Are you wondering why you aren’t making the money you should be?

Did you know the “typical” bike shop hasn’t made money on the sale of new bicycles in at least seven years?
 
• The typical bike shop in the U.S. has taken a loss on the sale of new bicycles for over a decade.  This is significant for a number of reasons, including the fact that new bicycle sales represent between 47% and 48% of total store revenues. 

• Initial markup for new bicycles has remained at a typical 40% for 6-years, from 1999 through 2005.  This initial markup appears to be undervaluing most new bicycles, and needs to be reviewed by specialty bicycle retailers to determine what can be done to increase the initial markup and the realized gross margin on new bicycles. 

• Some U.S. bicycle shops have made consistent profit on the sale of new bicycles, and are probably classified as high profit bike shops, which constituted 19% of all responding firms to the 2005 Cost of Doing Business survey.  This leaves approximately 80% of the typical U.S. bike shops consistently selling new bicycles at a loss, or at best breakeven.