Continuously Improving w/Dan Thornton
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Continuously Improving w/Dan Thornton this episode, David DeKeyser joins us once again to interview Dan Thornton, owner of Free-Flite Bicycles. Dan has been in the industry for over 40 years and has a great sense of business. He talks to Dave about opening his skateboard shop in 1977, transitioning to a bike shop in 1978, opening more locations, and getting back into an active role in the business this year. Dan also shares with us how he keeps up his “continuous improvement” mentality and how he keeps his employees happy through an incredibly busy time.
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Dan Thornton
Tue, 8/18 10:46AM • 41:30
SUMMARY KEYWORDS
bikes, stores, p2, people, day, business, bicycle, run, orders, retail, bmx, employees, retailers, showroom, week, industry, road bikes, trails, numbers, years
SPEAKERS
Dan Thornton, Rod Judd, David DeKeyser, Kent Cranford
Rod Judd 00:10
You are listening to bicycle retail radio brought to you by the National Bicycle Dealers Association.
David DeKeyser 00:16
Hello and welcome to another episode of bicycle retail radio. My name is David DeKeyser and I do retail consulting for the NBDA is P2 Consult program. You can find more information on that program and all the other great benefits the NBDA provides on the NBDA website NBDA calm. Today’s guest is Dan Thornton on our Free Flight Bikes with locations in Marietta, Sandy Springs, East Cobb, Georgia starting 42 years ago as a skateboard shop. preflight has evolved tremendously over the years. And with that, thank you, Dan, for taking the time to join us today.
Dan Thornton 00:54
Oh, You’re quite welcome. Happy to be here.
David DeKeyser 00:57
First off, 42 years starting to skateboard shop. Can you kind of walk us through your business’s bio a little bit through the years and at the end of that finish up with where you stand day-to-day in the business?
Dan Thornton 01:12
Yeah, 42 years condensed down in a few minutes isn’t easy, but I’ll give it a shot here. We, being my father myself, opened up a skateboard shop in 1977. And did quite well actually for about a year year and a half we thought things were just going to keep going. And in 1978 things took a turn for the worse in that industry. It seemed that liability insurances skate parks and hindsight now you look back and skateboards are very, very cyclical through generations of kids. They come they go, they’re big. They’re small parts of our sporting activities. So we made the decision and 78 kinds of looked around and said, what’s next? And what do we do now that we have a retail storefront? We know enough about retail to be dangerous. What do we do and At that time, BMX was booming? The BMX scene was happening. tracks were popping up everywhere. teams were traveling and nationals were happening through both ABA and NBA. So we kind of jumped in with both feet, we bought a little tiny bike shop in our hometown that had closed that had you know, I think it was about $8,000 in inventory. We moved to a little better area that was the better-suited showroom for bicycles and BMX continued with skateboards for a while, but that didn’t last very long as BMX took over quickly. When the BMX scene hit, we were doing national mail order, we set up a mail-order catalog that we actually hand printed in the store with a little pictograph machine, mimeograph machine, whatever you call it, ran catalogs, mailed them out and put ads in the back of BMX action magazine or BMX plus back then and just really, it just took off on us and we didn’t really know what It hit us and it ran hard for quite some time we had a national team that traveled we had mailorder going in a retail showroom that was kind of the hotspot for BMX, in our marketplace. And just like anything, you know, it’s cyclical to that it had its run road bikes, we had a gentleman that ran the Eastpointe velodrome that came to me and said, Hey, you guys need to be sunken, some road bikes, it’s the next thing coming. And we got into road bikes. And we sold rode bikes pretty hard for quite some time and was doing quite well with road bikes. And then the next thing the mountain bike wave and the mountain bike scene hit and we were there. So we really just transition from product to product, always keeping what we started with, and that’s BMX and family bikes. So it’s a big part of our business today. We have three stores now my dad through my mom, she worked for IBM and she was transferred in 1982. And at that time, he came to me and said, What do you want to do? You know, we can try to sell it. There’s probably not much here to sell. We could liquidate, you could do whatever it is you want to do or You could continue to run it and pay me back my investment over time and we’ll see how it works. At that time, my wife 42 years as well, we looked at each other and said, let’s do this, let’s make it work. And she went to school and learn to do books and I went to the school of hard knocks and dug into the stores. So I never had a formal education, everything has been from high school on and just school of hard knocks. And the rest is somewhat history. We now have three stores and 30 plus employees that are top of season 26 at the low point of the season, so it’s been very, very good for our family. We’ve been rewarded greatly and trying times today for sure. It’s a different type of stress from other times we’ve seen in this industry that we’re dealing with today with the COVID issues and shut down and the bicycle rebirth or boom if you want to call it whatever so
David DeKeyser 04:50
Yeah, a personal story there is that in the 80s I was really into BMX and I remember the free flight and Name and the catalog showing up in my mailbox as a teenager probably in 1984 1985. So whenever I would see your name pop up, the name of the stores pop up over the years that always kind of had a fond memory for me because that was a nice time I think in my life. So it’s kind of neat how you’ve transitioned so much over the years. Nowadays, in your stores, what brands are you selling what’s kind of paint a picture of what your retail business looks like today.
