Start a bike shop by following these 9

steps:
You have found the perfect business idea, and now you are ready to take
the next step. There is more to starting a business than just registering it
with the state. We have put together this simple step guide to starting your
bike shop. These steps will ensure that your new business is well planned
out, registered properly and legally compliant.

STEP 1: Plan your Business

A clear plan is essential for success as an entrepreneur. It will help you

map out the specifics of your business and discover some unknowns. A
few important topics to consider are:

 What are the startup and ongoing costs?

 Who is your target market?
 How long it will take you to break even?
 What will you name your business?

Luckily we have done a lot of this research for you.

What are the costs involved in opening a bike

shop?
One of the initial costs is obtaining any required business license and
permits. Depending on the location and size of your shop, opening a
bicycle shop can cost as much as $350,000, or as little as $10,000. Startup
costs are usually lower in smaller cities where rents aren’t as high, since a
substantial amount of space is required.
Once a suitable space is located, it must be outfitted to effectively display
bikes and accessories. Purchasing initial inventory is also costly, but many
wholesale bicycle dealers offer shop owners a line of credit at 0% interest
for a limited time (usually 3-6 months), which helps finance the initial
inventory. Other goods, such as safety equipment, clothing, and
accessories must be purchased outright.
Read our bike shop purchasing guide to learn about the materials and
equipment you'll need to start a bike shop, how much to budget, and where
to make purchases.

What are the ongoing expenses for a bike shop?

Ongoing expenses include:

 Rent
 License and insurance fees
 Inventory maintenance costs, which can be reduced by advertising
more expensive items in brochures, rather than keeping them in stock
 Freight charges, which can be reduced by using local wholesalers
whenever possible
 Sale and inventory management software designed specifically for
bike shops
 Tool maintenance
 Staff training and salaries

Who is the target market?

Preferred customers are people who enjoy cycling as a form of
transportation, a competitive sport, or a recreational hobby.

How does a bike shop make money?

Bicycle shops make money by purchasing bicycles and cycling accessories
for resale. Most shops also offer replacement parts and bicycle repair
services. Some offer bicycle rentals as well as sales. Customers rely on
the extensive knowledge and expertise of bicycle shop staff members to
maintain their bicycles in safe riding condition.

How much can you charge customers?

Bicycle repairs can cost anywhere from $10 to $150, depending on the
complexity of the job and the cost of the replacement parts. Simple beach
cruisers cost anywhere from $199 to $700, while complex, rugged
mountain bikes can range from $700 up to $10,000. There are also hybrid
electric bicycles. Although they may charge more, most people choose
bicycle shops over big box stores for the quality of their products, the
superior knowledge of the staff, and the high level of customization they
offer.

How much profit can a bike shop make?

On average, the retail profit margin for bike sales is 36%, although the
margin is somewhat higher for other types of cycling-related products, such
as clothing and accessories. By selling a combination of bikes and other
goods, the average bicycle shop earns a profit margin of about 42%.

How can you make your business more

profitable?
Many bike shops have begun expanding their businesses, by making their
stores available for other types of community events. According to a recent
survey of 4,000 bike shops, 12% now have coffee bars, 11% offer
cycling/spin classes, and nearly 1% partner with other service providers to
offer massage and yoga. Your profits can increase in direct proportion to
the community involvement your store makes possible.

What will you name your business?

Choosing the right name is very important. We recommend checking if the
business name you choose is available as a web domain and securing it
early so no one else can take it.

Find a Domain Now

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STEP 2: Form a legal entity

Establishing a legal business entity such as an LLC prevents you from

being personally liable if your bike shop is sued. There are many business
structures to choose from including: Corporations, LLC's, and DBA's.
You should also consider using a registered agent service to help protect
your privacy and stay compliant.

For most small businesses forming an LLC is a great option, but if you still
want to weigh all your options check our our article, What Structure
Should I Choose for My Business?

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you
can open for business.
In order to register for taxes you will need to apply for an EIN. It's really
easy and free!

You can acquire your EIN for free through the IRS website, via fax, or by
mail. If you would like to learn more about EINs and how they can benefit
your LLC, read our article, What is an EIN?.

STEP 4: Open a business bank account &

credit card

Using dedicated business banking and credit accounts is essential for

personal asset protection.
When your personal and business accounts are mixed, your personal
assets (your home, car, and other valuables) are at risk in the event your
business is sued. In business law, this is referred to as piercing your
corporate veil.

