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Losing More Bike Shops

Old 12-31-19, 11:48 PM
  #26  
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Originally Posted by merziac View Post
Don't forget UBI, that is a bellweather death knell when a framebuilding school cannot sustain itself in a long standing epicenter like PDX.
If I am not mistaken the one in Ashland is still open.
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Old 01-01-20, 05:01 AM
  #27  
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Originally Posted by SamSpade1941 View Post
If I am not mistaken the one in Ashland is still open.
It is, that's not PDX and we'll see how long they last as well, this may be part of a far larger trend than we are seeing yet.
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Old 01-01-20, 05:09 AM
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Originally Posted by bobwysiwyg View Post
Pretty much what expected your response to be, and I sort of agree. However, there's a side representing consumers and the pressure they apply. They are looking for low prices. The two pressures go hand in hand. To do otherwise suggests subsidising, and that's not going to fly.
Agreed, that being said it still just gives more justification for the greedy companies and shareholders to scorch anything that stands in their way every chance they get.
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Old 01-01-20, 05:15 AM
  #29  
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Originally Posted by Mr. Spadoni View Post
When and where is Universal moving?
I heard March or May I think, also thought they said Cedar Hills but jyl says Hillsboro so.....

Really sucks as they are not far from me and were very convenient to shop hands on when looking for finicky bits with good pricing.
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Old 01-01-20, 05:21 AM
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Originally Posted by schwinnderella View Post
Does not Oregon/Portland have a reputation of being a bit anti-business? I have no idea if this is true but i would certainly not want to own a business where government made it difficult for me to operate.
They do and God help you if you run afoul of it but I don't think it's a regular concern for bike shops, they seem to pop up anywhere with no trouble until their neighborhood is targeted for upscaling and they are forced to move with skyrocketing rents.
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Old 01-01-20, 09:13 AM
  #31  
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I wrote a detailed post, it auto saved then when I wanted to send, vanished.

bottom line, service, forget new bikes.
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Old 01-01-20, 09:18 AM
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Originally Posted by SamSpade1941 View Post
Rivelo closing is no shock... Why on earth order or purchase anything Rivendell from brick and mortar store in Portland when I can order it directly from Rivendell and for the same price or a tad less ? I think it was interesting they tried to capitalize on shooting film and old vinyl records along with bikes. A very confused bike shop IMHO and that was just a bad business model . As for Universal I order from them all the time , they ship really economically and quickly. I get my parts a day or two at the latest after I order them here in Salem. However I would probably more more inclined to visit them more now that they are moving to HIllsboro.

As for some of other shops

I honestly can't see how the cafe every worked for Breadwinner .
My one dealing with Norther Cycles left a bad taste in my mouth , I did not come away with a good will feeling after talking to the guys who run that shop , they struck me as rude.

Brick and Mortar stores in general are doomed as time moves on, so people who intend to stay profitable in that venue are going to need to offer exceptional service and a unique value proposition that does not focus on elitist attitudes (Norther), having items on display but not in stock (Velo Cult) and selling vinyl records, and poster prints by Will (Rivelo) ....
velocult did not work in San Diego, I like the guys but the concept up North while different seemed no better.
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Old 01-01-20, 09:57 AM
  #33  
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Originally Posted by merziac View Post
Agreed, that being said it still just gives more justification for the greedy companies and shareholders to scorch anything that stands in their way every chance they get.
I think you meant profitable companies.

There are two types businesses:
profitable ( the ones that last for any length of time )
unprofitable ( the ones with a bad business model that do not make money, they are the one's that go away when they can't generate enough revenue to sustain operations )

It really has nothing to do with greed and has everything to do with delivering value to their customers while making money for the business and it's investors. As someone rightly pointed out earlier there is too many shops right now in Portland and a not enough business to sustain them all. The market will correct the problem and the shops that are profitable will remain.
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Old 01-01-20, 10:42 AM
  #34  
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Originally Posted by merziac View Post
I heard March or May I think, also thought they said Cedar Hills but jyl says Hillsboro so.....

Really sucks as they are not far from me and were very convenient to shop hands on when looking for finicky bits with good pricing.
Dang. Could get a 2fer out of a trip to Universal. Vino, the wine shop, is in the same area. Couldnít go to one without stoping at the other.
Cedar Hills or Hillsboro? Both do have Hills in the name but guess will find out soon.
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Old 01-01-20, 10:46 AM
  #35  
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Price, product, service.
3 main factors in any business.
pick any 2 will lead to success.
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Old 01-01-20, 11:07 AM
  #36  
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Originally Posted by seypat View Post
Agees has another store on Rt. 60 a block from Chesterfield Town Center. It's been there for a long time. One of the other area chains opened a store on the other side of the mall. It closed within a year or two. Carytown Bicycle is opening up a store on Rt. 60 about a 1/2 mile east of Rt. 288.
Which only goes to show how often I go south of the James in my travels. Chesterfield and Powhatan Counties are virtually "there be dragons" to me, and I've lived in Louisa and Hanover for 22 years now. If I do head south, my first stop is invariably I Don't Know bar in Chester.
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Old 01-01-20, 11:37 AM
  #37  
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My LBS has been in business for 20 or so years and seems to be thriving. I think it's because they provide exceptional service (at $80 per hour), have at least 10 major brands to choose from, rent bikes and have an exceptionally knowledgeable and courteous staff. Perhaps a lack of co-ops in the area is also a plus for them.
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Old 01-01-20, 01:10 PM
  #38  
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Originally Posted by SamSpade1941 View Post
I think you meant profitable companies.

