Parent Company of Performance Bicycle, Fuji & Breezer Files for Bankruptcy

Nov 16, 2018
by Mike Kazimer  

Advanced Sports Enterprises Inc. (ASE) announced today that they have filed for Chapter 11 bankruptcy, in order to “restructure and better position itself for future success.” ASE is the parent company to Fuji, Kestrel, SE, Breezer Bikes and Tuesday Cycles as well as retail brands Performance Bicycle and Bike Nashbar, and was formed after Advanced Sports International (ASI) purchased Performance Bicycle in 2016.

According to Bicycle Retailer, the move is expected to lead to the closing of 40 of the current 104 Performance Bicycle stores.

In a press release, Patrick J. Cunnane, ASE’s President and CEO, stated, “While ASE is undergoing the Chapter 11 process, we will continue with business as usual; orders will be fulfilled and Performance Bicycle stores will continue operating

"Employee layoffs and store closings are inevitable, but at this time I do not have enough information to announce those plans. My goal is to continue to work through this process and keep our business intact. My vision for ASE is to become a profitable, vertically integrated, omnichannel bicycle manufacturer, wholesaler and retailer.

“We’ve taken a lot of steps to right the business over the past 27 months. We have conducted an extensive review of alternatives and believe pursuing a restructuring through Chapter 11 is the best path forward to ensure ASE’s long-term success. We are thankful for the continued support of our dedicated employees, valued customers, vendors and business partners as we navigate this process, and look forward to becoming a stronger company in the coming months as a buyer / investor for the business is found.”

Cunnane noted that sales of ASE's bike brands were steady, but that difficulties in increasing sales and profits on the retail side was one of the factors that led to the filing.


ASE was formed after ASI purchased Performance Bicycle in 2016.
States where Performance Bicycle stores are located.



139 Comments

  • + 79
 They moved into bankruptcy like a stiff breeze on mount Fuji...
  • + 3
 Too soon
  • + 27
 I SE what you did there.
  • + 26
 That pun was a solid performance, perhaps comedy is your forte?
  • + 1
 A loss for any of us is a loss of all of us. Sorry to hear the news....
  • + 14
 Maybe they should have vertically integrated those omnichannels sooner. Thats what makes or breaks a business right there.
  • + 15
 @Boardlife69: And don't forget the synergies. You gotta have those.
  • + 47
 The Breakdown of Where Bike People want to work:
INDUSTRY
PINKBIKE
IBD's
REI
LIMBO
WALMART
HELL
DMV
PERFORMANCE
  • + 3
 Low key like it for the benefits, over paying me and my schedule is better than anyone i know bike shop or not.
  • + 9
 I don't know. I think I rather be at the DMV than Walmart. Big Grin
  • + 9
 You forgot Amazon, and I'd strongly argue Walmart definitely belongs below Hell.
  • + 5
 @bman33: At least you get state benefits at the DMV.
  • + 3
 @matadorCE: I would suggest they may be one and the same. Any place that makes you do 1980s style stretching routines at the front of the store before the door opens is all I need to know...
  • + 19
 @matadorCE: I am a bike assembly contractor for Amazon it BLOWS! Rather work at a vape store.
  • + 5
 can confirm - i used to work at performance
  • + 41
 As a mtb rider that currently works at one of the Performance stores being closed, I must say that we get a bit of a bad rap within the mountain bike community as we sell mainly commuters and mid to entry level road bikes. Also, our performance is a GREAT place to work! After all, it's still a bike shop. I think it is a shame to not only be losing my job but also losing a shop that has been serving my cycling community ever since I have been a part of it.
  • + 6
 @xc12: I too work for performance and will be losing my hometown shop and work :-/
  • + 1
 @Phaethon85: Sorry to hear that man, we made the cut 4 stores in our district are closing though. Sad to hear the news about people being out of work.
  • + 1
 @Phaethon85: time to open bikeshop on your own?
  • + 2
 F@#$ Em
  • + 3
 @MrDiamondDave: ninjee chop em
  • + 3
 @robicycle: Or try to reopen one of the bike shops performance put out of business when they showed up in town.
  • + 1
 socom/navsoc
  • + 27
 They're one of those stores that always kinda feels like they're going out of business for the last 15 years. Every time I find myself in one stock is in random locations, empty shelves abound, kinda like a weird TJ max.
  • - 8
flag jaame (Nov 16, 2018 at 21:36) (Below Threshold)
 Trump is to blame
  • + 9
 @jaame: he's not.. our president isnt a king I know you don't know what that's like but trust me its nice having separation of powers.
  • - 4
flag MrDiamondDave (Nov 18, 2018 at 6:04) (Below Threshold)
 @jaame: GTFO with that shit
  • + 5
 @jaame: the butts have been hurt Big Grin
  • + 26
 Hmmm, have they considered a new wheelsize?
  • + 19
 Haha, notice the unsecured debts:
PinkBike: $11,000

