If you read the headlines figures on this month's Revenue Round Up, you'd be forgiven for thinking it has been another bumper quarter of growth. On the face of it, that definitely seems to be true, but Q1 and Q2 last year were where the worst effects of the COVID-19 lockdowns were felt. We're not really comparing apples to apples here, but instead looking at how the bike industry has turned around over the 12 months of the pandemic.
As you'd expect, there is sales growth across the board but also a lot of references to inventory and supply chain issues. We'll be interested to see how these filter through as we compare bike boom to bike boom in Q3. In the meantime, here's a look at how some of the big players got on through the first half of 2021.
Shimano: Bike Division Sales up 73.4% Year-on-Year Despite Low Inventory
Shimano has reported a 73.4% increase in sales over the first half of the year in its bike division as the global bike boom has maintained its momentum and demand for bicycles remains high in all markets.
The filing made specific note of Europe and North America where distributor inventory was low, but despite this the sales of its products remained "robust." Shimano's sales were driven predominantly by e-bike components. Shimano said, "while further increasing production in response to continued high demand, order-taking was brisk for EP8, the new product of Shimano Steps sport ebike components series, the new Deore MTB components and a wide range of existing products overall.
Shimano also said that it had experienced some factory shutdowns due to localised restrictions but "against the backdrop of the new normal, interest in and demand for bicycles and fishing continued to be high, and the Shimano Group increased production capacity at the factories in Japan and overseas."
Overall sales for the first half of the fiscal year 2021 increased 65.2% from the same period of the previous year to 264,694 million yen.More info, here
Fox at Least 12 Months Away From Normal Inventory Levels:
Fox's Specialized Sports Division, which includes Fox, Race Face, Easton and Marzocchi, recorded a 63.9% increase in sales for the second quarter of the fiscal year 2021.
The increase in Specialty Sports Group sales is driven by continued strong demand in the OEM channel. Demand for Fox's products has been so high that Bicycle Retailer reports
that CEO Mike Dennison said that at the current pace it will take 8-10 months for Fox to fulfill pre-orders for bicycle products and another 12-18 months to replenish depleted inventory channels at the distributor and retailer level.
Dennison also commented on the strength of "E-SUVs", which are more burly ebikes and cargo bikes used for transportation and carrying. He said: "That category has been on fire and it continues to be on fire .... people are thinking about other ways to be mobile ... they are thinking about electric cars for sure, but also thinking about electric bikes."
Sales for Fox as a whole were $328.2 million in 2021's Q2, an increase of 79.2% as compared to sales of $183.1 million in the second quarter of fiscal 2020.More info, here
Bike24 sales up 34%
German e-commerce giant Bike 24 features in a Revenue Round Up for the first time as it went public on the Frankfurt stock exchange in June. The retailer handled 908,000 orders in the first half of the year that resulted in total sales of €127.4 million, an increase of 34%. 92% of these orders went to Europe with the vast majority being in Germany, Austria and Switzerland but Bike24 is currently looking for a warehouse in Spain to increase its presence in Southern Europe.Bicycle Retailer reports
that an average Bike24 customer made 2.15 orders in the first half of the year, up 3.2% from the period last year. Each order with the retailer averages €141.
Andrés Martin-Birner, co-founder and CEO, said, "We have had an eventful and very successful first half-year behind us, which culminated in the IPO at the end of June. Thanks to our forward-looking procurement policy, our strengthened supplier relationships and a strong team performance, we were able to master the challenges that supply bottlenecks and delays in the supply chain pose to our industry."
Giant: eMTBs Now Make up 30% of Sales
Giant posted a new Q2 record for both sales and earnings as eMTBs grew to become 30% of its revenue. Consolidated net sales for the Taiwanese brand came to NT$21.37 billion, which represents an 8.5% increase compared to last year.
Bicycle Retailer reports that Giant said, "With the uncertainties of COVID-19, bicycles remain as in high demand and inventory on hand at retail still low less than 30 days. Due to the limited supply on bicycle components, production rate will less likely to improve further and with increases in global ocean freight as well as increase in shipping lead time could bring some impact to both sales and profit growth for the second half of 2021.
Giant is also looking to make some changes to its manufacturing arm in the future. It said, "Giant Group is still optimistic with the long-term opportunities in the global bicycle market and would invest in production capacity expansion by commencing Vietnam production facility project and increasing automated production to improve production quality so to ensure Giant Group maintain its leading manufacturing position and fulfilling market demand."More info, here
Dorel Sports Posts 9th Consecutive Quarter of Growth:
Dorel, the parent company of Cannondale, GT, Charge, and more, announced second quarter revenue of US $765.0 million, up 5.7% from US $724.0 million the same period a year ago. It didn't break down figures but noted that its Sports division enjoyed a 9th successive period of growth due to strong bike demand.
