I spend a large portion of my bike riding on my bikeE recumbent bicycle. I get a lot of compliments and statements from people stating that they would enjoy riding a recumbent bicycle and wish they had one. This has gotten me wondering if it is possible to build a business around building and selling recumbent bike frames. I have spoken with framebuilders out there who build and sell upright bicycles, but few I have spoken too have said they tried to build anything recumbent. Is this because building recumbents has been tried and proven as non profitable? I am aware that bikeE no longer exists as a business, was this because people were not interested in recumbent or alternative style bikes? It also seems that a fellow by the name of velodreamer does build recumbents, but does not live in the U.S. Anyway, any input is appreciated.
I am a recent engineering graduate in New Zealand and have grown to appreciate recumbents through starting up a HPV landspeed racing project (UCHP). Though this I have been able to meet local recumbent riders and experience and variety of recumbents (largely bikes) and I believe they are an underdeveloped area of the cycling industry which I am personally trying to navigate.
They have survived as a niche, M5 recumbents have been producing a complete range of good recumbents since 1983. So I would say that no one has proved recumbents to be profitable and there isnât much of a real benefit for the upright bike market. This article explains what happened with BikeE Bicycle Man.
The biggest challenge I have found is perception. People find them different/strange and tend to stay away, or as you say, people are fascinated and wish they had one. The common understanding people have of recumbents is they are âdifferentâ bicycles and get combined with the variety of special bikes largely used by people with health issues and the benefits of recumbents for typical people are over looked (comfort and efficiency).
I think that building and selling recumbent bicycle frames is quite conceivable, as it is rather similar to custom upright bicycle frame building, where one is building bicycles for a defined niche and typically premium market, and just selling frame reduces other overheads (having a stock of parts) and leaving much of the building up the bike the customer (as many people I have spoken to who seriously want a recumbent, want to make it themselves but are limited by ability to build the frame, but would easily be able to build up a frameset).
Currently the supply of recumbent bikes is limited to primarily small scale or one-off production, which results in a cost barrier for most people. (Note that the global tricycle recumbent market has apparently been growing in recent yearsâŚ). I believe for change in the recumbent bicycle market is the production of models that appeal to the mass market in the current age of âmicro-mobilityâ and having high quality compelling marketing (rather than the typical engineering/technical heavy promotion).
There is a tendency for equal profit margins in every industry. That is because if it was easy to be profitable in one industry more than in others people would flock into that profitable industry and drive down profitability there by taking market share from the incumbents by operating at lower profit margins. The factors that alter this are: (a) capital: the more capital (machines etc) is required to run a business the higher the profitability because capital is hard to come by and there is a risk of loosing it if the business fails, (b) monopoly effects like network effects: it is harder to become a Facebook competitor than a Specialized competitor so Facebook is more profitable than Specialized (I guess), (c) risk: the higher the risk of running a business in an industry for example because that industry experiences a lot of boom and busts or the success of businesses in that industry depends on other external unpredictable risk factors (environmental, risks associated with unstable governments (e.g. in war ridden countries)) the higher is the average return (as a compensation for this risk), (d) peopleâs willingness to accept lower profit margins because that industry is the only one they know (e.g. starting a restaurant business) or because they have a passion for the industry/product (making art, bicycle building).
Maybe I forgot something
Recumbent bicycle builders arenât different from upright bicycle builders in the aspects listed above except maybe (c) because itâs a smaller market which comes with the risk of more fluctuating demand. So in principle profitability in the recumbent industry and in the upward bicycle industry should be similar.
There are of course other non systematic factors like whether there is a local under or over supply of recumbent manufacturers in your area or whether the industry currently experiences demand growth or decline etc.