I don't remember performancebike getting any best of the year awards, I guess they didn't pay enough money Smile .
  • + 5
 130k to clifbar?? Someone must really like those things...
  • - 6
flag WAKIdesigns (Nov 16, 2018 at 14:58) (Below Threshold)
 Oh yeah, Fuji - a bike so capable it is an obvious contender for the bike of the year Award - Said no one ever. It’s like Etto winning the best helmet award. It just doesn’t happen.
  • + 5
 @WAKIdesigns: Actually, I hear that new Fuji with the breezer style suspension is a killer.
  • + 5
 The new (2019) Rakan and Auric LT are attractive bikes with neat, efficient suspension designs. They aren't the best value in terms of parts per dollar, but maybe this will help with that. A Rakan 1.1 for under $2500 would be a pretty decent deal and a great trail bike.
  • + 2
 @WAKIdesigns: Fuji is mostly a road bike company they are also targeted at the entry level they make some really nice road bikes at an attainable prices.
  • + 1
 I laughed at the argument that the reason Fuji bikee are not on PB awards is because they aren’t paying PB enough money which is a ridiculous statement. They aren’t there because they are epitomes of mediocrity.
  • + 2
 So, it sounds like you have ridden the M-Link suspension and are speaking from experience rather than out of your ass@WAKIdesigns:
  • - 12
flag WAKIdesigns (Nov 17, 2018 at 13:31) (Below Threshold)
 @DMAC65: hahaha, yeah, If I only could, I bet it would change my mind. Have you ridden FSR, ABP, VPP, various DWlinks? Single pivots? Some with different shocks in the same model? My Antidote? Well, I am going to take it out of my ass that Fujis system is just like most other sht. And since bikes look like straight from Astro catalogue, well, no. They will never ever get close to get nominated by any major magazine. You may as well nominate Rock Machine for the value
  • + 4
 @WAKIdesigns: WAKIdesigns: have you ever thought before commenting of the likelihood of down votes?
Just curious
  • + 1
 @mrwynnewillson: downvotes? what's that? a new form of neutrino? goes through you and you don't even notice? I love it... people defending Fuji bikes, so noble! I say it again, if you don't understand that Fuji bikes, or Diamond back or Merida, Cube, Canyon, Giant, Mongoose and a couple more just don't fit any award on any major site, we have nothing to talk about. You may want to read a bit on WOW factor. These bikes have none. I have no idea how is this not in the common sense yet!

I will give you examples of bikes that may come in "Bike of the year Awards" on various sites: Specialized (cuz specialized), Trek (cuz race results), Yeti (cuz everything Yeti), Santa Cruz (cuz everything), Intense (cuz expensive and Ameribrohican and race results), Mondraker (cuz race results) Unno (if you don't get that kill yourself), YT ( cuz Gwin and Andreu and all the marketing)

Know your place people... nobody gives a sht about Toyota Corolla. No one.
  • + 3
 @WAKIdesigns: but that doesn't discount the Toyota Corolla as one the most popular vehicles worldwide, also one of the most reliable and best values.

I think everybody these days knows that "Bike of the Year" is a highly skewed measure, and usually doesn't consider value in the equation.

