Cycling in Sydney Australia
Hi, should preface that this query may be journalism-related.
But in the wake of those Cranks stores closing, I was wondering if there had been any other LBS locations that have closed recently?
Michael O'Reilly (Sydney Morning Herald)
(2017 update of title to "closed/opened" reflecting expanded topic of thread)
In a real world, would you make 50 pies, give it away to shops to sell, but pay you at the end of the month? What income would you have for 29 days of the month?
Terms of Credit like 7 days is generous. Multiply that by $10,000's is not sound business economics for a distributor, as the distributor has to pay bank overdrafts, the manufacturers, their salaries for their staff. Shops without business is tough, but that's business.
"In a real world, would you make 50 pies, give it away to shops to sell, but pay you at the end of the month? What income would you have for 29 days of the month?"
Um... Yes. That is how most suppliers work. In many areas of business 30days payment from invoice is typical. Though in practice suppliers are often stretch for more.
When it comes to the retail supply chain, a term of credit of 7 days is NOT generous terms. I don't know where you get that idea from unless you work at a bank!
ie; Officeworks business account, typical 30 day payment from
In reply to Nick….While I know bashing distributors is a sport, despite the fact that they too employ people in the bicycle industry, take on huge financial risks and are committed to the overseas product lines they support while being smashed on overseas pricing…I can assure you:
I am a distributor. I have never in my life held a meeting with another distributor in the way that you describe. What you are describing is a CREDITORS meeting. Fortunately, I haven't had to attend one of those either but they are very different.
A creditors meeting is held when default occurs. We have had stores run debts for 7 months, with zero shame about it. Sorry - you'll find little sympathy here. And while the big bike brands may 'force' stock on stores, they are not holding a gun to the LBS's head. If you cannot play with the big boys, don't pretend to be one. There are a lot of other great products out there to sell without handing over the keys to your house. Unfortunately many stores have neither the experience or knowledge about this and prefer to spend a lot of their time riding. A lot.
As one very successful LBS owner said to me: "I learnt years ago you can't ride all day long and hope to run a decent business". He's right.
Bernard and Human909 is exactly right above. And yes, while Officeworks are giving 30 days on a business account, they aren't usually loaning out a credit limit of $100,000 on paper clips. Like all accounts of any kind you also need trade references.
Le Spit Cyclery at Spit Junction is on the way out
I thoght they were just moving.
Not one closing ...... a new one opened !! Yes that's right, Nick's Cycles in Springwood. I'm not affiliated in any way (I did go in for a coffee and snoop around), but good to see. Trek and Bontrager dealer.
Where are they?
Down near the RMS next to Blue Mountains Funerals (!) in Raymond Rd.
Eddie Salas Cycles at Rooty Hill is no longer trading.
Good News! Le Spit Cyclery has re-opened under new management. Shop still smells of fresh paint and they currently stock mostly Bianchi.
Kangazilla at Bella Vista will be closing their doors on 30th November. It will open only on weekends till the last day.
This means all of floor bikes and product will be reduced by a minimum of 25% off. Now is a great time to come in and grab yourself a fantastic deal.