Open a business bank account

 This separates your personal assets from your company's assets,
which is necessary for personal asset protection.
 It also makes accounting and tax filing easier.

Recommended: Get $200 when you open a business checking

account with Chase.
Get a business credit card
 This helps you separate personal and business expenses by putting
your business' expenses all in one place.
 It also builds your company's credit history, which can be useful to
raise money and investment later on.

Recommended: Learn about the best small business credit cards

here.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to

understanding the financial performance of your business. Keeping
accurate and detailed accounts also greatly simplifies your annual tax
filing.

STEP 6: Obtain necessary permits and

licenses

Failure to acquire necessary permits and licenses can result in hefty fines,
or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a bike shop
business. Learn more about licensing requirements in your state by visiting
the Small Business Administration’s reference to state licenses and
permits.
Most businesses are required to collect sales tax on the goods or
services they provide. To learn more about how sales tax will affect your
business, read our article, Sales Tax for Small Businesses.

Bike shops may also wish to look into applying for a resale certificate, as
a resale certificate allows retailers to purchase goods intended for resale
without paying sales tax.
In addition, certain local licensing or regulatory requirements may apply.
For more information about local licenses and permits:

 Check with your town, city or county clerk’s office

 Get assistance from one of the local associations listed in US Small
Business Associations directory of local business resources

Liability Waiver
If a bike shop is considering renting bikes, liability waivers are essential
since consumers will be in high risk environments, operating potentially
dangerous machinery. For this reason, it is best to require protective gear.
Attached is a link to a general informed consent form for a bike shop.

Certificate of Occupancy
A bike shop business is generally run out of a retail store. Businesses
operating out of a physical location typically require a Certificate of
Occupancy (CO). A CO confirms that all building codes, zoning laws and
government regulations have been met.

 If you plan to lease a bike shop:

o It is generally the landlord’s responsibility to obtain a CO.
o Before leasing, confirm that your landlord has or can obtain a
valid CO that is applicable to a bike shop business.
o After a major renovation, a new CO often needs to be issued. If
your place of business will be renovated before opening, it is
recommended to include language in your lease agreement
 stating that lease payments will not commence until a valid CO is
issued.

 If you plan to purchase or build a bike shop:

o You will be responsible for obtaining a valid CO from a local
government authority.
o Review all building codes and zoning requirements for your
business’ location to ensure your bike shop will be in compliance
and able to obtain a CO.

STEP 7: Get Business Insurance

Insurance is highly recommended for all business owners. If you hire

employees, workers compensation insurance may be a legal requirement
in your state.

STEP 8: Define your brand

Your brand is what your company stands for, as well as how your business
is perceived by the public. A strong brand will help your business stand out
from competitors.

How to promote & market a bike shop

A great way to promote your shop is by partnering with other local
businesses to sponsor bicycle races and other community events for
charitable causes. Part of what makes bicycling so attractive to peo ple is
being outdoors, interacting with nature and other members of the
community. Providing more opportunities for them to do that is sure to
increase your customer base.
Social media sites such as Facebook and Twitter are excellent platforms to
advertise both community and sales events. Many bike shops also make it
possible for their customers to purchase items online by maintaining a
page on Shopify, or another sales platform. Creating and maintaining a
website is a good way to inform regular customers about new products and
services, as well as upcoming sales.
Recommended: Get started with local advertising for your business with
a $300 credit from Yelp.

How to keep customers coming back

Purchasing used bikes from local community members is a good way to
build a local reputation, establish customer loyalty, and lower your
inventory costs. People who sell older bicycles that their children may have
outgrown are apt to use the money to purchase a new one.

STEP 9: Establish your Web Presence

A business website allows customers to learn more about your company

and the products or services you offer. You can also use social media to
attract new clients or customers.

Start A Bike Shop In Your State

Select your state below for an in-depth guide on completing each of these
steps in your home state.

START MY BUSINESS

Is this Business Right For You?

This business is ideal for environmentally conscious people who want to

promote physical fitness and enjoy interacting with others.

What happens during a typical day at a bike

shop?

Bicycle shop owners perform a wide variety of activities, including:

 Tracking sales and inventory

 Purchasing bicycles and accessories
 Scheduling and performing bicycle customization and repairs
 Creating sales promotions
 Arranging and participating in community events
 Researching new products and current trends in cycling
 Training staff

What are some skills and experiences that

will help you build a successful bike shop?