Not to often websites do "Best Value Bike for the Money" tests, and when they do they are highly limited in selection.
  • + 1
 @PHeller: I never said bike of the year isn’t skewed in fact I pointed it out in above comment. Best value will not go to Fuji either. It will go to Canyon, Radon, YT or... Spec Stumpy comp. And that award will also be biased because, well how can you say that Jeffsy is better than Torque. You can’t.
  • + 1
 @WAKIdesigns: its all marketing, who has the most money. Fuji's new bike is pretty rad on paper it should ride good at resorts. If you through specialized all over it youll be busting nuts as I would be.. lol
  • - 1
 @jacobxpaul: it's about which bikes are the most desired bikes in the first place. It is irrelevant whether Fuji looks good on paper. We all know if set up right it can deliver results just as well as any other bike out there. The only fool is the one who expects justice and reasoning in Beauty pagents. Yes marketing is a part of it, what happens at the races as well. Races are marketing too. This is how world is arranged. Sorry. If you want to live according to different values, then stay away from Beauty pagents. Simple. Unless you want a large group of people to appreciate you for what bike you own, meaning appreciate your choice, then well, Fuji is not the best option. If you are bitter that world looks like that then, then you have to find a way to suck it up and then appreciate what you have.
  • + 1
 @WAKIdesigns: @WAKIdesigns: mate my Canyon Sender gives me the wow factor. I did have to overhaul the suspension. It keeps me buzzing for 5 days after I ride it.
  • + 1
 @mrwynnewillson: I get a wow factor over Intense Tracer 2013. Or red alu Remedy 2016. They won't go to awards though... year awards are about if money were no object. and if they weren't, most of us would ride Yetis, Unnos, S-Works, Poles etc. But Canyon is miles closer to BOY award than Fuji.
  • + 1
 @WAKIdesigns: I rode an S-Works Demo and admitted the back end was better than the Sender. Sizing is a little off tho
  • + 11
 I guess the business model of taking 30% off already discounted bicycles and then giving a 20% Performance Rebate doesn't work so well after all?

I'm amazed they lasted as long as they did.
  • + 1
 Out of 104 locations only 40 of them are unprofitable. Under restructuring, those locations will be closed and 64 profitable locations will remain...
  • + 8
 @islandforlife: But just like the Highlander, there can be only 1.
  • + 3
 @nyhc00: and it will assume all the powers of the previous ones, becoming the ultimate location, reigning forever.
  • + 9
 Interesting ripple effect of this. Performance partnered with Amazon awhile back to handle builds for bikes sold on Amazon. I work for a small direct to consumer road bike company (Tommaso) and a good bit of our sales are on Amazon. We've had two orders just this morning cancel due to Performance apparently no longer accepting builds from Amazon.
  • + 11
 They were so much better when they were Supergo. I used to shop at supergo. Performance, Blah.
  • + 2
 The one in Costa Mesa used to have shopping carts to push around the store.
  • + 8
 The company made five separate Chapter 11 filings Friday, which will likely be combined soon. They are for ASE, ASI, Bitech (the corporate name of the Performance retail chain), Nashbar Direct (Nashbar's e-commerce business), and Performance Direct (Performance's e-commerce division).

ASE's capital structure includes secured debts with First Lien Credit Facility ($37.9 million), Advance Holdings Loan ($7.4 million), Trade Creditor Loans ($37 million) and York Street Loans ($20 million), totaling $102 million.

Unsecured debts owed to trade suppliers include:

Active Cycle, China: $4.4 million
PT Insera, India: $3.3 million
Vista Outdoor: $1.77 million
Shanghai General Sports, China: $1.5 million
Mizuki International, Taiwan: $1.4 million
Todson: $548,000
Highway Two: $423,000
Marin: $409,000
Garmin: $290,000
Saris: $285,000
Elite: $264,000
Accell NA: $280,000
Aptos: $212,000
Louis Garneau: $204,000
Wahoo: $202,000
Pearl Izumi: $200,000
Lezyne: $198,000
Castelli: $196,000
Vittoria: $159,000
Fox: $149,000
Clif Bar: $131,000
Eliptigo: $200,000
EN-R-G Food: $82,000
J&B: $178,000
Marin Bikes: $71,000
Team Tibco: $35,000
PeopleForBikes: $22,000
PinkBike: $11,000
  • + 4
 So does this mean the vendors on the unsecured list will not be paid the money owed to them? I’m not well versed in the Chapter 11 process...
  • + 2
 @COnovicerider: maybe, they have to present their restructuring plans to a court who can give the OK.
  • + 1
 @dthomp325: cool, thanks.
  • + 4
 @COnovicerider: Essentially, yes. Even though corporations now have the same rights as citizens in the U.S., they somehow still have magical powers that allow them to be forgiven for taking on too much debt, unlike if a citizen takes on too much debt for say medical bills or college, they're f*cked.