Dan Thornton 05:31
We’re one of the top 50 TREK dealers and we do a primary TREK business. We also do very, very well. We’re one of the largest Santa Cruz dealers in the southeast. So those are our two primaries. We obviously like everybody to do a couple of specials of this and that custom frames in the roadside, but that’s our primary too. So we’re primarily a TREK retailer.
David DeKeyser 05:53
With a Santa Cruz component there. Obviously, you must have some mountain bike trails or very good mountain bike trails. I’m assuming with In striking distance of some of the stores,
Dan Thornton 06:03
Blankets Creek is about five miles from our largest location, our oldest and largest location. And the blink Creek trailhead is managed and run by Sorba which is the southern offroad bicycle Association. And it was one of their very early trails when they went into developing clubs in the region. So they have both blankets Creek, rope mill and Altoona Creek are all run by SORBA And then so Creek it’s closest to our other two stores. We’re in a hotbed of some of the top trails in the eastern region. It’s without question blankets Creek is one of the most visited trails pops up on a bunch of top trails and in mountain biking for us.
David DeKeyser 06:42
Do you have some recreational paths or rail trails or anything like that near any of your stores?
Dan Thornton 06:48
We did? Well, I say we’re kind of surrounded by what’s growing. It’s slow. As everyone knows, money’s the issue. In almost every case, there’s quite a bit of political will to do it. There’s not enough resources from a financial standpoint to do what they want to do, but yes, there are recreational paths trails, the silver comet trail runs from Summerlin, which is really where a skateboard shop started. It goes all the way to Birmingham, Alabama, it’s 60 miles of old railroad tracks that were pulled up, turned into a really nice dual-direction bikeway that’s just hugely popular, especially as you get closer towards Atlanta in the city in Smyrna. So yeah, we have Roseville there’s a Greenway and then there’s paths and trails and it’s been quite a movement over the last say 20 years quite a change. But a long way to go here in Georgia, that’s for sure.
David DeKeyser 07:36
How big are your stores,
Dan Thornton 07:38
our largest stores 7500 square feet. We like to call it our mothership. If we have large bulk orders come in, that’s where they come in. And then we have weekly distribution to our other stores via transfer. The other two stores one is a two-story building, which we purchased about 15 years ago, and that’s right at just under 5000 square foot freestanding building and then last Or most recent opening a six years old. And that’s in the city of Sandy Springs in the shopping center, and it’s 4300. So all 43 or greater
David DeKeyser 08:11
is three of the most stores that you’ve ever had. Have you had more than that? Kind of how did you arrive at that number of stores in your current locations?
Dan Thornton 08:20
That’s a good one for very, very short periods of time. We had four but it was typically when we tried to a location that didn’t work. We may have been there five years, tried to make it happen, couldn’t make it happen. And while we were closing it, we would turn around and begin opening a store in another area to give it a shot. See if we can make that we’ve done and this is definitely our three. It’s very interesting when you look at stores one’s easy. I mean, you know, hindsight is always 2020 and I some days I dream of a 20,000 square foot one single store that does it all has it all. Because you know when you take your staff and you have an amazing staff At one and you start taking your best of staff to go run another one, you just basically end up with three stores with great staff, but not always the best of staff and you kind of lose a little control and it takes several years to really get that. It’s not near as easy as it looks on the outside to open multiple.
