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Bicycles - UK - March 2012

The bicycles market had a difficult year in 2011 as a result of the squeeze on household incomes which affected discretionary leisure spending and also negativity surrounding changes to the Cycle to Work scheme, which suppressed demand from that source. Some manufacturers also had too much inventory left over from 2011, which meant that there was more discounting than usual, impacting on average prices and feeding through to market value.

However, the longer-term outlook for bicycles is positive, with demand expected to continue to grow during the next five years as the negativity surrounding the Cycle to Work scheme subsides and the UK economy begins to pick up again.

This report answers the following questions:

  • What can the industry do to counter peaks and troughs in demand?
  • What can be done to overcome consumer fears about the danger of cycling on the roads?
  • What canthe industry do to capitalise on growing numbers of older people?

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Table of contents

  1. Introduction

      • Definition
        • Abbreviations
        • Executive Summary

            • Economy and legislative changes suppress market for now
              • Figure 1: UK bicycle sales volumes, 2006-16
            • Market factors
              • Companies, products and innovation
                • Figure 2: Leading bicycle suppliers to the UK market, ranked by turnover*, 2010
              • The consumer
                • Figure 3: Frequency of participation in cycling, January 2012
                • Figure 4: Involvement in cycling, January 2012
                • Figure 5: Attitudes towards cycling, January 2012
                • Figure 6: Cycling motivations, January 2012
                • Figure 7: Cycling target groups, January 2012
              • What we think
              • Issues in the Market

                  • What, if anything, can the industry do to counter peaks and troughs in demand?
                    • What can be done to overcome consumer fears about the danger of cycling on the roads?
                      • What are the factors holding back further growth in the cycle commuting sector?
                        • What can the industry do to capitalise on growing numbers of older people?
                        • Future Opportunities

                          • Trend: Experience is All
                            • Trend: Herbivore, Carnivore…Locavore
                            • Internal Market Environment

                              • Key points
                                • Cycling drops off after severe weather
                                  • Figure 8: Participation in cycling and mountain biking, 2007-11
                                • Interest falls but TV viewing rises
                                  • Figure 9: Paid to watch/watch on TV/read about/looked up on internet/any interest in cycling, mountain biking, 2007-11
                                • Broad cross-section of organisations pushing cycling
                                  • British Cycling membership on the increase
                                    • Figure 10: British Cycling membership numbers, 2008-12
                                  • Cyclists’ Touring Club (CTC)
                                    • National Cycling Network
                                      • Cycle to Work schemes struggle to deal with negative publicity
                                        • ACT pushes the expert angle
                                          • Thefts rise in hard times
                                            • Figure 11: Trends in reported thefts of bicycles, England and Wales, 1981-2010/11
                                          • High levels of bicycle ownership don’t carry through to adulthood
                                            • Figure 12: Bicycle ownership, by age, 2008/10*
                                          • Most people are infrequent cyclists
                                            • Figure 13: Frequency of bicycle use, 2000-10*
                                          • Commuting and leisure riding most popular cycling trips
                                            • Figure 14: Trips by bicycle per person per year, by purpose, 2004-10
                                            • Figure 15: Miles per trip by bicycle per person per year, by purpose, 2010
                                            • Figure 16: Where usually cycled, 2002-10
                                          • Proliferation of cycling titles
                                            • Figure 17: Total average net circulation per issue for major cycling magazine titles, 2010 and 2011*
                                          • Sportives boost road bike sector
                                            • Safety still big deterrent
                                              • Train companies continue to try to encourage cycle-rail commuting
                                                • Government abolition of Cycling England harms co-ordination of cycling strategy
                                                • Broader Market Environment

                                                  • Key points
                                                    • Weak economy starves leisure market of cash
                                                      • Figure 18: GDP, PDI, consumer expenditure and savings, at constant 2011 prices, 2006-16
                                                      • Figure 19: GDP quarterly percentage change, Q1 2006-Q4 2011
                                                      • Figure 20: Trends in UK consumer confidence, January 2008-January 2012
                                                      • Figure 21: Trends in the buying of bicycles, by price segment, 2007-11
                                                    • Young professionals growth could boost bicycle sales
                                                      • Figure 22: Trends in the age structure of the UK population, 2006-16
                                                    • ABC1C2 growth is positive for the bicycles market
                                                      • Figure 23: Forecast adult population trends, by socio-economic group, 2006-16
                                                    • Retired growth offers scope for safe off-road cycling?
                                                      • Figure 24: Forecast adult population trends, by lifestage, 2006-16
                                                    • Higher fuel prices fan the cycling fire
                                                      • Figure 25: UK average fuel prices, November 2006-November 2011
                                                    • Health needs can drive demand for cycling too
                                                      • Figure 26: Incidence of being overweight or obese, by gender, 2006-10
                                                    • Weather plays important role
                                                      • Figure 27: UK weather trends, 2006-11
                                                    • Exchange rates cause headaches for suppliers
                                                      • Figure 28: Trends in Sterling/Dollar exchange rates, 2006-11
                                                  • Competitive Context

