Rob: So Stuart Voysey from SCV Imports, thanks so much for joining us today.
Stuart: Thanks for having me.
Rob: And so you have a pushbike import business. And how long have you been doing that for?
Stuart: It's almost coming on 30 years now.
Rob: 30 years that's quite a journey. So can you tell us a little bit about how you came to get into that business so maybe the few years preceding that and how you got it there?
Stuart: So obviously, the main thing that got me into it was racing pushbikes myself. I use to do a lot of wind surfing and surfing before that, and I tried cycling and it was just so hard, that I was hooked. So I started racing. I went to the US. Was sponsored by a company called Dean Titanium. And that was the first brand that I imported into Australia. So before I started SCV Imports, I worked for Shimano Australia, who are quite large in the bicycle industry and I worked for them for three years.
Rob: Okay, so obviously you had that passion for cycling, and that's obviously driven that, you know, interest in that field. How did you make the shift from being an athlete and having a heavy interest in that to going. I'm actually going to import products? What was that sort of tipping point?
Stuart: Yeah, it's a really good question, so when I look back, I actually as a, you know, a 10 year old even I always had a competitive spirit. I windsurfed and, you know, I went to the world championships at 11 years of age. And, you know, when I came to Australia at 12 years of age, I was actually importing in a small way back then. My friends would want to game and watches, you know, at college and I would fly over to Hong Kong and bring back Nintendo game and watches, you know. And my parents would say, yeah one day you're going to be an importer. I didn't take a whole lot of notice to it back then. But really what happened was sort of natural progression. I, I wanted to have a go at having a professional career as a cyclist. And while I was overseas in the US, I realised that there was a lot of work ahead of me to to take that on. And my parents would have to support that. And that wasn't something I was willing to continue pursuing. But so the business side and the importing side, I was always interested in, I was always interested in commerce at school. I was always interested as a kid, how these businesses function. So I did a business course actually with David Jones. So that gave me sort of a retail side. And while I was at Shimano Australia, that was three years of insight into the bike industry, really. So there was a lot I learnt what to do and what not to do while I was at Shimano. So I realised what the shops needed. And when I started importing Dean Titanium, it helped me to get my foot in the door, basically. And from there, we picked up another brand from Taiwan, which was called FSA, and they expanded very rapidly. And the rest was the rest is history from there.
Rob: Okay. So and obviously we're talking about like circa nineteen ninety. And so when we think about starting an import business right now, we think maybe drop shipping, we think Internet sales. But in 1990, the Internet was actually around, but it was not a household common place thing. How logistically difficult was it to forge those partnerships and now how much travel was involved, by comparison to what you could achieve today?
Stuart: Yeah, that's a good question. So travel back then was critical to form a business relationship without actually meeting the buyers and sellers alike. It had to be done. There was no Skyping. So the fax machine was your friend. I can remember sending my first email. But there were mail order companies back then and they made business very difficult. So they, there was still a lot of grey importing going on. So when the Internet did come along, it was it was quite a beast for us to compete with, and it actually made life quite difficult for our retailers to understand how they could compete with it. So it was a it was a big change for the industry. And it has actually taking the bike industry a long time to adjust and work out that, yes, there is a place for a bricks and mortars workshop and there is a place for the Internet, the two can coexist. But for a while there, they actually thought this is going to kill the bike shop and it's just gonna be all Internet. And fortunately, that hasn't happened because that customer experience is really, really important. People can't just buy a bike, get it shipped to them and pull out an Allen key and make, you know, put their bike together safely. Quite often they need to walk into a shop and.
Rob: And obviously, one thing we haven't mentioned is that you're in that sort of mid to top tier. And so you're you're looking at people who are doing 50 kilometres a day or more on a bike. Not specifically, but in the in that this isn't recreational cycling along the beach pathway. This is, you know, people who are really taking it seriously. Do you think that's changed the avenue for people buying these, they're not walking into Kmart to to buy a bike like what you guys import?
