Jonalong
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Posts posted by Jonalong
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Dude, I'm right behind you, go for it, if you don't try it you will probably regret it, don't use your own money, don't use your rents money, don't use friends money, use the banks/investors money.
I got my figures from opening a bike shop just before the recession and also just before the price of bikes to retailers took a 30% (?) hike.
Just putting this to you in case you havn't thought of it. There may be a hole in the market for a reason. I can almost guarantee you are not the only person that has thought of this, is there a halfords? If there isn't ask yourself why. They have teams dedicated to finding places to open up and will have done a very good market research program. Bare in mind cyclists are VERY loyal to their bike shop. Great if you are the shop, shite if you are the competition.
Hi Mate, we have a Halfords, but it's out of town, and the bike section is always snowed under, you cant even talk to an adviser without standing for half and hour patiently waiting for them!
Point taken though! Your advice is not falling on to deaf ears! I will still persue the banks for thier investment over any other alternative.
I guess the main thing is wanting to know how you're expecting, from my fag packet calculations, to be selling a bike a day. Many many local shops aren't hitting one every 3 so I'd be interested in seeing your market research. I come from Caterham originally and know Tunbridge Wells fairly well. It's obviously an affluent market but I can't see where you're getting those figures from. Obviously happy to be proved wrong!
Your fag packet calculations are correct! i am planning on selling around 6 - 7 bikes a week - although not completely dependent on this.. They vary in value but there is such a hole in the market for regular everyday bikes that commuters, women and leisurely bikers want that they have so limited choice of at the moment... Tunbridge wells has a catchment area of over 100,000 (wealthy) people, the value of bikes sold to well off londoners should be enough to keep a steady flow bike sales.... as I say though, the shop should be over to tick over on servicing and maintenance alone... this seems to be the general consensus in the bike shop owners world! (And judging by the business of the other local shops!)
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I'm in the same position as Simps here, in that I don't want to invest the time in doing your work for you. Let's just say that your estimates are completely wrong. I own a very small marketing business which deals specifically with small to medium sized businesses in a niche. As well as that, I spent 5 years dealing with 120 small to medium sized bike shops on a daily basis with a specific interest in where their sales levels were. That's not an 'ooooo, look at me' statement, merely hopefully to prove that I'm not just trying to troll your idea. It's more that I wouldn't want to see a member of this community crash and burn, even if I haven't seen you here much.
Do yourself a favour: Take over a shop that exists already so that you'll know the figures and have a plan to increase them, or rent some storage space and start something online. Even then I wouldn't bother these days - unless you can cover a specific niche you'll have too much competition.
I know you don't want to do the donkey work for me, but could you give me an idea as to where you think i'm going completely wrong?!
Cheers.
Jon
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Thanks very much JD, appreciate it.
This is what it mainly comes down to, there is a massive gap in the market, that is my primary reason for wanting to do this, not for the 'fun' of owning a bike shop, i want to start my own business that is going to be successful!
I would kick myself in years to come when one opens up and does hugely well due to the demand in my local area!
I don't mean to piss people off!
Thanks hi-OOPS -CAPS!! thats the attitude!!
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Haha possibly! Show me where I'm going wrong!
I am kind of throwing ideas around here and I understand it probably looks like I am away with the fairies
My job is managing the money on £millions of construction projects, and I make some pretty serious profits on them, so I'm not completely mad
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this may be some use: http://www.bikewebsite.com/store.html
If would never touch my parents house. I think its disrespectful to even ask. But each to their own.
F*ck it... here you go! That site looks a bit basic to me!
