ICYMI on The Paceline last week.
I am not an economist. You know that, but I’m saying it now, because I’m going to remind you I said it in just a minute. This is what is known, in the rhetorical game, as a set up.
So, it’s shaping up to be a tough year in the bike business. The explanation for this isn’t very convoluted or complex, I think. In 2020, as the pandemic sent everyone home, the demand for bikes and bike stuff exploded. Due to factory shutdowns pretty much everywhere, that demand could not be supplied. In 2021 and 2022, as things eased, the industry boomed. Money flooded in, All the products sold. It was a dream scenario that many shop owners had never seen before.
As an aside, the ones I know didn’t all the way love it, because it meant working non-stop to keep up. Too much of a good thing, etc.
Meanwhile headwinds in the larger economy were developing. All that demand drove inflation. The prices of bikes and bike things went up (that’s what inflation is) and consumers began to feel ambivalent about both their free time, because we were all heading back to work, and their spending, because the media wrote endless stories about inflation and what it might mean for the near future.
Now, I said at the beginning that I am not an economist, and so my reading of what has happened in the bike industry might just be the ranting of a guy with a philosophy degree and too much time on his hands.
The media also contains precious few economists, and from my vantage point, there is a sort of self-fulfilling prophecy to economic journalism. If you write enough articles about a coming recession, consumers alter their behavior and trigger a recession. If you are paying attention, you will know that we are not currently in a recession despite the fervent prognostications thereof.
I have my own ideas about why we are where we are, but once again I’ll say, I am not an economist.
The upshot of all this, and the reason I’m talking about it today, is that the bike industry is experiencing a supply chain overload. Many companies forecast continued demand where none materialized, and so shops are full of stuff and low on cash. A cursory glance around the market will tell you that a whole lot of stuff is on sale, and this is the WRONG time of year to be discounting new gear. Usually that happens AFTER the spring demand spike.
That makes this an excellent time to shop for a new bike and any other bike-related thing you might need. I make this point, not to drive the grinding wheel of capitalism ever faster, but because I know a lot of small business owners who would really appreciate your patronage right now.
As I’ve said four times now, I’m no economist, but I’d wager little of the economic analysis you’re paying attention to is very prescient. Our economy is a complex, massively interdependent system. A new bike, by contrast, is a pure and simple joy.