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Profits down at Halfords after "disappointing" cycling performance

Firm has previously blamed poor summer weather for drop in sales

First-half pre-tax profit has fallen by almost six per cent at Halfords with the firm blaming ‘disappointing’ cycling performance in the second quarter for the drop. Insider Media reports that the company posted profit before tax of £46.4m for the six months up to October 2, 2015 against £49.4m for the same period the previous year despite an increase in revenue of 1.8 per cent.

Chief executive, Jill McDonald, said that while the motoring side of the business performed well and in-store service sales grew strongly, cycling performance in the second quarter was disappointing. “Given the seasonal mix towards cycling during the summer, this contributed to the decline in group profitability for the period."

The firm had previously reported decreased trading for the eight-week period from July 4, 2015 to August 28 2015, blaming poor weather and increased discounting on major brands for an 11 per cent drop compared to the same period the year before.

McDonald says the company is to launch a new strategy, called Moving up a Gear.

"Under the new strategy we will continue to invest to move from fixing the basics to enabling sustainable growth. There are a number of significant opportunities for further improvement, which include the leveraging of customer data and analytics, relentless innovation, a better shopping experience, enhanced customer service and services, and a fulfilment infrastructure for modern times.”

Earlier this week, Halfords announced that it was to launch a Sir Bradley Wiggins kids’ bike range ahead of the Rio Olympics. The new bikes will be launched in July 2016, a month before the Games.

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10 comments

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IanW1968 | 8 years ago
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The frontline staff are easy to criticise but they just reflect what is obviously an attrosiosly run business.

Let's face it if you've managed to have the biggest bicycle sales operation in the UK and not take advantage of the recent cycling revolution you quite clearly don't know wtf your doing. 

I was in there today and their clearance bins were full of gloves marked as sale in biro @£35 which were on the shelf as new stock @£31.50! 

A short term dip is no big deal, but this business is a classic underperformer long term due to poor management.  

 

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Batchy | 8 years ago
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What poor weather ? This last summer has been the best for  cycling in years. I know these things as I have been a keen cyclist for over 25 years . I live in the Lake District I know about bad weather . Halfords talk rubbish and maybe they sell rubbish they need to get real !

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balmybaldwin | 8 years ago
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It's really very simple. Halfords staff are not trained or caring enough to sell bikes. I'm sure there are a few frustrated gems in the mix, but generally bored, rude staff with no knowledge about the goods they sell or what their customers want. There's a good reason that anyone I know that has bought a Boardman or another good quality bike from halfords has insisted that it is left in the box for home assembly.

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clayfit | 8 years ago
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and training.  In the Halfords in Whetstone, I cringed while the 16 year old sales assistant told a potential purchaser that "I don't really like these narrow tyres on racing bikes, I always think they'll burst, they're so narrow.  I don't like them".  Yep, that's how to sell a bike.

Get people who know the product selling the product!  And they in turn will be better able to feed back information to the product managers about which products to stock and how to price them.

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mike the bike replied to clayfit | 8 years ago
3 likes

clayfit wrote:

...... Yep, that's how to sell a bike. ......

 

I turned up in Halfords dressed in my old Lycra gear, stained with road grime and looking  (a bit) like a whippet-thin, seasoned commuter with a history of racing.  I told the seventeen-year-old in charge of cycling that I wanted a simple, medium-sized hybrid for my wife to ride exclusively on the road, preferably by Boardman.  I wanted to pay today and collect tomorrow.

He directed me to the Carrera full-sussers saying my wife would love the bright yellow colour but I would have to wait a week for delivery of a medium.

I took a deep breath, nutted him squarely between the eyes and then beat him insensible with an own-brand track pump. ( It broke. )

Only one of these paragraphs is a work of fiction.

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Jacobi replied to mike the bike | 8 years ago
1 like

mike the bike wrote:

clayfit wrote:

...... Yep, that's how to sell a bike. ......

 

I turned up in Halfords dressed in my old Lycra gear, stained with road grime and looking  (a bit) like a whippet-thin, seasoned commuter with a history of racing.  I told the seventeen-year-old in charge of cycling that I wanted a simple, medium-sized hybrid for my wife to ride exclusively on the road, preferably by Boardman.  I wanted to pay today and collect tomorrow.

He directed me to the Carrera full-sussers saying my wife would love the bright yellow colour but I would have to wait a week for delivery of a medium.

I took a deep breath, nutted him squarely between the eyes and then beat him insensible with an own-brand track pump. ( It broke. )

Only one of these paragraphs is a work of fiction.

 

So he didn't really direct you to the Carrera full-sussers?  1

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dottigirl replied to mike the bike | 8 years ago
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mike the bike wrote:

...I took a deep breath, nutted him squarely between the eyes and then beat him insensible with an own-brand track pump. ( It broke. )

I bought two Park Tools track pumps* from them and they both had to be returned. Which I wouldn't expect from PT.

 

*birthday presents for each of my sisters. It means when I go to stay with them, I don't have to hit the nearest LBS every couple of days. Good thinking, huh?

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jollygoodvelo | 8 years ago
1 like

Oh, they're introducing a new brand?  And this one's named after a celebrity pro cyclist?  That's a new strategy.  Go on, tell us again you're going to open some new cycling-only stores and sell more clothing.  

I've got a Boardman and it's a good bike (though originally built by a numpty).  Carrera - at their "discount" price, no problem.  Voodoo - the Bizango got great reviews, fine.  

But let's look at the website.  Apollo.  Pendleton.  Raleigh.  Pinarello.  13.  Mongoose.  Ebco.  Dahon.  Viking.  Land Rover.  Whistle.  Falcon.  Pashley.  Townsend.  Claud Butler.  Tifosi.  Kona.  Cinelli.  And 30 others that you've never heard of.  What is your strategy, Halfords?  What are you trying to do?  For two years after the 13 bikes were launched they didn't stock them in store, even in 'main' Bikehut stores.  What's the point of having shops if you don't stock your stock?

Why should someone buy from you and not Decathlon, Evans, or a thousand others?  You don't seem to be able to tell us, so I can only assume that it's either a cynical "Cyclists like this stuff" move, or you're hoping that your sheer number of stores and brand visibility will mean enough money coming in.  Well, it didn't work for Woolworths and it won't work for you.

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CanAmSteve | 8 years ago
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They have occasional flash sales and on price-matched components, the prices can be good. But the in-store experience is just so bad. The staff try, but half the things you order for pickup never arrive, or are incorrect. I'm still waiting to be advised on an order made months ago - followed up with Customer Service... no reply. 

So things don't look good. More Stuck in the Mud than Moving up a Gear

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Must be Mad | 8 years ago
3 likes

I think the accusation that halfords bikes are "sh!t" is not completely fair.

Some of their bikes may well be sh!t, but the Boardman's and Carrera's are good quality bikes that will last.

In my view, Halfords are loosing money because there are other companies moving into the 'low cost/entry level' bike market, and they are managing to offer better deals with better service (Evens, Decathalon, Wiggle etc).  The market is changing and Halfords has been sleeping.

Oh and more honest pricing would be nice (Sell a £300 bike as a £300 bike, don't try to suggest that its a £600 at half price...)

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