Income Per Year Per Month Low Range Bike Sales £ 71,400.00 £ 5,950.00 Mid Range Bike Sales £ 61,200.00 £ 5,100.00 High Range Bike Sales £ 51,000.00 £ 4,250.00 Accessory sales £ 18,200.00 £ 1,516.67 Total £ 201,800.00 £ 16,816.67 Service Sales £ 31,200.00 £ 2,600.00 Total £ 31,200.00 £ 2,600.00 Total Sales Value (Per Month): £ 19,416.67 Purchases (Cost of sales) £ 12,031.67 Less: Closing Stock £ 200.53 Cost of Sales £ 11,831.14 Gross Profit £ 7,585.53 Less: Expenses Staff £ 30,000.00 £ 2,500.00 Shop rent £ 18,500.00 £ 1,541.67 Business rates £ 1,500.00 £ 125.00 Electricity £ 800.00 £ 66.67 Business Insurance £ 400.00 £ 33.33 Public Liability Insurance £ 300.00 £ 25.00 Water £ 300.00 £ 25.00 Phone £ 300.00 £ 25.00 Employers National Insurance £ 2,000.00 £ 166.67 Payroll and bookkeeping fees £ 1,000.00 £ 83.33 Accountancy fees £ 800.00 £ 66.67 Annual return fee £ 15.00 £ 1.25 Website £ 750.00 £ 62.50 Marketing £ 1,500.00 £ 125.00 Repairs, renewals and maintenance £ 1,200.00 £ 100.00 Sundry £ 1,040.00 £ 86.67 Total: £ 60,405.00 £ 5,033.75 Profit: (After Expenses) £ 2,551.78 Less: Corporation Tax £ 510.36 £ 2,041.42 Less: Closing stock £ 200.53 Approximate retained cash (Per Month) £ 1,840.89
Ah that sounds like your stuck in the old days then mate, he who dares wins, if you dont ask you dont get!
Ok.. that didnt come out quite how it should have done, never mind.
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Currently working as an finance analyst but before worked in the financial leasing industry where blue chip company's got 6-7%, established business with collateral would be at 10-15% and we wouldn't touch anything less with a barge-pole. Hence why I put a question mark afterwards, cos its uncharted ground for me.
Understand I'm not slating your business in the slightest, if you've know your stuff you know you stuff, if you can get the money and make it successful then fair-play but when you say things like "I think it might be a case of getting a personal loan secured against my parents house! should be an interesting conversation! haha" Then I start to think your not ready yet.
No problem, everyone has to learn at some point, and this is generally how I do it - asking lots of people their opinion and for their advice, then mushing it all together to make up my own mind! Looking back at my posts I think I have probably given the wrong impression of what I am after/have meant - sometimes a problem with writing things rather than real life interaction!
I'm not trying to put across that I know exactly what I'm doing, I have always taken risks and generally seem to get away with it and come out on top. I have done all the dog work to get to this point, its the finance that I am now after, and any advice is going to be invaluable.
I still need to actually go in to my bank and sit down and have a chat with the relevant folk, therefore I can't really comment on potential interest rates right now. But with the parents thing.... I just think it would be beneficial for me to take advantage of the comfortable financial situation they are in (i.e paid off mortgage, excellent credit rating) Rather than screwing myself over and paying the higher rates that I would be forced to use without having any assets to secure decent rates against. (I know for sure they could get £25k plus @ 7.5% ish) It's just the high risk of losing the money that would be worrying! Both are options at the moment.
Do you agree?
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"Theres no "this is how much start up will be" if your seriously going to walk into a bank and ask for money you need a whole business plan package, which if you do properly will take you of least a month to set up"
---This is why I was interested to hear exactly how this guy had figured out that I was under budget, with little to no information of the company plan, or what has been lined up. I'm simply asking about peoples experiences with lenders... It’s interesting to hear assumptions with no knowledge of what I am paying for shop rent, fit out, stock, etc!
You need to be able to account for and be knowledgeable about.... refurbishment, decor, stands, bikes, stock, suppliers, wages, national insurance, rent, workshop, liability insurance, contingency, marketing, launch, deadlines, cash flow projections, budget allocation, electronic POS, contracts, break clauses, limited company?, sole trader?, business insurance, building rates, water, electric, USP, demand projection, distribution.
-----Refurb is not required, the rest of your list - This has all been drawn up by myself and my accountant, who is also an excellent friend of mine and has done this many times before. J
"Personally I wouldn't employ someone with "15 years exp" because that essentially means £20k plus per year? You should be that "high" paid guy in your business. Also remember that 70-80% of businesses fail or lose money in their first year. So if you think you can go "urrrrr I wanna bike shop" and someones going to give the money to you, then you are stoned. All money borrowed will be at a very high rate which you need to account for in your business plan. And if that numbers too high then they won't invest in you because their repayments will cripple your company. From my finance exp if you do get money expect it to be at 20% or more?"
-----I understand where you are coming from, but time goes fast when you start working in a bike shop at 13…. He’s now 28 and will be doing the day to day running of the shop whilst I manage the business and continue with my other work. I do not plan to pay myself out of the companies money for the first year or so... I will continue to earn money through my current profession.
