Why are more of you DIYers not in the e-bike business?

[MadRhino]

Well, as a small business operated at home and giving some work to the kids around, I find it is not that bad. It is not time consuming, so one can still make a living out of another field of work. Most of all, this is a contribution to the EV revolution. The west coast is probably the best region for the ebike market in America.

I wouldn't do it here, where the sales would hardly reach a fraction of Henry's numbers, with the kind of bikes that I build especially. Also, I like to ride, much more than building. I work only a few hours a day and it is making good money for my employees and myself. The rest of the day is for sport and good time. Building for myself and maintaning my bikes is enough. My involvement is limited to help those who are interested, to find what they need to build theirs with success. I lift my hat to those who are willing to do more for the promotion of ebikes.

 

[cal3thousand]

Thanks for posting Henry111. The information that you share is valuable to me. I think that more of us should be in the ebike game instead of people in it without the passion and for just the money.

I agree with others' reasoning in that they may be able to earn more in another field. But, I think an ebike business doesn't need to be a full-time, primary income career. You have shown that it can be a very viable 'Side Hustle'. BTW, I've been listening to Side Hustle School (my new favorite podcast) and your story would do well as a feature.

I've thought about doing it in my spare time, but I don't have a house to be able to do that. Maybe someday.

 

[Henry111]

Well Woodlandhills, it is a pretty profitable HOBBY for an old retired dude who is only open for business 3 days a week and does business by appointment only. I've trained good mechanics, so all I do is greet folks, sell and spend time on my website. I did not mention that I also offer a 1000W/48V and sell a quite a few batteries, helmets, and locks.
Yes, I could have expanded much further than I have, but considering my age and lack of energy, I have simply chosen not to.
But:
For a younger, more ambitious guy not burdened with a lot of built-in negatives... Well...
Have a look at the Prodego operation.
I note that most of the negative objections responded here would apply to any business, not just e-bikes. So those folks should not consider going into a business of ANY KIND.

 

[Ozzzz]

Fascinating Henry111.
Sounds like the basis for a solid business and if kept small fits well as a part timer.. I'd expect your location would be very much an advantage but there's lots of scope for more diversity in a smaller market with variety in range/ production, hire or something (for a local area business). How do you manage warranty? I'd imagine this to be the biggest drawback to sales, where its possible to burn out a mtr or poor treatment of batterys can happen quickly.

Thanks for sharing, very generous.

 

[Henry111]

Fascinating Henry111.
Sounds like the basis for a solid business and if kept small fits well as a part timer.. I'd expect your location would be very much an advantage but there's lots of scope for more diversity in a smaller market with variety in range/ production, hire or something (for a local area business). How do you manage warranty? I'd imagine this to be the biggest drawback to sales, where its possible to burn out a mtr or poor treatment of batterys can happen quickly.

Thanks for sharing, very generous.

Considering my location: Wonderful? Lots of beach paths, friendly bike city, etc., etc. But being near the ocean means that most of my business must come from one side of me--meaning north--clear up into LA proper. South of me is the ocean and, unfortunately, fish don't buy bikes. I am surrounded by 7 Pedego stores (within 25 miles of me), one in Long Beach, just 4 miles away. I love it 'cause e-bike shoppers hear of and go to Pedego first and come away with sticker shock. I tell them: "Pedegos are nice bikes, just over priced and under powered--$2,600.00 for a 250W bike with a 10Ah battery. Gemme a break!" If I were going to open a store front, instead of operating out of my home, I would locate further north, even though Santa Monica is loaded with e-bike stores. But like Pedego, those over-priced imports would just mean more business for me. But I ain't gonna.

Regarding warranties: I offer 6 months on all electronics, 2 years on the batteries. Very few problems. The most prevalent are throttles going bad. I keep my bikes simple to avoid problems--no mid-drives, no pedelecs, no PAS systems, no cruise controls. I make them as bullet-proof as possible. Of course you can't make them fool proof, but I try. Note: My kits all come with a pedelec system, cruise control and an SLA battery charger. I don't install them. I give all of these to my daughter who sells them on Amazon.

