Hot of the press! Performance files Chapter 11
Last Post 01/14/2019 04:39 PM by 79 pmooney. 31 Replies.
Author Messages
Dale

Posts:1179

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11/16/2018 10:52 AM
There are a crap load of brands tied up in this fiasco

https://www.bicycleretailer.com/industry-news/2018/11/15/ase-owner-performance-bicycle-and-asi-file-chapter-11?fbclid=IwAR2bldcvzc_90q7FN61G3yBLfWRIsu4MAI4dX8Ct2qVoJEvy__mzWcAYVRw#.W-70nS3MzVo
79pmooney

Posts:2126

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11/16/2018 02:57 PM
It is the parent company that is filing but according to the Velonews piece, the brands Fuji, Breezer and Cycle Tuesday have been showing steady sales and will not be touched.

I don't know Cycle Tuesday at all, Breezer only through early MTB fame and I have Breezer-style dropouts on my first TiCycles. (This was actually a step down from the standard bullets but I liked that that the thicker stays with little taper looked better buttiing up to the breezer-style dropout. Yes, more hassle orienting the QR lever, but I don't race and won't. (Later TiCycles spec'd the same dropouts for its Hyak brand, the Asian made production bikes.)

I have always had a soft spot for Fuji. I worked in the Fuji shop aligned with the dealership '77. Bought and raced a last year's Fuji Pro and absolutely loved that bike. It fit! That platformed extracted effort from this body I didn't know I had. The bike did have a manufacturing flaw which lead to the BB shall breaking at the seat tube. Fuji came through with a frame built between runs, slightly different from that year's and the next. Beautifully built.

The other aspect of Fuji that I always liked was where they cut corners to keep price down and where they didn't. My Pro had a cheap seat and seatpost. Pedals were OK, nothing special. Drive train was Cyclone, Winner, Sugino Mighty. Full on race, no compromise. 144 BCD so all the Campy rings dropped on. I did switch early to Sedis chains and they worked beautifully with the Cyclones and Winner. Brakes were Grande Comp. Not a big name but much better stoppers than that brake everybody else used (and that I had to keep in mind in races). Bars and stem - Nitto (who? - remember, 1977).

I swapped the seat out immediately for the Avocet III i'd been riding. That cheap post? Funny - early on I race the Stowe Race in Vermont. Screaming descent in a light drizzle. COuldn't see ahead. (Glasses.) Stayed 3' to the right of the yellow line. Fine. But I hit a frost heave that I didn't see until it was about 20' away (going close to 50 mph). Got a kick in the butt that put me over a foot in the air. Bike came down straight, wheels rolled smoothly. Good bike! Finish the race in the "money" and win a Zeus seatpost from a local Boston shop. Nice. Took a week and a half to get to the shop to swap it out fror a 26.8 seat tube. Had to race the States the next week on the old post which was now slightly curve back. Painful! I screwed that race up badly, rode easily one of the hardest rides of the day to finisih 6 spots back from qualifying for Nationals. In so much pain at the finish I rode up ont someone's lawn, hit the brakes and keeled over, still strapped in. Horrified my mom, out to see her first race ever.

So that was a big aside! Except for that post (and seat that I never sat on), I loved that bike. I loved that Fuji did it right where it mattered. (That frost heave was a once in a lifetime experience. Haven't even come close since.) Over the years, I have gone into shops and checked out the newer Fujis and it always seemed to me they stuck with the overall philosophy I saw. Good to see that the plug isn't getting pulled (at least now).

Ben
longslowdistance

Posts:1812

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11/16/2018 03:23 PM
Looks likes it’s a maneuver to ditch some low profit stores and get a better deal on brick and mortar leases.

I wonder who bought the Motobecane brand name.
zootracer

Posts:658

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11/16/2018 06:19 PM
Did a lot of buying at Performance back in the day (early 2000's).

Motobecane (I had a few Motobecane's back in the mid 70's) is now owned by Kinesis (Taiwan) . Who have a manufacturing plant in Guangzhou China.

Cosmic Kid

Posts:2759

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11/19/2018 09:22 AM
This comes as absolutely no surprise to me...always expected this deal to fail.

ASI acquired Performance simply because Performance owed them so much money.....as capable as Cunane may be, he doesn't know retail operations and they did not bring in someone who understands how to run retail. Getting ownership of a company because they owe you too much money is rarely the start of good things. Rarely does it get turned around.

The *good news* for us as consumers is that there are deal to be had. Their Black Friday sale is going on now...almost everything is at least 30% off. If you are in the market for a a smart / interactive trainer, now is the time to move. The Elite Qubo Interactive that I used for 2 years is now down to $315. They also have the Elite Zumo, which is the cheapest direct drive trainer on the market...normally $799, now down to $560. Both are stoopid-low prices if you wanna get in on the Zwift world.

