Are you a bicycle enthusiast? Are you interested in starting a bike business?
If these questions apply to you then you are about to venture into a terrific green business idea that will not only help support the environment but will also encourage better health.
A bike business also looks good with immense opportunities in the electric bike, kid’s bicycles, and mountain terrain bike. So without further ado, here’s everything you need to know.
Who Is a Bike Business Right For?
A bike business is right for anyone who wants to promote physical fitness, enjoys interacting with other people, and is environmentally conscious. So, if you like any of these then you will definitely like the idea of starting a bike shop.
If you are looking to open a bike repair shop, you will need to be mechanically inclined and have some passion for cycling.
Passion is necessary to ensure that you connect with your customer while mechanical skills are required to repair bikes and effectively run the shop.
Some of these skills encompass accounting skills, bicycle repair, customer service, knowledge of cycling products and accessories, and managerial skills for training staff.
If you don’t have any of these skills, consider going for training and development.
Training and Development
Training and development are necessary to learn all the skills that are needed to run a shop effectively.
One of the best routes that you can go about this is by simply apprenticing with a current bike shop or working in busy local bike repair shops. But before moving onto employment, ensure that you have mastered the basics- you can actually do this yourself.
The other route is via professional qualification. If you are after this route, consider joining a recognized institution or benchmark that offer courses in bike mechanics
These may also include, but not limited to, specialized modules in areas such as wheel building and advanced road wheels.
What Does the Market Look Like?
According to ReportLinker, the global bicycle industry has a bright future with more opportunities expected, in the next couple of years, in segments such as e-bikes, kid’s bicycles, and mountain terrain bikes.
According to the source, the global bicycle market is projected to hit around $34.9 billion by 2022. This will account for about 2.7 percent growth from 2017.
The major factors that have been identified to drive this growth include the increasing concerns over the environment, increasing fitness conscious among people, and the increasing congestion of traffic.
Moreover, emerging trends in bicycle safety features such as those in electric hunting bike, as well as government investment in cycling routes, is also expected to positively impact the dynamics of the bicycle industry in the coming years.
Start-Up Costs
One of the initial costs involved in opening a bike shop regards obtaining the required businesses license and permits.
Depending on your shop’s size and location of operation, the start-up costs may range from $10,000 to about $350,000.
If you want to operate in a smaller city, the cost might be lower as compared to larger cities where rents are usually very high.
Upon locating an ideal space for your business, you need to outfit it so that the bikes and accessories can be displayed effectively.
For an initial inventory, you don’t need to worry about the cost as many wholesale bicycle dealers offer shop owners a line of credit at 0 percent for a limited period of about 3 to 6 months.
However, other goods like clothing, accessories, and safety equipment need to be purchased outright.
How a Bike Shop Makes Money
A bike shop targets individuals who enjoy cycling as a recreational hobby, a form of transportation, or a competitive sport.
The business thus makes money by purchasing bicycles and cycling accessories then reselling them to the above target market. Other shops also make money by offering replacement parts and bicycle repair services.
Steps on How to Start a Bike Shop
Before starting a bike shop, you need to ensure that you meet all the legal requirements depending on your state. These steps will set you along the path on how to ensure that your business is legally compliant.
Step 1: Plan
If you want to succeed as an entrepreneur, you need to ensure that you have a clear bike shop business plan.
Some of the things you need to consider while planning your business should encompass knowing your initial costs, identifying your target audience, giving your business a name, and calculating the amount of time you will need to break even.
Step 2: Establish a Legal Business Entity
Once you have a clear plan on how you are going to run the business, consider acquiring a bike shop franchise. This will prevent you from suffering legal consequences should you be sued by your employee.
Step 3: Register for a Variety of State and Federal Taxes
After forming a legal entity, you will now be in a position to register for various state and federal taxes prior to opening the business.
Once you register for taxes, you will get a tax ID number which will act as your unique identifier on all types of registrations.
Step 4: Keep Accurate and Detailed Account of the Business
Next, open a business bank account. This will be helpful in understanding how your business performs financially. Additionally, keeping detailed and accurate accounts will help simplify your annual tax filing.
Step 5: Acquire Necessary Permits and Licenses
In this step, you will obtain relevant permits and licenses. This will help you to avoid consequences like hefty fines or even shut down by the authorities.
Step 6: Insure Your Business
Here, you will insure your business, as per your state requirement. If you hire employees, you may consider taking workers compensation insurance.
Step 7: Delineate You Brand
Your brand determines how your business is perceived by the public. In this step, you will build a strong brand that will differentiate your business from that of competitors.
Step 8: Set up a Business Website
Finally, you need to establish your web presence by creating a website where customers can learn more about your business and the products and/or services that you offer.
You may also want to consider using social media to advertise your products or services.
Wrapping It Up
To start a bike business, one of the greatest resources that you will require is quality mentorship.
As you start planning your business, connect with At Your Business to get help with common business mistakes that you might not be aware of.