MY Home Business License is $265.00 per year. Just got my latest bill. When I asked them what I was going to get for my 265 bucks, their answer was not convincing.

 

[Sunder]

I note that most of the negative objections responded here would apply to any business, not just e-bikes. So those folks should not consider going into a business of ANY KIND.

Pretty arrogant statement there. The risks and aggravations are different for every business. I've run a paint shop before, I'm on the executive team of an IT consulting firm, neither of these businesses have the same risk and aggravation.

As a IT consultant, if I screw up, nobody dies. Your battery starts a fire when someone's sleeping... Who knows what your product liability laws are over there, but we have vicarious liability here, so if they can't get the manufacturer, then the reseller is liable. Other things can go wrong too - undetected crack in the fork, you didn't quite fit the brake right... The chance is tiny, but the liability is so big, that when I got a quote, it was like $3k a year insurance. It'd have to eat up half my profits at the volumes I was intending to do as a side hustle. Do you even have product liability insurance?

If a customer returned a can of paint as "faulty", it's pretty easy to see if it is or not. Whip out a piece of gyprock or wood, and paint some on. If there's no problem, it's their surface. If there is, I'm out $20-50. So what happens if someone says your battery died 3 months in? They left their bike leaning next to the fireplace all winter, and now it's lost 90% of its capacity.

What you might actually have is undiagnosed or under-rated risk. You might think selling a bike is like selling any other consumer good. But eBikes have more potential to be dangerous than most consumer goods, and they're also more fragile than many consumer goods. You know, someone comes on here saying "I want more power!" How often has that happened? They get dodgy advice, swap out your controller for a Sabvoton 12kw model and burn the motor out, swap back, and say "I never touched it, I swear". For $1500, most people are going to go to small claims court over this, even if in the back of their mind, they know they did it. People are bloody dishonest, especially when large sums of money are involved.

Mate, if it's worked for you, all the best. Keep doing it. I mean it. Enjoy. But just because you're doing it, doesn't mean that it's for everyone, and it doesn't mean anyone who has seriously looked at it, and decided "no" can't run any business. Saying that just shows your ignorance.

 

[Ozzzz]

There are some additional risks over on-selling bikes. Even then there are obviously some additional risks as a choice of business V return.
Quality control and liability insurance to minimise?

Thanks for your thoughts on warranty Henry. I'm considering adding a few bikes to our (outdoor) hire gear but i'm half a world away from US and our laws add too much to the tedium for it ever to be a big deal. The little motors and need for PAS add some constraints (here). From my background, i'd actually also see hire and tours (application to long, multi-day tours for older folk) as a business stateside, as another thought bubble for someone looking for ideas with limited budget.

The benefit about having such a (relatively) large market for sales (or anything) is that you have access to that market by quality and innovation, to which the quantity of other shops can only have some impact. It seemed very early days to me, the number of interested people I met who had heard of but never seen an ebike/ never thought of their personal use was surprising (while touring around the mid-west last year).

 

[zackclark70]

Had a good long chat with the owner of my local bike shop today about e-bikes and we agree that its something that would be awesome to do but the liability factor is a pain in the ass if you sell a bike that's over the legal maximum it can cause no end of problems that's not counting issues with battery's fires and what not currently the bike shop just fits components provided by the customer or sourced online as a kit so that the shop is not legally responsible for the wattage speed and battery's

He is looking into doing more in the way of e-bikes and i think i will be working with them on a few things as they are not as familiar with e-bike issues as me plus i have the skills to find issues way quicker than they currently can ( i think it will just be 250w hub motors 24v 10A 36v 7.5A 48v 5A 15.5mph/25kph ) so low end power compared to most bikes but 100% legal the big issue will be battery's as there is 2 options buy premade over priced battery's and have the issues that come with unknown quality or make a custom pack and do all the needed testing

i think it would make more money dealing in high end e-bikes there is lot of £3000 + bikes out there so i think this is an area that quality over qty would be better

 

[fechter]

Battery fires are no joke. Just one incident could totally wipe out a business. I have helped lots of people in the business, but I suck at business and do pretty well at my day job. Maybe when I retire in a few years I might do something bike related.