Kent Cranford 09:20
This podcast is brought to you by the NBDA, membership, and industry donors to continue providing education and content like the podcast you’re listening to now. We need your support. Go to NBDA.com and join or donate today.
David DeKeyser 09:40
Are you guys pretty comfortable now with where you’re at? Or do you have plans if you saw the right location, the right spot? Would you move into that? Or have you settled into what the business is at this point?
Dan Thornton 09:53
I’ve looked at that we looked at it. There are times we feel like we’re a little bit too small to be big and we’re too big to be small and we feel like We’re kind of caught in the middle, there’s no doubt there are economies of scale that can be gained by multiple locations. The problem is having very tight controls on those. And it’s not easy. It’s very, very hard regardless of what database, what systems, what point of sale you use, the amount of management and control of that is the hardest part. And that’s the downside to multiple locations. So I respect those guys. You know, when you see people with 1520 3040 locations, it’s just amazing that they’re able to do that and maintain a high-quality level of service to the customer. Do you think that just comes down to they have such a solid operational handbook in a way of, you know, they can just pop open the door and they’re ready to roll? Yeah, you know, I that in the discipline. I think the real thing there is discipline and oversight management. It’s extremely hard to create a perfect customer experience. And as you move Apply, that just gets harder, there’s no doubt in my mind that that becomes harder and harder. The dream of perfect service for every customer and everything else. It’s near impossible to create the perfect customer experience time and time again, without those controls and management are extremely hard to do to have people in different locations. Always being consistent with the way you treat your customer is the hardest thing and you know, the big retailers know it without question when you start looking at big retailers to this level of service. So that’s one reason that when you look at our competitors online and the Amazons when they have their management and control under one place, they completely control the script and let people know exactly what they can and can’t do. It makes it hard on retail, and we are dealing as everyone in this podcast knows that we’re dealing with pay levels that do not that have a big business. And it makes it tough. We love what we do every one of us, but it’s also a hard job.
David DeKeyser 12:06
Do you have any ideas there on ways to bolster those pay levels?
Dan Thornton 12:13
Well, it’s a margin game. Everybody knows, you know, I have friends that are consultants. And here you have people that are consultants in different industries, they have absolutely zero inventory, their assets or laptops. And that’s it. When they sell their businesses, they’re selling it at eight and 10 times revenue of gross profit. And typically, I find that most are looking at three times at best. And that’s if they’re really, really good with really, really good books and fantastic profits. And that’s tough to deal with. So, to raise the pay scale of an employee, the only way it’s going to happen is to increase your income and volume to make sure that you’re highly profitable and as we all know in this industry, That’s typically not the case. It’s just typically not the case, we’re dealing with many, many retailers that if they break, even in a year, they consider it a very good year. And in many cases, they have spouses and other people that help cover their paycheck. You know, it’s just not the normal business. You know, we’re very lucky, though, that we’ve survived when most of the retail has failed, which gives me a glimmer of hope that there are places for retailers to continue to move along the path to profitability, slowly find their way into where their profits match their efforts because it’s hard. It’s not easy.
David DeKeyser 13:41
And there seem to be almost two different types of stores. There are the stores that are being run from a very businesslike standpoint and the stores that are trying but are missing the mark and there’s just not enough kind of meat on the bone. If you’re not firing on all cylinders, and some of those things areas with the amount of time that you guys have been doing this with your stores. Are you always working on TREK has that turret you know, they always use the term continuous improvement you kind of run into that? Or do you find yourself doing that? Where you’re continuously trying to get down to the bone with a scalpel and really find areas that you can make more money? Whether that’s with data, or however? Or do you feel like you’ve hit your stride as a business from what you can improve?