Stuart: That's right. Actually, the bike industry in Australia. It's been really interesting to see it morph. So when I was racing, I was sort of seen as an eccentric guy who did this strange sport of cycling. You know, I didn't play footy, so, or cricket. So back then, if you were a bike rider, you raced. Whereas in Europe, if you were a bike rider, there was a good chance that you were a mother going down to the shops to buy fruits and vegetables, or you were a father taking your kids out. And a lot of them would have their kids on the back of the bike. They'd be collecting wood, putting it on the back of their bike and bringing it home. It was the bikes, a tool in Europe. And then there are guys who race, whereas in Australia, it's just been race centric. So we've over time, we've learnt that actually you can use bikes for other things. So it's been really good to see that morph. And fortunately, the brands that we've taken on over time, brands like Salsa and Surly, have all been strong in that sector of the market. So that's been, that's been really good to see.
Rob: Just in terms of that sort of consumer grade cycling. And do you think that Australian geography has a role to play in the lack of uptake for, say, commuting to the shops. Because we have to actually travel so much further?
Stuart: Yeah, definitely. So it's a little bit frustrating for us because you'll hear. The common thing is, is motorists will say, oh, I hate cyclists. And and that's really strong out there in the community. And I'll often say to people who say that, don't take it out on cyclists because they don't really want to be on the road. You know, with cars, it's dangerous for us. Whereas, again, if you go to Europe and even the UK, so in London, for argument's sake, it's quite safe to commute there in the heart of London. And they've realised that as soon as you separate people from the traffic and you give them a lane or even better, that they have their own cycle lanes way off from the roads, a lot more people ride. So a good sign of health in the cycling community is how many women are riding. So in Australia, when you look at on the roads, it might be 1 in 50, whereas in Europe it's almost 50/50. So and that's really based on safety. And it really comes down to what the councils are willing to do. I think thanks to COVID, we've noticed in Australia that actually people do want to ride their bikes. So that's pushing government to make changes with infrastructure. So we're really looking forward to the long term effect in that.
Rob: Yeah. Okay. I mean, we certainly are seeing more investment in cycle ways and dedicated pathways and that sort of thing. But it can be a bit fragmented. You know, the cycle way suddenly ends and it's a how do you get to the next part. And so certainly when there's children involved and people concerned for their safety. And I even had a colleague who died from a motor vehicle cycling accident. And it was horrific to hear that sort of thing. And so I think the councils are seeing a bit of a, bit of a requirement in terms of community expectation to invest harder in those aspects. Do you think as that happens and people are using bikes more regularly, you will see people cross from, say, the entry level consumer hardware into a, you know, more up to the challenge piece of kit.
Stuart: Yeah, that's. So we're already seeing that. So Canberra is probably the best example in Australia of commuting. So, a lot of cyclists, you won't see a lot of their trials are quite a long way from the road, so they're safe. And a lot of people aren't walking on the same trails as, you know, that you may be riding on in Canberra. That's really what needs to happen in Australia as much as possible. But I think it starts with schools. So, you know where little Billy used to ride to school, you know, back in the 40s or 50s. That doesn't happen anymore. It's just too dangerous. I wouldn't let my kids ride to school. You know, they're five kilometres from a school, but it's it's just not safe. Can that be fixed easily without a whole lot of trouble for and it'd actually free up the roads as well.
Rob: And the school carpark.
Stuart: And the school carpark. That's right. And you'd have bit of kids. And, you know, it's great. It's good for the environment.
Rob: And I think that's something that we're really focused on now as well, is, you know, reversing this trend of driving everywhere, just because you can. And, you know, I have a similar issue where the kids, maybe five kilometres from school, it's a four minute drive. And we actually do have quite wide bike allowed pathways for the most of that journey. But there's probably a kilometre or two where there's not even a shoulder. And so how do you fill that gap, do you drop them off at the corner and go past. And so how do we, how can we get, you know, more. Do you think COVID will catalyse more community drive to force councils to sort of fix some of those gaps?
Stuart: I'd like to think so. I know that the Central Coast Council keeps opening opportunities for suggestions. And I'd like to think that, the Central Coast community and hopefully this will happen all throughout Australia. People will say we need safer footpaths because there's too many cyclists. And hopefully motorists will say, look can, we need cycle ways rather than just say we hate cyclists, we need to eliminate cyclists. How can we do this safely. So I think COVID will push things along. I think if you looked at a graph, there is already growth and there's already expenditure that's increased over the years. And I think COVID will just push that along. Yeah, it's been a long time coming for Australia.
