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Brand Diversity Rules in Boston

Published October 12, 2009

BOSTON, MA (BRAIN)—Boston dealers have catered to the local clientele by offering diverse brand options judging by the three shops visited on the first day of BRAIN’s Boston Dealer Tour yesterday.

The first visit of the day took riders to Cycle Loft in Burlington, an expansive two-story, 16,000-square-foot building with 9,000 square feet of well-merchandised retail space. Owner Jeff Palter bought the shop in 2006, but the 33-year-old store had occupied the same building since 1996.

Palter, who “did time” in the car business after graduating with an MBA from Babson, was looking to buy a business when he heard the shop might be for sale. An 18-year veteran of Belmont Wheelworks, he said before finalizing the sale he worked out agreements with Specialized and Trek, which dominate the sales floor.

“I wasn’t going to mess with success,” Palter said of his goal was to focus on market leaders. He said the Boston consumer wouldn’t dig a single-brand store; in fact, Boston has no concept stores in the vicinity. “Going forward I’m going to stick with what we have, but I may edge into other things,” he added, noting that Boston is a fickle market and consumers like the cachet of Italian and U.S.-made brands.

Palter said he might spend $15,000 on Italian brands, but he would book it to marketing, not inventory. “It’s not my dream to put money into furniture. I’m risk adverse; I’m just thinking about differentiating on the floor,” he said.

Nearby Belmont Wheelworks, the second stop of the day, had a far broader brand strategy. There the floor showed an extremely diverse array of more than 20 bike brands including Specialized and Trek, as well as the likes of Independent Fabrication, Seven, Serotta, Colnago and Time. Co-owner Clint Paige said the mix of two good European brands with mainstream brands and custom builders works very well, adding that sales of local brands like IF and Seven are based on longtime friendships.

Paige started the business in 1977 with in-house framebuilder Peter Mooney on $2,000 cash, some Reynolds tubing and soldering tools. The first year it sold 129 new bikes; it now sells 9,000 new bikes per year. Both remain as owners, while the third partner John Allis, who joined the company in 1983, celebrated his retirement at a party at the shop on Sunday night.

Wheelworks has been in its main Belmont location since 1983 and the partners have owned that building since 1986. It also has an annex for kids bikes and a location in Somerville. The company paid off its mortgages 15 years ago and is now debt free, said Paige, extolling the benefit of controlling your own destiny.

One thing Paige can’t control is the weather, though; he said in June and July the business makes five times what it does in January, and in certain months it loses money. “We try to limit the number of months we lose money,” Paige quipped.

Harris Cyclery, the last shop visited yesterday, sells Giant and Raleigh as its main lines, partly as a counter to the two big guys represented in the stores that surround it, said store owner Sonny Harris. Harris, who spun the shop off from his dad’s hardware store, has sold Raleigh since he started the business 54 years ago.

Harris counters the seasonality of New England retail with a robust Internet business. He credits former employee Sheldon Brown with creating and nourishing that business. Brown, who passed away early last year, had been working at the store for two years when he came to Harris with an idea. “He came to me with this cockamamie plan. He said, ‘I want to start a Web site.’ I had no idea what that was,” Harris said.

Supported by the technical product information Brown wrote, orders through the store’s Web site grew to account for 60 percent of the store’s overall business. Half of the store’s 10 full-time employees are dedicated to the online business and respond to emails and fill orders for many small, obscure parts from a side room off the retail floor. Harris said it had averaged 55 to 60 orders a day, though orders have fallen to 40 to 45 this year due to the economy.

Harris said it’s still fortunate that he has the online business to get him through the winter months. “Six months of the year we’d make money if it was strictly retail. Two months we’d break even. The other four months you better have something else,” he said.

For more on yesterday's ride from shop to shop, visit the BRAIN Blog. And check back here tomorrow for coverage of Day Two of the Boston Dealer Tour as we head to Cambridge.

—Megan Tompkins

Topics associated with this article: Events

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