The COVID-19 crisis has wreaked havoc far and wide upon many business sectors. Mandatory lock-downs, short and long-term closures and other factors related to the pandemic have all meant that many businesses have faced unprecedented struggles to stay viable.
Nevertheless, the cycling industry seems to be one of the exceptions. Since the start of the pandemic, more and more people have started using bikes as an alternative to public transport, as well as choosing cycling as a safer exercise option to gyms and other closed spaces. Consequently, the pandemic has given an unlikely and substantial boost to sales of bicycles and bike repair and mending services on a global scale. This situation is not unique to the cycling business. All kinds of outdoor gear and supplies have experienced similar spikes in demands (and subsequent severe shortages). Furthermore, in many countries including the UK, bike shops have been given essential services status which has allowed them to continue to offer their services to the public.
Why is there a bike shortage?
All of this might all seem like great news for bike shops, except that the problem is now on the supply side. It is all smooth sailing for the cycling business unless supply cannot meet demand. The unprecedented surge in demand is coupled with the lowest supply levels the industry has ever witnessed. Bike industry experts are reporting that it may take a year or more for most distributors to get their inventories back to fully stocked status. Until then, many shops are struggling with offering their customers the bikes and service parts they need, with some shops even being forced to close under the weight of the inability to meet the spike in demand with inadequate supply levels. With no clear end to the pandemic crisis in sight, the demand on bikes continues to climb while the supply shortage persists. This is leading to lengthened wait times on bike deliveries.
The reasons behind the severe shortages are twofold: Firstly, production delays, especially in bike components, are a major reason in getting complete bikes delivered to your local cycle equipment store. Today’s bicycles undergo a complicated sequence of sourcing and assembly steps before they arrive in their final form in bike shops. The major component manufacturers, Shimano and SRAM, have suffered from the widespread global shortages in essential raw materials (steel and aluminum) as well as COVID-related factory closures, and have consequently reported lead times of a year or more to fill the supply gaps (compared to 90-day lead times under normal circumstances).
Secondly, the global transportation and logistics network has been hit with severe delays, especially when it comes to moving goods between Asia (where most bikes and components are made) to Europe and the rest of the world. It normally takes around two to three weeks for a container ship to go from Taiwan to Europe, now it can take up to three months due to increased demand on freight and overcrowded ports. Shipping and freight costs have almost quadrupled as well.