Rob: And I want to get to the business side in a second, but probably last thing before we do. Do you think that COVID has kind of, well, we know that COVID has created a surge in outdoor activity and created its own stock handling issues and that sort of thing. Do you think that those markets in fitness, health, outdoor, that sort of thing, are going to see a sort of a lull as sort of the side effect of that surge that's happened. Do you think there's a lull before it plateaus back out again?
Stuart: I think they will be lull. I think my gut feeling is that we're going to realise that the money we've been spending on the home gym, the new bike, etc. May not have been a good idea considering our financial situation. Will we look at unemployment now at its 10 or 11 percent cent, but I think the fallout will come. So we're not even June now, but I would say by December, I will be buying carefully. What I mean by that, as far as imports go. I feel that the Australian consumer will realise the financial impact and then start to back off.
Rob: Maybe some of the things that are holding on for now maybe won't hold on for quite that full duration and a lot further. So that doesn't lead us into the to the business side a little bit more. And obviously, you are physically importing product and are you warehousing as well?
Rob: And did you always take that kind of approach rather than, say, a third party logistics where it, you know, as I said earlier, we get used to the idea of drop shipping in a lot of cases. And, but you're wholesaling into stores and so you providing a warehouse cache?
Stuart: That's correct, yep. So it's quite old fashioned in that regard. We're just bringing in containers from Taiwan. Air freights and sea freights from the US straight into the warehouse in Tuggerah. And it's really just a matter of bringing in as much as you can and turning it over as fast as you can. And making sure that mix is right so there isn't a whole lot of dead stock. So that can only really be done with the right deal and network in place. And so far, you know, it's working a treat. Doing drop shipping with complete bikes and frames alike only really works at that really high end of the market where there's a lot more money to, in the margin. So you can air freight a bike out for the customer who's paying seven thousand plus for the bike. There are quite a few brands in the market that have taken on drop shipping. So it'll be, it might be a brand in Germany for argument's sake, you place your order with them, you're based in Sydney and within a week that bike arrives at your home, you given clear instructions of how to build that bike. That model has only worked for a few brands, and where it tends to fall apart is they don't have anybody in the country necessarily to back up if there's a problem and that makes people quite nervous. You know, if you're spending, guys will comfortably spend 15, 20 thousand on a pushbike. So that makes them think twice about. Do I really want to purchase from another country. If there's a problem, you know, I've never met them. Never spoken to them.
Rob: When it when it comes to that part of the market as well. Do you think that the drop shipping. Obviously there's a a small margin for those. Sorry. A small market for that level of bike based on the cost factor. Does that also then sort of make it less effective for you to try and bring in that type of brand because there's less market demand for that sort of gear?
Stuart: Ask a question again.
Rob: So when, for the guys who are dropped shipping like these top tier brands, because they're sort of a at that very top end of the market, does that, by its very definition, prohibit you from bringing in because you can't bring in a dozen bikes or something like that?
Stuart: It's funny, actually, I watch brands like that very closely because a lot of companies read the Australian market the wrong way. There's a lot of volume in a bike and a frame, there's a lot of air in that box. And to ship something from Europe or the US to Australia, it's costly. And then you have our system, our dealer network, our culture. So I'll often watch those guys that do drop ship and wait, because quite often those brands come up and they say, we just need a distribution model. And we've been approached in the past by companies who initially started with a what seemed to be a modern and up and coming form of selling, which backfired for them. So it, it works for some products and doesn't work for others. So we have actually had products that we have been selling and we've believed a direct selling situation would be better. So the manufacturer just sells direct to the public and cuts out retailers and wholesalers alike. But for the most part, it doesn't work.
Rob: And obviously, you're making an investment in that stock with the, you know, in order to move that on. How has that process evolved over 30 years, you know, have you become more in tune to what's going to sell and any bumps in the road that you can share?