Dan Thornton 14:31
No, I believe fully that there’s always room for improvement. We’re continually It doesn’t matter what decision we make anything whether it be new canopies for our events or new fixtures for the walls. We look at everything from a financial standpoint, is there going to be ROI? Is there going to be a return on investment for what we’re getting ready to do here or is it just because we think it’s really cool to have and those decisions are made every single day based on what’s going to be better for us the processes we use for service check-in. And you know, I look at track as an amazing partner. I don’t really know where we would be today without that because I see comments on some of our industry forums where I can tell that retailers are operating the way we did 25 years ago, just seat of the pants, cash registers. And you know, many cases, I believe a lot of retailers have pointed sales, but really, they’re just very, very expensive cash registers. inventory is inaccurate. No maximums being used, service orders, and service tickets aren’t being controlled. It just goes on and on and on. And you don’t have to have a business degree. Obviously I don’t. And you don’t have to have a business degree to get it to do it to make it work. But you got to have a commitment. And it’s always a commitment to doing better. And I think so many retailers and I understand it, I get it. I’ve been there to wear every day you turn the key in your day is in your face and it doesn’t end when it does. End You have no time for anything, you go home, you’re exhausted. You start over the next day, there’s never time for continuous improvement. But that’s how it’s going to get better. And if you can’t find the time to do that, it’s a long road. Without profits, it’s very hard to be profitable. Right? Not enough margin.
David DeKeyser 16:20
That’s always going to be the hard thing, I think is to, as you said, there’s just not enough hours in the day if you’re being slammed. That brings us to today where most retailers seem to say that they’re exhausted with what has been happening in the last few months. And there’s been a few that sound almost invigorated by the challenge and everything. How are you doing? How are you personally handling this and how are you feeling kind of on a day to day basis right now?
Dan Thornton 16:51
For me, it’s been invigorating, there’s been nothing but invigoration coming from me, I have been for the last 10 or so years. Very, very backseat to our business, allowing my son who’s our general manager. And before him, even prior general managers to run 80%, probably more like 90% of this business. And when this happened, unfortunately, my son was out riding and took a hard crash and had to be taken out by ambulance because he broke his femur. And the day it happened, I’m like, oh, I look like I’m gonna be back on the retail floor. And I came into one of the stores that probably needed the most help. And just said, Okay, it’s time for me to get involved. I got very involved in everything that he would do. He was almost two weeks completely out of touch because of it just it was a pretty severe break and surgery by followed by, now, you know, rehabilitation therapy and things and he’s doing better. He’s activated again, but it’s activating to a point that I’m kind of excited to be back at it. I’m 62 years old and thought I was pretty much done with retail. I’m having actually more fun than I’ve had in many, many years doing what I do, and just a newfound passion for the showroom of retail. And it showed me an awful lot of where we are what we need. And, you know, we’ve taken the store that all of our stores are up substantially as a company, we’re up 52% on the year, we went into COVID, up about 17% thinking we were having the best year we’re going to have when it happened, we closed for three days thinking this is going to be devastating and the worst thing could ever happen to us. We modified our business, change the world we were doing change the way we did business, and had meetings with our managers and immediately opened up and the rest is history is just insanity every day, you know, we leave, you’re exhausted. we’ve modified our hours, not only our hours of a day, but we also modified our opening days to give every single employee the opportunity to have two days off. Could we be up 60 or 70%? Absolutely, but I think I threw that would have lost some really, really Good employees and lost their confidence in me as a decision-maker to keep the business going. It’s extremely hard as it is, I’m happy to say we’ve really lost no employees through this stressful time so
David DeKeyser 19:15
and that’s mainly due to having an extra day off or two days off, you think and producing those hours.
