European benchmarks offer positivity for retailers 

Both the Dutch and German bicycle markets reported sales dips in 2023. Although the correction in the market following the boom years was expected, additional factors including supply chain issues, wars and economic uncertainties have added extra layers of difficulties to the challenged market. Whereas spring 2023 didn't offer an upturn in e-bike and bicycles sales and set the course for much of the rest of the year, market indicators are suggesting that 2024 could be the year of market recovery.

European benchmarks offer positivity for retailers

German market to stabilise in 2024 after last year's decline

The decline in bicycle and e-bike sales Germany experienced in 2023 was a one-off writes the Cologne based Institute for Retail Research IFH in their annual market study. According to IFH, the demand will increase moderately again in the future starting in 2024.

The outcome of the IFH study is in line with the publication of the German IBD organisation, VSF, earlier this year. “Around 70% of our members expect neutral to positive sales development in 2024, while 74% of the IBDs expect their stock levels to normalise before the end of the season,” wrote VSF last March.

Slow market recovery

The forecast for the bicycle market remains cautiously optimistic for IFH. It is generally known in the market that the jump in sales during the Corona years would not continue. The only big question is whether the sales decline in 2023 was only a market correction or a new, downward trend. For 2024, the experts at IFH Cologne and BBE retail consultancy are currently expecting a slight increase in sales: “In the coming years up to 2028, the market will slowly recover. An average annual growth of up to around 4% is possible.”

“The high inventory levels of bicycle dealers mean that large price reductions are sometimes necessary to sell the inventory. At the moment, this is being felt primarily by manufacturers, who are suffering a drop in orders. In the coming years, however, the market will level off again and record constant growth,” says Christoph Lamsfuß, Senior Consultant at IFH Cologne.

“After a satisfactory start in 2024 and a reduction in inventories, the industry will soon return to normal. E-bikes and company bike leasing offerings, as well as increasing workshop orders continue to have a positive effect,” says Florian Schöps, Manager BBE retail consultancy, assessing the data.

‘Tense market situation this year’

“The report from IFH Cologne is in line with our expectations for the bicycle market in 2024,” says Katharina Hinse, Head of Economic & Industrial Policy of the German industry association ZIV. “We also expect a tense market situation this year and a significant recovery with solid growth from 2025 onwards. Nevertheless, we assume that individual manufacturers and retailers should already achieve a good economic performance this year," Hinse confirmed.

According to German retail research institute, IFH, e-bike sales reached a point of saturation in 2023 without mentioning an expected impact on the business for 2024. However, the high level of e-bikes sales in recent years was benefiting the sales of bicycle accessories, such as cell phone holders or navigation systems, helmets and spare parts. These have been in even greater demand since the boom in the bicycle market and benefit from regular service appointments by e-bike riders.

Retail sales up again in the Netherlands after dip in 2023

Retail sales between January and March 2024 in the Netherlands partly recovered from the strong decline the market experienced in 2023. Turnover increased year-on-year by 5.2% in the first three months of 2024. In the same period last year, revenue was still down by 10% mainly as a result of the sales hike in 2022 shows the benchmark of H&L Accountancy and Tax.

The Dutch market saw a slight decrease of 6% from 833,366 units in 2022 to 804,101 units last year. Thanks to a higher average retail price the revenue was down only 3.7% from 2022 to €1.4 billion in 2023. The H&L Benchmark reports more than just the total turnover of bicycles. It also includes accessories, services and workshop revenues.

Clearing warehouses

For retailers in the Netherlands, the average profit rose to 13.8% of the turnover in the first quarter. It was slightly higher compared to the same period last year. The question remains whether and how much this margin will be under pressure in the coming months as a result of stock clearances. The workshop is and remains an important part of the IBD’s profit, with turnover continuing to rise as expected.