Stuart: Yeah, definitely, so one of the most important things for us with bikes. We need to have quite a few shipping windows within a year. So if you're selling a brand where, say, for argument's sake, you sell half a million units a year, but they only have one shipping window a year. That's a lot of money that you've got to put forward. But if the other brand has four shipping windows a year and you're going to sell half, how many million units, that's doable. And our economy of scale is nothing like the US or the UK. So we have to be really careful that we don't leave ourselves vulnerable with having too much stock, our having to buy too much. So that, it's definitely, that's a risky business if you don't have very many buy in windows. Parts and accessories, so there's a company we just started with recently out of Minnesota, a company called Wolf Tooth and their turnaround times about two or three days. So when you're dealing with a company like that, you can place a five thousand dollar order each week or a ten thousand dollar order every second week, It's great. But if they turned around and said, look, we want you to order monthly, your minimum order is fifty thousand. Then all of a sudden it's not an option. Yeah. So delivery turnaround time and the delivery speed is critical for Australian distributors.
Rob: Naturally, that buying cycle as well. Say you're buying, even if it is three or four times a year, how do you try and compensate or predict say dollar variations so that you don't either. I mean, it's great if you win and and the dollar goes up. But if you have customers at the end, at the retail level, assuming a price is going to stay fixed for a year and, you know, we see a 30 cent change in the dollar, how do you cater for that?
Stuart: Yeah, so. Fortunately, our deal is in stockists have been have been great and, we've worked together really well. So our agreement is such that, and it's not written in concrete, or stone even. But we'll say if the dollar moves, three percent in either direction then will vary the price. So we factor a little bit of a buffer in our pricing, but it does get tricky because some of that preorders are eight months in advance. So, for argument's sake, we have a shipment arriving any day now, and had that arrived a month and a half ago, we would have been in trouble because I think the dollar got as low as point five four.
Rob: For a couple days, yeah.
Stuart: Yeah, that's right. A sitting there watching the dollar slide from, you know, point five nine down to point five four pretty much in a day. So a situation like that is nerve wracking. But because you do make wins every now and then, if you if you make a loss, it's fine. You know, you just wear it.
Rob: And is that something that becomes easier over time as the company is more established and, you know, you have a bit more of a foothold in those things and a little bit better practice at gauging those, you know, sell channels?
Stuart: Yeah, definitely, I think, once you start getting up to contain loads and you're shipping become less of a factor, it's a lot easier to say, OK, this is the margin I'm making. But it's really hard when you start out and you're going from one pallet this month and then the following month, you're going to three pallets. So your freight costs vary, you're on costs are varying, so your margins varying. And if the dollar's moving, you know. Every now and then, we would we would have a 30, 40 grand shipment drop and we would come out with a thousand dollars and the end, you just go oh my goodness, what are we doing. So, yeah, those early days are nerve racking, but once you get to containers 20 foot containers, 40 foot containers, it's a lot easier.
Rob: I can imagine, especially at a wholesale level, because you are mainly distributing to retailers, those you know, one or two points of margin can be quite considerable in it. Whether the deal makes sense or not right?
Stuart: That's right. Another area that we get caught out on is, you might have a supplier that sends you an email for argument's sake. And they'll say, we've made a running change, we're actually now gonna use these tyres. So it's gonna cost, another three dollars and, we're using a two colour finish, which is gonna cost you an extra ten dollars, please don't forget to make those adjustments. And then you've got the dollar moving and then you get an email from your shipper saying oil's gone up. So there's this change, so to keep that flow going and increasing those prices as needed. Quite often a shipment will come in, has missed those changes. And you've already locked those orders in for the shops. So, yeah, there's are so many variations that go on. But with experience, you get there in the end.
Rob: Get better at, better at juggling more balls in the air.
Stuart: That's right.
Rob: Do you think that the market that you are playing in, which you know, isn't that but a race to the bottom retail, do you think that helps create some of that accommodation for variations and dollar fluctuations. Because it is a more about considered purchase than a, you know, race down and grab Johnny's bike for 50 bucks?
