Much like the the uneasy narrator of Edgar Allen Poe’s The Raven, the owner(s) of your local bike shop (LBS) may have an uneasy sense of impending doom.  Here are some of the current issues that keep them up at night:

• The global economy — And more specifically, the fluctuations in the exchange rates.  Yes, even the friendly sales gal in the bike shop is an unwilling participant in the complex web of global finances.
• The local economy — Purse strings tighten like the Hangman’s noose.
• The credit crunch – Your LBS is most likely in the treacherous (and almost inescapable) retail money cycle:

1. Borrow on credit for merchandise. After all, who would shop at an empty store?
2. Sell merchandise piece-by-piece at a profit. And the sooner the better since the notion of “this year’s model” ensures that some of the merchandise will be discounted.
3. Sell enough merchandise to pay the creditor. Easier said than done; one bad week/month/season/year or unexpected expense can upset the apple cart.
4. Rinse, repeat. But if there is a hitch in the cycle, somebody is going to say, “Jenga!” (although not as cheerfully as a small child).

• Online discount retailers — When the consumer’s end product is the same regardless of venue, then price is king … and eBay is the current king of kings.  A brick-and-mortar store’s best (and possibly only) defense is to provide both virtual and face-to-face business.
• The move to “franchise” bike shops — Trek started a trend (with Specialized and Giant following their lead) to provide a brand oriented store.  This is a a tactical marketing move to encourage brand loyalty, rather than identifying with a sense of place.  Your LBS might become like milk … homogenized.
• Taxation without representation — Conventional wisdom says that the small retailer has little or no influence over the product design, options, or choices made by their suppliers.  Basically, you sell what you can get.

So … considering this abbreviated list of externalities, what can the LBS do?

• Nothing … it is the natural evolution of capitalism and consumerism – The small fish eventually gets eaten by the big fish.  The LBS will follow the local sports store, local pharmacy, local pet store, local (insert hobby here) into relative obscurity.
• Move towards specialty products and services – Cater to a local demographic or niche within the Red Ocean of bicycle consumers … recumbents, fixie hipsters, retro-grouches, commuters, guys that wear tweed, etc.  If you haven’t already guessed, this is the approach of Renaissance Bicycles.
• Align with “lifestyle” retailers –Tap into the Blue Ocean of consumers.  Approach the potential customer via another vice … like leather or perfume.  However, previous parallels industries indicate this will probably be more fad than habit forming.
• Provide superior service  – Well … this is partly a trick answer.  Larger retailers can provide more employment compensation and incentives.  They often have the means to attract more qualified and/or experienced staff.  But as many LBS patrons know, that doesn’t mean the LBS can’t be the best.
• Reject the traditional retail model — 60 pairs of cycling shoes, even the Sasquatch sizes?  “The run” of frame sizes for a particular bike?  Forget the “stock every item” mentality and mimic the Apple Retail Store … have a dozen or more demo bikes for the customers to simply enjoy.  After all, this is a recreation industry.
• Go out and ride as much as possible – A simple but effective tool.  This creates a context between purveyor and consumer, and it also reinforces the basic human need for belonging and mutual respect.  At the heart of it is whole reason people own bike shops … they just like riding bikes.

The moral to this rant is the traditional LBS needs to change.  If it simply continues to conduct business as if carbon fiber bikes are the wave of the future, it is probably too late.  Fortunately, most LBS owners see the writing on the wall.  Rather than thinking the old agricultural idiom, “get big or get out“, they think “get creative or get out”.

While our current economic times will undoubtably become The Grim Reaper of some struggling bike businesses, it will hopefully provide the extrinsic motivation to re-think the traditional model of the LBS by all interested parties.  As noted time and again, innovation is the real key to capitalism.  Who knows, it might even provide a true renaissance of the bicycle as part of our American landscape.