Business idea (cycling related) Whatcha think?

Discussion in 'The Bike Cafe' started by bianchi10, Jun 2, 2011.

  1. bianchi10

    bianchi10 New Member

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    So the other day I had a business idea come to mind. I live in Portland, OR. which is has the largest cycling population per CAP. in the US (last time I checked anyway). We have a coffee shop on EVERY corner here it seems like which usually seems to have at least once cyclist inside with bike chillin outside or against the window by the door. My busniess idea is simple and I think with the details ironed out, it could be succesful. we all have a local spot that is a good meeting place to start a ride. sometimes an empty parking lot, sometimes a bike shop or coffee shop.


    Have you ever met somewhere all geared up and not know what to do with your bike? or when you walk in you slip around on your cleats unless you have cleat covers?
    Have you ever met at your place and thought...dang I didn't eat much for breakfast but I dont have anything with me?
    Have you ever been on a ride and wish you had more gels or protein bars but didn't want to go into a grocery store?
    Ever want to meet someone at a good spot where you could get a nibble before going on your ride where you didn't have to worry about your bike getting stolen by sitting outside?
    Ever met at a local place and seen you needed some air in your tires or had a flat but didn't have the minimal tools?

    My idea is simple. Not a coffee or cafe shop, nor a bike repair shop. A place specifically for cyclists of all kinds. Imagine you walking up to a building where you dont have to deal with the akwardness of trying to open a door in your cycling shoes while pushing your bike through as the doors slide open and your invited into a room where it is soft rubber which is saf/anti slip for your shoes/cleats. a wall dedicated to where you can place you bike in a rack system and not have to worry about leaving outside. A place to get some coffee (nothing foo foo, just simple. no need to go to coffee college to serve it) before a ride where you have booths set up to sit and relax while watching the latest cycling race/local weather...etc. I would have products like hammer nutrition or products alike to purchase like gels, powders, bars before or after a ride. Other minimal and simple snacks like muffins, bagels, fruits...etc. available at the counter.

    On the other side of the store...Forget your extra tubes for your 80 mile ride? pick a couple long or short stem tubes up from the wall. need to pump up your tires, take your bike to the wall where an air hose is ready to fill you up. Need to make some minor adjustments before heading out or back out or on your way home? use a station where tools are available to tighten, adjust, swap out.

    Its not a cafe, its not a bike repair shop. Its an environment that is easy to meet at, stop in for, hang out at for cyclist of all ages.


    Location would be KEY, but somewhere on a main road and in the center of the cycling traffic diameter.

    obviously this is a very quick version of what would need to be detailed in thought. I think it could be successful. would I be a millionaire??no, but I would be in an enviroment that I love and not working in this dead end career I'm in now.


    Whatcha think? you think it could be successful? what could you add to this idea to make it more realistic?
     
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  2. clearlybored

    clearlybored New Member

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    It sounds like the upfront costs would be really high. (inventory for bike parts, special racks, special flooring). Are there enough bikers buying enough products to make this feasible? It doesn't sound like a place non-bikers would go to. You'd have to charge a lot for coffee and everything else to break even.
     
  3. davereo

    davereo Well-Known Member

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    Maybe set up in an area with a high tourist volume. You could rent out a few bikes and offer guided tours for a fee. Have your guides snapping photos of customers on tours and offer picture packages afterwards while they are sitting around drinking up your beverages.

    Your idea has some merit. I think if you work in the tourist angle you could get funding or low rate loans from your local Chamber of Commerce.
     
  4. limerickman

    limerickman Moderator

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    It sounds like a novel approach. It's a compendium of a bike shop/cafe/meeting place which in interesting.

    i agree with the poster who suggested that location is essential. Where you decide to locate will be the key in my opinion. You'd need to get a place which is accessible and which can be easily accessed.

    Do you plan to have seating in this place? It might be an idea to have a limited seating availability with some tables.
     
  5. bianchi10

    bianchi10 New Member

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    Yeah, location will be key. I talked with several people today, 2 of which own their own company and gave me some great things to look over and research. At this point it is still just an idea, some thinking and planning. I have yet to act on anything, nor will I until I see that the next step is ready for me to take which means having all the information needed to do so.

    Yes, the way I have the blueprints in my mind is left/front part of the room will be booths and next to that some taller tables with stools.

    I also imagine a streching aperatice. We have one at our 24 hour fitness. Its basically in the shape of a door with several bars to grab and strech, which I would personally find handy at a location I'm trying to draw up. There are TONS of ideas running through my mind, some I see realistic and some far fetched. just need to do some research before making any steps forward.
     
  6. Yojimbo_

    Yojimbo_ Well-Known Member

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    Sounds like a good way to lose your shirt to me.
     
  7. kdelong

    kdelong Well-Known Member

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    OK, I'm thinking to myself, would I use it? Probably once or twice, but only if it were on the route that I wanted to ride. I don't now how Portland is set up but we have a lot of trails and low traffic country road areas around here that are sort of spread out and separated by areas that you only ride in if you have a death wish. I am not the kind of person who likes riding the same stretches of road or trail very often, so I often throw the bike in the truck and take off to one of the many staging area. For this area, there is only one place that I can think of that would remotely be a decent spot, and then only on the weekends when you get the weekend warriors, if it is not raining or cold. These factors sort of make this a bad idea, at least in this area. As for topping off your inflation or needing a spare tube, we have several good bicycle shops that have locations near the bike trails, and some of the ice cream parlors have some limited gear, although one has a full service bike shop attached to them. As for the country roads, it would be a disaster to put a shop like this out there because there is not enough constant bicycle traffic to make it viable.
     