Stuart: Yeah. So depending on the price point within the industry that you're working within, you'll find that one will attract that bargain hunter. So it's almost like once you go under two thousand dollars, the customer will just say, it's, you know, I want the cheapest one I can get. Hopefully I can get the two thousand dollar bike for fifteen hundred. And then you've got that top end where it might be some prestigious Italian bike, and the customer is a CEO and he walks in and he just says, look, there's the 15 thousand. You know, you guys are doing a great job, can't wait to ride a bike. So there's that sort of variation. But what I've noticed has happened since I first started in the industry is everything was the race to the bottom. As soon as the Internet came out. Everybody was just, it was the guy that was buying the most they could afford to have the tightest margin to survive. And then over time, manufacturers and suppliers realised this, we can't sustain this. So how do we, how do we change this. And that's actually when a lot of manufacturers pulled there ranges off the Internet so that the prices weren't constantly under pressure. I mean, you've got to understand that because the economy of scale is different in each country, everyone's working on different margins, everyone's wages are different. So through the global financial crisis in the US, they were trying to sell, a lot of US companies were trying to sell into Australia, so it made it Australian retailers look terribly expensive. And that meant that a lot of importers now in the bike industry, we're working on margins that are similar to the US. So we, we've had to find that extra margin somewhere so we can pay Australian wages and and cope with Australian overheads. So I hope that answers the question? Did I go did I go way off in other directions.
Rob: No I think that was pretty good. One thing that you did touch on there was the GFC. And obviously when you are trying to make market predictions and just like COVID coming along, which fortunately in cycling has seen a boom in sales. What lessons did you take away from something like the GFC, which you worked through?
Stuart: Yeah, I learned a lot in the global financial crisis. Yeah. Where do I start?
Rob: And quickly, no doubt.
Stuart: Yes. Yeah. Very quickly, so. From the day I first set the business up, we saw growth's between 25 and 35 percent right up until the global financial crisis.
Rob: So how many years in was that?
Stuart: That would have been maybe.
Stuart: Maybe 10 years in. So that meant that, yeah, maybe more towards 15, actually your probably right, maybe 12 years. So, I was running a business that just had continual growth. So it was managing cash flow. Some my business partner and I couldn't pay ourselves what the wages that we should have been because all of our money was going into cash flow. Now all of a sudden I was managing a company that overnight the dollar had gone to parity. So all of our stock had dropped by 30 percent. And then the consumers were buying less. And just as we came out of the tail end of the global financial crisis, our largest supplier dropped us. So, I had to change my thinking, I had to change the way I manage the business. And really the biggest change we made was we had five sales agents and we ran that down to one sales agent. And we poured quite a lot of money into our infrastructure, so our software, our server. We went from having five full time staff down to three. And we still haven't changed that. So we're turning over well, well over double what we were turning over in the global financial crisis, still sitting on the same software servers, and the staff. And it's, we're running three staff, a full time, two part time. And we really learnt how to gain efficiencies. So, less staff paid more. Better staff, better software, better service. And it's worked a treat. So when we were running five sales agents, we were finding a lot of those sales agents were also selling for larger companies. So we were sort of the, you know, the back seat.
Rob: Oh, and you can also get.
Stuart: And you can also get. That's exactly. So we had one guy who was absolutely brilliant and he helped build a lot of business for us. But it is hard for sales agent because the only way they can make ends is meet is by having a lot of lines. That makes it very hard to sell. So we realise that shops were ringing us and asking for technical advice and then making the purchase. So as soon as we changed that structure, we were profitable and we were able to get our pricing more in line with US pricing, which was critical. Going through the global financial crisis it made, soon as the dollar went to parity, people realised that if it's a dollar in America, it should be a dollar in Australia. So if you were, if you had fat margins and you were trying to rip off the Aussie guy, all of a sudden he'd worked it out and you were done. So, you know, they were distributors in Australia that were charging too much. And overnight, you know, retailers cottoned on and that made made it really difficult for them to do business.
Rob: Well, on the flip side of that, because that deal occurred so rapidly. How do you strike that balance as a distributor where the dollar may have gone to parity and you've suddenly got a warehouse that's worth half of what it was a year prior?
Stuart: So how do we manage to survive that or?
Rob: Yeah, and how do you kind of find that balance between the legitimate cost of that stock versus what it's suddenly worth, even though the bike is still the bike?
