24 BMU 2009 Spring www.biketaiwan.com
Bike Show Excitement The Brno Int'l Sports Fair The Czech Republic and Slovakia have attracted much foreign investment since they joined the EU on May 1, 2004, and their overall economic development and bicycle exports have flourished. Most bicycle manufacturers here export half of their output, and sell the remaining half on the domestic market. Many manufacturers have their own brand names, but some specialize in OEM sales. The bike markets in the two countries are promising, and the much-improved Brno show has become Eastern Europe's largest dedicated bike exhibition. Text & Photos: Grace S. Ruan A bustling atmosphere prevailed Veletrhy Brno is the Czech Republic's largest trade show at the Brno show. venue, and contains 19 exhibition halls. The cycling activity outside the show had a retro appeal. Recession and economic downturn has engulfed the world following the outbreak of the global financial and economic crisis last year, and consumers are increasingly reluctant to loosen their purse strings. In spite of this bleak outlook, however, the 8th Int l Sports Fair in Brno, from November 6-8 2008 was a vibrant scene. The fact that since December 21, 2007, anyone holding a European Schengen Visa can freely enter the Czech Republic and Slovakia for tourism or business activities has helped make the Brno show a rousing success. The bicycle markets in the Czech Republic and Slovakia have grown by an average of 10% annually during the last few years. As for national economic growth, Slovakia has enjoyed somewhat better growth than the Czech Republic. According to Mr. Jaro Stefanik, Merida s agent in Slovakia, Slovakia s economy grew by 10% in 2007, while the Czech economy grew by only 7%; Slovakia is projected to have 8.6% economic growth in 2008, while the Czech Republic is expected to have 5%. As for 2009, Stefanik expects the two countries to achieve roughly 5% growth. Salaries have increased by approximately 10% annually. While Slovakia s per capita salaries and consumption levels have lagged behind those of the Czech Republic by around 25% in the past, this differential has fallen to around 20%. Banks in Slovakia and the Czech Republic www.biketaiwan.com 2009 Spring BMU 25
Apache President Vladimir Mika stated that the Czech Republic has over 300 dealers. guarantee deposits up to a certain limit (approximately 45,000). Slovakia expects to begin using the euro in 2009, while the Czech Republic plans to adopt it in 2012. The Czech Republic produced approximately 450,000 bikes in 2008, of which 50% were exported to the European Union, Eastern European countries such as Poland, and northern Europe. While most Czech bike firms serve the OEM market, some sell bicycles in the Czech Republic and Slovakia under their own brand names. Slovakia produced roughly 230,000 bikes during the year, of which many were exported to the European Union and Czech Republic. Because the bicycle market has grown steadily over the last few years, there have been many new entrants in the Slovak bicycle industry, which led to inventory problems in 2008. Many companies have stated that inventories have fallen, and forecasts for 2009 remain fairly conservative. Although the Czech Republic is an Eastern European country, the level of consumption is not far behind that in the rest of the EU. For instance, the retail prices of MTBs average 300-350. Most bikes sold in the Czech Republic are Cross Bike, Trekking, and MTB models. Not many racing bikes are sold, but there has been a significant increase in the number of children s bikes. Apart from the continued popularity of last year s white, many red, blue, gray, and black bikes have also been sold. The Czech Republic does not produce many bicycle parts. Apart from Remerx rims, Tufo and Rubena tires are also produced domestically. Tufo chiefly specializes in tubeless tires aimed at the high-end racing bike market and exported to Asia and the US. Ruben a m o s t l y p r o - duces reasonablypriced tires aimed a t t h e E a s t e r n European market. Pell s, Duratec, Fort, Maxbike, and RB frames are made in the Czech Republic, as are Marex and Velogros spokes, and Kinex bottom b r a c k e t s. M o s t Czech bike makers import parts and components from Taiwan, China, and Vietnam, but some get their supplies from elsewhere in Europe. While many older consumers are loyal to local Czech and Slovak brands such as Favorit, and prosperous middle-aged people like Author, most young people prefer imported brands such as Merida, Scott, Specialized, Giant, KTM, Trek, and GT. Czech brands include Universe Agency (sold under the Author name; Author is the Czech Republic s biggest brand), Superior, 4 Ever, Pell s, Apache, Amulet, Acstar, Kastar, Favorit, Oplran, Dealer, and Sundance. Slovak brands include Kelly s, Dema, CTM, Kenzel, AMP, Istro Hga, and Belve. Apache's booth design features an Indian style. Tufo tires are chiefly aimed at racing bikes. 26 BMU 2009 Spring www.biketaiwan.com