Other deals abound....
Just say "NO!" to WCP!!!!
Dale

Posts:1179

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11/19/2018 10:36 AM
Posted By Cosmic Kid on 11/19/2018 09:22 AM
Getting ownership of a company because they owe you too much money is rarely the start of good things. Rarely does it get turned around.



^This.
Also leveraged buyouts where the company gets so loaded with debt that it can't pay the juice
(Toys R Us, I'm looking at you).
Cosmic Kid

Posts:2759

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11/19/2018 11:02 AM
I'll also add (as Dale noted above) that this is really bad news for the industry as a whole. Yeah, the IBD's love to hate on Performance, but they were a major outlet for a number of brands. If the reorg does not work, it will be difficult to replace that volume for a bunch of companies (Pearl Izumi, Shimano, etc).
Just say "NO!" to WCP!!!!
longslowdistance

Posts:1812

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11/19/2018 05:52 PM
Are the Trump tariffs a factor?
Cosmic Kid

Posts:2759

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11/20/2018 07:16 AM
I don’t think so...Performance was in trouble before ASI acquired them and sakes have declined for 6 years.
Just say "NO!" to WCP!!!!
Dale

Posts:1179

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11/20/2018 07:33 AM
Posted By Cosmic Kid on 11/19/2018 11:02 AM
If the reorg does not work, it will be difficult to replace that volume for a bunch of companies (Pearl Izumi, Shimano, etc).


Not just that but the chain reaction of ASI going Chapter 11 and stiffing suppliers means some of THEM will be in trouble.

And so go the dominos
Cosmic Kid

Posts:2759

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11/20/2018 08:42 AM
Yeah, there are rumors brewing of another major supplier about to file Chapter 11....my guess is that it would be Accell North America (Raleigh, Diamond Back, etc). They took a HUGE hit when Sports Authority closed and then lost the Dick's business.
Just say "NO!" to WCP!!!!
Dale

Posts:1179

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11/20/2018 10:04 AM
I saw the dollar amount one supplier was owed when one of the big box stores went under-- it would have sunk a smaller supplier.

It's like the joke where the man worried he couldn't pay the bank the $100,000 he owed. If he owed $100,000,000 it would be the bank that worried.
Cosmic Kid

Posts:2759

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11/20/2018 10:20 AM
Did you see the list of suppliers owed money from Performance (and how much)? Not good for some of them....
Just say "NO!" to WCP!!!!
Dale

Posts:1179

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11/20/2018 02:19 PM
Here it is... read it and weep

Unsecured debts owed to trade suppliers include:

Active Cycle, China: $4.4 million
PT Insera, Indonesia: $3.3 million
Vista Outdoor: $1.77 million
Shanghai General Sports, China: $1.5 million
Mizuki International, Taiwan: $1.4 million
Todson: $548,000
Highway Two: $423,000
Marin: $480,000
Garmin: $290,000
Saris: $285,000
Elite: $264,000
Accell NA: $280,000
Aptos: $212,000
Louis Garneau: $204,000
Wahoo: $202,000
Pearl Izumi: $200,000
Eliptigo: $200,000
Lezyne: $198,000
Castelli: $196,000
J&B: $178,000
Vittoria: $159,000
Fox: $149,000
Clif Bar: $131,000
EN-R-G Food: $82,000
Team Tibco: $35,000
PeopleForBikes: $22,000
PinkBike: $11,000
Orange Crush

Posts:2527

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11/20/2018 02:32 PM
That's a lot of Clif Bars.
Cosmic Kid

Posts:2759

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11/20/2018 03:42 PM
Some of the ones that jump out / concern me are:

Vista Outdoor (Bell, Giro, etc)
Todson
Highway 2
Marin
Lezyne
Accell NA (already hurting...another $300K could push them over the edge)

Most of thsoe concerns are either over the size of the debt (Vista) or what I perceive as to the size of the debt vs. the size of the company (i.e. $200K to Lezyne is a helluva lot more than $200K to Fox).
Just say "NO!" to WCP!!!!
Dale

Posts:1179

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11/20/2018 05:45 PM
That as what I looked at-- Lezyene and Accell jumped out for the same reason as you, and Bell/ Giro... how the heck do you let receivables get to that level? Someone's head should roll over that.
79pmooney

Posts:2126

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11/20/2018 08:53 PM
I don't see Advanced Sports. owner of Fuji, on that list. Good.

Ben
79pmooney

Posts:2126

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11/20/2018 08:54 PM
I don't see Advanced Sports. owner of Fuji, on that list. Good.

Ben
Cosmic Kid

Posts:2759

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11/20/2018 10:45 PM
Ben, ASI is part of the filing. They, along with Performance and Nashbar, are bankrupt.
Just say "NO!" to WCP!!!!
79pmooney

Posts:2126

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11/20/2018 11:49 PM
Double post.