                                                    • Key points
                                                      • Cycling is most popular outdoor sport
                                                        • Figure 29: Most popular participation and spectator sports, 2011
                                                        • Figure 30: Top five sports/activities played or taken part in regularly, 2006-11
                                                      • Electric bikes offer competition for more traditional bicycles
                                                      • Who’s Innovating?

                                                        • Key points
                                                          • Car manufacturers look to e-bikes
                                                            • An electric mountain bike?
                                                              • Retro-fit e-bike kits could have huge potential
                                                                • Sub-£1,000 pricing brings e-bikes within scope of Cycle to Work schemes
                                                                  • Bamboo emerges as alternative material for frames
                                                                    • Cycling facilities offer chance for safer recreation
                                                                      • Barclays Cycle Hire scheme expands London cycling
                                                                        • Electric bike rental from Hertz
                                                                          • Stirling Bike Train commute aims to tempt commuters from cars
                                                                            • Electronic gear shifting comes within reach of the enthusiast
                                                                              • No Logo is antithesis of brand snobbery
                                                                              • Market Size and Forecast

                                                                                • Key points
                                                                                  • Market dips slightly in 2011 as austerity and Cycle to Work changes hit demand
                                                                                    • Figure 31: UK bicycles market, 2006-16
                                                                                  • Market set to stabilise in 2012
                                                                                    • Alternative sourcing strategies on the cards?
                                                                                      • Forecast
                                                                                        • Figure 32: Forecast for UK bicycles market value, 2006-16
                                                                                        • Figure 33: Forecast for UK bicycles market volume, 2006-16
                                                                                    • Segment Performance

                                                                                      • Key points
                                                                                        • Hybrid/commuter bicycles drive sales
                                                                                          • Figure 34: Estimated breakdown of UK bicycles market, by segment, 2009 and 2011
                                                                                      • Market Share

                                                                                        • Key points
                                                                                          • Halfords leads the way
                                                                                            • Figure 35: Leading bicycle suppliers to the UK market, ranked by turnover, 2010
                                                                                        • Companies and Products

                                                                                          • Key points
                                                                                            • Industry structure
                                                                                              • Figure 36: Trends in overseas trade in bicycles, 2007-11
                                                                                              • Figure 37: Leading sources of imported bicycles, 2011
                                                                                            • Halfords Group plc
                                                                                                • Figure 38: Key financial data for Halfords Group Plc, 2007-11
                                                                                              • Specialized (UK) Ltd
                                                                                                • Figure 39: Key financial data for Specialized UK limited, 2007-10*
                                                                                              • Giant Bicycles (UK)
                                                                                                  • Figure 40: Key financial data for Giant UK limited, 2006-10
                                                                                                • Raleigh Holdings Ltd
                                                                                                    • Figure 41: Key financial data for Raleigh Holdings Limited, 2006-10
                                                                                                  • Tandem Group plc
                                                                                                      • Figure 42: Key financial data for Tandem Group Plc, 2007-11
                                                                                                    • Trek Bicycle Corporation Ltd
                                                                                                        • Figure 43: Key financial data for Trek Bicycles Limited, 2006-10
                                                                                                      • Universal Cycles Ltd
                                                                                                          • Figure 44: Key financial data for Universal Cycles Limited, 2006-11
                                                                                                        • Other suppliers
                                                                                                        • Channels to Market

                                                                                                          • Key points
                                                                                                            • Specialists retain hold on sales
                                                                                                              • Figure 45: Bicycle sales (unit sales), by distribution channel, 2011
                                                                                                            • Evans is largest specialist
                                                                                                              • Online players extend reach
                                                                                                              • Brand Communication and Promotion