Brno is the second-largest city in the Czech Republic, and is the leading city in South Moravia. With a population of more than 400,000, Brno has a good transportation system and a welldeveloped industrial base. Local sightseeing attractions include the stalactites of Moravsky Kras cave, St. Paul s Cathedral, and Špilberk castle. The spacious Veletrhy Brno Exhibition Hall contains 19 display rooms, and is the largest exhibition center in the Czech Republic. Brno Int l Sports Fair is the largest bicycle show in Eastern Europe, and is considered the best show in Europe apart from Eurobike. According to the organizers (Bike Brno, Caravaning Brno, Boat Brno), 458 vendors participated in 2008, the display area of 21,284 square meters was 3.9% larger than 2007, and the 42,000 visitors represented a nearly 10% increase compared with the previous year. There were approximately 2,000 foreign visitors at the show. While some participating vendors believed that there were fewer visitors in 2008 compared with 2007, they were still convinced that the 2008 show achieved even better results Duratec bikes are custom-made, and the frames are also individualized. The company's hand-made bikes are naturally quite costly. Kastar is an agent for many brands. President Karel Starek (right) put tremendous effort into recruiting exhibitors for the Brno show. Starek's wife is on the left, and his daughter is in the center. Aspire is an agent for GT, Schwinn, and Maxxis. GT has a fine reputation in the Czech Republic. The photo shows product manager Oskar Jancik. Ho Yuan-kuei, head of the Economic Section of the Taiwan Representative Office in the Czech Republic, Board of Foreign Trade, MOEA. than during the year before. The number of vendors from Taiwan increased by four compared with 2007. While only Wheel Giant took part in 2007, Sunny, Hsin Chuan, Gigantex, and Wellmart According to Katerina Rejechrtova, WTB's GM for Europe, the Brno show was more productive in 2008 than in 2007, and Iranian, Israeli, and African customers showed up in 2008. Schwalbe is the biggest brand in Europe. Shown here are Schwalbe's German sales manager Klaus Jurk (left) and Norbert Heller (right) of Helleragency. The Czech company Master is 80% owned by Panther of Germany; Master's annual output of 50,000 bikes is largely exported to Germany and other markets in Europe. Shown here is GM Brona Vseeyckova. Slovakia's Kenzel specializes in low-price bikes. Shown here are President Josef Kender (right) and his wife Monika Kenderova. also participated in 2008. In addition, numerous local agents of such Taiwanese firms as Giant, Merida, SR Suntour, Kenda, Sun Race, Cheng, Velo, Exustar, and KMC, were also at the show. www.biketaiwan.com 2009 Spring BMU 27
The trading company JMC is also a Felt distributor, and sells approximately 6,000 Felt bikes annually. BBB is JMC's parts and accessories brand. Bicycles account for 25% of JMC sales, and parts and components account for 75%. Shown here is GM Jaroslav Mikulicka. According to Klaus Grueter, sales manager for Belgium's Sapim, Sapim produces roughly 200 million spokes every year. Apart from Eastern Europe, Sapim also exports to the US, Germany, and Switzerland. Approximately 95% of its spokes are exported. Sapim established Asia Sapim in Taiwan in August 2008. Sunny wheel and Hsin Chuan both participated in the Brno Marwi Europe GM Martin K. Vogt (left) and show, and Goldhill President Gray T.L. Hung (left) made a special Eastern Europe Sales Manager Pavel Mzyk (right). trip to the show. Also shown are Sunny wheel President Tony Hsu (right) and Hsin Chuan President Hsi-Huang Hsu (center). Acstar was established in 1994. In Cyklo Svec is an importer, a brand the words of President Milan Manually, dealer, and an agent. Shown here is "Work is our passion, and we don t do it President Karel Svec. for the sake of money." Golden GM Yufeng Yang (right) stated that his company produced around 1.5 