Yup, nice to have a rigged economy.
  • + 3
 @scott-townes: individuals can also file for chapter 11 bankruptcy, it's not a "magical power" only for corporations.
  • + 4
 @dthomp325: Yeah, its hardly a similar process.....
  • + 1
 @scott-townes: not sure what you mean, it is a very similar process. In both cases the individual or business seeking chapter 11 presents a plan to the court which must be agreed to by a majority of creditors and approved by a bankruptcy administrator
  • + 1
 @dthomp325 A board of directors and the CEO can still give themselves bonuses and keep everything they gift themselves from the company if they file for chapter 11. Its not a punishment for those running the company who are responsible for how well the company does. A person filling for chapter 11 even for reasons out of their control, like health issues for example, all of their assets are open to repossession and garnishing. Sure the wealthier you are, the better deal you can make but for most average citizens, that's not an option. Its a rigged economy.
  • + 1
 @scott-townes: any bonuses during a chapter 11 have to be approved by the administrator/court, and chapter 13 is the type of bankruptcy where an individual would have wage garnishment.
  • + 8
 I'm sure Performances "no questions asked" return policy didn't help much. Used to work there and saw so many people buy bikes for weekend park trips and then return them after they've been ridden into the ground.. that was a nightmare..
  • + 1
 Their return policy was ridiculous. I've returned some used stuff to Performance that no LBS would ever accept back.
  • + 4
 Sometimes a customer "first" policy is a bad idea, people just ruin was it's actually intended for.
  • + 1
 @dthomp325: ha ha, so true. bike bud of mine had some PooFormance shoes .. wore them into the ground for at 6, 7 years.. returned them --- couldn't believe they honored the policy. that was indeed absurd
  • + 8
 Yesterday as the emails were coming it was interesting, this is what happens when business men that don’t ride bikes run a bike company. Sales only drive sales lol.
  • + 12
 Well when your profits go to shareholders and not Whistler tickets for the staff, you've got a problem.
  • + 7
 “We’ve taken a lot of steps to right the business over the past 27 months."

