Photo: Yakima
Some vendors are taking unusual steps to support independent specialty shops that are dealing with heightened competition from online rivals.
In the active space, for example, Ibex Outdoor Clothing recently announced it was launching a new online revenue sharing program with retailers beginning in 2017. Under the program, key dealers will receive 10-percent of all ibex.com consumer sales from within their areas. In addition, Ibex will provide the “Elite Dealers” with data on what Ibex products consumers are buying in their region. Finally, Ibex will include “ride-along referral” collateral in every direct ibex.com consumer order that introduces consumers to their local Ibex retailers.
“Ibex feels strongly that the fabric of our industry is more vibrant and healthy with a strong, independent retail base supporting customers and communities across the country,” said Ted Manning, CEO of Ibex, in a statement.
In the bike space, Trex and Giant have only begun selling direct to consumers online over the last year, but have also done so through a revenue sharing scheme with independents. Instead of being shipped to the online shoppers, bikes are shipped to the local dealer of the consumer's choice. The local bike shop then builds the bike and coordinates delivery with the purchaser.
The brands earn credibility by having a strong presence in independent stores and that supports sales in other more mainstream channels.
An article in Outside Magazine, however, notes that the revenue sharing model — at least in the U.S. cycling channel — will be tested by the arrival in 2017 of Canyon Bicycles, which has flourished in Europe by selling directly to consumers at discounts. The battles over shelf space are also expected to convince smaller, niche vendors to shift to the increasingly popular direct-model route, the article suggests.
Likening it to past challenges by video stores, the author, Robbie Carver, concludes that in order to keep local bike shops from going out of business, cycling enthusiasts are “going to have to forget about price and instead put a premium on experience.”