million bikes in 2008, of which 50% were sold in the EU. Czech agent Comp GM Richard Mraz is shown on the left. Tianjin CITIC has established a bike plant in the Czech Republic. It is still finding its way, and hopes to make a breakthrough in the near future. Shown here are Czech plant GM Chen Jian (center), Yu Yingjie (left), and Tianjin Xinhuajie GM Han Hong-wei. Azub-Bike has been Dahon's agent for three years. Shown here is Bc. Honza Galla of the marketing department. Roman Kratky (right) owns two bike shops in Olomouc. Although sales have grown at a rate of 15-20%, fewer BMX and Downhill bikes have been purchased. Also shown is Sunny wheel Sales Manager Vivian Hsu (left). Vedora imports parts from China. Shown here is Technical Director Stefan Vereb. Visitors find Gigantex's products to be very fascinating. Shown is GM Lee Shao-chiang (center). 28 BMU 2009 Spring www.biketaiwan.com
Fort frames are chiefly made from steel; Fort's main market is Eastern Europe. Although Trek enjoys good sales and a high-end image in Russia, it needs to work harder in the Czech Republic. Duratec makes personalized carbon fiber bikes. Sundance's carbon fiber bike. Continental is also striving to expand its market in the Czech Republic. Because e-bikes sell well in the Netherlands and Germany, a pavilion was set aside at the show for displaying and test riding e-bikes. Velamos' bikes mostly sell for low and mid-level prices. This dark gray retro single-speed bike displayed by Italy's Cinelli is clean and handsome. KCK also displayed Shimano products. www.biketaiwan.com 2009 Spring BMU 29
Azub Bike has been an agent for Dahon's folding bikes for three years. Its folding bikes are always priced around 350. Amulet is a brand company. Kross was yet another participant. Aspire is an agent for the GT, Schwinn, Mongoose, and Maxxis brands. Aspire was established in 1996, and became GT's agent in 2001. It has 21 employees. Apart from bikes, Aspire also sells exercise products. Scott sells about 3,000 bikes annually in the Czech Republic, and has 12 employees. Leader produces 50,000 bikes annually, and 35% are sold on the domestic market. Leader emphasized its children's bikes at the Brno show. The agents of Kenda, KMC, and Velo all attended the Brno show. Germany's Kettler was also at the show, where it emphasized its German production. 30 BMU 2009 Spring www.biketaiwan.com
Author President Martin J. Havlena was constantly meeting with customers at the show. Author GM Ondrej Havlena noted that the Czech bicycle market has remained relatively immune from the effects of the recession. Author is the Czech Republic's leading bicycle brand, and finds favor among middleaged consumers of solid economic means. Author (Univer se Agency) is the Czech Republic s leading brand, and chiefly imports bicycles from Taiwan and China. Asiana International is Author s agent. Author GM Ondrej Havlena stated that Author sold approximately 120,000-140,000 bicycles in 2008, of which around 50% were exported to Russia, Poland, the Ukraine, and the EU. Parts and accessories account for roughly 30% of Author s sales. As far as the global financial crisis is concerned, Havlena expressed that the Czech economy is still strong, and he remains confident about the future. Superior (Bike Fun) has three or four assembly lines and produces OEM bikes for seven companies, including local Czech firms and Dutch firms. According to General Manager Mark de Kwant, Superior produced 115,000 bikes in 2008, which was about the same as in 2007; of these, 70,000 were sold under the Superior brand. The company obtains its rims from Remerx and its spokes from Sapim in Belgium. Product manager Peter Lavicka explained that local spokes are not used because the Belgian prices are lower, and quality and delivery time are also better than for local products. Bike Fun established the new company STR in 2008; STR specializes in low-price bikes, while Superior focuses on higher-price products. Lavicka believes that Bike Fun s output in 2009 will be more-or-less the same as in 2008. Although 90% of 4-Ever s output is sold to other brands (in the Czech Republic and China), GM Radim Broz is Superior executive director Hein Hulzebos. Bike Fun (Superior) product manager Peter Lavicka (first on right). Bikes displayed by Superior. Bike Fun (Superior) GM Mark de Kwant. still a big believer in corporate image, and went out of his way to have a unique booth design at the show. Broz feels that a good image should be accompanied by good quality, a good brand, fine service, and decent profits, and 4-Ever therefore sells most of its bikes to IBD brands. 4-Ever produced 56,000-57,000 bicycles in 2008, but domestic sales only accounted for 5-10%. According to Broz, 4-Ever sells bikes www.biketaiwan.com 2009 Spring BMU 31
