By Karen Axelton
Remember before the recession when gas prices were soaring? At the time, there was lots of talk about electric bikes, and sales at bicycle and scooter shops were rising. Combined with lots of hubbub over green as a business and consumer trend, and it seemed like bikes were poised for takeoff as legions of dissatisfied Americans traded in their cars for a two-wheeled commute.
Fast-forward two years and the Los Angeles Times takes a look at how sales of electric bikes, touted as a gas-saving alternative to cars, have plummeted. While electric bicycle sales had risen from 100,000 in 2005 to 170,000 in 2008, they have since dropped to 150,000, the article reports. Although Electric Bikes Worldwide Reports had projected sales to rise to 300,000 this year, retailers aren’t seeing it. In fact, many who had launched bike shops in the past few years are struggling to stay open.
The article points out the risks involved in tying a business to a fluctuating trend. While gas prices will undoubtedly rise again in the future, right now, consumers have other concerns that make shelling out several hundred to several thousand dollars on a bike less than palatable.
Of course, this article focuses on Los Angeles, which is notoriously inhospitable to bikes. In other regions of the country, bike stores may have more staying power. For instance, I recently visited Portland where bikes were indeed everywhere in the urban landscape.
The moral of the story? If you’re starting a business, don’t base your decision solely on trends. Combine those trends with knowledge of your local market and a plan for how you’ll stay afloat if the worst-case scenario occurs.