Dear Uncle Dave: Where the hell is my new bicycle!?

Dear Uncle Dave:

I work in the bike industry and, while I don't want to complain, people are driving me crazy! Half my day is spent dealing with "where's my bike!" e-mails. Angry customers. Angry distributors. Angry dealers. Why can't everybody just chill out a little bit? I know that they really want their new bikes, and I do really want to give that new bike to them. I'm not sure if people have been paying attention, but there's been some shit going down this year that has lead to serious supply chain disruptions. What can I do to better inform people about what is going on?

Sincerely,

Partless, not heartless

Dear Partleheart:

First off, I'd like to express my sympathy to you for having a job that requires you to deal with the public. That sounds horrible! Trust me, it is way more fun having a job/side gig that allows me to send bitchy e-mails to people demanding things rather than receiving them.

Now, about your problem, I don't really have much that I can offer to help you with your situation. The great thing though, is that I know somebody who can! For the first time ever, Uncle Dave is going to interview the question asker in order to help them answer their own question.

Uncle Dave:

I think that most people, myself included, have absolutely no understanding of how the bicycles that they buy come together. We all understand that designing the bikes happens well ahead of time, but sort of assume that some magic takes place and the bikes show up relatively quickly once a decision gets made to make and sell them. So, broadly speaking, how far ahead of time does a bike company have to start the process for manufacturing a bike? When do parts orders get placed? What is the longest lead time item that needs to be ordered? Is there any flexibility to make changes once things are set? What are some of the things that need to happen that we don't even think about?

Partleheart:

We'll start by talking a bit about what happens during a "normal" year of bicycle production. Over the last ten years, the industry has been ordering something like 100,000 bicycles a year. Now, we're asking the same factories to produce 250,000 bicycles a year. These factories haven't added more square footage, tools, or employees. So now there is just simply too much demand, which had led to long lead times. But we'll talk about that in a bit.

In a normal year, assuming a design is approved and finalized, the lead time for a frame from the factory can vary between 90-120 days. Components are typically a bit quicker, with a lead time somewhere between 30-45 days. Then you have to factor in transit time. Ocean freight takes a month. You can airship within a few days, but it is very costly.

You also want to build in a safety margin. It's better to have parts arrive before you need them, not day of. So we add another thirty day cushion. After factoring for lead time, ocean freight, and safety margin, we typically place component orders anywhere from 90 to 180 days out.

Once an order is placed, there is some flexibility to make changes, and this depends on the lead time. The flexibility increases as the lead times grow longer, but you don't want to make last minute changes. All lead times are constrained by things like the quantity of employees, or the number of tools you have.

We order tooling based on projected demand. When demand doubles because of an unexpected global calamity, you have some tough decisions to make. You can only produce X amount of parts out of each tool. The lead time for a new tool is six weeks. Plus you have to train any new staff on assembling the product, etc. By the time you have more tooling, more staff trained, and can now meet the increased demand, will their still be a demand?

That's the process for ordering the bike, but there are a number of logistical business hurdles that take place before you can order. You have to create parts numbers, forecasts, etc. All of these steps take time. Forecasting drives orders. In April, when the sky was falling, businesses were in full lockdown and the cycling industry slashed orders. They assumed that sales would crash precipitously, but very quickly we noticed something odd. The exact opposite was happening. Demand grew.

The decisions we as a whole industry made in the Spring are affecting our business now. The outdoor world asked factories to slash production, and then made an abrupt 180. To paraphrase an overused metaphor - we're trying to turn around a big ship (after changing our minds as to what direction we wanted it to go).

Ultimately, people don't care why products are taking so long to arrive. We're so used to having things shipped the next day and tracking its progress across the country, that waiting is unbearable. We have created a society weaned on disposable products that are available right here, right now.

The factories are facing these same dilemmas. Should they invest in the infrastructure and personal to meet this new found demand? Will the demand still be there by the time they scale up? In many regions, it's becoming increasingly difficult to find employees. Many are forgoing factory jobs in favor of different career paths. Others have fled due to their homes due to Covid and some countries remain travel restricted. We've heard rumors that some factories are turning away brands because they have exceeded capacity. These brands and factories may have long term relationships, but there's only so much capacity.

