New business funding -cycle shop

[d8mok]

Hoping for a pointer in the right direction to see if my idea is going to be viable.

Firstly my apologies from my lack of knowledge regarding business. I’ve been PAYE for my whole working life so this is completely out of my normal scope.

I’m currently employed (furloughed) but soon to return to a job which I’ve grown to dislike. Over the years I’ve thought many times about opening a small cycle shop and silly as it sounds it feels like this could be a good time to try to make it a reality. Plan is simply repairs and parts not to sell complete bikes unless that ends up happening later.

I’ve been around bikes for 25 years and even though I can do any job to a shop standard I plan to get the relevant qualification for peace of mind , and cheaper insurance.

I’ve got a good idea regarding what start up costs I can expect. Such as tooling, insurance , training, stock, and an idea of what a suitable place would cost to rent.

I would like to keep the business separate from my own finances and personal liability.

I’ve been told before that government grants may be available but google doesn’t really give a proper answer. Is there such a thing?

Alternatively am I better using my own savings to fund or a loan?

Thanks in advance

[DSLiverpool]

Do you need a shop ? I doubt it.

Lots of incubator units around with easy in/out - remember you need easy access for drop offs.

[d8mok]

Good point regarding a shop. I will definitely need parking , and felt a small shop would look more professional. I’ve actually got my eye on a small place which would be ideal as it’s outside town centre but easily accessible.

I’ve actually got a large garage at home (fits 5 cars) which is another option. However I feel I want to keep it separate to my home life.

[ReverendCounter]

What about offering to pick the bike up from your customers - you could maybe work from a home workshop/shed before you commit to the premises route - unless it's a not-to-be-missed opportunity.

[ReverendCounter]

By the way did you look at these? https://www.gov.uk/apply-start-up-loan

[The Moose]

d8mok said:

Good point regarding a shop. I will definitely need parking , and felt a small shop would look more professional. I’ve actually got my eye on a small place which would be ideal as it’s outside town centre but easily accessible.

Don't put the cart before the horse! It's so easy to sign up to many monthly commitments that you "need" that end up drowning your business.

d8mok said:

I’ve actually got a large garage at home (fits 5 cars) which is another option. However I feel I want to keep it separate to my home life.

I like the idea of a parts/repairs only shop - the great thing is that I would guess that you don't need much space to store all your tools/parts to make the repairs.

Would it be possible to actually work out of a van at your customers' house/work? How much petrol/diesel for the van would it take to pay for the rent/rates/electric/water/broadband/insurance etc for the shop...and do you think you'd do those miles driving around to customers and either fixing the issue there or bringing the bike back to your shop?

If there's a super popular biking place near where you plan to work, you could always hang out there at the weekends in your stickered up van offering on the spot repairs, gloves if it's cold, wet weather gear if it's raining etc.

With a simple Facebook page, website and Google Maps listing, you'd probably be good to go.

Don't forget that there's probably great money to be made in buying old bikes off people and selling them on.

[The Moose]

ReverendCounter said:

By the way did you look at these? https://www.gov.uk/apply-start-up-loan

Don't do this. Cashflow it all!

[d8mok]

Thanks for replies guys. Really helpful.

To answer a few points ...

I did look at start up loans but I’m not wanting to start in debt really. If it was “free” money to help me get started that would be different. I have got some savings but ideallly not wanting to use those if I can help it. I may try to save like mad this year and open something from home later on once I’ve got some extra cash.

My other issue is that I’ll be walking away from a company car so will need a car/van.


Yes I did think about working solely from home as I have a workshop and good space. My worry is people knowing where I live. The collection/drop off idea is one I’d considered but wasn’t sure if people would be trusting to someone to turn up and take their bike away without knowing where.

A local guy has a home based repair shop and is always booked up 4-6 weeks in advance.

In terms of buying old bikes etc - Yes i do this anyway quite a bit. Either stripping for parts or recycling the bike. This would continue.

[nyt]

Is your shop on a route that sees lots of passing cycle traffic?
Is there public transport?
I'd imagine that cyclists might like to drop off their bike on the way to work, catch a bus to work and then pick up the bike on the way home.


In the trendier parts of london, the cycle repair shops with a dew seats/benches and a someone selling coffee and cakes seem to do well.

[Mazinbrum]

There are two bike mechanics in my area and both work from home. One has a van and also does mobile repairs, I would have thought a shop would be too big an overhead.

[JeffreyD]

The only thing I would add is definitely take a bit of paid advice of you do choose to take a lease on a shop or unit.

It's a different kettle of fish than a personal rental lease

And no matter what the advice says don't sign a personal guarantee!!!

[The Moose]

d8mok said:

The collection/drop off idea is one I’d considered but wasn’t sure if people would be trusting to someone to turn up and take their bike away without knowing where.

