Category: Europe

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USA Bike Brand Closures 2024

115 Brands left the US market with 60% closing, 30% going back to Europe and the rest ceasing bicycle sales

It is no secret that the bicycle industry struggled globally in 2024. The US market saw significant financial turbulence with brands entering liquidation, bankruptcy, and restructuring. Earlier this year, I reported on the number of brands closing exceeding 2023. At the time, 25 brands had closed or left the US market. With continued headwinds, this figure greatly increased.

115 bicycle brands have left the US market in 2024

This dramatic increase in closures represents a greater than 4 times the volume of closures in 2023. In late 2023, brands tried to free up inventory space and reduce overhead by aggressive discounting. Much of this discounting was at a loss, with the hope that a return to form in 2024 could heal the wounds. Unfortunately, many smaller brands did not have robust financials, leading to more vulnerability. That is where the large number of closures come in. Many large organizations can restructure, but the options for smaller brands with less recognizable IP are much more limited.

As you can see from the chart above, the majority of these brands closed their doors entirely, while a smaller portion simply stopped selling bicycles. Nearly one third of brands that left continued on after abandoning the US market, retreating mostly to Europe. The European continent is not safe from the economic woes of recent years, so this represents more of a simplifying of their businesses by returning to home countries. In 2023, there were only a couple of brands leaving the US market for Europe, as US ebike growth appeared to be continuing strong.

Brand Channel Distribution

After the exodus of brands from the US, 889 brands remain selling brands in the country with landed inventory in the US. Of these, the distribution strategies remain fairly stable, with Direct to Consumer (DTC) being the most common available option due to the low barriers to entry.

There has been a slow progression of DTC brands trying to gain a foothold into IBD and ROM channels in order to further their distribution. This channel shifting will become evident as more details emerge from the People for Bikes DTC project launching to members early in 2025.

What is in store for 2025?

Looking ahead to 2025, it is hard to miss all of the headwinds for the US bicycle market. Brands who focus on core financials and cash flow management will fare better than those who overextend themselves. Some of the major uncertainties are:

  • Potential Tariffs further increasing prices
  • Heavy 2023-2024 discounting depleting available demand
  • Long term bicycle sales declines
  • Strained personal finances of consumers

With all this said, it is likely that 2024 represented a peak of brand closures. 2025 may still exceed 2023, but I expect it to fall well short of the 115 brand exodus we saw in 2024. There are some early signs of life with used bike prices beginning to recover, and unit inventories reaching normal levels. If brands can digest more of their high dollar inventory, they will be in a better position as the market turns.

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What is a bike shop anyway?

One area of the bicycle industry that has remained quietly murky is how many bike shops there are in the United States. This seems simple enough to do. I can write some bots to pull retailer lists from brand websites and aggregate them together. But here is when we start running into the edge cases. 

  1. What if they are a service only shop? 
  1. Or a non-profit dealing with training? Is that still a bike shop? 
  1. Why are there random other businesses on these dealer lists? Auto and moto dealerships; general stores; snow sports, etc. 

We start to run into probabilities, and edge cases more than we would like. What we can do is augment this collection approach with a consumer centric one. Here, we ask the question, “where could I purchase, rent, or repair a bicycle?”. Then the breadth of possibilities opens. 

This article will be an initial attempt to unify the language of the bicycle industry around the types of businesses that consumers interact with to define the broader bicycle market. Below is a flow diagram detailing how to define each type of bicycle business. Below that we will analyze how many locations there are in the US and Canada fitting into these classifications. 

How many shops are there?

There is a lot in flux as to the count of retail locations. Nonetheless, the following is the result of our initial categorization efforts for the entire list of retail locations. Depending on your perspective on the industry, you might be surprised about the size of mass market, or the size of traditional bike shops.

Nonetheless, it is clear that consumers view both styles of purchasing equally when it comes to bicycle purchases. Looking at rest of market data from Circana, it seems that children’s bikes are much stronger in these mass market locations, due to their much lower prices.

Within the Bike Shop category, traditional independent bike stores dominate the location share. Although there was a sizable amount of acquisition of retail locations by brands before and during the pandemic, they still only account for a small share of total locations.

The big difference with Canada is an increase in outdoor retailers. This makes sense as we move to higher latitudes, there is a shorter cycling season and more need to blend categories.

Making the point more dramatically is Norway, where two thirds of retail locations are Multi-Sport. You can see my recent blog post about estimating the size of the Norwegian market here.

A bonus for you nerds who read to the bottom: did you notice how the roughly 18,000 locations is roughly the square root of the ~330 million Americans in the US?