Dang, ASI is in this mess.  I hope someone saves Fuji (though I'm guessing Fuji is now just a name and the bikes come off molds they do not own.

Ben
Cosmic Kid

Posts:2759

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11/21/2018 08:36 AM
No, Fuji has a number of proprietary frame designs, both on the road and the Tri side (would assume the same for MTB).

But they are a far cry from the brand you once knew and loved. Their old steel frames had a “soul” to them and were extremely well-built. Somewhere along the way, they became a “value” brand and lost what made them unique. They then did a lot fo weird frame designs, that even if they were proprietary, looked they they were just open-mold Chinese frames.

Their more recent efforts have been better (their Norcom Straight Tri frame was actually a really nice frame design) but the brand was pretty tainted by then. They became reliant on Performance simply because they could not get enough IBD’s to carry them.
Just say "NO!" to WCP!!!!
Dale

Posts:1179

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11/22/2018 08:20 AM
There are some black holes bike brands go from which they never return- Performance, Dicks, REI, Bass Pro (Ross bikes anyone?)

Once they go there IBD's treat the brand as radioactive.
Cosmic Kid

Posts:2759

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11/22/2018 09:01 AM
I’ll never stop marveling at the IBD’s ability to shoot themselves in the foot...they get high and mighty about bike brands going into certain retailers, but yet continue to embrace others who have a multi-channel distribution strategy.

Discount shops / chains aren’t going away, nor are online sales. Using a brands multi-channel distribution can actually enhance their business in some areas. But the IBD’s are so locked into this ancient idea that they need to “compete” on price vs sporting goods or the mass...it is arcane.

If a supplier builds a solid multi-channel strategy, that offers unique benefits to all channels, it can really be a win-win opportunity. The Mass / Sporting Goods channel gets the validity of carrying an “IBD worthy” brand and the IBD gets the massive exposure of the brand to millions of consumers, enhancing recognition when a customer walks into their shop.

At Brunswick, I worked really hard at developing an IBD- specific strategy for our product line....a “value” brand was not gonna cut it. So we developed all new frame platforms and product spec that shop guys would appreciate. We were beginning to get some traction back in the IBD when they sold the company to Pacific...and that sealed the brands’ fate.
Just say "NO!" to WCP!!!!
Nick A

Posts:578

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11/26/2018 11:43 AM
Understanding market forces has never been my strong suit. But, wow, I remember when Performance started, and actually getting the owner answering the order line back in the day. You'd think that between that, and what we have now, would have been a more conservative, viable, and still wildly successful venture.

N
longslowdistance

Posts:1812

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11/26/2018 11:52 AM
I remember back in the 80s when they were just a shop in Carrboro, NC, making innovative clothing. The discount table with returns and seconds was full of great deals. I still have some of the stuff from then - very well made.
Nick A

Posts:578

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11/26/2018 02:35 PM
Cool. Just when you think you're old school, there's someone even older schooler. LOL.

N
Orange Crush

Posts:2527

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11/26/2018 04:54 PM
Haha - LSD, I am still wearing a Bonfanti cycling jersey from the late 80s. They don't make em like they used to. I had a jacket that lasted till last year but zipper finally gave in.
Cosmic Kid

Posts:2759

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01/14/2019 11:55 AM
*Long, slow whistle*

Specialized to pay ASE $700K for the Roubaix trademark. Dayum...that is a lot of cabbage.
Just say "NO!" to WCP!!!!
79pmooney

Posts:2126

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01/14/2019 04:27 PM
Posted By Orange Crush on 11/26/2018 04:54 PM
Haha - LSD, I am still wearing a Bonfanti cycling jersey from the late 80s. They don't make em like they used to. I had a jacket that lasted till last year but zipper finally gave in.

Sometimes they do.  I have 4 Mavic jerseys that were on big time sale a the local bike chain.  Marked down from ~$100 to $30.  Poor zippers.  But the rest of the jersey is very well made and thought out.  These are sturdy off-season jerseys, fluorescent orange with lots of silver reflecting tape (very well done, zero issues in four years), big, sturdy pockets and (outside the zippers) really good workmanship.  Also fit very well and are a joy to ride. 

For 3 seasons they are my most worn jerseys by a lot.  Visibility yes, but also simply the best non-summer jerseys I've ever had.

Oh, the zippers?  I picked up 4 high quality orange zippers at an outdoor fabric store going out of business for almost nothing.  Had the local laundromat send jerseys and zippers to their seamstress for excellent work.  Turned them into $60 jerseys but still a steal.

Ben
79pmooney

Posts:2126

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01/14/2019 04:28 PM
Bah.  Double post
79pmooney

Posts:2126

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01/14/2019 04:39 PM
Bahh!  Yet another double post.  Cursed internet connection.




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