It’s no secret that the recent cost of living crisis and seemingly endless rise of inflation has impacted many people and small businesses around the world. The impact has also been felt significantly in the fitness industry and as 2023 has now come to an end, it’s important to look back at some of the big losses that have impacted the industry as well as looking at a way out of the dark.
The Great Cycling Collapse
For those in the know, the cycling industry has been struggling for a while now and this has only been intensified by a harsh and cold 2023. The rise of the pandemic boom has now led to a harder than normal crash. Most major cycling companies are currently stuck in a situation where they have far too much inventory compared to the volume they actually sell, having ordered to meet the crazy demand that no longer exists and with a community that doesn’t have the money to spend on the latest model. This means that bikes then get sold at cut-rate deals to make room for more stock and a vicious cycle continues.
Most cycling distributors have now been faced with hefty cuts and in some major cases, this has led to administrative action. Leading cycling giant Wiggle, as well as a number of major UK distributors such as FLi, Moore Large and 2Pure, have all headed into administration this year with the impact of these being majorly felt throughout the industry, particularly in the case of Wiggle. In the case of UK distributors, the impacts of Brexit have also been detrimental with Europe making up a big part of their market and high customs fees making exporting overseas far less attractive or profitable. It’s not just the UK however with European distributors Signa Sports and Bianchi all facing restructuring and job cuts.
The Green Machine
While the rise in costs is undoubtedly the biggest reason for the collapse of many cycling businesses, it is not the only issue that the industry as a whole has faced. Part of the issue is simply that ‘green’ isn’t cool anymore. Or at the very least, it’s seemingly not the priority anymore. In the past, cycling was seen as the hip and trendy option and one that is considerably greener than getting in the car. This was, in part, what sparked the 2020 boom period and the rise of e-bikes and e-scooters. Cycling was a way of keeping fit while also being less damaging to the planet. However, growing costs and a reduction in Government ‘green-friendly’ policy has left cycling in a weird place. The commitment of parties to address the issues of drivers while also slashing the funding for new cycling lanes and instead push ahead with bus lanes has meant that the uptake has greatly diminished and overall interest in cycling has plummeted as shown in the Telegraph (https://www.theguardian.com/lifeandstyle/2023/nov/04/brexit-lack-of-cash-politics-has-the-uk-cycling-revolution-run-out-of-road).
The rise in popularity of e-bikes has also tailed off and many businesses and council schemes have faced bankruptcy. This includes Dutch e-bike company VanMoof, who were later bought by McLaren Applied. The e-bike and e-scooter industry has often been one beset with controversy; with reliability and general malfunctions proving difficult to solve. While they initially proved popular with local councils as a greener alternative to transport, reports of crashes and general misbehaviour have reduced enthusiasm. Schemes in Leicester, Exeter and most recently in Derby and Nottingham have been majorly impacted by the likes of Ride-on Scotland and Superpedestrian going under. Local schemes are also reporting record low figures with the rental of Santander bikes dropping 33% year on year. While the growth of e-bikes seems to be the future of the cycling industry and a market that represents good growth potential for the UK, the industry is only getting further behind Europe in terms of uptake.
The Show Must Go On?
While businesses continue to be impacted by the cold nature of the industry right now, this has also had an impact on cycling events. The Cycle Show, which celebrated 20 years this year, was cancelled due to ‘current challenges facing the industry’. Cancellations to such events is a stark contrast to only a few years ago when new events were popping all over the place. This certainly isn’t the end of the world and many other shows and events are still running but it just goes to show that the current climate is certainly changing around the cycling industry.
The cycling industry is a big beast and the slowing down of bike sales has negative impacts on several businesses within the industry including the nutrition and energy bar industry. Several businesses have been impacted by high costs and reduced business including BPI Sports, Biosteel and Outdoor Provisions, following on from businesses such as MusclePharm and Sci-Mx which have gone under in recent years. The nutrition industry is unfortunately no stranger to interesting start-ups not lasting but it is particularly worrying to see established businesses start to drop off.
Now, is there light at the end of the tunnel? It honestly depends on how you look at it. Marketing insiders and economic professionals predict that the cycling and sports nutrition industry is due a stabilising period but it’s going to be a tough time for many small businesses and independent brands in the space as it is in most sectors. The best way to support the brands you care about is to share their product, get the word out and let’s all try and grow this together. The cycling and outdoor industry is a great community and one we want to see grow and flourish over the next few years.