                                                                                                                • Key points
                                                                                                                  • Seasonal peaks in spending on promotion
                                                                                                                    • Figure 46: Monthly trends in advertising expenditure, 2007-11
                                                                                                                    • Figure 47: Advertising expenditure in the bicycles market, 2007-11
                                                                                                                    • Figure 48: Spend by top 20 advertisers in the bicycles market in the last full 12 months, by media type, December 2010-November 2011
                                                                                                                • Frequency of Cycling Participation

                                                                                                                  • Key points
                                                                                                                    • A third of adults cycle
                                                                                                                      • Figure 49: Frequency of participation in cycling, January 2012
                                                                                                                  • Involvement in Cycling

                                                                                                                    • Key points
                                                                                                                      • Over two fifths of cyclists also drive
                                                                                                                        • Figure 50: Involvement in cycling, January 2012
                                                                                                                      • Frequent cyclists more likely to wear helmets
                                                                                                                        • Figure 51: Involvement in cycling, by most popular frequency of participation in cycling, January 2012
                                                                                                                        • Figure 52: Involvement in cycling, by next most popular frequency of participation in cycling, January 2012
                                                                                                                    • Attitudes Towards Cycling

                                                                                                                      • Key points
                                                                                                                        • Much positivity associated with cycling but perceived dangers deter
                                                                                                                          • Figure 53: Attitudes towards cycling, January 2012
                                                                                                                        • Over a third of daily cyclists agree it’s too dangerous to cycle on the roads
                                                                                                                          • Figure 54: Attitudes towards cycling, by most popular frequency of participation in cycling, January 2012
                                                                                                                          • Figure 55: Attitudes towards cycling, by next most popular frequency of participation in cycling, January 2012
                                                                                                                      • Cycling Motivations

                                                                                                                        • Key points
                                                                                                                          • Fitness and fun biggest motivations for cycling
                                                                                                                            • Figure 56: Cycling motivations, January 2012
                                                                                                                          • Fitness the biggest motivator for lapsed cyclists
                                                                                                                            • Figure 57: Cycling motivations, by most popular frequency of participation in cycling, January 2012
                                                                                                                            • Figure 58: Cycling motivations, by next most popular frequency of participation in cycling, January 2012
                                                                                                                        • Cycling Targeting Opportunities

                                                                                                                          • Key points
                                                                                                                            • Figure 59: Cycling target groups, January 2012
                                                                                                                          • Rebel riders
                                                                                                                            • Route riders
                                                                                                                              • Bench riders
                                                                                                                                • Unchained
                                                                                                                                  • Rebel riders most likely to be regular cyclists
                                                                                                                                    • Figure 60: Frequency of participation in cycling, by cycling target groups, January 2012
                                                                                                                                  • Route riders most likely to wear helmets
                                                                                                                                    • Figure 61: Involvement in cycling, by cycling target groups, January 2012
                                                                                                                                  • Rebel riders have highest level of bicycle purchasing
                                                                                                                                    • Figure 62: Bicycle buying behaviour in the past 12 months, by cycling target groups, January 2012
                                                                                                                                  • Route riders keenest advocates of cycling
                                                                                                                                    • Figure 63: Cycling motivations, by cycling target groups, January 2012
                                                                                                                                • Appendix – Internal Market Environment

                                                                                                                                    • Figure 64: Reported road casualties by bicycles in Great Britain, by severity, 2005-10
                                                                                                                                    • Figure 65: Reported road accident casualties, by road user type, 2005-10*
                                                                                                                                • Appendix – Market Size and Forecast

                                                                                                                                    • Figure 66: Forecast for UK bicycles market value, 2011-16
                                                                                                                                    • Figure 67: Forecast for UK bicycles market volume, 2011-16
                                                                                                                                • Appendix – Frequency of Cycling Participation

                                                                                                                                    • Figure 68: Most popular frequency of participation in cycling, by demographics, January 2012
                                                                                                                                    • Figure 69: Next most popular frequency of participation in cycling, by demographics, January 2012
                                                                                                                                • Appendix – Involvement in Cycling

                                                                                                                                    • Figure 70: Most popular involvement in cycling, by demographics, January 2012
                                                                                                                                    • Figure 71: Next most popular involvement in cycling, by demographics, January 2012
                                                                                                                                    • Figure 72: Involvement in cycling, by most popular involvement in cycling, January 2012
                                                                                                                                    • Figure 73: Involvement in cycling, by next most popular involvement in cycling, January 2012
                                                                                                                                • Appendix – Attitudes Towards Cycling