20% or more?! I would rather save up the money myself than pay that! I think I can currently get the money for 7-8% if I were to do it through a personal loan. (Not recommended!)
What do you do for a living out of interest?
-----------RobinJI
Thanks mate and good luck! I will let you know how it all goes, I’m looking forward to getting stuck in now! It really helps when you can use others with parts and experience that help you along the way! I couldn’t have done this with my experience alone!
My calculations came up with a figure of 40k with that again as working capital.
Could you please share your calculations? Would be very helpful!
Thanks.
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Not meaning to piss on your plans but you will need more startup money plus at least that again as working capital.
Also not meaning to be offensive but if you are starting on a budget then it would be really handy to know how o do simple things like bleed maguras.
Please note I am not trying to put you off, I am just throwing my opinion out there, as you are well aware all opinions matter in considering a business including the 'negative' ones.
Haha, no problem, criticism is happily accepted!
I know how to bleed maggies.. didn't have a bleed kit at the time and was meant to be going out on a ride later that day! That was an purely an example
Anyway that's beside the point, I have a guy lined up (with 15 years experience running a bike shops) that will be managing the shop day to day and will be servicing etc etc!
Could you please advise on what additional start up money I would need? (Agreed, £25k is on the low side, I would budget for around £35k)
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Maybe look for investors rather than trying to get a loan?
I would not fancy sharing the profits further down the line...
Plan would be to expand the business if all went well!
Thanks for the suggestion though.
Jon
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I would never open a bike shop, most lose money on shops, internet is where its at when you launch, if you can't sell on the internet then there's no way you'll sell in a shop. If I were to think about it I'd get a contract with Cycles UK or similar, at an old shop we worked at we got all returned mail order bikes for £10 - bit of repairing they were £130 bikes easy, sell on ebay - happy days.
There is a lot of people out there that need work done on their bikes, most bike shops can survive on servicing and labour alone, bike sales do not account for much of their profit. The only bike shop we have in town has waiting times of over a month just to bleed my maguras! (with 2 or 3 workshop guys!)
Initial set up costs will be around £25k, with predicted turnover value of around £20k a month and costs of £18k -(worst case) - this is based on pretty low sales figures.
Where there is a will there is a way, I'd rather take a risk and start making my own money, than never risk it and end up lining someone else's pockets for the rest of my life!
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Looks like you've got it all sorted out then (well, almost all). Can't help with the loan side of things, I've been running a similar business to Tarty for 5 years now but didn't need a loan, it gradually expanded from a bedroom store to a normal outlet. I think it was a similar case with Tarty, not sure about loans though. Usually if a mail order company has to expand it's premises, it's doing exceptionally well and can more often than not do without a loan. You will need one though, definitely.
Ok, thanks very much! yeah I would imagine that would be possible for a primarily internet based business, its opening premises and getting everything set up that is going to cost me the money!
To be fair in the current climate very few banks are happy to hand out loans unless you have some capital of your own to put in, for say a 50k loan they will probably want to be seeing about 20k of your own in the bank. I had the same mission not so long back and i gave up trying to borrow from the banks. But having been round them all having meetings with business advisor's, NatWest, Barkleys & HSBC seemed like my best option. Also if you can get the amount you need to borrow on a personal loan. Do it that way as the business accounts don't actually offer much for small businesses, and there's normally a larger charge for a business account. Hope this helps
Thanks very much for sharing your experience, this is how I expected really, I had been considering a personal loan, but have been advised that if I register as a Ltd company, and manage to secure finance against the company rather than me, should everything go pop - the bank and "company" will suffer rather than my pocket!
However i feel that if I could get everything off the ground there shouldn't be too much chance of it going down the drain!
I think it might be a case of getting a personal loan secured against my parents house! should be an interesting conversation! haha
Thanks again.
Jon
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Haha, I have thought about a fair bit! I didn't want to bore everyone with the details, just wondered if anyone had had success with a specific bank! by no means is that all I know you need to do
I'll expand slightly... Starting an independent bike shop, little competition in the area, product range and target market is sussed, suppliers etc sorted, I have a business plan, profit and loss forecast, cash flow, the potential premises have been whittled down, I am now looking at the borrowing... all the above need to be drawn up before approaching a bank!