There are two types businesses:
profitable ( the ones that last for any length of time )
unprofitable ( the ones with a bad business model that do not make money, they are the one's that go away when they can't generate enough revenue to sustain operations )

It really has nothing to do with greed and has everything to do with delivering value to their customers while making money for the business and it's investors. As someone rightly pointed out earlier there is too many shops right now in Portland and a not enough business to sustain them all. The market will correct the problem and the shops that are profitable will remain.
Maybe

The bike shop business is fickle at best, many hamstring themselves by trying to cover an already too small niche within a niche. Some do it well, some get lucky and some find their groove for awhile only to fail anyway and yes many are doomed from the start. We are lucky to have many that help us along despite their misguided intentions and lack of business acumen.

Agree to disagree, skyrocketing rent and overdevelopment equates to mostly to greed at the end of the day.
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Old 01-01-20, 01:35 PM
  #39  
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Originally Posted by merziac View Post
Maybe

The bike shop business is fickle at best, many hamstring themselves by trying to cover an already too small niche within a niche. Some do it well, some get lucky and some find their groove for awhile only to fail anyway and yes many are doomed from the start. We are lucky to have many that help us along despite their misguided intentions and lack of business acumen.

Agree to disagree, skyrocketing rent and overdevelopment equates to mostly to greed at the end of the day.
Someone else opined earlier that Portland is not very business friendly ( that has been my observation of Oregon in general ) . I have witnessed the same events on a lesser scale here in Salem.

Skyrocketing rents point to a lack of property development not too much development . My experience in Oregon to date is that on a statewide level property development is generally discouraged EXCEPT in certain ways by certain people who insist on property zoning at every level of the state, county and city, speaking as someone coming from a state where there is significantly less regulation on property development , rents are substantially cheaper because there is more availability. The market forces of supply and demand are working exactly as they should based on what I can see.
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Old 01-01-20, 01:47 PM
  #40  
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Originally Posted by norcalmike View Post
Price, product, service.
3 main factors in any business.
pick any 2 will lead to success.
Go back to school.
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Old 01-01-20, 01:53 PM
  #41  
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In the US, conventional (non electric) bicycle sales are declining in units and dollars. E-bike sales are growing strongly. This is on a wholesale basis. E-bikes are still a somewhat specialized category, sold by a minority of bike shops.

https://www.bicycleretailer.com/studies-reports-0

Bicycles are for the most part still subject to the tariffs of up to 25% imposed as part of the trade war. Some niche categories like single speed bikes and 20" bikes are excepted. I believe this has depressed profit margins for retailers. Oregon also has a bike sales tax, itís small but profit margins on most bikes is already thin.

The bicycle component industry has arranged its pricing such that US retailer wholesale price is not much different from online prices. The more knowledgeable the consumer and the higher end the product, the more likely to buy from online or even UK online (Wiggle).

In Portland, the business tax (city, county, TriMet) is about 4.3% of operating profit.

Bicycle riding is not growing, much, in Portland. Population growth has slowed to about 1% and, anecdotally, the new in-migrants are less likely to commute by bike. E-scooters are taking some share from bicycles, though not clear how much. Despite all the new bike lanes being installed, bike % commuting is flat to declining.

Rents are rising fast. I mostly hear about this in the context of restaurant closures but it must be affecting bike shops too (e.g. Western Bikeworks).

The cityís rules may not affect bike shops too much but do affect businesses that combine bikes with beer. The last straw for Velocult was when the city demanded that the bar area be physically separated from the bike area on the grounds that kids frequented the bike shop.

If someone put a gun to my head and forced me to open a bike shop, I think Iíd:
- Focus on repair services. You can flex the labor cost to match demand, lay off mechanics in the slow periods, pay mechanics by piecework.
- Merchandise stocked for sale will be very limited. Only basic stuff that turns quickly, and only limited quantities. Iíd have only two or three types of locks and only a few units of each, same with helmets, tires, etc.
- Have other stocked products that are sold only with installation. Donít sell a set of fenders from your inventory for the customer to take away. If customer wants to take fenders home to install himself, offer to order them. This will turn off many customers but most of them will buy online anyway, unless your retail price is close to the online price which would make your margins too low to justify stocking a low-turn part.
- I think the beer or cafe element is still worth trying but youíd have to be able to run a bar/cafe operation that would survive on its own. Which probably means having food and enough volume to support the labor and equipment/facilities cost. And may mean having someone else run that part of the business.