People will find out where you live if they really want to!

How about having a small fleet of loaner bikes that you could drop off when you pick up? Probably wouldn't add that much additional cost? You could then collect and drop off from peoples' work places and they wouldn't be without transport?

[d8mok]

The Moose said:

People will find out where you live if they really want to!

How about having a small fleet of loaner bikes that you could drop off when you pick up? Probably wouldn't add that much additional cost? You could then collect and drop off from peoples' work places and they wouldn't be without transport?

Yeh that could be a idea. I’m sure some people will use them to commute.

My target market is probably more hobby cyclist as I’m based near the Peak District and we have a good cycling community here. It seems that many people have got into cycling fairly recently but can’t do the simplest of tasks but also want a quick turnaround.

I have most tools needed currently but not sure they are shop quality tools so that would need to be one of the first investments. Along with cytech which is the training standard which most people recognise.

[d8mok]

Mazinbrum said:

There are two bike mechanics in my area and both work from home. One has a van and also does mobile repairs, I would have thought a shop would be too big an overhead.

You may be correct. I’m not entirely sure how much money extra having a shop would generate. It’s more for the reason of keeping home safe.

[d8mok]

JeffreyD said:

The only thing I would add is definitely take a bit of paid advice of you do choose to take a lease on a shop or unit.

It's a different kettle of fish than a personal rental lease

And no matter what the advice says don't sign a personal guarantee!!!

Thank you. Just the kind of stuff I need.


I’ve talked through this idea with a couple of friends who think it’s a great idea but also have no business knowledge like myself so it’s good to hear these kind of comments.


Part of me is thinking maybe I could build the website (I can do this fairly cheaply) buy some of needed tools I don’t have , and could even start in addition to normal work. I’d need to check out insurance though if doing it from home as I don’t want to get sued.

[JeffreyD]

d8mok said:

Thank you. Just the kind of stuff I need.


I’ve talked through this idea with a couple of friends who think it’s a great idea but also have no business knowledge like myself so it’s good to hear these kind of comments.


Part of me is thinking maybe I could build the website (I can do this fairly cheaply) buy some of needed tools I don’t have , and could even start in addition to normal work. I’d need to check out insurance though if doing it from home as I don’t want to get sued.

As others have said l, there's a local guy near me who works from home and offers collection and delivery in his van. He's always busy and booked up in advance.

You only really need a decent shed.

Insurance will be really low.

[Simpo Two]

A new business, one you haven't done before, straight from PAYE-land... the first thing, other than market research, is to keep overheads to an absolute minimum until you get it off the ground and figure out how the controls work. Monthly rent £1,000, Monthly income £500, crash and burn.

Can you do it from home? Then if you take £500 you're £500 better off, not £500 in debt.

ETA Just read all the replies and see it's been covered, but the point is made

[d8mok]

Simpo Two said:

A new business, one you haven't done before, straight from PAYE-land... the first thing, other than market research, is to keep overheads to an absolute minimum until you get it off the ground and figure out how the controls work. Monthly rent £1,000, Monthly income £500, crash and burn.

Can you do it from home? Then if you take £500 you're £500 better off, not £500 in debt.

ETA Just read all the replies and see it's been covered, but the point is made

Yes totally agree. All things I need to hear. It’s a huge step as I would be leaving a fairly well paid job with company car to basically mess around with bikes and pray it makes money.

We have 2 local shops and 1 mechanic who repairs from home. All are always booked ages in advance with long wait times. This is one of the main issues people moan about as nobody wants to wait weeks for a repair.

1 is a large store which is more interested in selling new bikes and doing repairs.

1 is a small shop which is mostly repairs and does sell a few bikes but I own more myself that he has on display

And the mobile/ home guy who just repairs.

I’m friendly for the last 25 years with the big shop and even though I like them I wouldn’t trust to do anything on my bikes.

The small shop is ok but hardly ever open as he does 4 half days. He’s usually 4-6 weeks booked up.

The mobile guy knows someone I know and he seems busy for week in advance but I also don’t think he works full days and often only does a few quick jobs and the goes riding.

Oh and we have Halfords too

[d8mok]

JeffreyD said:

As others have said l, there's a local guy near me who works from home and offers collection and delivery in his van. He's always busy and booked up in advance.

You only really need a decent shed.

Insurance will be really low.

Nowhere for a shed currently but have a big garage. Im still struggling with the idea of doing it from home though for security and also a work/life balance. I’ll give it more thought though.

[skilly1]

Can't you start up the website and put the word out locally and see how it goes. Work on bikes in the evening, weekends. If it takes off leave job, if not you have lost nothing.
Seems very risky to leave job to start a unknown business, far better to test the water.