The epidemic has ushered in a global “pandemic” of bicycles. Since this year, the price of upstream raw materials in the bicycle industry has soared, causing the price of bicycle parts and accessories such as frames and handlebars, transmissions and bicycle bowls to rise at different levels. As a result of this, local bicycle manufacturers have been raising their product prices.
Raw materials show a significant increase in bicycle manufacturers to adjust product prices
In Shenzhen, a bicycle consumer enterprise, the reporter met the bicycle parts supplier who was delivering to the whole bicycle factory. The supplier informed the reporter that his factory mainly makes aluminum alloy, magnesium alloy, steel and other raw materials into parts shock forks, supplying bicycle factories. This year, due to the high rate of increase in raw materials, he had to passively adjust the supply price.
It is understood that in previous years, the price of raw materials for the bicycle industry is very stable, rarely showing significant shifts. But from the beginning of last year, many of the raw materials used for bicycles rose, and this year the price not only continued to rise, and the rate of increase is higher. Shenzhen a bicycle consumption enterprise executives informed reporters, since the practice, this is the first time he experienced such a long period of raw material price hikes.
Raw materials continue to rise, resulting in bicycle enterprises to form a significant increase in costs, in order to reduce the cost pressure, the local bicycle consumption enterprises had to adjust the car factory price. However, in the face of fierce market competition, bicycle enterprises can not transfer all the pressure of rising costs to the downstream terminal sales market, and therefore many enterprises are still facing great operational pressure.
The manager of a bicycle company in Shenzhen said that the price was adjusted once in May this year, by about 5%, and again in November, also by more than 5%. There has never been an adjustment twice a year.
A bicycle shop in Shenzhen, the person in charge of self-reported, bicycle shops from about November 13 to start the price adjustment, the whole line of products rose by about 15% or more.
In the face of various unfavourable factors, bicycle enterprises focus on planning medium and high-end models
At present, raw material procurement costs and export shipping costs rise and other unfavourable factors, so that the bicycle industry competition is particularly intense, but also test the operational capabilities of enterprises. Many enterprises have seized the market demand, increased innovation and actively planned for the mid-to-high-end bicycle market to digest the impact of unfavourable factors such as the rise in raw materials.
With the consumption of mid- to high-end bicycles as the main focus, profits are relatively high, so the impact of rising raw material prices and freight costs is not as great as other large parts of the bicycle consumption enterprises.
The general manager of a bicycle company in Shenzhen said that they mainly do carbon fibre-based mid- to high-end bicycles, with a delivery price of about 500 US dollars, or about 3,500 yuan. In a bicycle shop in Shenzhen, the reporter met Ms. Cao, who came to buy a bicycle. Ms. Cao informed the reporter that after the epidemic, there are many young people around like her, who started to enjoy cycling for fitness.
It is understood that while consumers’ requests for bicycle products such as functionality and shape are gradually progressing, many bicycle manufacturers are facing increasingly fierce competition in the market and are focusing on planning for relatively high profits and more competitive mid- to high-end bicycles.
With people’s requests for bicycle functions no longer limited to simple transportation, with sports, fitness, leisure functions of mountain bikes, road bikes and other high-end bicycle market gradually expanded, consumers in the beauty, riding warmth and other aspects also put forward a higher request.
In the interview, the reporter understands that the current complex market environment is increasingly testing the operational capabilities of enterprises, the application of the domestic accumulation of years of complete bicycle industry chain advantages, accelerate product structure to improve, and gradually change the domestic bicycle industry in the past to low value-added products, is becoming the consensus of many domestic bicycle enterprises to develop.
Post time: Dec-10-2021