 

[2old]

Henry, thanks for the breakdown; as a supplement to your retirement funds, this is a good sideline as long as you're protected from liability. BTW, were you at Myron's with Eugene last September?

 

[MadRhino]

I knew from the start, before building my first ebike, that I would never get into that kind of business. I have been into motorcycles when I was young, and even if it is a much better market than ebikes, I would never go back to that kind of business. I was young and believed that motorcycles would give me easy money, and I would spend my time doing art. Life just turned out the other way around. I have made easy money with art, and spend my time riding. :wink:

 

[ferret]

I note that most of the negative objections responded here would apply to any business, not just e-bikes. So those folks should not consider going into a business of ANY KIND.

I think you are %100 right and it also answers your initial question "Why are more of you DIYers not in the e-bike business?".

Just because a person is a DIYer, mechanically/electrically knowledgeable/skilled, likes do build and ride etc. doesn't mean that that person has the skills, abilities or inclination to start or run a business operation.

You might as well ask the question "Why are more of bushiness owners not into DIY ebike building?". Why would they be? Why would a DIYer start a business?

Avner.

 

[zackclark70]

I note that most of the negative objections responded here would apply to any business, not just e-bikes. So those folks should not consider going into a business of ANY KIND.

I think you are %100 right and it also answers your initial question "Why are more of you DIYers not in the e-bike business?".

Just because a person is a DIYer, mechanically/electrically knowledgeable/skilled, likes do build and ride etc. doesn't mean that that person has the skills, abilities or inclination to start or run a business operation.

You might as well ask the question "Why are more of bushiness owners not into DIY ebike building?". Why would they be? Why would a DIYer start a business?

Avner.

LOL there are plenty of people here that run there own business they just dont care about this thread i have been running my own business for years just not e-bike related when i have the money i will probably start making and selling battery packs to the UK/EU but that needs a bunch of time and money to do all the needed tested

 

[dogman dan]

Speaking of risk, I did not see any liability insurance in that list of costs.

 

[Henry111]

Well, I can see that I am barking at the wrong door.
Fact is, however, I already knew that when I started this thread. But, nevertheless, my research instincts told me that thoughts generated by folks like you, who are already enthusiastic e-bike builders, would prove valuable, and it has. Furthermore it confirmed my original opinion.
And that is:
I really should be talking to folks who are already in, or just starting in, or just interested in getting into the e-bike business.
So what has this been all about:
I have purchased the domain name: PEBA (Professional E-bike Builder Association) and have already designed the logo and now in the process of building the website.
PEBA will be dedicated to professionals who build, or want to build. their own e-bikes FOR RESELL. By building their own bikes, and it ain't rocket science (as I think dogman of E-bikekit will assure you) they cut out the middle man and escape from those over-priced importers, offering e-bikes that were mostly designed for the European and Asian markets, and go out of business faster than the dealer can get their bikes on his floor. And do it without betting the farm, even starting with just one bike at a time.
With that, I want to thank all of you who were so kind as to give me your valuable input.
Cordially.
Henry111

 

[Chalo]

Speaking of risk, I did not see any liability insurance in that list of costs.

Most bike manufacturers won't sell wholesale to a dealer who doesn't show proof of liability insurance. Perhaps Micargi does; they certainly have a fly-by-night vibe about them.

I'm pretty sure that as a legitimate commercial enterprise, costs would be higher-- and outside of coastal California, prices would probably have to be lower. But real bike dealers don't make 54% margin. We make about 40 percent gross margin before associated per-unit costs and overhead, and often less on expensive bikes. As I said before, sometimes that can result in a small profit. Sometimes not.

