‘We like to compete in the e-bike segment’

The long-time experience in the production of city bikes for a leading Dutch brand, gave Bike Fun International (BFI) a strong position in the expanding urban mobility cycling market. Bike Europe talked with CEO René Gasser about the manufacturer's ambition to serve the central European markets as a leading distributor, but also how they can distinguish themselves as an OEM supplier.

“In Central European countries like Czech Republic, Poland and Hungary, cycling mainly means leisure and sports and not urban mobility,” explains René Gasser, CEO at BFI. “Therefore, we operate on two business legs: sports and city bike. Thanks to our strong connection with the Benelux market, we have a very experienced team in the category city bikes. For more than 22 years our technical teams worked on city bikes. They know every screw and each fender specified in this product category. As I am convinced cycling becomes an important part of the infrastructure in many cities and this skill will be very important to grow our company.”

How big is your market share locally and what is your projections for the years to come?

In the 2023 CONEBI report the total market volume is estimated at 400,000 units including 110,000 e-bikes. Some 120,000 units of this total were sold via non-IBDs. In total we hold a market share in the IBD market of approximately 10% and we want to double or triple this. We don’t underestimate the influence of A-brands especially from Germany, who are also becoming bigger and bigger in the Czech Republic. On the other hand, we see a trend in countries like Germany and Italy that more people tend to buy local brands to support the companies. Of course, a lot of IBDs want to be Trek dealers and we aim to be the next option after Specialized and Trek. When painting a realistic picture with Superior we should be able to distribute some 40,000 to 45,000 units in our home market which is equal to 25-30%. That’s why we always distributed Superior in the Czech Republic although our export was leading. In future we want to take this step further and become the strongest supplier in the central European markets, which are now dominated by foreign brands.

After the take-over of BFI in 2020 from Mark de Kwant, the new owner stated seeing a “huge opportunity in e-bikes.” How is that working out so far for BikeFun?

Like the rest of the industry, we learnt an expensive lesson. Five years ago, the majority of the people in Central Europe could not afford a Bosch equipped e-bike. That has changed. Also, the trend of bigger batteries and more powerful drive trains was introduced in Czech Republic. As a results, Bosch drive systems are now even specified on Superior and Rock Machine e-bikes. Our own drive system, supplied with Dapu motors in combination with Phylion batteries are now only specified on mid-range e-bikes and we are analysing the future of this segment. An increasing number of consumers prefer a branded drive system. Undoubtedly Bosch is a winner in service, including the availability of spare parts and sharing know-how. Taking the market position of others into account, I think we can sell some 20,000 e-bikes annually on our local market.

What benefits can you offer European OEM customers with this location in the Czech Republic?

The mobility segment will be the main driver for our future growth. For OEM customers our advantage of being located in the Czech Republic over Asian competitors is our knowledge of local markets. Asian suppliers can never be so close to the market in terms of differences in specifications between all various countries. Even within the Benelux countries the variations in product specifications for city bikes are big. You need to have that deep knowledge of each single market and be aware of the local preferences. Thanks to our skilled team in city bikes we can offer this know-how to our OM customers.

Another advantage is the logistic and financial support we can offer. During the covid days hiring additional warehouses created a financial burden for many companies in the industry. We have managed to get this strictly under control and our OEM customers can benefit from that. It is an important part of our full-service package, from design, to ordering components, assembly and 24-hours delivery is something we can offer from our location in the Czech Republic. Our goal is to offer product availability information from the beginning of the order to delivery of the bikes. We know customers are not interested in how you organise your processes, they want to know whether they can trust you deliver on time. Sharing real time information is extremely important and even negative information is better than nothing.

How would you describe the company in the highly competitive market?

Producing bicycles and e-bikes in Koprivnice means you can never win on price. The gap between the cost of labour in Germany and the Czech Republic is too small to make such a difference. So we need to offer more, such as logistics and JIT delivery to the customer’s warehouse. For that reason we try to have local sales people in each market to explain the total BFI experience to our customers. They also understand the needs of our customers and manage expectations on both sides. As I already mentioned, we have a lot of knowledge of specifying city bikes in various countries. We like to compete in this segment: e-bikes with local specifications. Here we can prove our added value. We deliver our part of the complex solution in the business. Our customers can focus on the sales, while we will take full control of product development, logistics, assembly, and provide delivery in the right place on time. In a normal situation we can store up to 30,000 bicycles for our OEM customers to guarantee maximum flexibility in deliveries.

How was 2024 for BikeFun and what are your expectations for 2025?

Our performance in 2023 was still better than in 2022, but our expansion was less than expected. Both in production and sales 2023 was good. The number of bicycles produced increased from 127,359 units in 2022 to 168,682 last year. [The last and previous fiscal years can’t be compared as BFI changed from a mid-year to end of the year fiscal period to align with the other companies in the Consillium group.] The number of e-bikes went up from 61,823 to 96,181. Our total sales hiked from CZK 2,513 bln (€100.5 mln) in 2022 to CZK 3,456 bln (€138.4 mln) in 2023. This year we see a decrease in volume of about 15% while we were targeting stabilisation. We see a major shift of our business from OEM to our own brands which shows we made the right decision to invest in Superior, Rock Machine and Frappe. The combination between OEM and own brand turns out to be vital. For 2025 we expect that the e-bike market will still have to deal with high inventory, at least until the middle of the year. The market for regular bicycles is facing a much less stressful inventory situation. After the pandemic everybody focused on the production of e-bikes which caused this huge inventory situation, particularly of e-MTBs. That was not the case with regular bicycles.