see 3PL partnerships for our international expansion as key to our growth strategy,” Mr Knöller added.

The new distribution hub is strategically located in Hockenheim, Germany with excellent distribution channels to several European markets. With the site now filling out, SSU will apparently be able to create cost savings and synergies across the company by integrating the strands of SSU’s continental European bike inventory, including purchasing, supply chain management and operations.

Yesterday the Signa Sports United business announced the appointment of a new CEO for its InternetStores division in Max Heimann.