Merida's Czech (Slovak) agent GM Jaro Stefank (right). 4 Ever GM Radim Broz (left) and wife. 4 Ever product managers David Vrobel (left) and Adam Vagner (right). chiefly to establish brand recognition and polish its image, and he does not plan to increase sales of company-brand bikes. Instead, Broz believes that it is even more important to provide outstanding bikes and services that will help customers become more competitive. The company plans to build a new plant in June or July of 2009. Merida s agent: This company is located in Slovakia, but chiefly sells to the Czech Merida sold approximately 30,000 bikes in the Czech Republic during 2008. Republic. According to GM Jaro Stefanik, the company sold 30,000 bikes in 2008, up from 25,000 in 2007. Most Merida bikes sold were mid-/high-end models fetching prices of 900-1,000 for MTBs. The company is Merida s most successful agent in Eastern Europe apart from Russia. While noting that economic conditions in Czech Republic and Slovakia are currently still not bad, Stefanik indicated that sales will at best remain flat in 2009. Progress is an agent for many brands, including Giant. President Josef Prib has been the chairman of the Czech Bicycle Association for ten years; this association currently has 31 member firms. Prib is in the midst of preparing to provide market information to association members. With regard to providing bikes to Cycle World, Prib expressed that while it is difficult to judge its success since it is in its first year, Giant expects sales to grow by 20%. As for local buying habits, Prib noted that ordinary middle-aged persons tend to purchase Author bikes, older persons prefer Favorit, and the younger generation like Specialized, GT, Scott, and Trek. Progress has recently started selling children s bikes and e-bikes. President Libor Petavalsid Valsky of Pell s started out as a rider, and is personally involved A full suspension bike displayed by 4 Ever. Progress President Josef Prib has been the chairman of the Czech Bicycle Association for ten years. Progress is an agent for many brands, including Giant. 32 BMU 2009 Spring www.biketaiwan.com
Pell's President Libor Petavalsid Valsky. in product design. Valsky was formerly in the computer business (around 1991), and only became a bicycle distributor in 1999. He began selling whole bicycles and producing carbon fiber and aluminum frames in 2004. The company offers 90 kinds of hand-made frames, and its products fetch prices of as high as 8,000. According to Valsky, thanks to growing sales and collaboration with Merida and Specialized, Pell s has enjoyed annual growth of 30-35% over the last few years. Pell s produces approximately 9,000 bikes in Pell's introduced an Olympic competition bike. Pell's BMX won a design award. the Czech Republic on an OEM basis, and its BMX are assembled in Taiwan. All of its top-end competition bikes are made in-house. For instance, Pell s provided ten bikes for the 2008 Olympics. Valsky owns two companies, Pell s and Pell s Invest. Roughly 70% of bicycles are sold between February and July. August is the time when companies begin sales promotions to clear out their inventory, and new bikes are introduced in September. Apart from the domestic market, Pell s also exports bicycles to Poland, Hungary, Slovakia (roughly 15%), and Germany. Favorit is one of the Czech Republic s older brands, and has fifty years of history. Many people in the older generation once rode Favorit bicycles. Although Favorit had some financial problems in the past, it went back into production a few years ago. It specializes in mid-/lowend bikes. Favorit displayed its children s bikes and other whole bicycles at the show. Children s bikes account for approximately 20,000 of Favorit s annual output of close to 100,000 bikes. Sixty stores sell Favorit bikes, and the company has around 200 employees. KTM GM Josef Spie Berger. According the BPS GM Pavel Veselovsky, KTM acquired BPS in 2004. KTM purchased BPS in 2002. BPS is headed by General Manager Pavel Veselovsky, and chiefly serves the OE market. According to KTM GM Josef Spie Berger, BPS produced around 85,000-90,000 bikes mostly hybrids, city bikes, and MTBs in 2008, and the roughly 165,000 bikes sold by KTM in 2007 included 25,000 made by BPS. Berger is not very concerned Favorit produces 100,000 bikes annually, and is actively striving to shape a new image. www.biketaiwan.com 2009 Spring BMU 33