There is an electric bike dealer across the river from my shop. This is what they have to offer for 1500 clams: https://shop.rocketelectrics.com/collections/juiced-riders/products/copy-of-bike-juiced-cross-current-2016

I'm sure it's nothing special, but it appears to be a lot more bike than an off-brand beach cruiser with a cheap hub motor kit installed. It has a manufacturer behind it. This is the value you have to match or beat to make an e-bike business work where I am.

 

[marvak]

But that battery looks ridiculuosly small. Either its fake, or they use some cheap custom made frame from china, in witch case its not worth $900

 

[marvak]

You can have this as reference. German made motor and battery system. Top quality bike parts, like pinion gearbox.

Price is ~4000€

http://www.radrezept.com

http://www.radrezept.com/bikes/getrieberad/pcustom

 

[Henry111]

That's a 350W bike with a 48V (would you believe) 7Ah battery.

 

[MadRhino]

A shop nearby has some Cannondale and Specialized ebikes. Expansive BB drives with high end components. He has sold 6 this year, with maybe a chance to sell 3 more before the end of the season. It is a very little part of his business. His staff is spending a lot of time answering questions, for very few sales. Yet it may be better in a few years. People here are spending a lot on bikes, but the ebike is slow to take off. The best success around is in rental e-scooters.

 

[Henry111]

But that battery looks ridiculuosly small. Either its fake, or they use some cheap custom made frame from china, in witch case its not worth $900

Please name me some frames that are NOT made in China?
Further more:
Name me some (so called) Chinese frames that are NOT made in Taiwan?
Yes, I do know that there are a few high-end CUSTOM frame builders in the USA--if your pockets are deep enough.

 

[Henry111]

Although, Pedego is a competitor of mine, and I often complain that their bikes are over-priced and under-powered, I still must say that when it comes to MARKETING e-bikes in the USA, Pedego is the only company who has really figured out how it should be done. Partly because they understand the market better than any of those big-time importers.
They all envy Pedego, and surely some of them (considering their expensive R&D) are smart enough, so it must be that they are just too lazy to put in the work that Don DiCostano has put into building Pedego. Many of them have the notion that all they have to do is import bikes with a lot of fancy gatgets, bells and whistles, and bullshit the American bike dealer into buying and selling them. Ain't happening! Meanwhile Pedego just keeps on adding to their string of Pedego stores--maybe thinking a little like Tesla.

 

[2old]

Juiced, the bike that Chalo referenced has a 28 mph bike with 350w motor ans 8.8 a-h battery for $1195. The ones that I've ridden (Interbike and other expos) seem like an excellent deal.

 

[MadRhino]

But that battery looks ridiculuosly small. Either its fake, or they use some cheap custom made frame from china, in witch case its not worth $900

Please name me some frames that are NOT made in China?
Further more:
Name me some (so called) Chinese frames that are NOT made in Taiwan?
Yes, I do know that there are a few high-end CUSTOM frame builders in the USA--if your pockets are deep enough.

Asian industry had changed. China is now a much bigger player, and Taiwan a major western sub-contractor.
American and European bike brands are having most of their frames made in Taiwan, where they make better frames than most American manufacturers could do at a profitable cost. Chinese frames are Chinese, much cheaper, and poor quality for most. Taiwan bike frames are too expansive for the Chinese market since western companies had established their western standards and quality control in the Taiwanese industry. When you buy a 10,000$ carbon racing bicycle, the frame is most likely made in Taiwan.

 

[Chalo]

But that battery looks ridiculuosly small. Either its fake, or they use some cheap custom made frame from china, in witch case its not worth $900

I worked on one of those bikes for a regular customer recently. The battery tucks down into the frame tube, which is more of a channel at that location. The bike seemed more than acceptable, like a $1000 bike if it had been pedal only. I was surprised to find out only costs $1500. Most e-bikes seem to cost triple or more what they would if they were pedal bikes.