Dan Thornton 19:22
Will no employee ever worked more than five days a week. That’s our mantra. I want employees to ride their bikes, have fun, enjoy family, and do what they do. So we don’t drive anybody past we really don’t expect even managers to put in more than 45 hours a week. And nobody’s this most of our managers have been putting in less than typical. So by closing two days a week, it’s allowed us to have 100% full staff attendance every day of the week. So we don’t have those split schedules to where one day you have five people in the showroom, and one day you have three. One day you have to mechanics one day you have four based on seven days a week and the number of hours where Open typically. So what we’ve done is just gone 10 to five every day, and Tuesday through Saturday, every week. This week we’re stepping up because things we can see the tempo is starting to change. A lot of it’s based on product availability, bicycles aren’t available as they were early on. So with that happening, we’re modifying and we’re going to go 10 to seven. We’re here till seven every day anyway. We’re just here normally from five to seven, organizing for the next day building bugs cleaning up taking care of service, everybody has a role in a task, mopping cleaning touch surfaces, just doing everything we need to do to be prepared to turn the key the next day. So now what we’re going to do is go ahead and open up till seven. We think we’re still gonna have time for that sort of thing after because the volume has flowed our numbers are still quite good. Every day I keep saying we’re going to have the worst June we’ve ever had yet. We’re off the charts in June even though it feels like we don’t have inventory. We’re getting bikes. They’re just not enough. But we’re selling a lot of things that we probably wouldn’t have sold. So, you know, at this point, month to date, we’re up 116% over last June was huge. It’s crazy. Yeah, it’s crazy. So it’s a good time for the industry. But I think everybody has to take a deep breath and realize that no matter how you treat your people and what you do for your employees, we’ve been bonusing extra pay on an hourly basis. We’ve increased everybody’s pay through this for now. And we’ve also allowed all the employees that have goals and marks to hit on a monthly basis. We’ve just taken that off the table and said, instead, we’re just going to continue to pay the full bonus whether you hit those marks or not because some of them the way we’re handling services, not measurable. You know, we had service ticket sizes that we would bonus on, we had, you know, email capture rate that we would bonus on and things like that. So we just took all those bonuses and said we’re going to give them to you as long as you’re here every day working hard. We’re going to give you your full bonus regardless Have you hit your measurables? At some point that’ll change back and will go back to normal and, you know, employees will still be compensated well, but right now we feel like we owe it to our employees. So it’s been great.
David DeKeyser 22:13
So kind of looking forward over the next month or two, you noted that you’ve started to see a little bit of a slowing. And is that a slowing in the numbers due to product availability? Or is it a slowing in that people, the general public is starting to go back to work and there’s kind of normalization started to happen in society it? Yes, it’s both
Dan Thornton 22:39
Georgia was one of the early states to start opening back up. And we noticed almost immediately the traffic patterns started picking back up and were notorious for horrendous traffic. It’s still nothing like it was many, many office spaces are still closed and other things like that, but without question a difference in the number of door swings, we track traffic and we know our traffic counts are way, way off. The difference now is we’re a little more able to handle the customer without the ferociousness, you know, the people lined up outside and we’re just not as stressed on a day to day basis. So we’re able to take probably even better care of our customers yet still control traffic. We don’t have open showrooms. We’re allowing one customer to instill her, but they’re not lined up 10 deep, but we’re still seeing that those customers that are in are here to buy. And if we have what they need, they’re buying it. Services not quite as far back as it was. We’ve never been more than two and a half weeks. doing most of our while you wait for quick repairs. At the front door. We’ve set tents upfront kind of triage centers, and if it’s deeper than that, we let them come on back, talk to the mechanics and determine whether or not it’s something they want to leave for two weeks, but that’s about where we’ve stayed in two weeks for the most part on one service turnaround.
24:01
Have you heard of P2 groups and wondered what they are? P2 stands for the profitability project. And while profitability is that the focus of everything we do, we do so much more p to group members share their expertise and their insights. They ask questions and they exchange resources to make sure every member is profitable and successful in every aspect of bike shop ownership. Reach out today so we can tell you more.
David DeKeyser 24:36
As far as the locked showroom, and how you’re operating currently. Do you have any sense as to how long that will last? Is that something that you feel could continue as long as the virus seems to be circulating or is that something you feel you might wind back? Have you given that any thought at this point?
Dan Thornton 24:58
Yes or no? Definitely given a thought, a day, we have no clue. The difference now is on a typical Saturday in the season, there are times that you’re overrun with customers, and you don’t think about it twice. You just have people wandering the showroom waiting for somebody and it’s just as out of control the differences. There’s no order to the order. You have to have a pretty good showroom general that knows what’s going on and is always continually pointing and saying, okay, somebody would be right with you. What are you okay, Bill? Sue, will you help them? Can you help hurt you? And now what’s happening is they’re outside instead of inside, and when they come in, we have time to talk to them. It’s very unique and different to have to speed up a conversation when you can tell. Maybe they’re just COVID stir crazy and want to chat and get to that point where we’re like, Okay, well, you know, if you wanted to go ahead, we’ve shown you what we have. We’ve got other people waiting outside. If you’re not ready to make a decision. We understand we’re here. Come back or call us another time. You kind of has to escort them out because you can’t let somebody The phone is the worst part about our business right now is taking care of the phone. But you can’t let them come in and be the phone call that goes on and on and on to where they just want to talk about their last two months of lockdown. And that’s what’s happening is you just could sense that people want to chat sharing the point where
David DeKeyser 26:20
you’ve had a big increase in phone traffic as well.
