As one of the few businesses, the time of covid was kind to bicycles, because even during the restrictions in many countries it was possible to go on trips – of course alone – on trips. However, the subsequent period of rapid inflation, in which people began to save, also crossed the plans of manufacturers and sellers. Hoping for continued interest in bicycles after the main waves of covid have ended, they bought a large amount of stock – and now they do not know what to do with them and are counting losses, The Wall Street Journal wrote.
ElliptiGo bike company CEO Bryan Pate didn’t have enough of his outdoor bikes to sell when demand soared in 2020. Today, the warehouse in San Diego is crammed with too many bikes that few people want.
We were like surfers who didn’t catch a wave, said Bryan Pate, CEO of cycling company ElliptiGo.
The price of their bikes starts at around 1500 dollars (about 36 thousand crowns). “It’s an all-out battle to get even for the next 18 months,” he said The Wall Street Journal.
Rivers are evaporating due to climate change. The river pillars of European trade are collapsing
This year’s hot summer, with temperature records across Europe, has caused the major European rivers to dry up drastically, making them impassable for ship freight transport. Thus, one of the basic pillars of European trade is collapsing and, for example, in France, it complicates the cooling of the nuclear power plants there. The damage caused by the low water level will reach billions of euros, Bloomberg wrote.
Many retailers who had too little to offer in the early stages of the pandemic now have too much of everything – from bikes and furniture to clothing and grills. They stockpiled additional inventory as they anticipated continued demand and supply chain issues. They did not expect that customers would shift their spending to concerts, restaurants and travel, and then that rising inflation – which was in June the highest in the US since 1981 – erodes household budgets.
Walmart and others are also troubled by large inventories
The resulting backlog of unsold goods has prompted many large national chains such as Walmart a Targetto focus on reducing inventory of goods this year with the caveat that their profits would suffer. At the end of July, Walmart announced a cut in this year’s profit of up to 13 percent, after which the chain’s shares fell by almost eight percent. The owners of the network, the richest family in the world, the Waltons, came in no time by 11.4 billion dollars.
People save, Walmart lowers outlook. The world’s richest family lost billions of dollars in a single day
After the largest US retail chain Walmart reported on Tuesday a reduction in this year’s profit of up to 13 percent, the chain’s shares fell by almost eight percent. The owners of the network, the richest family in the world, the Waltons, thus lost 11.4 billion dollars in a moment. And they are not the only affected chain owners, reported Bloomberg.
And they are not the only affected chain owners, Bloomberg reported at the time. Luxury furniture retailer RH and grill maker Weber were also hit by flaring demand for their wares, and retailers lowered their sales estimates at the start of the summer. Mattress maker Sleep Number has also started offering more promotions this year after sales slowed.
The same problems are raging now by the cycling industry, which saw a sharp increase in demand during 2020when consumers confined to their homes sought exercise or an escape from isolation.
Coca-Cola and McDonald’s report a decrease in profit by tens of percent. Also because of leaving Russia
Food giants McDonald’s and Coca-Cola announced better-than-expected results for the second quarter, but both companies struggled with a decline in profit, by tens of percent. Reason? Inflation and cost growth, in which especially McDonald’s accounted for 1.2 billion dollars due to its departure from the Russian market.
American stationary bike manufacturer Peloton Interactive, which believed demand would remain elevated for years, spent hundreds of millions to move bike manufacturing back to the US, to avoid shipping problems from overseas. But when consumers came out of isolation and quarantine, they lost interest in high-end bikes. AND A peloton with a lot of unsold bikes left, canceled his production plans.
Sales of the entire bicycle market fell
Sales are cooling even in smaller cycling businesses. Sales at bicycle retailers in the US thus overall fell by seven percent from January to June compared to last yearaccording to market research group NPD, compared to a 46 percent jump in the same period in 2020.
Gasoline prices in the US are the same as in March. In the Czech Republic, it was significantly cheaper
Gasoline prices in the United States fell below four dollars per gallon (about 24.89 crowns per liter) and fell to the lowest level since March. That means relief for Americans struggling with skyrocketing prices for everything from groceries to rent, leaving the country with inflation at one of its highest levels since the early 1980s, The New York Times reported. In the Czech Republic, the price of gasoline has now decreased by almost nine percent compared to March.
At Bike Habitat in New York, in the early stages of the pandemic, lines formed for whatever was available that day, said business owner Charlie McCorkell. He now has roughly 2,000 bikes in stock, more than double what he would prefer. And some customers are willing to leave, for example, just because of the color of the bike.
We have a hundred black ones and no red ones, said Bike Habitat owner Charlie McCorkell. And customers only want the red ones.
„I expect 2022 sales to be lower than 2019“, he added.
Some bike dealers have gone so far as to they exchanged products with each other in an attempt to equalize the supply between stores, said Heather Mason, president of the National Bike Dealers Association, a trade group of specialty bicycle dealers. “We’re seeing a decline in interest and we really want to reverse that as best we can,” she added.
Inflation affects love life in the US. Tensions rise over who should foot the bill
The price increase, which is the highest in the United States in 40 years, is also reflected in the behavior of users of online dating sites. They are now much more interested in the income of their potential partners, writes the Bloomberg agency.
ElliptiGo, which has been on the market for 14 years, found itself in its current position due to decisions made already in 2020. Skyrocketing demand in the first months of the pandemic convinced Pateo’s boss to increase the number of bikes he ordered from manufacturers in Asia by a third. Faced with warnings that lead times were lengthening for components manufacturers needed to assemble the company’s branded bikes, he placed similarly large orders for 2021 and 2022 in mid-2020, much earlier than he normally would have done. It even had to buy a small number of components for delivery in 2023 and 2024.
The decisions were made a long time ago under very different circumstances, says ElliptiGo boss Bryan Pate. But the world is not what it was back then, he added.
The blessing he planned for did not come. By his own admission, Pate watched customers flock to competitors while his bikes either sat unfinished or were stuck in Taiwan due to supply chain issues. “And now that I have enough rounds, I expect that ElliptiGO sales in 2022 will be below 2019 levels,” Pate said. “We paddled, we got a little momentum, but then the wave passed us,” he said. “We never surfed. And the reason we didn’t surf is because we didn’t have a product,” he noted.
All about inflation
Inflation scarecrow. What causes it? How to defend against her? How to invest, where to save savings, where there are decent interest rates, which bonds are worth it? How do the state, the government and the CNB fight inflation? Who and why increases the price and how much? How to cope with price increases? Is it the right time to get a mortgage, will interest rates rise or fall, and for what reason? Context, tips, advice, warnings.
High inflation troubles not only the Czechia, but also other European countries and the United States. See the overview in the world.
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