If those steps had been in the right direction, they would not have to file for Chapter 11.
  • + 3
 Tell that to GM....
  • + 4
 'right direction' vs 'time cost of money'. Sometimes you cant bail the water fast enough. Sad as it is.
  • + 3
 @mintysauce: If you have a vision and a plan for taking a company in the right direction you can usually secure funding to do that. Sounds more like too little too late. The very idea of trying to sell bikes and only bikes through a retail location seems like a very challenging model to me. Long gone are the days where you could simply open up a store in the right location and expect to make a living.
  • + 0
 Out of 104 locations only 40 of them are unprofitable. Under restructuring, those locations will be closed and 64 profitable locations will remain...
  • + 2
 Chapter 11 is reorganization and the company survives in a new slimmer form. Chapter 7 is liquidation of assets and everything is gone and a lot of people get screwed.
  • + 1
 @friendlyfoe: perf doesn’t make money on bikes it’s mostly clothes and accessories. They also run a McDonald’s style logic ie we need a store within 30 min of you no matter where you are or if the store is profitable.
  • + 1
 @friendlyfoe: it works a bit differently with really big corporations like this. There is so many moving parts that even if you are in the know, it could potentially take years to pinpoint the real problems that need fixing and years afterwards to correct them.
  • + 1
 @Compasteedee: I work in a relatively big corporation. There is a reason Business Process Management is a specialized area for helping companies with exactly that Wink
  • + 4
 mean while Trump is going with the narrative that all businesses are doing the best they have done in 25 years. he takes credit for the rise in stock market but not the recent drops. His whole trade war with the tariffs are really going to hurt a lot of people. Bike costs for the consumer will increase by 25% for an item that isn't a necessity. That's a HUGE increase. it's not like a 2%, or even %5. So the bike that was $1000 last year is going to be $1250 this year. Meanwhile all the dolts are crowing how great america is.
  • + 2
 Aside from the fact people working in the 40 Performance stores scheduled to close will be losing their jobs, I couldn't help but smile a bit when I read about the bankruptcy. I worked sales for Performance in 2014 and 2016 and in my opinion they are a terrible company to work for. I have too many examples to list as to why I feel this way and I know I am not alone.
  • + 2
 They can make more money, millions from their soon to be closed Commercial Properties being undervalued during Tax filings. Ever wonder why there are so many commercial properties around your area that's built but never occupied? Yet our Property taxes are through the roof, literary!
  • + 1
 Obviously their UNPROFITABLE commercial properties are not particularly valuable, otherwise they'd be making money off of them.
  • + 1
 They don't open any of the properties, all the stores are leases.
  • + 1
 Brick and mortar stores are tanking due to online sales in every category. Some of it is earned misery due to lazy and foolish management. MTB's have crossed a value threshold that is hurting higher end sales. IBD's who offer excellent service and stay on top of inventory will be fine. The rest will experience Darwin's theory.
  • + 6
 So...those Auric LTs will be going cheap real soon.
  • + 4
 I have to say that those look pretty rad
  • + 1
 My second job out of college was taking phone orders for Performance. Flipping through the catalog all day was actually how I first got into mountain biking. (They had a scuba catalog we all had to take orders for, too.) They were kind of an industry behemoth way back then, but seems like they've been in decline forever. Kind of impressed they limped along all this time, honestly.
  • + 1
 Ahh, reminds me of Bikes USA... a local chain that went from 6 local store to about 50 silly fast... next thing you know, they're 50million in debt, which is baffling to me --- how the hell can they be extended that much credit on products that don't sell. I blame Trek for extending that credit knowing they'd fail. Jon Chang tried the same thing with Washington Bike Center. He had 3 store then tried to blow it up for a bunch more too soon. He also had a huge bike park which never got off the ground, failed before it even opened. Bike industry is so messed up right now
  • + 1
 Da plane
  • + 1
 @shortbus: airline industry too -- they should ban anyone standing less than 5' 5" cuz they can't reach the overhead compartment
  • + 1
 Not a surpirse at all. After all my, work related, encounters with Advanced Sports over the last 6 years, i was asking myself "How are they still in business?". Had been a long time coming.

