10 November 2007

Wal*Mart opening bike shops

For avid cyclists, Wal*Mart has long been the anti-IBD (independant bicycle dealer). Their cheap bicycles are often more expensive to repair than replace and largely unsuitable for off-road use (though one of our testers' first mountain bikes was a Huffy Stalker, purchased for $100 at the now-defunct Lechmire chain). Their contracts with suppliers result continual downward pressure on prices, ensuring a continuous supply of cheap goods but squeezing suppliers who have little choice but to sell to the nation's largest retailer and making sustainably/conscientiously/quality goods seem outrageously expensive by comparison. And, of course, their assembly skills are famously awful, even dangerous.

In any case, Wal*Mart has received attention of late from their proactive moves to become more environmentally friendly. Taking steps toward daylighting stores and energy efficiency aren't only good PR, they can help the company's bottom line. In line with that, and the nation's slow realization that being healthy is actually a good thing, Wal*Mart has announced plans to open over 100 in-store shops. With stuff that we might actually buy. bikeradar has the scoop:

"Wal-Mart has designed a full-service bicycle shop within its 203,091 square feet of retail space. Professional bicycle mechanics are something new for Wal-Mart, who historically hire contractors to assemble bikes for the chain, with little or no experience. In early 2006, Wal-Mart, will annual sales of US$348 billion, announced a grand plan to open 100 bike boutiques within its stores by late 2007.

An extensive community bike trail system connects to the shopping center. An outdoor gazebo next to Wal-Mart offers cyclists a rest stop, water and air hose."

What does this mean to the bike industry? On the one hand, prices and margins will be squeezed even further. Good for the consumer, bad for the bike shop. On the other hand, it could make the idea that spending good money (hundreds of dollars) on a bicycle isn't outrageous. It will also likely give good bike shops a chance to do what they do best: provide first-hand knowledge and personal service. The challenge will be finding the money in skinnier margins to attract and retain the staff they need in order to provide these things.


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