Bike Case Description

Background:

BikeHeaven is a small retail store in Natick, MA specializing in high performance bicycle components and accessories.  Founded in 1983 by three former riders for the U.S. Cycling team, BikeHeaven sells mostly to road and mountain bike enthusiasts and triathletes.   It’s the classic “lifestyle” company – the three founders run the store mainly to pay the bills so they can continue to compete and have fun.  None of them are very tech-savvy, and until recently they didn’t even use a computer.  

Traditionally they have received most of their revenues from in-store sales, but in the past five years more and more customers have been calling the store to order components and receive them by mail.  In 2001 about 35% of their revenues came from mail-order.  Back in 1995 they got one of their friends to build and maintain a simple website with a price list and a phone number (in exchange for free bike tune-ups), and eventually customers began to call from all over the United States.

Though BikeHeaven’s product inventory and prices are reasonably competitive with the big mail-order companies (Performance Bike, Excel Sports, Specialized, etc.), the rise in phone orders is mainly due to their customer service.    Since all the employees at BikeHeaven are current or former professional cyclists, customers get extensive information and advice before and after purchase. In the confusing, constantly changing world of high-performance bike components, this level of service is extremely rare.

As a small retail store BikeHeaven ‘s business processes are very similar to any other bicycle retail store, however they consider following two processes critical for success in their business

Inventory Management and Order Processing

Compared to other bike component retailers, BikeHeaven is extremely “low-tech.”  They don’t have a computerized inventory control or order processing system – everything is still done by hand using a paper-based system that really hasn’t changed much since the store was opened in 1983.  In 2001 they finally bought a second-hand computer and learned to use Excel, but only figured out how to make simple lists (not track inventory).

Inventory and order processing at BikeHeaven is managed with three documents – the product catalog, the out-of-stock list, and the shipping charge list. 

The product catalog (originally done by hand but now on Microsoft Excel) is just a simple listing of product items and prices, organized by product category (wheels, brakes, frames, tires, clothing, etc.) or product name.  They update their product and price list every quarter, print out copies for the Natick store, and get their friend to post it to the website.