about the effects of Europe s financial crisis. KTM had already sold 165,000 bikes by the end of October 2008, which represented growth of roughly 10% by volume and 20% by value over the same period of the previous year. There had been significant growth in bikes costing around 2,500, noted Berger, but sales of very high-end bikes were down by 30-40%, and carbon fiber bike sales remained flat. Kelly s (MaMa) has a fine brand image in the Czech Republic and Slovakia, and exports bikes to Poland, Austria, Switzerland, Hungary, and the Ukraine. Kelly s produced about 72,000 bikes in 2008. Its largest plant is located in Slovakia, in the well-known hot springs resort town of Piestany. Taiwan UNI- Victor is a Kelly s shareholder (25%), and is also the company s purchasing agent in Taiwan and China. Kelly s booth designs at the Brno show have been highly memorable, and the booth s body-painting feature has attracted much attention. Unfortunately, the company did not participate in the 2008 show. Thanks to its participation in Germany s Eurobike show, Kelly s receives most new orders around the end of September, and therefore finds November to be too late. Dema: A c c o r d i n g t o export manager Ing. Radek Rangelov, since the Brno show s November date is too late, Dema attended the show chiefly to enhance its image and share views with customers, and not for the Apart from bikes, Slovakia's Dema also sells exercise equipment and infant products. Shown here are Ing Pavol Skrinar (left) of Dema's sports department and export manager Ing Radek Rangelov (right). Dema displayed FSA products. purpose of increasing sales. Dema has three departments producing exercise equipment, bicycles, and ski gear respectively, and also makes car seats and baby pacifiers (such as for Chickabiddy). Jan Kubicek is the company president, and Ray Gegus is the general manager of the bicycle department. Dema produced approximately 50,000 bikes in 2008, of which roughly half were exported and half sold on the domestic market. Most of the exported bikes were highprice models (including bikes exported to the Czech Republic), and bikes sold domestically were mostly low-price models. CTM: This Slovak bicycle plant is located not far from CTM is located in Slovakia, and is close to Kelly's. Shown here are President Lukac Miroslav (left) and Vrabel Kemil (right). Slovakia's CTM manufactures 20,000 bikes each year. Kelly s. According to President Lukac Miroslav, CTM manufactured around 20,000 bicycles in 2008, was established in 1994, and uses the CTM brand name. Slovakia is the company s main market (70%), but 30% of output is exported to the Czech Republic. Because consumers in Slovakia have weaker buying power than those in the Czech Republic, the company s ordinary bicycles commonly sell for around 150-200 in Slovakia, although some models sell for as much as 800. Prices have been climbing each year, said Miroslav. CTM s employees number around 20, and the plant has as few as ten workers in the wintertime. CTM s Taiwan agent is Amethy. Miroslav is of the opinion that the 2008 Brno show attracted fewer buyers than in the past. 34 BMU 2009 Spring www.biketaiwan.com
Kenzel's booth. Kenzel is another Slovak bicycle manufacturer, and focuses on low-price models. It was established in 1991, has painting equipment, and produced approximately 16,000 bicycles in 2008. The importer BP Lumen is also SR Suntour s distributor in the Czech Republic, and the two companies enjoy a collaborative relationship. According to Sales Manager Lukas Barta, BMX sales are surging in the Czech Republic. Established in 1991, BP has 20 employees, one bike shop, and 800 dealers. It displayed Rubena BMX tires at the Brno show, and plans to vigorously expand its overseas market in the future. Cycle World: Established in 2007, this chain store currently has four locations and mainly sells bicycles from Giant, Merida, and Pell s. Sales at Cycle World GM Marek Dolezal stated that two new stores will be added in 2009. This BMX frame from BP Lumen was designed by Kamil Feifer (left). Sales Manager Lukas Barta is on the right. the Prague store have been very good (nearly 2,500 bikes were sold in 