It is February 2020, the bike industry is consistent since the downturn of 2008, what awaits us in March 2020? The Covid-19 pandemic. Unforeseen impacts occurred in every industry, especially ours and it’s important to examine the trends and learn from them so we can grow all of our businesses. Today we’ll dive into the different episodes of the pandemic impacting our industry, how the impacts were manifested in shop operations, and where the market stands today.
During the lockdown, everyone wanted a bicycle. People were looking for fun things to do outside and cycling was a top choice. This led to a bike shortage – there were no bikes left to buy anywhere! Shops couldn’t sell bikes and couldn’t make money, which was a big problem. Some shops couldn’t pay their staff or rent, so they had to close for a while.
Supply Chain Issues
As people rushed to buy bikes during the pandemic, bike shops had another issue to face – they couldn’t get new bikes or even parts to repair existing ones. This was due to something called the “supply chain.”
The supply chain is like a big relay race. One company makes the bike parts, another company ships those parts, and finally, your local bike shop receives them to sell or use for repairs. But during the pandemic, there were fewer workers to make the parts and to ship them. This meant the supply chain was broken. Bike shops found themselves waiting and waiting for parts that were slow to arrive.
Without new bikes or parts for repairs, bike shops struggled. They had to make tough choices about whether they could stay open or if they needed to close down.
Staff Cuts: A Tough Decision
When businesses don’t make enough money, they often have to find ways to cut costs. One of the hardest and most unfortunate decisions is to let staff members go. This was a reality for many bike shops during the pandemic.
In late 2021 and early 2022, shops were still not selling as many bikes or doing as many repairs as they needed to stay profitable. With less money coming in, they couldn’t afford to pay all their staff. As a result, some shops had to lay off some or even all of their workers.
This was a difficult time for everyone in the bike industry. People who loved their jobs and were passionate about biking found themselves without work. At the same time, the bike shops lost valuable team members and the unique skills and knowledge they brought to the business.
Luckily, things are starting to look up, but these tough times have taught us some important lessons about the need to plan for unexpected challenges.
Good News for Shops: Employee Retention Credit (ERC)
Shops that kept their staff during the pandemic can now get some help. The Employee Retention Credit (ERC) is money given to businesses who kept their staff during hard times. The rules have changed for 2023, so if you haven’t applied yet, go for it!
Many bike shops are busy now, selling lots of bikes and doing repairs. But this might not last forever. Our goal is to help you run your shop better and save money, so you’re ready for whatever comes next.
The COVID-19 pandemic was hard on the bike industry, but it’s taught us a lot. Now, we know how to handle big challenges and prepare for the future. We can use these lessons to do well, no matter what happens next.