Stuart: Yeah, we'll see, It's a perfect storm because not only has your stock devalued and you can't, in the old days, you would hold your price and you could still make margin. Look, this is the way it is, we received it at this dollar. This is a situation. This is what you've got to pay. But the Internet changed that. So if it's a hundred dollars in the US because the dollar has changed, you've got to make the changes here. So that really hurt. But really, if you if you're sitting on a million dollars with a stock and you're forecasting forward for another million, then your hope is that, that's what's going to pull us out of a hole. So what I did was I switched from big shipments to a lot of smaller shipments. So a lot more stock running through the warehouse at a, at a slightly tighter margin. But I just tried to get the turnover going, get the cash flow going. And just in case the dollar went from parity and weakened even more. And once things levelled out, then we started bringing in containers and. You sort of blush, you have to move that stock out, unfortunately, it's got to go somehow at a loss. And you just, you know, if it's, if you down to 20 dollars, you just got to make sure that that 20 dollars is turned over better next time. You know, you might lose. First time around, but hopefully you gain the next purchase.
Rob: I mean, obviously, that that cache of stock has pros and cons, but as we've seen with COVID come along, so many people are moving to like at just in time warehousing model where that they're not carrying that stock. And do you see yourself transitioning to that in the future or you, sort of think you've got the process nailed.
Stuart: Yeah, a lot of that comes down to our suppliers. So one of the things that we really try to, encourage is. So we do a lot of business with US companies and a lot of those US companies will, get their manufacturing done in Taiwan say. So what they'll do is they'll say, OK, your 50 bikes are ready. Can you organise your 20 foot container. And that's all well and good, but if the shops have actually phoned us and said, look, can we get another 20? We can't do that. So we really need a situation where these guys have the manufacturing run ready. But there's also a little buffer of stock. So that puts the manufacturer under a bit of pressure because, you know, well, how much of a buffer is that going to be. So really, it's it's like the manufacturers putting the distributor under a little bit of pressure to buy more if he needs more. And then the distributors pushing back onto the supplier and saying, can you also hold a bit more stock just in case we need it. So, you know, one of our suppliers is, a company called QBP in the US, and they're one of, well, I think they are the biggest distributor in the world in the bicycle industry. And, it's been really interesting watching them develop, their systems in Asia. And what's really working for one of the particular brands is four windows, where we preorder and any of the just just in time items, come out of the US. But there is an extra price that needs to be paid to get it air freighted, especially out of Minneapolis, on the other side of America.
Rob: So shifting gears a little bit too, say the selling and the retail side, obviously your core business is on distributing to retailers. But I notice you've got a bit of e-commerce going on as well. And is that direct to consumer, and what role has that played and how do you keep everybody happy?
Stuart: Yeah, that's a really good question, because it's only really been over the last five years that retailers haven't really had an issue with distributors making some product available direct to the public. So I think the key thing is. We don't really discount to the consumer, so we don't compete with the shop. That's the key thing. And where it's helpful for us is often we'll get consumers that will say, look, I'm in Alice Springs, I need this titanium bolt, my local bike shop, you know, sells 200 dollar bikes. He doesn't even know what a titanium bolt is. Can I buy it directly from you. He doesn't need to make that phone call. He can just buy that straight off the website. We also sell a lot of technical items. So conversion kits and all sorts of different knick knacks that, some consumers know exactly what they want. And the shops don't necessarily want to stock it and they can make those purchases. But as far as buying a bike from us directly. That's not, they can't do that. They've got to go to our dealers or our stockists.
Rob: Because it was actually a bit of synergy they're where, yeah as you say, the retailers don't have to stock a thousand different specialised parts, but their customers can still come direct and get that going. That's an interesting balance.
Stuart: It's a very small part of our business. So direct selling is, you know, it might be three percent.
Rob: Do you ever see it evolving where you do make bikes available online. Or is that sort of a deliberate protection of the wholesale sales channel?
Stuart: I hope not. I constantly read about consumers talking about, I went to this bike shop in Melbourne and, here are photos of the bike that they built for me. I'm really happy with the service. And, you know, I had a little problem with this, but they fixed it for me. And and then on the on the flip side, you see guys who have purchased a frame from a shop and then they've taken it home and they've bought bits off the Internet and they've put it together. And quite often we get phone calls from these consumers and they'll say it's just not working. And we'll say, well, maybe you should go and see a bike shop, and they hate it. They hate being told to go to a bike shop because their whole intention was to build it themselves because they thought they could do it. And this bike shop is gonna rip me off, you know. And there is there is that mentality, there are a lot of people out there who are like, you know, the retailers are ripping us off, so we've got to work out a way of getting around them. And, you know, it doesn't always work, it would be like buying a car and, you know, the wheel falls off, and if you don't have anywhere, where you can go, it's it's your own your own fault. You've got to fix it yourself.
