There is a truism in journalism known as Betteridge’s Law of Titles. It says, more or less, that “Any title that ends with a question mark can be answered with the word no”.
The current title is not one of them. It ends with a question mark because we really don’t know. At least not for sure.
I’ve revisited the notion of traders going out of business several times in the past: notably in December of 2023, most recently in May of 2024, and going all the way back to 2019. My colleague Ray Keener addressed the same question earlier. .
Both Keener and I worked with Christopher Georger’s company, Georger Data Services. And each time we (and Georger) have come to the conclusion that, while some retail businesses may indeed be exiting the cycling game, they are being replaced at about the same rate by new businesses.
Either way, those parts didn’t answer the big question of whether bike shops—or industry suppliers, for that matter—are failing at an accelerated rate versus historical rates. All we know for sure is that the overall dealer population is pretty much constant and even growing, thanks in large part to the steady influx of new e-bike-only retailers, even though many of these businesses aren’t bike shops in the traditional sense. .
Merchant’s explanation
Common sense tells us that a large number of these bike shops – just for the sake of discussion, let’s say there are 500 or more – have gone out of business in the past year.
I contacted Christopher Georger, owner of Georger Data Services and The Bike Shop List, to see if he could provide any absolute numbers for dealers appearing on one or more of the sixty-odd bike brand dealer lists he tracks in December 2023, but was absent from all listings until December 2024.
Georger points out that his source material includes REI stores. Dick’s Public Lands stores are also included, but not other Dick’s locations. Scheels stores listed on Trek’s dealer locator are included. And Beeline-only dealers are included, as are listed Yamaha dealers.
Of the nearly 7,700 total stores listed by the GDS by December 2024, around 770 are new, having appeared for the first time within the previous twelve months. About 200 of them carry electric-only bicycle brands.
But nearly 650 stores that were listed 12 months ago no longer display any of the merchant locators that GDS tracks.
Of course, the fact that these retailers no longer appear on Georger’s lists does not necessarily mean that they have gone out of business. They could have changed the names as a result of being bought by Trek, Specialized or Pon … or another retailer, for that matter. They may still be in business, but have moved to a service-only model. They may have moved to a new location. Or they may be a single closed branch of an ongoing multi-store operation.
But common sense (not to mention Occam’s Razor) tells us that a large number of these bike shops – just for discussion purposes, let’s say there are 500 or more – have gone out of business entirely in the past year. Shut up for good, closed the door and left.
There are many failed traders.
Since this is the first time Georger has compiled this particular set of data, there is no good way to know if the number 2024 is unusual. But my experience tells me that the average number of stores going out of business in a “typical” year (that is, before COVID) would be more like a couple hundred, not more than double that amount.
Anecdotally, there is certainly some evidence to support this conclusion. The problem is that stores that go out of business tend to do so quietly, and the news rarely gets beyond the local market affected. But thanks to social media, local events can spread to the larger population.
Members of the Facebook cycling group (disclosure: I’m the admin) have been posting what seems like an article or two a week for the past few months about bike shop failures from local media sources in cities around the country.
One commenter claimed that Portland—certainly one of the best bike cities in the United States—has consolidated from more than 70 bike shops a decade ago to 49 today. If so, that would be a 30% drop in bicycle retail businesses over 10 years.
Finally, I spoke with retailer Randy Hall, who owns two successful Bicycle Connection stores in Delaware, with Trek/Electra and several closing brands. But Hall also has a side hustle, helping cycling industry suppliers and retailers offload excess or unwanted inventory. These could be existing stores that simply have more product than they need, but increasingly post-COVID, he says, his customers have been “almost exclusively” stores that have gone out of business.
So back to the question posed in the title, are vendor businesses starting to fail at extremely high rates? It certainly seems possible, and, depending on how you read the available evidence, maybe even likely.
And it’s not just traders
“115 bike brands have exited the US market in 2024. This dramatic increase in closures represents more than four times the volume of closures in 2023.” —Peter Woolery, Bicycle Marketing Research LLC
Hard times – and with them, business failures – have also hit the supplier side of the cycling industry. In addition to Kona (which, rightly, was quickly reestablished under original founders Dan Gerhard and Jake Heilbron) and Rocky Mountain (which is being restructured), there’s Diamondback, Redline, iZip, Raleigh and, most recently, GT. With the exception of Kona and Rocky Mountain, all of these bike brands are currently “on hiatus,” which seems to be the catchphrase du jour for a brand that’s not quite dead, but doesn’t ship (or buy) any products. new for the foreseeable future. the future, or
Data industry and self-described data geek Peter Woolery has been keeping track of it all. In a recent blog post on his website, Bicycle Marketing Research, Woolery says, “115 bicycle brands have exited the US market in 2024. This dramatic increase in closures represents more than four times the volume of closures ( 25) in 2023.”
In the wake of massive discounting at or below supplier cost starting in late 2023, Woolery says, many smaller brands lacked the strong finances needed to weather the industry-wide storm and were forced to close operations. He also points out that while large organizations often have the resources to restructure, smaller brands have less well-known IP, which leaves them with more limited options.
Of the 115 brands forced to close, Woolery says, “about 60%” were e-bike suppliers. He showed me the list of failed brands with the request that BRAIN not publish it, but reading the file, it appeared to me that many of the failures were for lesser-known, discount D2C e-bike brands (see the second chart of previous ).
I asked Wooler about his basis for declaring a brand dead. He responded with a list of seven criteria, one or more of which would be sufficient to deem the company out of business in the US. These ranged from public announcements or current bankruptcy filings to D2C websites going offline, no longer having US retailers or distributors. listed, or no inventory available on the site.
For all that, he told me in an email exchange, “there are a lot of new cases and brands coming back under new ownership. I try to keep up with them and adapt to them.”
In conclusion, Woolery’s blog post says, “2024 is likely to represent a peak of brand closures. 2025 may still surpass 2023, but I expect it won’t be too far from the 115 brand exodus we saw in 2024. There are some early signs of life with used bike prices starting to recover, and unit inventories reaching normal levels, if brands can digest more of their inventory in dollars. they will be in a better position as the market turns.”
To which I can only respond with a hearty “amen”. With a few notable exceptions, like a relatively small number of retail markets (Boston, for example) and a handful of relatively healthy bike brands (Marin comes to mind), 2024 was a brutally difficult year for almost everyone in our weird little industry.
So, no promises, but here’s hoping 2025 brings us something better.