Dan Thornton 26:23
It’s probably our biggest stress or concern right now. And there’s a point where you cannot get to all the calls. It goes to voicemail right now we’d love to you can’t obviously but you know the TREK Marlin is the hot bike. There’s the Marlin the bird and the FX are the three bikes that if I had an unlimited supply, I don’t even know what we do. We would have people lined up 50 deep and if we had an unlimited supply, but we don’t so you know, my part of me and I told the guys the other day in the manager’s meeting, Colin, I said I really love to put on this on the phone recording message that says thank you for calling free-float bicycles. We at this time don’t have Marlins. We Don’t have verbs and we don’t have the x’s. If that’s what you’re looking for, please call us back in two weeks click. And just because that’s what it is, all we do is explain and then they don’t understand why they think it’s because China makes the bikes and it’s all about the duty and import problems that have been going on. And it’s not it’s just nine months of bikes have been sold in 10 weeks, 12 weeks period. It’s hard for them to grasp that. Why can’t they just make more? You know,
David DeKeyser 27:26
how far out Have you placed orders now and it’s kind of a two-part question is How are you planning the next few months inventory wise? And is there some light at the end of the tunnel from an availability standpoint?
Dan Thornton 27:38
I don’t know how other companies are managing backorders I think truck I got to take my hat off to them. They have done an amazing job of fairly handing out bicycles and when I say fairly, if you have some business sense and you have the time to sit down and place your backorders, your bikes will come to you in the order you placed them. There’s no Cutting in line. There’s no favoritism to trick stores. And I thought at first that that was one of my big fears is like, oh boy, now we’re going to be competing to get bikes from people that own the stores, they’re going to get them first. And that hasn’t been true. If you place your orders now, it doesn’t mean they weren’t way ahead of us and getting some back orders and but it does mean that you get your bikes in the order you place them. So we’ve been placing orders weekly to kind of keep a flow of bikes coming. I mean anybody that went in and said on one 100, Marlin mediums, hundred smalls, they don’t have the ability to take on 400 mostly 400 bikes at any given time. So even if they could, they wouldn’t get them. But what we’ve been doing from the very start was placing orders all the way back to April. For bikes that we thought were going to be a problem so we keep getting them weekly. We’re getting shipments but it’s not enough. It’s just not when it’s going to get better. I’m seeing there are bikes that if you go to Trek’s website, it tells you right now, if you place an order today, that order would be placed and delivered on x. And right now there are bikes all the way out to November in December. If you don’t have bikes in the queue and you haven’t been aggressive on keeping orders in, it could be a very long year for you.
David DeKeyser 29:14
And I heard that the 2020 ones in not with the track but with another manufacturer that is already showing sold out. And I think that that’s kind of that same timeframe of November, December, January.
Dan Thornton 29:25
Yeah. So it seems like we’ve already been getting some 2021 bikes, both road and mountain bikes, but those are all bikes that like I said, we went in and placed what trek did was very wise was, let’s say the color was blue, and you placed orders and back orders for blue. And the new bikes coming in green. What they did was they just converted your order over rather than saying, Oh, you didn’t know about the new color yet you’re out to align. So the person that placed an order a month and a half later when the new model shows up. They don’t step in front of you. It’s obvious that they put a huge amount of time and energy thinking through the process to make sure that their dealers are treated fairly. I’m quite impressed. of all three companies, their shipments have been on time. I know most of our other vendors are struggling with three and four-day delays. Shimano East Coast so they have very few employees. And we’re, we’re seeing like six and seven-day delays from the time the orders picked at the time it leaves the door trick we’re still getting if we get it in by two or three, we’re getting the shipment out the same day. So I have to say I’m pleasantly surprised at what’s been going on with our partner.
David DeKeyser 30:30
That’s great to hear. You know, now everybody’s trying to look at the crystal ball a little bit. And I think that there’s some hope that you know, the one question that everybody keeps popping up, is this going to last? And I think that there are two parts to that where we’re already seen, like you said, with things loosening up, there are fewer people that only have bikes to go to. So that might soften up demand a little bit, but do you feel that have you gotten the For many of these people, that this is something that is going to become a regular part of their life. And we may have a rising tide of participants over the next few years.
