In recent years, driven by a consistent and enormous global demand, the E-bike market has seen rapid development, with Europe and America being globally recognized as the main markets for E-bikes, boasting a large market scale and a mature consumer environment. However, Australia, located in the Southern Hemisphere, is not lagging behind in the development of its E-bike market.
Looking at the import data from Australia, the development of its E-bike market is in sync with the global market. The market began to expand gradually in 2019, with 2021 being particularly prosperous, until a significant decline in import numbers in 2023. In fact, the market was affected by a decrease in demand from the beginning of 2022. However, due to the delay in bookings and transportation lag, Australian wholesalers continued to maintain a high level of imports for a while. Entering 2024, the import volume in the first two months remains low but is gradually approaching the pre-pandemic average level.
Focusing solely on the category of electric bicycles, their import growth is more stable compared to traditional bicycles. In 2023, electric bicycles accounted for 28% of the total imported bicycles in Australia, a proportion much higher than the market share of electric cars driven by government subsidies for electric vehicles, almost four times that of the latter.
Moreover, a distinctive feature of the Australian E-bike market is the popularity of electric mountain bikes, which differs from the European market (in Germany and the Netherlands, electric bicycles account for 53% and 80% of total bicycle sales, respectively). In Australia, electric mountain bikes are more commonly used for sports and leisure rather than daily commuting.
The development trend of Australia’s E-bike market is positive, but surprisingly, the retail end, as a market with tremendous potential, seems to be standing at the industry’s forefront but is actually in a profit dilemma. Even a few top performers have a profit margin that hovers around 10%, and most stores are struggling on the brink of breakeven or even in a state of loss.
This predicament stems not only from the drastic fluctuations in the external market but also from the complexity of the industry’s internal structure and cost structure.
Cost Control and Profit Margin Compression
During the period of rapid increase in bicycle demand, the delay in bookings and transportation lag often led to a shortage of inventory for bicycle stores. In response, many stores had to order in advance in large quantities to replenish their inventory. However, the subsequent decline in demand brought with it significant risks, and the excess inventory turned into a heavy financial burden, putting immense pressure on the financial situation of merchants.
Currently, most bicycle stores have three main profit centers: complete bike sales, parts and accessories (P&A) sales, and workshop services.
- Complete Bike Sales: As a traditional profit pillar, complete bike sales, although seemingly lucrative, are actually eroded by the rising supply chain costs and increased demand for refined services (such as assembly, tuning, and test rides). Especially in the high-end E-bike market, the high manufacturing and transportation costs make it difficult to achieve an ideal profit margin, even with high sales prices.
- Parts and Accessories (P&A) Sales: Although accessories have a higher profit margin, this area is more susceptible to the impact of large online discount stores. Consumers can compare prices online and choose more economical purchasing channels, reducing the competitiveness of bicycle stores in this area.
- Workshop Services: Workshop services are another important profit point for bicycle stores, but the rise in labor costs, coupled with the non-direct profitability of some services (such as free inspections), further compresses the profit space.
Pressure from Rent and Operating Costs
Australian bicycle stores also have to bear the high rent and operating costs. In Australia, bicycle stores are almost invisible in large shopping centers or prime retail areas because the rent is too high!
Given the product characteristics, stores need a large display space, but under the high rent, bicycle stores find it difficult to ensure profitability. Even in the suburbs, a space of 150 to 300 square meters has to pay an annual rent of 50,000 to 100,000 Australian dollars. Especially compared with the European and American markets, the Australian market is relatively small, and sales are not enough to support high operating costs, making it difficult for bicycle stores to enter these high-traffic areas.
Lack of Industry Subsidies
The Australian government provides substantial subsidies for the purchase of electric vehicles, but there is almost no subsidy for electric bicycles. The failure to obtain corresponding policy support has, to some extent, limited the rapid expansion of the market and consumer purchasing enthusiasm, thereby affecting the profitability of retail outlets.复制再试一次分享