2008). Sales totaled approximately 5,000 bikes in 2007, said GM Marek Dolezal, and the company looks forward to adding two new stores in 2009 as it gradually achieves its ultimate goal of having 30 stores (by 2015). The stores currently employ 26 persons, and retail prices are mostly around 12,000-20,000 Czech koruna. Dolezal also noted that bikes costing around 1,200 sell the best, and colors consist chiefly of white, gray, and black. Paul Lange is Shimano s distributor in the Czech Republic, Slovakia, Hungary, the Ukraine, Austria, Switzerland, and Germany. In order to gain a better understanding of Shimano, said Paul Lange President Paul Lange booth received lots of visitors. Paul Lange is Shimano's agent. President Bernhard Lange spent two years in Japan studying Shimano's methods. Paul Lange invited more than 300 guests to celebrate the 60th anniversary of the company. Bernhard Lange, he received marketing training in Japan during 1983-1984, and he also has a good grasp of Shimano s manufacturing operations. Paul Lange is therefore able to ship Shimano products to the EU within 48 hours, or no longer than three days at the slowest. President Lange is dedicated to providing the best possible service, quality, and quick deliveries. Lange expressed that the Ukraine s economic downturn will not have a major effect on his company. Lange is supportive of the Brno show, and stated that Paul Lange inked 20% of its sales at the show. Cyklo Zitny is SRAM s agent and is also Prologo s distributor. Founded in 1993, Cyklo Zitny was originally a distributor of Germany s Sachs, and doubled in size within a two-year period. Apart from supplying Bike Fun, this company chiefly sells its products on the aftermarket, and also has online sales. According to President Jaroslav Zitny and Marketing Manager Jan Matetv, www.biketaiwan.com 2009 Spring BMU 35
Cyklo Zitny is SRAM's agent. Shown here are President Jaroslav Zitny (left) and marketing department manager Jan Matetv (right). Cyklo Zitny is an agent for SRAM, Michelin, Vredestein, and Prologo. Cyklo Zitny s customers look for reasonable prices, new products, and innovative R&D. Marex Spoke w a s founded in 1903; Panther (Master) is its largest customer. According to Eva Markova, 80% of the company s products are exported to the EU, including Poland, Slovakia, Germany, Austria, and Hungary. Sales in the Czech Republic are mostly to the aftermarket, and few Czech bike manufacturers use the spokes. Marex employs automated production, Remerx produces mainly aluminum rims. Remerx rims are used by many local bike manufacturers, and are also exported to other EU countries. and employs around 25 persons. Markova is a fourth-generation member of the founding family; ownership of the company is shared evenly between her and an aunt. Marex has been hard-hit by the current recession, and has had to reduce its output by 50%. Rims produced by Remerx are used by many bicycle manufacturers in the Czech Republic and Slovakia. The company produces only aluminum alloy Golden rims. Remerx was founded in 1990, and has earned a good reputation in the Czech Republic. Bike Fun bikes use Remerx rims. According to Mrs. Remerx, the president s wife, the company currently produces 200 rims and 200,000 wheelsets each year, 70% of the rims are Pavel Stedry of Specialized's Czech international sales department. exported to the EU, and there are approximately 100 employees. Specialized: The Czech distributor of Specialized was purchased by Specialized USA on November 3, 2008. The company began selling Specialized bikes in 1998, and chiefly targets the Czech, Slovak, and Polish markets. MTBs account for 60% of sales. Typical prices are around 18,000 Czech koruna (very roughly 700). Specialized has responded to the steadily growing sales of children s bikes in the Czech Republic by introducing a children s bike series. Specialized sold 7,000 kid s bikes, 8,000 MTBs, and 1,000 racing bikes in 2008, said international sales employee Pavel Stedry. The brands displayed at the Brno show reveal that bicycle companies are using the Czech Republic as a springboard for entering the European Union. Bike manufacturers should take notice of this situation. Marex has 105 years of history, President Jaroslva Marex (left) is 73 years old. His daughter Eva Markova (right) holds a 50% stake in the company. The organizers held a banquet after the show to celebrate the event's success. 36 BMU 2009 Spring www.biketaiwan.com