The motorcycle sales sector has been facing difficulties for several years. The tense economic environment is causing sales to fall. However, the situation is not uniform across all product segments. For less than 125 cm³, the market is more stable.
The success of scooters actually boosts sales. The segment of more than 125 cm³ had had good results due to the automatic obtaining of the corresponding license by the holders of the license B since 1996. This market is now in decline of speed.
The second-hand sector remains dynamic and supports the entire sector. As for the bicycle market, it is evolving in a very favorable context. The increase in fuel prices, the increase in the number of cyclist tracks in the cities, the popularity of the outdoors and sports activities are all factors that play in his favor. The self-employed, however, must face the competition of supermarkets and specialized chains in sporting goods. For now the results of this segment are up.
The market for the distribution of cycles and motorcycles and France
The sector is organized around 4 poles.
- Motorcycle retailers market mopeds and scooters with a cylinder capacity of less than 50 cc, and for which no license is required. The law requires that persons born after 1988 must have their road safety certificate. These retailers also sell small vehicles that do not exceed 125 cc. These vehicles, which must be registered, are subject to an A1 license or B license. Finally, these professionals sell large-displacement vehicles, for which registration and possession of a license corresponding to their category are essential.
- Spare parts retailers are often the sellers of cycles and motorcycles.
- Repair units also sell parts and accessories.
- Bicycle retailers are largely dominated by supermarkets and sports goods chains. Maintenance and repair is usually provided by the retailers themselves or small independent professionals.
The constraints of selling bike and motorcycle
For the maintenance and repair activity, a professional degree is required. It may be a CEP or a BAP or any other diploma recognized as equivalent or superior for the practice of this profession. In the absence of a degree, a 3-year professional experience in the sector will be required. The experience is taken into account as an employee or as an independent employee.
In addition to the general rules of the retail trade, the main rules concerning the trade of cycles and motorcycles are those relating to safety. In particular, the texts require that bicycles be handed over to customers in perfect working order, that is to say mounted and in compliance with all legal requirements.
Trader status in the sale of cycles
The professional who carries out a maintenance and repair activity has the status of craftsman. It is therefore part of the trades directory of the Group of Craftsmen. For sale, registration in the companies register is necessary. The professionals who carry out these two activities must therefore carry out a double registration.
As with most activities, it will be possible to practice as an individual entrepreneur or by creating a corporation. Taxation follows the regime of industrial and commercial profits for individual entrepreneurs.
The professional is therefore subject to corporate income tax if he has created a company, or includes the income from his business in his income tax return if he has opted for the business. Most professionals practice in the form of companies. In this sector, only the standard VAT rate is 19.60%.
The characteristics of the profession
The installations are generally done by creation. They mainly concern the activities of agent or dealer for motorcycle brands. The facilities are much rarer in the cycle segment due to the overwhelming dominance of supermarkets and sports goods chains.
The management of a point of sale of cycles and / or motorcycles
The dealer who applies good management rules tracks his turnover and the breakdown between the new, the opportunity and the spare parts. He analyzes his stocks and his supplies.
The brand agent closely follows the balance of sales of motorcycles and the result of its repair activity.
Professionals specialized in the sale of cycles apply these same methods. In their case, the maintenance and repair activity generates a lot more turnover. The size of the companies influences the result a lot. It also depends on the professional status, which can be dealer or agent. Finally, it is a function of the marketed range.
On the other hand, the activity is very seasonal. The most active periods are the end-of-year holidays and the months of May to September. On average, the sale of motorcycles accounts for more than 80% of a dealer’s turnover. Maintenance and repair are not cyclical and support the activity continuously. These are therefore strategic complementary activities even if their contribution to turnover is lower.
Purchases are the largest item of expenses. They must therefore be mastered.
The other charges are much lower. Personnel costs are limited to 6% of turnover. Other expenses represent 9% of sales. For premises well located in a large city, rents can be very high.
For the sale of motorcycles, the results depend on the conditions offered by the manufacturers to their dealers or agents. They are also strongly influenced by the range sold. Indeed the margin is higher on accessories and spare parts than on new vehicles. In general, optimal inventory management is essential. Finally, it is decisive to calculate your gross margin well and to maintain it. In particular, promotions and takeovers must be seriously studied.
In the case of cycle sales, competition from supermarkets and specialized stores is such that independent professionals must apply very strict management rules. However, these are insufficient if they are not accompanied by additional services and an irreproachable reception. In this context, standing out from supermarkets is crucial.
Seasonality leads to cash requirements. These must be limited thanks to scrupulous management. It is essential to have significant capital because of the significant investments.
The valuation of a business cycle and / or motorcycle
As a% of turnover, a goodwill can be evaluated between 20 and 50% of the average annual turnover. Of course this valuation must be refined depending on the quality of the location and especially the profitability of the business to resume.
Finance the creation or resumption of a bicycle and / or motorcycle business
In this sector, it is necessary to have solid financing capacities. With this condition, professionals associated with leading brands, and developing services close to their customers have assets to succeed.
It is these that the banks will be able to finance. The contribution must be considerable and the experience of the project leader must be in adequacy with the creation or the resumption of such a trade.