Some skills that will help you succeed in this type of business include:
  Bicycle repair
 Customer service
 Knowledge of cycling products and accessories
 Accounting skills
 Managerial skills for training staff

The Barnett Bicycle Institute offers courses in bicycle mechanics and

maintenance, and the National Bicycle Dealers Association provides a
number of educational resources on their website.

What is the growth potential for a bike

shop?

The bicycle industry is demonstrating continuous growth, with the majority

of bicycle manufacturers enjoying an increase in profits for 2016.
Depending on location, it is possible to achieve enough growth to
offer franchise opportunities.

TRUiC's YouTube Channel

For fun informative videos about starting a busines visit the TRUiC
YouTube Channel or subscribe below to view later.
Subscibe to our YouTube channel

Take the Next Step

Find a business mentor

One of the greatest resources an entrepreneur can have is quality
mentorship. As you start planning your business, connect with a free
business resource near you to get the help you need.
Having a support network in place to turn to during tough times is a major
factor of success for new business owners.

How and when to build a team

It’s important to build a team from the beginning. Typically, a team includes
a lending institution, and at least one staff member knowledgeable about
cycling products, and skilled in bicycle repair.
NEXT STEPS
Get more ideas with our Business Ideas Tool.
Check out our How to Start a Business page.
Sign up at the Business Center to access useful tools for your business.

Useful Links

TRUiC Resources
 TRUiC's Bike Shop Purchasing Guide

Industry Opportunities
 National Bike Dealers Association
 Franchise opportunity with Bike Doctor
Real World Examples
 Bike Doctor, a bicycle shop specializing in repairs, serving the
Mid Atlantic area
 Wheels in Motion, bike shop

Further Reading
 Considerations when starting a bike shop
 A list of typical expenses associated with starting a bike shop
(NBDA)

Entrepreneur Interviews

Read Interview
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 HOW TO START A
MOTORCYCLE SHOP

Hitting the open road, with nothing but a motorcycle and a few essentials,
has long been a favored American pastime. Those active within the
motorcycling community regularly require maintenance and repair on their
motorcycles and enjoy spending their hard-earned money on accessories
that enhance their riding experience. From selling new and used parts, to
bike repair and rebuilds, motorcycle shops offer a variety of goods and
services that fit the immediate and long-term needs of bike enthusiasts.
Learn how to start your own Motorcycle Shop and whether it is the right fit
for you.

Start a motorcycle shop by following

these 9 steps:
You have found the perfect business idea, and now you are ready to take
the next step. There is more to starting a business than just registering it
with the state. We have put together this simple step guide to starting your
motorcycle shop. These steps will ensure that your new business is well
planned out, registered properly and legally compliant.

STEP 1: Plan your Business

A clear plan is essential for success as an entrepreneur. It will help you

map out the specifics of your business and discover some unknowns. A
few important topics to consider are:

 What are the startup and ongoing costs?

 Who is your target market?
 How long it will take you to break even?
 What will you name your business?

Luckily we have done a lot of this research for you.

What are the costs involved in opening a

motorcycle shop?
Veteran motorcycle shop owners recommend a budget of approximately
$55,000. This number could vary significantly, depending upon the
inventory you choose to carry and services you intend to offer.
Initial investments should include:

 Shop location - first and last month’s rent is typically required

 Inventory - engine and electrical parts, accessories, parts for repair
services, and motorcycles
 Display equipment
 Legal fees
 Marketing supplies and a website
 Insurance

If your intention is to manage a larger dealership, your start-up budget

should be significantly higher. Prior to writing your business plan, focus on
building relationships with wholesale retailers. They set the prices and can
offer valuable insight into what your initial and ongoing investment should
be.

What are the ongoing expenses for a motorcycle

shop?
As a repair and retail establishment, you will be facing a number of
ongoing expenses. In addition to the standard rent, utilities, phone, and
Internet, you will need to budget for the following:

 Payroll
 Inventory
 Insurance
 Marketing

Established shop owners indicate a break even budget of $16,000 per

month.

Who is the target market?

Men falling in the 18 - 25 and 40 - 65 age brackets represent more than
80% of motorcycle sales. While your shop will generate revenue from
novice bikers, the bulk of your marketing campaign should be geared
towards experienced bikers.

How does a motorcycle shop make money?

Your shop will generate income based on the goods and services offered.
Some businesses operate on a local level only, while others sell goods
online, expanding their reach to a much broader audience.

How much can you charge customers?