Thereís a couple locations around me that combine a largish front outside area (probably used to be parking) with a small building (set well back on the lot.) I could see a repairs-focused bike shop in the building, with a food cart pod and covered seating in the front area. Try to get enough rent from the carts to help the shop get through the slow season.
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Old 01-01-20, 01:58 PM
  #42  
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I donít agree that rising rents reflect insufficient development activity.

In new buildings, the retail space is priced high. It really canít be otherwise, due to the cost of the new building.
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Old 01-01-20, 02:03 PM
  #43  
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I know of a two store, single ownership that is really terrific on service and rates well with customer cordial, highly involved with community events, etc. but both towns make it very difficult.

Refused effective exterior signage, not allowed to park retail bicycles outside during business hours, is required SPECIAL food permits + INSPECTION to just sell energy bars! Ridiculous extra fees.

Town management is rotten and corrupt all throughout this country.

Partial solution is the NEED for public officials to encourage cyclist and the business.

With exception to one larger city (college town) I'm familiar with, the mayor is an avid cyclist and bike shop owner.

Outstanding bike trail infrastructure, commuter safe and the results show, the town sustains other bike shops.
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Old 01-01-20, 02:05 PM
  #44  
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Originally Posted by SamSpade1941 View Post
Skyrocketing rents point to a lack of property development not too much development.
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Old 01-01-20, 02:14 PM
  #45  
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Originally Posted by jyl View Post
I donít agree that rising rents reflect insufficient development activity.

In new buildings, the retail space is priced high. It really canít be otherwise, due to the cost of the new building.
sorry thatís not correct. Rent like most other things is affected by availability of space to be rented and market demand for the space .

eta thatís why excessive regulation and rent controls can and do negatively affect the costs associated with leasing space .


the harder you make it for property owners to make space available profitably the more it will cost to rent the available space

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Old 01-01-20, 02:18 PM
  #46  
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Originally Posted by SurferRosa View Post
supply and demand itís not magic ...
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Old 01-01-20, 02:25 PM
  #47  
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Originally Posted by SamSpade1941 View Post
Rivelo closing is no shock... Why on earth order or purchase anything Rivendell from brick and mortar store in Portland when I can order it directly from Rivendell and for the same price or a tad less ? I think it was interesting they tried to capitalize on shooting film and old vinyl records along with bikes. A very confused bike shop IMHO and that was just a bad business model . As for Universal I order from them all the time , they ship really economically and quickly. I get my parts a day or two at the latest after I order them here in Salem. However I would probably more more inclined to visit them more now that they are moving to HIllsboro.

As for some of other shops

I honestly can't see how the cafe every worked for Breadwinner .
My one dealing with Norther Cycles left a bad taste in my mouth , I did not come away with a good will feeling after talking to the guys who run that shop , they struck me as rude.

Brick and Mortar stores in general are doomed as time moves on, so people who intend to stay profitable in that venue are going to need to offer exceptional service and a unique value proposition that does not focus on elitist attitudes (Norther), having items on display but not in stock (Velo Cult) and selling vinyl records, and poster prints by Will (Rivelo) ....
Rivelo was a concept store. They didn't even do repairs or build up the bikes they sold. The owner cashed out his house in Potrero Hill SF to afford him a lifestyle in Portland. Bikes and Dylan records? Just a bad business model.

Velo Cult had a chance until the city of Portland started enforcing their own fire department laws. Half of the square footage (basement) couldn't be utilized as intended due to access issues, and the upstairs area couldn't be fully utilized due to occupancy limits. They never had much inventory to sell - I often wondered how they would stay in business. When your highest profit margin item is beer, why have a bike shop to drag the business down? Then there was the large amount of potential capital hanging from the ceiling (museum grade bicycles).

Norther's sales were mostly on the internet. Very few of the custom bikes they sold were local. You don't need a brick and mortar store to do that. The proprietor bought most of his inventory because it was stuff he liked, not necessarily that it sold. When all of your Gilles Berthoud bag sales go out with a custom frame/bike, you don't need to stock 7 of them - you have one on display and order off of it. Maybe StarMichael will work out of a garage part time.

I loved all three of these shops, but when you're running a bike business, you have to focus on the business end if you want to stay around. Owning a bike shop has always meant buying a job. You're working for minimum wage, at best, with no benefits.