Dan Thornton 31:10
I’m an optimist and believe Yes, I am seeing still more people on bikes, whether it be neighborhoods, bike paths, trails. I’ve started this week doing some group rides, we’re still you know, social distancing in the parking lot. We’re not getting on the wheel as we would normally do for road rides. But the numbers are greater. And I’m starting to see now in our sales, some high-end road bikes are going that weren’t going in the heat of all this. We’re seeing high in mountain bikes. Our Santa Cruz inventory has been depleted. We can’t wait until the announcements of the new product and about a week and a half, and orders placed. So my gut says that we’re going to continue to roll I really do not see. I know there’s a lot of pessimism out there. And I keep seeing people saying Yeah, you’re going to see all these bikes on the Facebook marketplace and eBay and another year. that’s gonna happen. I mean, there are definitely people that got caught up in this and said, I gotta have a bike, gotta have a bike. Now I have a bike, why buy a bike? I think there’s going to be a continuation of this. I think people are learning to vacation without going to Europe or going to the beach. The staycations have been a big part of our sales, families coming in buying for bikes on a bike rack. And I’m seeing more and more bikes on backs of cars as I go to the bank and go go grab lunch or whatever. There’s, without question, more activity. So I think long term, we’re all going to see a positive kick from this not just now but in the future. But there’s no crystal ball. I wish I had one. You know, like, we sold the whole bikes in April May. And our rec sales were just okay. People were coming and going, Oh, no, and you know, and they’re buying $600 $800 $900 bikes. And I think the money shock of buying a couple of bikes at $800 when most people were probably wishing they could have bought a $500 kept them away from buying a bike rack. Well, it was almost a boomerang effect. those same people are coming in now wanting racks and racks are out two months now. So what was a bike shortage is still a bike shortage but now there’s a rack shortage. There are no racks hardly to be had immediate shipping who could have predicted that you needed or Yakima sales doubled already this year more than doubled. And we can’t get more for a while. So it’s pretty shocking to see what’s going on. And those are those things that if you had a crystal ball, you could have said you know what’s gonna happen? All these people are gonna need a way to transport these bikes are buying but I doubt many people thought that way and didn’t bank orders and all of a sudden now, inventories dried up. So people are like, what, why can’t I get a rack? You know, it’s just not that easy.
David DeKeyser 33:46
let’s shift gears a little bit. I kind of want to touch base on your involvement with the NBA over the years if you want to give us a little history there.
Dan Thornton 33:56
Yeah, happy to gosh now it’s probably been 20 plus years because I’ve been off the board at least three years. And I’m not good with saying Oh, it was 19 X that I did x. But I was invited to be on the board of directors as a, just a board of directors. I was on the board for 17 years. So I went through the board was on the board for many years, and then slowly started taking officer positions from secretary-treasurer to VP. And then finally president, and then I was the chairman the year after passed after that. And then when that was over, I just said that that’s enough. I’ve done enough. It’s obviously anybody that knows anything about the NBA knows that it’s a nonprofit association, and there’s no compensation for the board, no stipends. And it wasn’t really about the money. It was just the fact that I had felt like I had done my time doing what I could do. My whole goal going into the NBA was to try to help dealers be better and see dealers that really wanted to reach out and figure out a way to make money be profitable. in this industry, we love to do that. And that was the whole design in the desire programs from everything, including those that know the PT program. That was my whole intent of being on the board was to just see this industry continue to prosper and raise all boats. I felt like we did some really good things while I was there. It was a good run I met some amazing people from J grades of the formal owner of the bike gallery, Chris Cagle, one of my best friends ever. Whelan, sprocket and on down the number of people that I served on that board with and got close to was just incredible and helped my business tremendously as well.
David DeKeyser 35:43
Why don’t you talk about that a little bit more? From a mentorship standpoint, you have three stores in Georgia. They’re good-sized stores, but some of the names that you just mentioned, you were rubbing elbows with, kind of the Titan so the bike industry in a way and What did that mentorship mean to you? And how much did that involvement? I know you were involved in the P2 groups talk about that a little bit.