Martin Schwartz, Dorel President & CEO, said: “Given the continuing chaotic supply chain environment, we are very pleased with the second quarter performance of our businesses. We are reporting substantially improved earnings while dealing with record increases in container freight rates and higher product costs in many categories. Demand for our products remained robust, but we were not able to fully satisfy consumer needs due to inventory shortages from a lack of ocean container availability. Dorel Sports had a remarkable quarter, again achieving record sales and earnings. Demand for bikes shows no signs of slowing and Cannondale’s models remain extremely popular in all markets.” More info, here
Accell Sales Throttled by Supply and Logistical Issues:
Accell Group, which includes Ghost, Lapierre, Haibike and more, posted a 3.3% sales increase in the first half of 2021, but it apparently could have exceeded this were it not for issues surrounding supply and logistics. In the second half of the year, it is looking to increase output factories (and therefore sales) and improve efficiency in its assembly plants
"Overall demand for our bicycle brands and products remains high across Europe. This clearly reflects the increased recognition of the underlying positive impact of cycling on health, business and the environment. We are well on track to meet our 2022 targets,” CEO Ton Anbeek said.More info, here
if you have sales demand that is generally 5,000 units a month, just because all the other companies are booked out doesn't mean that you just start producing 10,000 units a month. you need to hire people, buy machinery and find a vendor that can double your raw material needs.
I find it very hard to believe a company would have the capacity to produce 10,000 pieces a month but only build 5,000. thats a ton of money wrapped up in machinery and people just sitting idle.
Proof positive that Brage is the ultimate "influencer"
You could also have a huge factory, all the staff in the world to make your product, but one break in the supply chain and your whole factory shuts down. You are seeing that right now with Subaru and the chip shortage.
What I was getting at, for example, Shimano can't make their chains because they can't source the metal, then other chain manufacturers are probably going through the same thing. And when that source becomes available again, I can guarantee Shimano will be on the top of that list to get it.
I can see where @vinay: is coming from though, I think. If the smaller players have a ton of product stocked up, now would the time to get their stuff out there while others can't be got. But if you have no backlog of stock, then you are crap out of luck.
The smart move would be to just wait it out, everyone blame someone else further down the supply chain, and hopefully people get bikes before they are too old to ride
@mobil1syn: Yeah, maybe. But that's why I mentioned YT Industries earlier (in how they started out). They simply reserved the option to replace components if suppliers weren't delivering. It will be harder to do if you have a huge range of specs (often six or more spec options per model nowadays) but for instance Privateer Bikes may still be able to pull this off. If Fox doesn't deliver customers could choose to either wait it out or get Manitou or Suntour equivalent suspension for say 100 or 200 or euro off.
Danny MacAskill will tell you differently
"In the first quarter of 2021 Merida Bikes generated a total revenue of TW$ 8.02 billion (€236.71 million) a year-on-year increase of 52.56%."
aint those the same things??? /s
This is the nature of futures contracts. The market is liable to change between the agreement and execution, and both parties accept the risk they will be the loser in that shift in exchange for certainty. If a company can’t hedge these risks they shouldn’t make future commitments.
I say all this while being a libertarian horrified at what the government has done. But companies can’t just drop their commitments when it’s inconvenient for profitability. Especially when posting record profits already.
Absolutely not trying to sensationalize anything here.... just curious where the pedal powered 2-wheel world is headed...
jelously/arrogancy of the -20 downvotes is amusing
it's just crazy how most of the industry has shifted to big bikes to make up for lack of skill - which generally come from the ones who buy the "high end spec" versions.
I get passed by the guys on Commencal's at the bike park on the connecting trails(like gravel roads etc) but when it comes to the turns or jumps I just float by
Anecdotally, how is it on the shop front? I assume a lot tougher.
My local powersport supplier is getting railed. They sold all available inventory for the year by May.... now taking preorders for sometime next year and can't book a sale until the shipment comes in. It's gonna be a tough back half for the end dealers who can't get stock.
In the fall of 2019 I was looking at new “end of season specials” on a UTV to plow our driveway. A little looking around and I had plenty of options that were $5k+ under MSRP (around $18k).
Decided that was still too much money, then started looking again this summer.
Now, the same UTV is at least $5k more expensive, if you can find it in stock anywhere.
I guess bikes aren’t the only outdoor gear absolutely inflated in value by the pandemic.
I highly doubt eMTBS are 30% of Giant's total revenue or "consolidated net sales" overall. They make such a huge range of products that including bikes and components, and they are also a wholesale parts distributor, all sources of revenue for them. I can imagine it might be 30% of their revenue from mountain bike sales specifically, or current model year bikes, but it has to be something more specific than bottom-line 30%.
Regardless of supply demands.
These numbers do not even cover what online and LBS are clearing year over year I would love to see that figure.
lol they’re not in stock either. Beautiful frames though