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Speaking at the annual Trek World dealer meeting on Monday evening, ​Trek president John Burke told several thousand Trek dealers about a plan that has been two years in the making and called it the “largest investment Trek has ever made.” As of late September, customers will be able to select and purchase any Trek bicycles as well as parts and accessories from Bontrager directly on the company's website. Bikes will be delivered to a Trek shop of the customer's choosing for assembly and final delivery, with the shop receiving a "service commission" for its troubles.

The move is being made in response to the global increase in online business and changing shopping habits in the biking world, although the company is emphasizing improving the shopping experience rather than lowering the final cost of the product to the end-consumer at this point, citing "24/7 availability and convenience" as the main reason riders like to go online to shop these days. This is of course still very different to the pure online brands (Canyon, YT, Commencal, etc), because the bike shops are still an obligatory part of the sales process (you will not be able to choose to have your new Trek delivered directly to your doorstep), but it is still a very significant step and one that Trek would not be taking unless it truly believed that people will increasingly want to be able to buy bikes online. As for the end prices - they remain the same at this point, but it is not too far-fetched to imagine that Trek is merely laying the groundwork now to be able to compete to a degree with the consumer-direct brands on price in the future.

The service commission will be equal to about 80% of the margin shops receive on bike sales today. With orders being fulfilled from Trek's central stock as opposed to the shop's own, Trek says shops will also face less cost of sales, implying a financial status quo for dealers as the end game for now. Of course, if Trek is taking 20% of the shop margin for itself, it is also because it believes it can now do a better or at least more profitable job of marketing, selling, and distributing its product itself, with only point-of-sale and post-sale service left entirely in the hands of the dealers.

On the topic of service, Trek is also launching a dealer service certification program, quoting the high profitability of service vs product sales as the path to survival in an increasingly competitive and connected world. To support this new program, Trek is building a 5,000 square foot service education center at its Wisconsin factory.

E-Bikes were also mentioned as a path to growth, and the company is introducing 3 new e-bike models this week.

Source: Bicycle Retailer

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