Perhaps you think that a bicycle business is a simple and not very innovative undertaking, but the truth is that a company of this type can be very profitable in these times.
Every day we worry more about being in shape, but also about important aspects such as the environment or saving time and money on transportation to go to work.
That is why opening a bicycle shop can be a very good business with a great future ahead of it.
The rise of cycling does not stop: today there have been a large number of people who decide to go to work by bike instead of by car or to pick up their children from school and walk around the city.
How to start your bicycle business ( 8 steps )
1. Create your business plan to organize yourself
A business plan is mandatory for any business; It does not matter if you are going to start a cafeteria, a cleaning business, or an online clothing store.
And with a bicycle business, you must also develop it to study your market and know what steps to take in the different stages of your company.
You don’t have to be a professional to write your business plan, it’s actually easier than you think. It’s like creating an instruction manual.
The most basic concepts that you should include are:
- Where will your business be located (a city, a rural area, online)
- Analyze if there are potential buyers in that area or not
- Who will be your potential customers
- Where they move (social networks, blogs, magazines, physical places)
- What specific products you will sell (only bicycles, or also accessories and guides for cycling routes)
- Who will be your suppliers (brands) and what are their budgets
- How much money do you have to start your business, and how much capital do you lack?
- Where will you get the capital you need to start your business (loans, collaboration with a partner, government aid)
- What profit margin will you get with your sales
- What costs will your business have (rental of a premises, purchase of bicycles, salary of employees, etc.)
- What procedures should you do to open your bike shop (business licenses, insurance for workers, building permits for the premises)
- What marketing strategies will you use to promote yourself (social media, magazine ads, street signs)
- How much will these promotional strategies cost?
- Who are your competitors
- How they can affect your business
2. Look for suppliers of bicycles and accessories
The next step is to look for suppliers of your products to be able to make a detailed budget later with all the necessary data.
How can you find distributors? In these 3 easy ways:
- Google bike brands to contact them.
- Write the ones you know on a piece of paper and find their phones to talk to them.
- Go to a cycling association or organization and ask them for a list of brands they use to contact them
3. Analyze the capital you have and your expenses
It is very important to create a budget for your business and thus know how much money you will need to open it.
The first step is to check how much money you will need. Make a list of EVERYTHING you have to buy or pay for during the first 6 months, such as:
- The rent of the premises.
- The approximate costs of electricity, maintenance of the premises, etc.
- The units of each bicycle and accessories that you are going to buy and their prices according to the provider you have chosen.
- The salary and labor insurance of your employees if you are going to hire staff.
- The furniture and decoration necessary for your store.
4. Find a place big enough
At this point, it is important that you look for a place that is well located but also has enough space to store the bicycles and expose them to the public.
Remember that a bicycle is not like a dress or a phone: it takes up more space than these products and therefore you will need more space in your store.
5. Complete the procedures to open your store
Any business must be totally legal; And to achieve this it is necessary that you inform yourself of all the documents that you must present to the government of your country.
In general, these procedures are not complicated, nor do they take long to be approved.
The basic procedures that you must do for any company are these:
- Opening statement: to give notice that you are going to start your business.
- Commercial registry: to register your business in the business registry.
- Register as a self-employed worker: you must register here as an entrepreneur and to register your employees.
- Opening license : it is the license that indicates that the premises are in good condition to open a business there.
- Building permit : this is the permit that you must obtain in order to remodel the premises (place shelves, supports, etc.).
6. Choose the equipment for your premises
Most businesses have a common decoration: shelves where the products can be displayed to the customer, and a counter to place the box and charge.
For your bike business, you will also need shelves (to display the accessories you sell) and a counter. But you will also have to install several racks.
7. Do you need to hire staff?
An important point to think about before opening your business is whether or not you will need employees in the beginning.
This should be decided by you depending on the forecast of potential customers who will go to your store according to your expectations, and also according to the budget you have at the beginning.
Something that I do recommend you do is that you hire an accountant to keep the accounts of your store.
8. Create your marketing plan and open your doors!
Finally, before opening the doors of your bicycle business, you need to make a marketing plan to see how you can attract customers to buy your products.
Buyers are not going to arrive alone.
This is a big mistake 67% of new entrepreneurs make when they open their companies: they don’t have a plan to promote themselves, and that is why their sales are very low and, in the end, they have to close.
11 tips to start your bicycle business successfully
The 8 steps above are all you need to do to start your bike business. But here below I am going to share with you 11 tips with which you will be able to be successful with your business:
- Do not offer too many brands to your customers, because a wide variety to choose from usually makes them feel lost and you could lose sales.
- It offers at first only a couple of bicycle brands. In this way, your suppliers will give you a great discount on your wholesale purchases.
- When you ask your suppliers for a quote, make sure that the profit you will get for each sale is at least 32% . This is the normal profit margin for a bicycle business.
- Always make sure when asking suppliers for a quote that they will also offer you a demo bike so that your customers can test it in your store.
- Think about also offering a repair service in your store or at the customer’s home because this will increase your profits substantially.
- Also sell complementary products in your store, such as helmets, wrist and knee pads, cycling clothing, etc. These accessories can help you a lot in times of low season like winter where people do not buy as many bikes as in the rest of the year.
- In the first months of opening, buy only a couple of units for each bike model, and order more units from your suppliers as you sell them. Suppliers will not accept that you return bikes that you have not sold.
- Subscribe to a magazine or publication dedicated to the world of cycling. So you will always be up to date with the latest news, trends or products that you can incorporate into your business.
- Find out if the government has aid for businesses like yours , or if they need bicycles for an initiative, and they are willing to rent yours for a good price.
- You can offer guided bike tours in your store and charge for this service separately to generate more profits.
- Many adults buy bicycles today, but children are also a market with great potential. So don’t forget to include children’s bikes in your catalog as well.
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