Finland’s IBDs to Focus on High-End Market
HELSINKI, Finland – The Finns are interested in cycling, but that is not reflected by the 2014 sales figures. There were several factors outside of the bicycle business that dampened the estimated growth. The cycling season in Finland is short and the actual sales season is even shorter.
This year the sales season started early and some retailers made record numbers in March and April. However, cold periods in May and June affected sales in the peak time, which proved difficult to recoup later this summer. The retailers were exceptionally cautious with their stock levels. After a practically snowless winter the retailers were left with too many unsold skis in stock. This high inventory took all their cash and one thing led to another: a bad winter took the sales power from the retailers. On the other hand, Finnish people like to ride and there was a positive trend in cycling. However, the slowdown of the economy was reflected in declining sales of all consumer durables, including bicycles.
Bicycle Market Finland 2012-2014
Source: Custom’s statistics
** estimate by Sporttimyya-magazine
Two worlds apart
The Finnish bicycle market is fragmenting more and more. The cheaper bicycles see a growing popularity. A large number of consumers think a basic bicycle meets their requirements and they don’t want to spend much money on a bike. The second group of buyers ride a lot and are mountain bikers, road racers, or commuters. They are willing to pay more for their bicycle.
A middle class of bicycle riders between these extremes is virtually non-existent anymore. This ongoing polarization of the market changes the distribution channel too. The cheap bikes are sold in hypermarkets and other low cost channels. The IBDs have benefitted from the trend as well. They sell more expensive bikes and build up the service channel needed. The middle class sales channel had a difficult time taking their service to a high level in order to be accepted by the avid cyclists.
The overall total market was quite steady in 2012 -2013 and the estimates for 2014 seem to show a small growth.
The statistics are only available until July, when more than 80% of the business has been done. 2014 shows a small increase in import, which was partly leveled by the export. The largest sourcing countries were Turkey, Indonesia, and Taiwan. The production in Finland increased substantially, although 2014 statistics are not yet available. Today Finland has three assemblers and their quantities are increasing.
Helkama Velox Oy is the only one making its own frames. In 2010 this company restarted the production of the Finnish traditional Jopo bike, which has given a boost to its sales. The estimates for 2015 are quite positive and there are some new trends as well. Some retailers report that a new group of mountain bike riders, women in their 30s and 40s, are entering their stores.
Also, cyclocross is almost a non-existent sport in Finland, but the sales of these bikes is rather good compared to the size of the market. It looks as if they are designed for Finland’s cycling conditions. They can be ridden on road and trail alike and are handy in wintertime, which lasts six months a year here.