                                                                                                                                    • Figure 74: Most popular attitudes towards cycling, by demographics, January 2012
                                                                                                                                    • Figure 75: Next most popular attitudes towards cycling, by demographics, January 2012
                                                                                                                                    • Figure 76: Attitudes towards cycling, by most popular attitudes towards cycling, January 2011
                                                                                                                                    • Figure 77: Attitudes towards cycling, by next most popular attitudes towards cycling, January 2011
                                                                                                                                    • Figure 78: Attitudes towards cycling, by most popular involvement in cycling, January 2012
                                                                                                                                    • Figure 79: Attitudes towards cycling, by next most popular involvement in cycling, January 2012
                                                                                                                                    • Figure 80: Attitudes towards cycling, by new bicycle buying behaviour in the past 12 months, January 2012
                                                                                                                                    • Figure 81: Attitudes towards cycling, by second-hand bicycle buying behaviour in the past 12 months, January 2012
                                                                                                                                • Appendix – Cycling Motivations

                                                                                                                                    • Figure 82: Cycling motivations, by demographics, January 2012
                                                                                                                                    • Figure 83: Cycling motivations, by most popular involvement in cycling, January 2012
                                                                                                                                    • Figure 84: Cycling motivations, by next most popular involvement in cycling, January 2012
                                                                                                                                    • Figure 85: Cycling motivations, by new bicycle buying behaviour in the past 12 months, January 2012
                                                                                                                                    • Figure 86: Cycling motivations, by second-hand bicycle buying behaviour in the past 12 months, January 2012
                                                                                                                                    • Figure 87: Cycling motivations, by most popular agreement with attitudes towards cycling, January 2012
                                                                                                                                    • Figure 88: Cycling motivations, by next most popular agreement with attitudes towards cycling, January 2012
                                                                                                                                    • Figure 89: Cycling motivations, by most popular cycling motivations, January 2012
                                                                                                                                    • Figure 90: Cycling motivations, by next most popular cycling motivations, January 2012
                                                                                                                                • Appendix – Cycling Targeting Opportunities

                                                                                                                                    • Figure 91: Cycling target groups, by demographics, January 2012
                                                                                                                                    • Figure 92: Attitudes towards cycling, by cycling target groups, January 2012
                                                                                                                                    • Figure 93: Frequency of participation in cycling, by cycling target groups, January 2012
                                                                                                                                    • Figure 94: Involvement in cycling, by cycling target groups, January 2012
                                                                                                                                    • Figure 95: Bicycle buying behaviour in the past 12 months, by cycling target groups, January 2012
                                                                                                                                    • Figure 96: Cycling motivations, by cycling target groups, January 2012

                                                                                                                                Companies Covered

                                                                                                                                • Avocet Sports Ltd
                                                                                                                                • Cannondale Bicycle Corporation
                                                                                                                                • Concept Cycling Ltd
                                                                                                                                • Dawes Cycles Limited
                                                                                                                                • Dorel Industries Inc.
                                                                                                                                • Falcon Cycles Ltd
                                                                                                                                • Formula One Administration Ltd
                                                                                                                                • Giant Manufacturing Co Ltd
                                                                                                                                • H Young Holdings PLC
                                                                                                                                • Halfords Ltd
                                                                                                                                • Hawk Factory Cycle Stores Ltd
                                                                                                                                • London Stock Exchange plc
                                                                                                                                • Muddyfox Ltd
                                                                                                                                • MV Sports Group Plc
                                                                                                                                • Pacific Cycle LLC
                                                                                                                                • Professional Cycle Manufacturing (PCM) Ltd
                                                                                                                                • Professional Cycle Marketing
                                                                                                                                • Raleigh UK Ltd
                                                                                                                                • Saracen Cycles Ltd
                                                                                                                                • Shimano
                                                                                                                                • Specialized Bicycle Components, Inc.
                                                                                                                                • Sports Direct Plc
                                                                                                                                • Tandem Group
                                                                                                                                • The London Organising Committee of the Olympic Games and Paralympic Games Limited
                                                                                                                                • Trek Bicycle Corporation
                                                                                                                                • Triumph Motorcycles Ltd
                                                                                                                                • Universal Cycles Plc

                                                                                                                                Bicycles - UK - March 2012

                                                                                                                                £1,750.00 (Excl.Tax)