Love of the sport, opportunity leads tech entrepreneur to open
Concept Cyclery
MORGAN HILL
Bruce Hollibaugh was a Silicon Valley electronics entrepreneur for nearly two decades, running a semiconductor manufacturer, then went on to consult. He never planned to work in another business – much less retail.
The Morgan Hill outdoors lover and avid bicyclist was looking for a high-end Specialized Bicycle Components brand bike and found there wasn’t “enough inventory” in shops he visited in and around South County. His search led him to visit Morgan Hill-based Specialized headquarters for a referral to a dealer. By chance, he spoke with the company’s marketing executive, who “mentioned (Specialized) was looking for entrepreneurs who wanted to open a concept store,” Hollibaugh recalls.
Bingo. It was summer 2006 and Hollibaugh became “intrigued” at the idea of opening a store. A little more than a year later the idea is reality: On Oct. 20 Concept Cyclery opened a 5,500-square-foot store on East Dunne Avenue. First impression of the store is that it’s a cross between a Foot Locker and a car dealership, with neat rows of bikes. There are three flat screen TVs tuned to bicycle racing coverage and about half of the store is clothing neatly hung on racks.
The Concept Cyclery is tailored to be the “Nordstrom” of bicycle stores, he says, complete with a VIP program in which Hollibaugh and his staff go to busy high-level Silicon Valley executives and star musicians instead of them coming to the store.
“I designed the store to be experience-based,” says the bespectacled Hollibaugh, dressed in a black Specialized shirt and black slacks. “It’s more like a showroom than a standard bike shop.”
Naomi’s, a coffee shop named after the building owner’s wife, will soon open next door to the Cyclery, which is open seven days a week and has six full-time and four part-time employees, Hollibaugh says amid fielding calls on his Treo smartphone. Much like in a shoe store or a car dealership, few products are on display while the rest of the inventory is in the back of the shop or in a warehouse. So, although it isn’t apparent, the store offers “a broader selection” than most South County bicycle shops. In addition to Specialized, Cyclery sells the Spanish bike brand Orbea.
But not everyone thinks the concept store idea can work in smaller towns. Brian Lucas, owner of Off the Chain Bikes in Hollister, said his business appeals to a wide customer base and is skeptical the concept store can make it. He believes the idea for these types of stores was taken from how Harley Davidson turned its business around.
“That’s what Specialized is applying to the bike market,” says Lucas, whose store carries the brand. “I’m so used to seeing bicycle shops that do it all. If you just want to do (a high-end shop) that’ll probably work in a bigger city. In a small town, it’s probably not going to work.”
Josh Moore of Mountain View, president of Responsible Organized Mountain Pedalers, R.O.M.P., a 300-member nonprofit organization that represents bicyclists’ interest in the Bay area, said “there’s definitely a demand for Specialized and high-end” bicycles and parts and many bike shops in existence are “not high-end, boutique concept stores.
“I definitely think there’s a market” for stores such as Concept Cyclery, Moore said. “The idea of spending $2,000 or $5,000 is totally within people’s discretionary income.”
One fact everyone agrees on is that South Valley offers plenty of trails and paved tracks for avid bicyclists like Morgan Hill resident Leslie Nary, and there’s no shortage of bicycle groups. Henry Coe State Park has thousands of miles of track and there’s a bike trail stretching 20 miles along the Coyote Creek. Hollibaugh anticipates his business will boom in the next five to 10 years thanks to “baby boomers and women,” whose participation is contributing to making bicycling an “exploding sport.
“A lot of people are trying to reconnect, especially the over-40 crowd,” Hollibaugh says.
Nary is in that demographic. She moved back to the Bay Area from New York state four months ago. She rides every Saturday morning with other women, including Hollibaugh’s wife, Jennifer. The group members sign up for the ride at the store.
“I’m a middle-aged woman and … (biking) keeps me younger,” she said. “It’s fun, it’s a great physical endeavor, the people you meet are really, really nice people.”
As far as Concept Cyclery, Nary said its customer service is what makes it stand out from other shops.
“Typically a lot of bike shops the guys that work there, they ride, but they’re not the best customer service people in the world,” Nary said. “Particularly for women, especially middle-age women … you’re not exactly treated with respect. (Concept Cyclery) treated me with respect. If I’m going to go somewhere, that’s where I’m going to go.”
