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It's been an interesting rollover. The worlds remain pretty even, but where there are differences, the seem to be largely a function of people entering into new markets and having (or not having) competition in those markets. But before we dive into that, let's look at the big picture

So, in terms of sales, China and EU remain pretty close to one another; there's only about 10% difference in the revenue each region is generating. That suggest that, over all, the firms face pretty similar opportunities.

Having the same sort of revenue generating capacity, the picture is strikingly difference when it comes to profit; China—for whatever reason—seems to be nearly twice as profitable as the European Union.

That's kind of surprising because the actually COGS in China is noticeably higher than that in the EU. Yes, both regions are making in-roads into reducing their production costs, but the EU seems to be doing a much better job of that. So where are these extra costs coming from? 

Well part of it must be the spending that China has done on new capacity, where there is about a 10% difference in capacity between the two regions.

Nevertheless, China doesn't have a  lot of idle capacity (certainly not 10% more that the EU), so they must be producing a lot more bikes (well, technically SCU, I suppose). I'll leave to folk in the individual regions to comment on that.

What China is spending a good chunk of money on is Quality.  The quality-gap between the two regions is distinct, and is a function of—I think—the different (aggregate) strategies the regions are pursuing. More on that later.

The difference sure ain't in the advertising. The costs are pretty much in-line with the sales in each region.

Another thing that is different is that the EU is more stingy with its retailers. 

Let's take a little look at that revenue again, and the difference in the strategies of the regions. First, the EU has a couple of big 'revenue generating firm'.  And whilst both regions have the same number of products, they are concentrated quite differently. 

European Union
** 3 **
European Union
RHO Inc.
** 3 **
European Union
Rackk City Bikes
** 3 **
European Union
Jack It Up
Wheelie Cool Bikes
Wheelin N Dealin
European Union
Munchy Bikes
European Union
-- 1 --

The difference is even more stark when you look at the perceptual maps of the two regions. Firms in the EU have gone into more markets than those in China ... and when they have gone into markets, they've not face any real competition. This gives them the opportunity to 'cream it'. And some are definitely doing that.

It's kind of surprising to me, that Pedal didn't launch a new bike (or more). I wonder what's going on there.

As an aside, Munchy Bikes seems to have a good strategy (in many ways), but it's not clear if they are executing well. (Mind you, they are still rated HOLD). 

That's probably true for PeakPerformanceBros who didn't have enough stock.  I wonder whats going on with Adv3.

Any how, let's see how that translates into cold hard numbers.

There's a lot to like about PsiclePath and JackItUp. Look at that margin. Very nice. If the grow their sales/capacity/etc they will be unstoppable. Again, it's down to execution. I do like their profit too.

RHO Inc, and PeakPerformanceBros have a reasonable margin in the 10-19% range. 

At the bottom is Pedal and Wheelie Cool Bikes who are both spending more than they are earning. They'll need to cut their cloth to fit.

European UnionPsiclePath$9,473,251$41,716,66823%
European UnionJack It Up$7,140,056$34,804,75821%
ChinaRHO Inc.$5,191,912$38,926,70713%
European UnionPeakPerformanceBros$4,896,132$46,271,36411%
European UnionMunchy Bikes$1,406,673$22,110,6616%
European UnionRackk City Bikes$1,145,632$35,584,2563%
ChinaWheelin N Dealin$641,601$24,416,6393%
European UnionPedal-$984,841$15,113,560-7%
ChinaWheelie Cool Bikes-$2,603,071$25,397,696-10%

Turning to how much capacity firms have, Sugma has the largest factory. I wonder what their idle time looks like.

European UnionRackk City Bikes$1,145,632$35,584,25641,384
European UnionPsiclePath$9,473,251$41,716,66838,810
European UnionPeakPerformanceBros$4,896,132$46,271,36438,316
ChinaRHO Inc.$5,191,912$38,926,70738,192
ChinaWheelin N Dealin$641,601$24,416,63935,191
European UnionMunchy Bikes$1,406,673$22,110,66132,066
European UnionPedal-$984,841$15,113,56031,208
European UnionJack It Up$7,140,056$34,804,75830,717
ChinaWheelie Cool Bikes-$2,603,071$25,397,69630,208

And so to the big board, and at the top is PeakPerformanceBros If they'd had a margin as good as Jack it up, they'd be hard to stop. But there is a pack close behind them of PsiclePath, RHO Inc, Jack It Up, and Sugma Interestingly, as I dig into the data, RHO Inc is the firm were everything looks pretty reasonable and solid; all the other firms have some area (or areas) where things are out of wack. RHO Inc just needs to do more.

Rackk City BikesE.N.T.E.R.T.A.I.N, and Sigma are in the middle really. For E.N.T.E.R.T.A.I.N, this represents something of a move upward, but I suspect Sigma and Rackk City Bikes are a little disappointed in their performance.

Of the four firms at the bottom, I'm curious to see how they turn things around ... it's not desperate yet, but they are in danger of getting too far behind.

European UnionPeakPerformanceBros$27.25$4,896,132$46,271,36438,316$9,737,184
European UnionPsiclePath$24.88$9,473,251$41,716,66838,810$20,320,174
ChinaRHO Inc.$22.87$5,191,912$38,926,70738,192$10,613,206
European UnionJack It Up$22.85$7,140,056$34,804,75830,717$14,828,472
European UnionRackk City Bikes$16.74$1,145,632$35,584,25641,384$6,818,033
ChinaWheelin N Dealin$12.47$641,601$24,416,63935,191$3,183,291
European UnionMunchy Bikes$11.02$1,406,673$22,110,66132,066$7,373,266
ChinaWheelie Cool Bikes$9.53-$2,603,071$25,397,69630,208$1,511,575
European UnionPedal$8.69-$984,841$15,113,56031,208$3,012,881

Digging into the results, is Sugma copying Simga too much. They both Sigma and Sugma have ended up with too much unsold product. But that's normally easy to fix. 

So, no-one is really in the commuter business; with the continuing rise of e-bikes (and e-scooters), I wonder if that's a good thing ... or is it just a thing. 

Meanwhile, back in the EU, there seems to be a lot of lost sales for most folk. Is that a consequence of being lucky or unlucky (or good). I'll leave that to you to decide.

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  1. Peter Smith AUTHOR

    Tom Crutzen "Inserted the Chart from Table macro"


    So I graphed a few things, and was struck by this.

    Looking at the graph, one has to wonder why—given their revenue–Rackk City Bikes, and Wheelie Cool Bikes don't have a higher SHV. What are they spending their money on?