Rob: And I guess that's the role that the bike shops really need to play, especially contrasting to someone like a department store that's selling cheap bikes. They're not really offering that sale like that after sales service, and they're certainly not specialised in it. And does that sort of then also still come back to that market segment where people are more concerned about maintenance, they're more concerned about the squeaky brakes. Maybe they're doing enough miles on a bike that they need to actually replace the brakes before the bike rusts out?
Stuart: Yeah, that's right. Look, I should have mentioned that in the bike industry today. There are so many, intricate details, so there's hydraulic brakes now, there's electronic shifting. There are all sorts of things that weren't around when I first started racing. So, when I first started racing, a seat post, for example, that goes into a frame, I think there was like three sizes. Today there's about 40 different sizes, the same with the bearings that are used, and the wheel sizes, I mean the tyre sizes are insane. So the guy that works, that's a mechanic in a shop today, is worth his weight in gold, especially if he's, you know, in his 30s or 40s and he, he can remember all of these extra details. But to be an 18 year old mechanic who hasn't done a course today, he's gonna struggle, because there are so many intricacies in the in the industry. The compatibility issues, leave some people completely baffled. So you'll get you'll get the guy that used to have the two hundred dollar bike and he'll bring it into a bike shop and he'll say, I just need new gears and they'll say, that's fine, we can fix that, it's gonna cost you five hundred dollars, you know, and they'll say how can it be, how can it be five hundred dollars. Well, your bikes ten years old and no one uses five speed anymore. It's twelve speed now. And in fact your frame won't fit the new gearing, so we actually need to spread the, you know, the frame so the wheel fits in and we'll need to do this and that. So it, it's moving at such a such a rate. It's almost like software. If you don't keep updating it, you'll have to get a new computer, you know.
Rob: Might not get hacked, but might not work the same.
Stuart: Exactly. Yeah, that's right. It won't be long before you can hack a bike. But, so, yeah, it's a lot more technical today than it was 20 or 30 years ago.
Rob: Do you think those intricacies and all those parts of that industry that you need to understand as even as a distributor, do you think that helps you maintain your place as a distributor?
Stuart: Yeah, definitely, so there's quite a few brands that we have on board, and I'm thankful that I've got great staff because there's a lot to remember. And if you've got good staff that understand the details, the shops will ring and they say, look, we know you guys are the ones to help us with. What size bearing do I need for, what size bolt do I need for, what would you suggest? So the boys are able to answer those questions, and that just relates straight through to sales.
Rob: And so do you think for the opposing reasons that you, like say you wanted to expand your distribution model into, say, fishing equipment. And I'm guessing Shimano on bikes and Shimano in fishing gear is the same brand?
Rob: Do you think you could replicate the model and train a team to do that? Or does it really just come back to that passion for cycling that you've got?
Stuart: Yeah. So something like that would be potentially driven by a supplier. So if a supplier wants to, head into another marketplace. They may raise that with us and say, look, are you interested. And we have had those options in the past and we haven't taken them. Mostly because we run a lean and mean sort of business. And that was, you know, thanks to the global financial crisis. And that would mean I would never necessarily turn down an opportunity like that if it looked like it was going to be profitable, obviously. But I would take more guys on board to do that, because as soon as you switch your focus, you can lose everything you had. And that's a danger in small business. I think if you're a corporation, you can't do that. You can farm people off to diversify. But at our size. Got to be careful to diversify.
Rob: Interesting. So we're coming up on time. But I've got a few quick questions that I'd love to answer you, love to answer, love to ask you. If there was one thing that you had learned in your business career that really stands proud what would that be?
Stuart: Culture is probably the, the biggest thing that I've learned over the years. So that takes a bit of explaining. We've tried to work on getting closer to our retailers and through that, we've created a culture. So every year we have a bike ride. It might be in Melbourne or one of our favourite ones was we recently rode from, out to the convict trial. So was 100 km ride down to St Albans, and we stay down there overnight and drank beer and ate burgers and had chips, and it was just grass roots sort of stuff.