All three went down due to naivity, IMO. Most bike shops are hobby businesses, unfortunately. If you can live with that, fine. Try and raise a family on it, good luck.
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Old 01-01-20, 02:28 PM
  #48  
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Originally Posted by jyl View Post
In the US, conventional (non electric) bicycle sales are declining in units and dollars. E-bike sales are growing strongly. This is on a wholesale basis. E-bikes are still a somewhat specialized category, sold by a minority of bike shops.

https://www.bicycleretailer.com/studies-reports-0

Bicycles are for the most part still subject to the tariffs of up to 25% imposed as part of the trade war. Some niche categories like single speed bikes and 20" bikes are excepted. I believe this has depressed profit margins for retailers. Oregon also has a bike sales tax, itís small but profit margins on most bikes is already thin.

The bicycle component industry has arranged its pricing such that US retailer wholesale price is not much different from online prices. The more knowledgeable the consumer and the higher end the product, the more likely to buy from online or even UK online (Wiggle).

In Portland, the business tax (city, county, TriMet) is about 4.3% of operating profit.

Bicycle riding is not growing, much, in Portland. Population growth has slowed to about 1% and, anecdotally, the new in-migrants are less likely to commute by bike. E-scooters are taking some share from bicycles, though not clear how much. Despite all the new bike lanes being installed, bike % commuting is flat to declining.

Rents are rising fast. I mostly hear about this in the context of restaurant closures but it must be affecting bike shops too (e.g. Western Bikeworks).

The cityís rules may not affect bike shops too much but do affect businesses that combine bikes with beer. The last straw for Velocult was when the city demanded that the bar area be physically separated from the bike area on the grounds that kids frequented the bike shop.

If someone put a gun to my head and forced me to open a bike shop, I think Iíd:
- Focus on repair services. You can flex the labor cost to match demand, lay off mechanics in the slow periods, pay mechanics by piecework.
- Merchandise stocked for sale will be very limited. Only basic stuff that turns quickly, and only limited quantities. Iíd have only two or three types of locks and only a few units of each, same with helmets, tires, etc.
- Have other stocked products that are sold only with installation. Donít sell a set of fenders from your inventory for the customer to take away. If customer wants to take fenders home to install himself, offer to order them. This will turn off many customers but most of them will buy online anyway, unless your retail price is close to the online price which would make your margins too low to justify stocking a low-turn part.
- I think the beer or cafe element is still worth trying but youíd have to be able to run a bar/cafe operation that would survive on its own. Which probably means having food and enough volume to support the labor and equipment/facilities cost. And may mean having someone else run that part of the business.

Thereís a couple locations around me that combine a largish front outside area (probably used to be parking) with a small building (set well back on the lot.) I could see a repairs-focused bike shop in the building, with a food cart pod and covered seating in the front area. Try to get enough rent from the carts to help the shop get through the slow season.
At least in Portland, you can run a bicycle shop/bar. In Virginia, that is legally impossible because there are no bars in Virginia. Period. If you want to own a bar, there must be a restaurant attached (actually predominate), and the food side must sell as much as the alcohol side. And the ABC watches that very closely - the best biker bar in Richmond was closed because the owner didn't bother to worry about the food side. He knew damn well that bikers doing a Saturday or Sunday run weren't interested in having lunch 5-6 times during the day, but were making bar stops for a beer or two 5-6 times during the run.

There is one exception to this law: Craft breweries are allowed to have a 'tasting room' on site. It's not a bar. They're limited to sell only their production, bar tabs are not allowed so you have to pay for every glass, and they may not serve food so there's usually a food truck parked somewhere on the property. Growlers once handed over, and canned beer may not be opened on the site but must be taken off the property to be consumed. Happily my favorite craft brewer is a 2.5 mile bicycle ride from my house, especially since they no longer can my favorite beer, so I have to either drink it there or take a growler home.

22 years living down here, and I'm still rankled by the 'no bar' law. To attempt what's being mentioned, you'd have to have a bicycle shop and a tasting room on the same property, and most likely firmly divided with a door between the two. No idea if ownership of both business could be by the same person.
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Old 01-01-20, 02:33 PM
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Originally Posted by merziac View Post
It is, that's not PDX and we'll see how long they last as well, this may be part of a far larger trend than we are seeing yet.
Ashland was the first campus, UBI didn't open in PDX until ? Portland was popular as a campus because people out of state/out of country were excited to visit Portland for a week or two while going to class. I'm wondering if the higher cost of staying in Portland vs Ashland might have something to do with the campus closure.

UBI's class offerings are fairly unique. I don't think the location change will affect that too much.
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Old 01-01-20, 02:39 PM
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Originally Posted by SamSpade1941 View Post
supply and demand it’s not magic ...
​​​​​​Right. What happens to price when demand rises? What happens to price when supply drops?

The result does not agree with your post. See Seattle as an example of rising rents during a boom in development.
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