Adjusting in the Midst of Chaos

Adjusting in the midst of chaos, there is no better time to make some changes than when things are changing. The thought process is that chaos will allow you to more easily make changes you may have been contemplating but just hadn’t accomplished due to inertia for whatever reason. When everything seems to be in constant flux in your operations, staffing needs, inventory availability, and service demands make changes that may have felt disruptive in standard times and may be easier to get done. I’m talking about those annual changes you avoided for a few years. I am talking about refreshing your margins that have eroded on products that you can potentially clawback—and pursuing new or additional partners to add layers of product availability. What follows are some pricing and product procurement thoughts to increase margins and broaden your product portfolio.

Service Pricing

Consider evaluating your ala carte fees to maximize your on the spot repair business. This evaluation could help alleviate long wait times, which could be alienating first-time customers, who may get a poor perception of your store based on those lead times. Also, by doing on the spot repairs assuming you can come close to replicating your pre-pandemic labor dollars for the same timeframe, you may substantially decrease the stress on your service staff.

Adding New Partners

 This a critical time for our industry and many loyalties are going to be under review. Things are happening right now that have the future potential to disrupt things about your business should they continue when this all passes. First, a lack of inventory from your primary preferred vendor(s) may be the opening and impetus you needed to make a strategic change by adding a vendor(s) that can help you meet your needs. The “all the eggs in one basket” approach may be under enormous scrutiny for many retailers at this point, mainly if that basket is empty. Also, as the picture becomes more evident over time, these potential new vendors may be more willing to work with you on gaining more appealing margins. Competition is a good thing, and current times may result in retailers gaining some leverage in margin discussions.

Evaluating Staffing Needs And Customer Perceptions

Many retailers could use more staff, and that sales are outstanding right now. Many are also noticing that they can post huge sales days under challenging circumstances with the same amount or even reduced staff. Who would have thought you could sell and service as many or more customers while not allowing any or very few into your business?! Are there aspects of how sales are currently occurring that could change perceptions of what customers expect? In the future, will customers be more amicable to a slightly longer wait for an employee? These may be questions to ask as things return over time to slightly more “normal” operations. In a nutshell, what can we learn from how we are operating, and consider if there are ways you could reduce staffing needs by becoming more efficient? The thinking here is to consider scenarios. Lots of truths about your business are being challenged. At least allow these challenges to be viewed as experiments and examples of what is possible.

Inventory Requirements

Many retailers have noticed something extraordinary. If a customer wants a bike, they will buy one! As selection has become smaller, they will buy what you have. In our own retail business, we tried very hard to battle the proliferation of SKUs over the years. Too many subcategories, models, and colors began to overwhelm us, and we discovered that we were selling what we had as we simplified our selection. Our customers were not as impressed by the enormous range many brands have available as they were simply in having a bike we could sell them. Too much inventory can be a significant hurdle for many shops to overcome, and perhaps our current situation may build confidence that you can do more with a little less!

I believe that retailers are currently in a position to make changes that, in regular times, would very likely create issues with either employee, customer, or vendor buy-in. There is too much happening at this moment in time to allow for overthinking decisions. Everyone is handling issues in addition to the fact that it is springtime. Think hard about what you are seeing happen in your business. Contemplate if any changes you had to make are challenging your perceptions or those of your customers. In doing so, you will learn what is required to provide bikes and service.

Words by David DeKeyser animation_offset=””]

David DeKeyser and his wife Rebecca Cleveland owned and operated The Bike Hub in De Pere, Wisconsin, for nearly 18 years. In 2018, they sold the business and real estate to another retailer based in a nearby community. David now writes the Positive Spin series on Bicycle Retailer and Industry News and he writes articles for the NBDA’s blog, Outspokin’. David also provides business consulting through the NBDA’s P2 Consult Program.

 

The NBDA has been here since 1946, representing and empowering specialty bicycle dealers in the United States through education, communications, research, advocacy, member discount programs, and promotional opportunities. As shops are facing never-before-seen circumstances, these resources offer a lifeline. Together, we will weather this. We at the NBDA will not waver in our commitment to serving our members even during this challenging time—but we need your support.

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