Fees for maintenance, repair, and bike customization are based on labor
and parts. Parts and accessory price are generally marked up 100%.

How much profit can a motorcycle shop make?

Unlike many businesses, motorcycle shops often see a profit in the first
year. While the first three years may generate a profit of $13,000 to
$17,000, this is a positive sign and sets the business up for long-term
growth and success. Total annual profits vary, depending upon the
specifics of what services you offer, what parts and accessories you sell,
and how you plan to sell them. Annual profits can range between $35,000
to $64,000 or more.

How can you make your business more

profitable?
Many motorcycle shop owners report having significant success operating
an online motorcycle parts business. Since bike shops are often a place to
congregate, offering food and drinks, along with a comfortable seating
area, will ensure your customers are comfortable and happy. This is an
effective way to increase your profits without a large increase in overhead
costs. Shop owners have also realized success by offering airbrushing
services, selling second-hand bikes, and offering motorcycle tutorials to
educate those interested in learning more about their hobby.
What will you name your business?
Choosing the right name is very important. We recommend checking if the
business name you choose is available as a web domain and securing it
early so no one else can take it.

5 Franchises Below P200K You Can Invest in with a Partner

Save, loan, or partner up for these small businesses that could grow your investments.

Franchising a business is no longer as hard as it used to be. Back in the day,

entrepreneurs would need at least a million pesos to set up shop for any of the big
name corporations. But now, the food cart model has changed the game and even
been duplicated across other industries. With a good head on your shoulders, a good
partner, and some hard-earned money to invest, these franchises below P200K could
open up another source of income in the coming years.
ADVERTISEMENT - CONTINUE READING BELOW

1. Speed Driven Car Wash

Franchise Fee: P110,000
Established in 2013, Speed Driven Car Wash has been providing location
assistance and 3-day hands-on trainings to their customers-turned-franchisees for
less than P200,000. The basic car wash package can even be upgraded to include
auto detailing for only an additional P40,000. As more and more cars pile up in
Metro Manila, there’s definitely a market to service.

For more details, visit www.speeddriven.ph.

2. Hong Kong Style Noodles & Dimsum

Franchise Fee: P135,000
Required Space: 4 square meters
Hong Kong Style Noodles & Dimsum fall under the quick eats on-the-go category
for the busy Pinay. Whether it’s a filling snack to tide you over as you sit in traffic or
 an affordable meal when it’s petsa de peligro, food carts and kiosks make a killing
for their friendly prices and familiar flavors.
Considering Hong Kong Style Noodles & Dimsum has been making a name for
itself for over 15 years now, the franchise package comes at a bargain and
leaves the entrepreneur to deal with finding a high traffic location to make the
most of the investment.

For more details, contact Angelito Marcelino of Asia Pacific & Global Franchising
Co. at apgf001@yahoo.com.

3. Pet Galore
Franchise Fee: P150,000
Required Space: At least 40 square meters
If you've gone to Cartimar then you'll easily be familiar with Pet Galore. The pet
shop not only carries an assortment of leashes, crates, aquariums, and treats but
also different breeds of dogs, cats, fish, birds, and rabbits. Aside from the franchise
fee, though, the location of the Pet Galore franchise will need proper ventilation as
well as permits for animals in order to run smoothly and ensure the safety of the
pets. Consider taking a partner or two (preferably animal lovers!) when deciding to
set up a branch.

For more details, contact Archie Uy at sales@petplus.com.ph.

4. Buko ni Magic
Franchise Fee: P180,000
Taking the low-cost route of a standard cart, Buko ni Magic offers a complete
franchise business package that includes up to 2 kilograms of buko juice,
equipment, and crew uniforms. Just find a location that hasn’t been captured by a
competitor at a mall, school, or office building to increase the chances of success.

For more details, contact Magic Siomai Station at +632.393.4435

or magicsiomaistation@yahoo.com.ADVERTISEMENT - C
 5. Cycle House
Franchise Fee: P199,000
The bicycle business is growing with support from both the global and national
fronts on the bike as a form of transportation and exercise. Safety measures
gradually increase just as communities of cyclists gather on a more frequent basis.
The offerings of Cycle House are entering a market that is ready for it. As a sole
venture or partnership, acquiring a Cycle House franchise and working on the
renovation of a unique retail space can prove to be a pretty lucrative investment.

For more details, visit www.cyclehouseph.com.

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WORK AND MONEYFranchises You Can Invest in for Less Than P100K