Overstock Hampers Slovenian Bike Business
LJUBLJANA, Slovenia – Is the market growing again or is there overstock? Numbers say the curve has turned upwards, but the reality in bike shops is quite different. Optimism is not on a high level and outside factors like weather aren’t helping. But the demand for bicycles is still high.
“It could be worse,” is a sentence often used by Slovenian dealers. Their business is far from the “golden years” at the turn of the century, but many others are facing much bigger problems. Slovenia is still in a recession and is very slow with structural reforms. Its rating in the international community is also not the highest. Demand for bicycles again dropped in 2012, which is no surprise; with high unemployment and the very rational behavior of consumers.
Bad spring weather across the continent also affected the Slovenian bicycle market. At about the same time another unexpected thing happened to many dealers. One of the popular banks with so-called “fast credit” collapsed and suddenly the money flow from that address stopped. The figures were not astronomical, but in a market where every bike counts, it just added one more unwelcome challenge.
|Value in EUR||15.5m||14.3m||14.2m||14.7m||14.5m|
|Average price in EUR||135||144||153||191||198|
Hig hopes on bicycle market
The general trend in Slovenia is putting high hopes into the bicycle market, since more people are into the sport and commuters numbers are also growing. For example – the bike sharing program in Ljubljana is among the most successful according to the number of inhabitants.
The size of the market in 2012 is estimated to be about 60,000 units sold with an average retail price of around € 350. A slight drop compared to 2011 was expected, but the rise in 2013 was not. In the first half of the year imports increased almost 10% compared to the same period in 2012 (from 54,128 to 59,265 units). This also helps to explain why the stores are still full of 2012 models and all of them are now selling them with big discounts.
Taiwan and Italy
Taiwan is still the leading producer for the Slovenian market, but their share has decreased. In fact Taiwan and Italy are now almost at the same level with around 16.5 thousand units, however the value of the trade is far apart. Trade with Taiwan reached € 36.8 million, while Italy only did € 24.5m, which is a clear indicator of the price range of the imported bikes from both countries. Looking at the whole market, the EU countries are still leading Asia, with strong trade from Belgium, the Netherlands, Germany and Austria.
Final figures for 2013 will be interesting, but for the dealers the hard months are upon them. Revenue is on average lover than it was in the past and in the autumn/winter time they will have to sell the majority of the stock to get ready for the new season. Now it’s also a final chance to give the customer the additional value like bike fitting, community and special offers, as many already use those ‘tools’ with great success.