  8. sitzmark

    sitzmark Member

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    Cycle Bar -

    Not one to squelch ideas, so take this as demographic input only. Like KD, trying to think how I and those I ride with would use such a facility.

    My demographic:
    Age: 50's
    Rides/week: 4-6
    Sat: Social club day or ride with friends/family (sometimes early ride with LBS1)
    Sun: LBS 2 ride early, then friends/family after
    Mon/Wed: Usually solo evening ride
    Tue: Evening TT coordinated with LBS 3
    Thur: Evening fast ride with LBS 2

    Typical ride: 25-45 miles evening solo, 50-80 Sat/Sun
    Annual miles: 4k - 4.5k (mostly Apr-early Nov) which is fairly average for those I ride with. Some crank out double that.

    Except for the TT, the shop rides all start from the shop parking lot. Usually 20-30+ riders. Shop staff arrives early Sat/Sun morning to open shop before ride for anyone needing misc items or quick adjustments. Very rarely is anything purchased. Some loitering around after the ride and that is when sales occur. Most riders return from ride, chat, and depart quickly to do family things. If any stops during ride, they are quick regroups and never involve a retail establishment.

    Social club rides generally start at different locations each week for a change of scenery. Usually a school parking lot, library, or recreation park to stage the event. These groups often plan a mid-ride break in conjunction with restrooms, refreshment, food. Sometimes an actual lunch stop or post ride meal depending on the group.

    So for me and those I ride with, some form of organized ride group is a key to bringing people to the location. Shop group rides generally are split into 3 groups by speed goals. For the social group rides, there is not a lot of overlap of routes. There are a couple areas with the best streets (the high rent district) that all groups within a 10-30 mile radius tend to ride through. The coffee/muffin shops in those areas see a fair amount of traffic from the more social rides. Shop rides and "race clubs" blow by in pelotons of 20-40 riders without anyone stopping.

    My suggestion would be to scope out all the local social ride clubs and popular ride routes to see where they overlap. Roads in the West tend to be in better shape than here in the East, so you may not have the smooth road draw of the high income areas that happens near me. That could be good or bad - rent in those areas is highest too.

    Which lead to another issue .. rent. Commercial/retail space goes for about $10-$35/sf. You figure a 25x50 space is going to cost you around $1,050/mo minimum in rent @ $10/sf triple net, which means all costs for taxes, insurance, maintenance, etc are on top of that. Your challenge - low cost retail space with good traffic flow .. and specifically cycle traffic flow. Takes a steady stream of sales to come up with ~$1,200 profit to pay the monlthy lease. Simple math - that means selling 1,200 items each month that have $1 profit built in. Or 2,400 items with $0.50 built in. Foo foo coffee has a higher margin that regular coffee. I don't drink coffee, so can't tell you what the price elasticity is for a "regular" cup of coffee, but my gut says $1 on top of cost is pushing it for standard Joe. So at $0.50 profit per cup you have to sell 80 cups of coffee a day just to pay the rent. In addition to the rent you have a fairly good chunk of start up - tools, lease-hold improvements (flooring, seating, etc), food service equipment ... not sure what that would amortize out to per month on a purchase/loan basis. Some of it can be leased.

    Maybe a monthly "membership" fee in conjuntion with your ride club for the right to use all services free or at a discount. LBS2 near me does the $25 annual velo club membership fee, which gets me 20% off services and most products. Shop owner does this more to keep customers hanging around the shop and not to make money. His bankroll business is high-end custom bikes (Parlee, IF, Serotta, etc.) , as well as ready to ride Guru, Gunnar, Giant, etc. He isn't making any money with the velo club - just keeping customers close to the vest - maintaining contact and rapport.

    You might have to be very creative in figuring out how to secure a stable revenue stream to make the monthly rent payment. There are many other expenses on top of that - especially if you want to take any salary out of the operation. Very interesting idea, but run the numbers carefully first. You'll need a lot of buying traffic. My various groups of ride partners and I are fairly avid riders, but I'm not sure I see us generating enough monthly revenue to keep something like your operation in the black. Maybe I'm not thinking of all the opportunities to pull $ out of our pockets .. If I do I will add more. Many other demographic groups.... Good luck - sounds fun if you can pull it off!!
     
    bianchi10 and steve like this.
  9. bianchi10

    bianchi10 New Member

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    Thank you for the info guys. At this point There seems to be a lot of things that would keep me from proceeding with this. It was just an idea that came to mind, but the deeper I get into it the less profitable it seems it would be. I would want to make a living out of it, not just break even or loose money for that matter. I appreciate all the advice guys! I think the idea has some merrit, but there needs to be some other things brought to the table in order for it to work succesfully.
     
  10. sitzmark

    sitzmark Member

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    Spent a week visiting my in-laws in Leavenworth, KS. Didn't want to give up cranking out some miles, so contacted the local shop and rented a bike. You might be interested in the shop format ... bikes and coffee. Brendan Sheehan - proprietor. More bikes than coffee, but both under the same roof. http://www.santafebikes.com/index.php

    Terrific shop and the owner and staff couldn't have been more helpful. Joined in the Monday night ride and the practice crit race series on Wednesday night under the lights with a points format - 3 events, points leader takes the evening. A wonderful group of cyclists in Leavenworth. If you're ever there - hopefully not to live in t the "Big House" :grin: - then be sure to contact Brendan. Tragic story that has turned into a powerful positive community for local cyclists. Brendan's son cycled the entire state of Kansas one summer, then was struck by a car on a Friday evening ride in September that same year. He was 11 years old. Brendan organizes a memorial race every year in his son's memory. Powerful stuff.

    Thank you for a great week Brendan!
     
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