Rob: And slower ride back.
Stuart: It was a slower ride back for me. And that was, that was a great time. And everyone's riding doing what they love. And it just created a really good culture. And so since that, we've continued that. It really is. It really is. People that make it all work. You can sit down and you can look at PNL sheets and work out your cash flow and everything. But, if you're not spending time getting to know customers and just meeting them at where they feel, feel comfortable. Yeah, it's hard to...
Rob: Good people.
Stuart: Make it work. Yeah, good people.
Rob: Cool. If there was a decision that you made along the way at some point that you could change, to change the outcome, what would that be?
Stuart: That's a hard one.
Rob: If there is one.
Stuart: If there was a decision that I thought wasn't a good one to make, I would, I would say following what the industry standard seems to be. Something I learned going through the global financial crisis was I had actually followed a lot of things in the industry because that's just what everybody did. And we paid dearly for that. And it wasn't until I started thinking more outside of the box and what would actually work for me, what would work for my business, what would work for my shops and my suppliers, that I completely changed the structure of the business and put money where I thought it was beneficial and I wished I had done that sooner. But we made those changes and we've seen the benefits from it since.
Rob: And more proof that, that's how it's done is never the answer. That should be given.
Stuart: Exactly. That's right.
Rob: Interesting. And was there a mentor that you had or was there a mentor that you would love to have had along the way?
Stuart: Yeah I have been really blessed, I've had a lot of mentors along the way. And yeah, from my parents, to the coach that I had. And look, Steve's my business partner and we get along great, he's my father in law as well. And we went through some really hard times. Partnerships are hard. No matter what, Steve's in his 70s and he's been in the business for long enough to know where we've come from. He was there through all the hard, hard times and he has been a great sounding board over the last few years. So that's really nice to have to have somebody that's older than you in the business that you can bounce ideas off. So he's been really positive.
Rob: And so, Steve's your father in law, so that's that's an interesting mix of relationships there as well.
Rob: While this isn't a rapid fire question, did you have to navigate that at all or did it all just kind of?
Stuart: Definitely. Yeah, yeah, so I mean, difficult for both of us. You've got, different age groups, different expectations. And, the best thing about it is, is that, as we nutted things through and we realised, okay, Steve, that's your patch, Stuart, that's your patch. And that took years to achieve. To sit down and discuss that pre partnership and say, okay, this is what you're gonna do, this is what I'm going to do. It just doesn't work like that. So we've come out the other end respecting each other's area within the business and supporting each other within those areas. The funny thing is, is our partnership started with Steve kind of being pessimistic and me being optimistic. And now he's optimistic and I'm pessimistic. So I don't know how that happened. But it's great that it is that way, and it's been good times.
Rob: Is it important to have that bit of a kick to keep forging ahead when things maybe don't look so great?
Stuart: Definitely there's an opportunity we're looking at at the moment and, you know, my my staff is saying, go for it. My wife saying go for it. And Steve's going to come on, what are you waiting for. And I'm just sitting on it. I can't believe it. Most of my career, I've been running ahead and doing things before anybody says anything. So I think it's just, you know, I've been in it for 30 years and I've got an older head now and I like to sleep on things, you know. More than one night.
Rob: I mean, if it I think if you're if your staff, your wife and your business partner are all for it, we probably know how that's going to work out.
Stuart: That's right.
Rob: Mate were out of time, but I've really enjoyed this chat. So Stuart Voysey, where can people find out more about your company?
Stuart: We're on the on the web, www.scvimports.com.au. And there'll be listings on there to show our dealers, you can contact our dealers or you can call us there at Tuggerah.
Rob: Excellent. So then probably I've already bought a bike through your business and maybe don't even know it. Stuart Voysey from SCV iImports, I've really enjoyed this chat. Thanks so much.
Stuart: You bet. Thank you. Thanks, Rob.
Rob: There you have it. I hope you've really enjoyed this episode. And if you did, please like it, share it or leave us a review on your favourite platform. It helps us show more of this content to people just like you.