I am in the jolly process of assessing my best financial options - business loan? personal loan? half and half? its quite a minefield with all the options available for finance, alongside everything else that needs to be sorted!
Its not what you know, its who you know! I like to try and get advice and information from as many sources as possible, a bike forum would seem like a good place to me!
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I am currently in the process of trying to start up a bike shop... company plan is nearly there, need to register the company and then try and get a small business loan!
Has anyone done this before?
Any suggestions on banks? Or general advice?
Many thanks
Jon
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Etnies Number Mid - Best Shoes I have ever worn, designed for BMX, but awesome for Trials!
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Having casually BMX'd throughout my teenage years I have gotten through to my final year of university and the urge has come back...
Always wanting to get into trials I havesaved up £400 to get myself a nice starter bike etc etc...
New to such stuff I was wondering if a more wiser being could tell me whether;
1) Is having only 5 - 10 hours spare time per week on average enough to make this a reasonable investment?
2) is £400 an adequate amount for a suitable quality/cost bike?
3) So far I'm leaning toward an Onza, specifically Onza Rip 2013. ThoughtS?
Yes, yes, and yes!!
I practice for around an hour a night 4-5 nights a week, and have made excellent progress - that's on a £40 Onza off ebay with only a few quid spent on it.
That sounds like a good starter bike, second hand bikes on ebay are a good bet as you will save a lot of money compared to the build price of the bike!
My advice would be to get a bike asap and get out on it while the weather is still good!
Jon
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Unlucky mate... I have bought two cheapo Trials bikes off eBay so far and luckily both were bargains!
£36 for an Onza T-Bird which still rides like new (except a creaking crank) and another which came with Magura HS33's for £52! Both still ride lovely
What did you go for?
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Surely if people need opinions on a product they can just ask on here
And fill the forum full of the same sort of threads??
Is it really necessary to trawl through forums and writing threads, searching up product reviews when in reality, the product could be sold there and then if it had a few solid reviews on it!
I don't hesitate to spend a lot of money on something if i can see that the majority of others are happy with their purchase...would I spend a lot of money on something in the hope that its going to be ok? Probably not.
Just my two cents... and only trying to help you (Tarty) and people who are looking for decent products who don't have hours to spend posting on forums!
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A quantity sold counter like ebay would be good as an alternative, just to know what the generic consensus is...
Other than that site and product range is great
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Would that make you bother? My ego doesn't need stroking that much to be on the front page of a site related to reviewing products that go on silly looking bikes...
It's a trade off between the effort of running the incentive and the benefit that comes from that. If the reviews will breed higher value sales more often then sure, but that's unlikely being as the 'reviews' most of us need comes down to what riders we'd like to ride like use.
I disagree! People who buy Trials products on Tarty bike are generally going to be people who can leave a half sensible review... I would bother simply because it's going to help others make a decent purchase!
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Haha... my thoughts exactly guys.
Review away! I happily review my products on Amazon after I have purchased them, mainly because I really appreciate the reviews left by others..
Nearly every product I buy on the internet is based on customer reviews!
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Completely agree with that, definitely should be for purchased products, I thought you would have sold more than you have in that case... or not a lot of people are rating!
I'm only bothered cos I'm about to buy a fair bit off you.. haha. Cheers.
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Everyone talks about Tarty Bikes, and it seems to be the main Trials retailer online, so why are there so few ratings for the products on there???
It would really benefit everyone if everyone rated, surely? It would make a lot of my decisions a lot easier that's for sure!
Ideas?? Is everyone being lazy?
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Anyone from the Tunbridge Wells/Tonbridge/Crowborough area????
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Sorry to hijack the thread but does anyone recognise the brakes on this bike??
I won it on ebay last night but have no idea whats on it! Cheers. Jon
Starting A Bike Shop....
in Chit Chat
Posted
Thanks mate, I agree with you! Passing traffic should account for a huge amount of sales. Once the locals realise they have an alternative to what is currently available, that is open more hours and can service their bike for the next day, rather than the next month - they hopefully should be peeled away from old habits!
And yeah - JD that is the main market research that I have done so far, asking people what they want. And the overall consensus so far has been yes, we want it, go for it!
I spend a lot of days and nights riding around town, when you are on a bike you realise how many other people are also out on them! Begging for somewhere to grease their squeeky crank!