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<b>Slovenia 2009: </b>Economic Crisis Came Late, But Hard

Sales & Trends

LJUBLJANA, Slovenia As for all sectors, 2009 was not easy for the cycling industry in Slovenia. The main impact is a delayed result of the global recession, but this is not the only reason for worsening results.

<b>Slovenia 2009: </b>Economic Crisis Came Late, But Hard

LJUBLJANA, Slovenia – As for all sectors, 2009 was not easy for the cycling industry in Slovenia. The main impact is a delayed result of the global recession, but this is not the only reason for worsening results.

Bike Imports to Slovenia

Imports
2005
2006
2007
2008
2009
Value in EUR
9,406,404
10,264,420
11,076,322
15,527,567
14,333,666
Quantity
80,744
84,639
77,660
114,920
99,353
Average price in EUR
116
121
143
135
144

(Source: Eurostat)

Distributors and shop owners. In Slovenia these are the same people in many cases. They’re talking about sales drops up to 20 % compared to 2008. That is when looking at the quantity and about the same goes for turnover. But the margins are getting smaller and smaller and the profits are down. Mostly because customers demand better discounts.

In a market where every sale counts, it’s hard not to grant customers’ wishes. Slovenian companies also lose a lot of customers to nearby Austrian and Italian shops and the Internet (especially on the components market), but don’t have a really good idea how to take customers from them.

Import numbers are lower compared to 2008 – down by 14%. But in fact I dare to guess that the real number is closer to 25% or even 30%. That is because many of the bikes that came to Slovenia were quickly sent ahead to nearby countries (relocation of the stock with big retailers). Lower numbers were expected, after a huge increase of imports in 2008 that was above the market needs.

In 2009 consumption was around 85,000 bikes, which seems just under the average of the past years. The average price of imported bike rose 7% to € 145. This is a steady trend in the last 5 years. Average prices are getting higher as the market develops and people realize that super cheap mass-market bikes are no good.

No big changes were seen regarding the origin of the bikes. Taiwan and Italy are still main suppliers of the bikes – the same as they were in the last five years. Cambodia is still third biggest supplier. Asian companies again took the bigger market share – almost 60% of the bikes came from their companies, which is better than year before. EU countries are second with 40% share. Countries of ex Yugoslavia, especially Serbia and Bosnia could become better partners for Slovenia and EU in the future, but for now the traffic from this countries is still very small.

On the export side the increase is huge, but that is not a realistic statistic. Slovenia does not produce over 17,000 bikes, they are just re-sold to other countries. The largest bike manufacturer remains Cult with a line of mountain, city and trekking bikes, while their program of special bikes for the postal service is steadily growing. Studio Moderna, with their foldable bike Bigfish is getting more and more recognition all over Europe thanks to steady promotion at fairs like Eurobike and others acrosss Europe. A large break through for them could be very close.

The numbers for 2009 are still quite good if we compare them to sales of other sporting goods. But winter came early in the end of 2009 and was strong until the start of March, which will definitely have affect on the first quarter of 2010. Record unemployment and low wages, mostly connected with recession in car, construction, textile and other industries does not help the situation.

The biggest trouble for 2010 season could come in the form of empty warehouses – banks are not giving the credits as easy as in the past and many dealers already faced this problem when they had to order for this season. Another threat is approaching from the government – in the shape of the new health law. A draft version of this law lists mountain biking as an extreme sport meaning insurance companies would only cover 40% of all medical costs from mountain bike related injuries. The rest will have to be paid by the rider and that could mean another drop in sales in a very MTB-oriented market.

 

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