Maybe i can get my hands on a cheap Fuji SL1 Frame...
  • + 3
 Speaking of re-structuring...how did it work out for Niner? Never ridden one, but didn't they file and re-structure?
  • + 2
 Thats sad. My first bike was a fuji hardtail and it kept me motivated for solid 5 years.
  • + 3
 Step aside, armchair engineers. Let’s let the armchair MBAs have a turn!
  • + 3
 Way too soon. Still upvoted
  • + 3
 Oh no! What about Lauren Gregg!?! Hopefully she finds a new sponsor.
  • + 10
 Dude seriously, that’s who you are most concerned about? Never mind all the people who work at the stores, creditors who are going to get screwed, you are most concerned about some random woman who parleyed owning a van in to minor bike industry fame finding a new sponsor....
  • + 55
 @wibblywobbly: Dude, seriously? You don’t know the first thing about me, or the work I’ve done in the industry over the past 10 years. Fuji is no longer my sponsor, they are my full-time employer.
The employees and shop owners? They are my coworkers, many of whom are like family now. The vendors I’ve worked with? They are my good friends. This job? It’s the livelihood that I rely on. This has been an extremely difficult day for all of us. Did you mean to make it even worse and hurt a stranger with a mean, shitty, totally uneducated comment? We don’t need more negativity today. Think before you speak, especially when you don’t know what you’re talking about. Do better next time. Be a kinder person, please.
  • + 15
 @Laurengregg: a lot of people had a really bad day today, including some I know personally. I hope it all works out for the best and I have no ill will towards anyone. It was a flippant comment that sponsorship is the least of anyone’s worries when jobs are being lost and whole units are potentially being shut down. I apologize and I genuinely hope things work out for you and everyone involved.. I take no joy in any of this.
  • - 4
flag DaveJube (Nov 17, 2018 at 13:41) (Below Threshold)
 @Laurengregg: Hang in there and don't worry about what some fat turd behind a keyboard says about you. You Know the deal. I know the deal. I have several friends that I used to work with that now work at the main Fuji HQ in Northeast Philly, and they are great people. The past year or so has been difficult for a lot of us working at local bike shops. Everyone is feeling the squeeze and I've seen at least 2 shops close.
Just hang in there because I think things are going to turn around for all of us very soon. It's happened before, the pendulum swings back and forth. It will never be back to the heydays of the 90s but there are better days ahead. Focus on today and don't worry too much about what might happen tomorrow. You don't know what will happen so don't sweat it. Concentrate on today. Good Luck!
  • - 1
 @wibblywobbly: Laurengregg b****slapped your ssa!!!!
  • + 2
 shoot, time to stock up on forte convert magnesium pedals then...
  • + 0
 "Restructuring for future success, blah blah".....These statements are always the same BS........mediocre products and we are broke AF....yeah that...just say that.
  • + 2
 Its sad to see anything to do with bikes go out of business
  • + 1
 looking at the map...surprised to see no stores in NV. too much of a gamble?
  • + 1
 This is surprising, I’ve heard the “breeze” has been all the rage among capers lately eh?
  • + 1
 People should have seen this “Coming down Main Street”. - More or less like Ellsworth filing for bankruptcy #nosuprise
  • + 0
 This is sad. To many politics with to high of expectations. Had they taken the right steps from the start this wouldn’t have happened
  • + 1
 Fuji, Breezer, Kestrel.............bikes no one really rides. Fuji got lucky with the Mercury Team back in the day.
  • + 2
 I still have a Breezer Lightning from when Breezer was a cool brand
  • + 1
 I have a fuji plus bike. Suits me.
  • + 1
 Wow which all those quality high end brands it’s hard to imagine not being a profitable business
  • + 1
 What's wrong with mid-states? People are not buying bikes there? ))
  • + 16
 That's the flat bit no? The big truck bike hating bit?
  • + 3
 Literally the entire region is flat. Im guessing less than 5% of US PB users are from the midwest.
  • + 8
 @skerby: Hey man!! Wisconsin has hills. And the U.P. And parts of Minnesota. Hills, not mountains. My local trails have 200 feet over a .4 mile. Actually, grab a road bike and ride 25 miles due west from shore of Lake Michigan on the road I live and tell me it's flat. Steep, 125 foot rollers the whole way. Illinois and Indiana on the other hand... Haha..
  • + 11
 @browner: how do you manage to ride with your kilt on and your big red beard while the Loch Ness monster is chasing you? I mean while we are stereotyping....
  • + 13
 Surprisingly uninhibited by kilt, beard and monster
  • + 3
 @oldschool43: I'm gonna remember this in case i find myself driving through someday, thanks boss.
  • + 7
 @eswebster: you should see Nessie shred. Rumour has it she's been banned from Fort Bill because she made Rachael Atherton look too amateur.
  • + 2
 @browner: plus if it ever gets warm, it keeps the bits a bit cooler...
  • + 2
 Cheese fondue gives me random bursts of turbo propulsion. But its not so nice for the guys behind me as it seems to slow them down as they choke to death. Nino's secret weapon.
  • + 1
 @oldschool43: You're in the Northern part of teh states, not Mid West.
  • + 3
 @RideTahoe707: Technically we are the midwest. Along with Ohio. That has never made sense. Like, the Loch Ness monster. Always knocking on my door, asking for treefiddy.. Makes no sense..
  • + 1
 Parts of Indiana gots hills. Brown County and O'Bannon state parks have stuff worth riding. Others, too. Total elevation numbers are overrated, when not lift served. If I climb a 100' hill ten times, I'm getting the same amount of descending as if I climb 1000' hill one time, and I can use downhill momentum ten times to take the sting out of those ten climbs, versus only once on the big climb. It's not the size of the hill; it's what ya do with it. ;-)
  • + 1
 @skerby: kansas city to northwest Arkansas has quite a bit of singletrack.
  • + 1
 What does this mean for Nashbar?
  • + 0
 But do they have any dw 29+ bikes?
  • + 1
 I believe SE is the only brand with a 29+ wheel at performance currently
  • - 1
 Only a Randy sponsorship could sell more Fuji bikes
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