On the brand side, scaling is scary. Some bicycle vendors are placing order locks within certain delivery windows. If a bike shop cancels an order, they're charged a small cancellation fee, but we're left holding that inventory, so you want some certainty that you can sell it.

So, that's how we have gotten to where we are now. What does this mean? Well, for us, our carbon frames have the longest lead time. That has shifted dramatically due to the pandemic induced bike boom. With some factories, we have now placed orders one year in advance. We've done this because factories have limited capacity and we are trying to secure our place in line for that product. So we've almost tripled our lead time on bicycle frames.

Components are all over the place. Over the past few months, we've had difficulties with a number of products. The lead times for suspension, drivetrain, saddles, tires, etc. are continually shifting. All of these suppliers are in a tough position. They're trying to find ways to best serve all of their customers, and so are we. We've made spec changes. We've dual sourced some components from additional vendors. The biggest change is commonizing spec. We're moving towards parts that can be utilized across multiple product lines, so that we can have a deeper supply of any given component. We've also been forced to reduce customization and options to ensure we have better inventory, and have shifted towards vendors with shorter and more reliable lead times. Just anything we can do to ship complete bikes.

When is it going to go back to normal? Right now it's anyone's guess! To meet demand, our vendors are working to increase their capacity. That requires more equipment, staff, training, etc. We should see that increase in capacity by Spring 2021. By that time, the bike boom may have cooled off. There's no way to tell.

No one has an answer to these questions...and if they do, they should be investing in the stock market, not selling bikes. Year over year, the total volume of bikes sales does not tend to increase. It just shifts from one category to the other. Maybe it's gravel this year, mullet bikes next, and reverse mullets the year after that. The total number stays static. This Pandemic induced bike boom has brought a surge of new customers into the market. If even a small percentage become passionate cyclists, then the total volume will increase. By how much and for how long is anyone's guess.

Uncle Dave:

So, basically, you're fucked?

Paddleheart:

Ya, I guess so.

Uncle Dave

Sorry.

It's looking up for you Paddleheart, because you've won a Blackburn's new Core Pro pump. It's designed to be a shop-level pump for home use. It has a nice wide base for stability, is compatible with any valve, and it's a whopping 29" tall. Hopefully this will cheer you up after a long day dealing with all of your angry contacts!

If you've got a question that will satisfy Uncle Dave's curiosity, you could win a prize, but you'd better make it good; he's tough to please.

Send your excellent (or funny, or ridiculous) questions at [email protected]

Uncle Dave's Music Club

Not too long ago, I complained about all of the introspective pandemic albums that were coming out. Which was a bit unfair. I do wish that more people had spent the pandemic figuring out new ways to peel off their wallpaper using nothing but sound, but I recognize the challenge of doing so when you're locked away all alone. So, I'd like to take a moment to recognize a slow burner that grew on me through the fall.

Kevin Morby is one of those guys that I just can't stay mad at. He jumps around a lot and puts out some weird shit from time to time, but I keep coming back for more. I'm not sure if Sundowner qualifies as a true "pandemic album", but it feels like one. For some reason, I can't embed the link for the album version...or for the live acoustic version...so there's an extra few clicks for you required.

Campfire is worth a look as well, if only because the intro looks like it could be leading into an mtb flick.

Additional Uncle Dave's Music Club

It's no surprise that a man who lives as an enigma goes out like one too. MF Doom died sometime back in fall 2019 but the news is just coming out now. I was most into the King Geedorah/Viktor Vaughn alter egos. I spun that shit like crazy on my Mini Disc player and just started to give some of it a listen again a few months back. Check out Vaudeville Villain, The Drop and Fazers for a brief taste. Dark, funny, twisted, all at once.

If you've got a question that will satisfy Uncle Dave's curiosity, you could win a prize, but you'd better make it good; he's tough to please.

Send your excellent (or funny, or ridiculous) questions at [email protected]