Dan Thornton 36:08
Sure, I’d be happy to well, it all started I think in about 1999. I was invited to go over to the Tour de France. And I believe that was the first year that Lance won the Tour. And I was there with some pretty heavy hitters that the industry that I had only read about at that time, my wife and I were there. Were there with Chris Kegel, Jay Graves the former owner of the bike gallery in Portland, Oregon, gossips Hill Able from Austin, Texas. And the list just goes on. And I hate that I left anybody out. But even Jimmy Hoyt from Texas is there and I realized quickly that these guys were no different than me. They just got an earlier start on growth and realize quickly that Yeah, there’s room for us to be bigger and better. And I started listening and talking and asking questions. About how they did this, how they did that. How did they come to this? How do they come to that? It wasn’t long before we got home, and we started really looking at our ability to grow. It was a huge turning point for us. When you can be in a room with the brains that I was able to spend a week with. You cannot get that back. There’s just no way that you can pay for that type of education. Not long after the NBDA, I was invited to be on the board of the NBA. And at that point, Chris Kegel said, Hey, I think Dan would be a good board member. Let’s ask them and bring them on. That’s when we started talking about the idea of the P2 group early on. And Jay Graves and I were the first two said absolutely. We actually cut a check before there was a P2 group and left it with Jay Townley and said Jay, get this thing started. Here’s a check. And he said on those checks for over a year before, I believe at that time, Fred Clements started working with Dan Mann as a consultant. And the decision was made to go ahead and let’s get this P2 things started. And it was the best money I’ve ever spent getting in the room with some really smart retailers. So we were involved in group one. group one was extremely successful in the P2 group. And we were meeting twice a year, we were talking on the phone on a regular basis, sharing of our numbers, I could see quickly that there was so much potential for us to be better and do better. All I had to do was listen and change the way I did business. And that’s the hardest part is making those changes. The listening parts easy. You know, anybody can go to a meeting, make a bunch of notes, and come back and do nothing. But changing them is what really helped us and visually seeing where we were compared to these guys. I was seeing numbers of margin different so I’m like what the heck you know, we’re not getting 42 points after everything. We’re not getting 46 points. We’re getting 38 points. So when we’re not making money, we’re not seeing growth here. Our labor as a percentage of sales is this, our rent as a percentage of sales is that and when you start seeing numbers that come out of P two, it’s eye-opening, that you’re doing something wrong. Or you’re doing something very right. Not everybody’s doing anything wrong. They’re just a confirmation that Yeah, we’re doing everything we can possibly do. Which means the P2 group isn’t for everybody. But the collaboration and sharing ideas was unreal. I’m no longer on it. I realized when I wasn’t that active in the day to day business that I had kind of run my time through and it seemed like I wasn’t getting back near as much as I was giving in the meetings, and the sharing of numbers and I just finally said, okay, I’ve done my time on the board. I’ve shared my numbers, I’ve shared my secrets of what’s helped us grow. Now it’s just time for me to kind of kick back and not really do this anymore, and have that extra expense. I looked at it as an expense at some point. But that Doesn’t mean everyone should it’s if you’re early in your career and you’re struggling to figure it all out, there’s not much better you can do than be a member of P2. It’s phenomenal.
David DeKeyser 40:10
Well, thank you, Dan. That was a pretty glowing endorsement of the P2 program number one, and fun history of both your involvement in the NBDA and the P2 group along with your business. And I think that anybody that listens to this is going to have an enjoyable few minutes learning more about your business and getting some ideas on how to be a better retailer. So thank you very much for joining us today. You’re quite welcome. enjoyed it. If you found this episode or others of bicycle retail radio insightful and informative, please consider joining the NBDA if you haven’t already by visiting nbda.com as the NBDA has benefits that can save you money and improve your business. Ultimately, your membership adds to the collective voice of this specialty bicycle retailer. In the NBDA his efforts to represent and advocate for your interests.
Rod Judd 41:04
Thank you everyone for listening. This has been bicycle retail radio by the National Bicycle Dealers Association. For more information on membership and member benefits, join us @nbda.com
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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.
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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.
Now is the time to become a member as we join together to make one another stronger. Whether you’re a retailer or an industry partner, your membership in the NBDA is one of the best investments you’ll make this year.
Learn more about the benefits of being a member and join now.
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