Omni-channel approach will reach new consumers and enhance retailer sell-through.
Kent, Wash. (June 14, 2016) – Raleigh Bicycles announces a partner dealer fulfillment program focused on the end consumer and bettering sell-through at retail. In April, Raleigh launched a commerce-enabled website that offers sales of complete bicycles to consumers, fulfilled through Raleigh retail partners, creating an omni-channel path to purchase.
Realizing the most important metric in dealer profitability is GMROI, this year Raleigh is asking its dealers for smaller up-front commitments and helping them turn inventory more frequently. By focusing on the end consumer, and making bikes very appealing and sharply priced, Raleigh’s focus is to drive new consumers, better sell-through, strengthen margins and, in the process, create financially healthy retail partners.
“We just don’t believe in the pre-season model,” said Larry Pizzi, senior vice president of Raleigh Bicycles. “We don’t believe it’s in anyone’s long term interest to deploy heavy-handed sell-in tactics during the late summer and fall in an attempt to tie-up the sales floor and block out competition; with long dating terms and large up front requirements, retailers take on more inventory and credit risk than they need. We fully recognize that many of the larger brands are already forcing our retail partners into this strategy – so why pile on?”
“Our new omni-channel approach to doing business is designed to tackle the challenges that exist today for many retailers, along with addressing the ethical dilemma that has existed for years in the bicycle industry,” he continued. “Raleigh will be a partner in driving true consumers to your door. We’ll ask you to purchase what you need when you need it and to pay for it in a reasonable period of time. Finally, we’ll be a partner in opening up the digital space for those affiliated with Raleigh.”
ERIK’S, a top source for quality bicycles and ski equipment in Minnesota and Wisconsin, is a valued Raleigh retail partner. “We’re very excited about Raleigh this year,” said Erik Saltvold, founder of ERIK’S. “The product is attractive and compelling, and we like the focus on the simple joy of cycling and introducing new riders to the sport. The omni-channel initiative reflects forward thinking and provides us, as a retailer, a great way to extend our assortment and hours to attract customers we wouldn’t have otherwise.”
Stated in a March letter to dealers, Raleigh’s aim is to grow the pie of potential consumers, break down the barriers of entry, and invite people into the cycling world to participate and belong long term. To do so, there must be multiple purchasing options in line with how today’s consumer shops. This modified distribution strategy has already begun to increase exposure for the Raleigh brand and their partner retailers.
Since the commerce-enabled site launched less than two months ago, 70% of Raleigh’s ecommerce sales are being fulfilled through dealer partners and average sales price for transactions through the site is 60% higher than other channels. Unlike other industries, revenue from sales made through the website is shared with dealers: Retail partners receive a normal margin when their point-of-sale system has been integrated and the bike is in stock, and a healthy commission if the bike is not in stock, along with a new traffic through their doors. Raleigh’s omni-channel efforts means that the dealer does not take on inventory risk, and the store receives traffic from new consumers, creating long-term relationships for the retailer.