Edinburgh Bicycle Co-operative (EBC), Scotland's biggest chain of bike shops plans to double in size by 2017, grow it's workforce from 160 to nearly 300 (all have a share in the company) and increase turnover to £20m. That is what Jeremy Miles, Managing Director of the Edinburgh Bicycle Co-op Jeremy Miles will be telling the Scottish launch of the United Nations International Year of Co-operatives this Thursday.
The EBC announcement is yet another sign of the continued health and growth of the UK cycling economy. Last summer a report by the London School of Economics that estimated the UK's 'Gross Cycling Product' contributed £2.9bn to the UK economy with the retail sector turning over £2.47bn annually. Despite the economic difficulties now facing the country, the UK's cycling economy is forecast to keep on growing.
EBC won't need any introduction to our North of the Border readers or even those in the North of England these days, having sold £11.5m of cycling goods in 2011 including 20,000 bikes through the original shop in Edinburgh plus five others in Aberdeen, Leeds, Manchester, Newcastle and Sheffield as well as through its successful online operation www.edinburghbicycle.com. EBC has also enjoyed success with its in-house Revolution brand of well priced, well specced bikes and accessories.
The first store opened as a co-op in Edinburgh in 1977 with the staff owning a share of the business once they had completed an induction period. To this day, employees are invited to become members of the co-op after a year’s 'apprenticeship'.
Jeremy Miles previewed his speech in today's The Scotsman, saying he wants to focus on online retailing, new store openings and "targeted acquisitions in local markets" especially struggling existing independent shops.
"The bicycle business is characterised by a handful of very large players at the volume end of the business," he continued, "with many excellent owner-managed businesses servicing local markets.
"Edinburgh Bicycle Co-operative has a very distinct profile in the market, where we focus on customer service and our brand personality.
According to Miles, "There are a lot of changes going on at the moment with private equity firms coming into the cycling industry. The traditional bike shops that everyone would think of are finding it quite difficult and are disappearing," he said.
As road.cc posted in December, an investor called Bridgepoint paid £180m for Wiggle, while Cycle Surgery and Evans Cycles are also private equity owned.
Miles continued, "The growth in the market is very much the weekend leisure cyclists and the commuter. The internet is also driving a lot of this and we want to be part of it, but we want to be a business with a slightly alternative view."
So far the co-op's expansion has been restricted to Scotland and the North, as the EBC distribution centre is situated on the outskirts of Edinburgh, but Miles says many of the growth areas are in the south.
“The real opportunity is in places like London, Birmingham and Bristol,” he said, adding that distribution problems are "not insurmountable," he says.
Interestingly, he's hoping the business will develop along the same lines as the Co-operative Group’s food business, which follows not far behind the big four food retailers.
"That’s an interesting model and something we would aspire to, especially in the shadow of these large powerful corporates that are coming along," he said.
The Scottish launch of the UN International Year of Co-operatives will be co-hosted on Thursday by Co-operative Development Scotland along with EBC at their original store on Whitehouse Loan, Edinburgh. The international event aims to increase public awareness about co-operatives while promoting their formation and growth.
Jeremy Miles says about EBC in particular, "Underpinning the brand is the co-operative structure and values - it is a key asset that will drive our five-year expansion."
According to Sarah Deas, chief executive of Co-operative Development Scotland, "Edinburgh Bicycle Co-operative is an outstanding example of how a business can grow and prosper when the ownership is shared by the staff."