Bicycles Online Ridding Cloud to Success
This content is produced by The Australian Financial Review in commercial partnership with Telstra.
Bicycles Online built its fast growing business from scratch with cloud software and services that have given it digital tools that were once only the province of large enterprises.
The five year old, tech-savvy company has employed a range of cloud-based software covering online sales, accounting, file sharing, collaboration, customer relationship management (CRM) and enterprise resource management (ERP).
The next weapon in Bicycles Online's digital armoury is taking advantage of big data analytics, an area many larger, mature companies are just coming to grips with.
Bicycles Online got its start in early 2011 when co-founders Jonathon Allara and James van Rooyen needed to refresh the bike fleet for their bike rental outfit - Manly Bike Tours.
The pair had noticed that while there were about 300 bicycle brands on sale in Australia, only a handful of major manufacturers actually made the bikes. They decided to cut out the wholesale middleman with their next bike fleet refresh and buy straight from the manufacturer, in this case from Indonesia-based Polygon Bikes.
They brought in a container of 130 bikes and sold the bikes they did not need for their Manly-based bike tours business on eBay.
The bikes sold out within three weeks and the pair realised there was an opening in the market for an Australian online bikes salesoperation sourcing direct from the manufacturer.
Bypass the middleman
"There was an opportunity to bypass the middleman," says Allara.
They kept importing the Polygon bikes, founded the Bicycles Online business and managed to buy the domain name that had already been registered by another business for $500.
"It is a really powerful search term," says Allara.
Allara and van Rooyen then bet their business concept on their first major shipment where they had the chance to buy 1200 old stock bikes from Polygon at a big discount.
They were able to move the shipment through the August to December 2012 Christmas sales season and make a tidy profit.
"It gave us a big kick-up in the world," says Allara. The business has since flourished with strong annual growth. Bicycles Online turned over about $5 million in 2015. Bicycles Online is now expanding into its own brand of bike accessories and intends to lift its national profile in the coming year.
The company's software armoury has expanded along the way.
Customer interaction was one of the first challenges faced and cloud-based Zendesk was brought in to help.
"It manages all our customer enquiry channels including email, live chat and phone calls," says Allara. "You can measure performance and see how we are going from the customer satisfaction side of things." Bicycles Online handles about 4500 customer interactions a month.
Other cloud based apps and services the business uses include Google Apps for document management, Dropbox for file exchange, Inventory Planner for stock and Saasu for accounting.
The ecommerce core of the business sits on the Telstra owned Neto package, available on the Telstra Apps Marketplace.
"With Neto it's all local. The integration with eBay is much better and the integration with all the shipping partners is reallygood," says Allara.
Bicycles Online is increasingly using Google Analytics for business insights, discovering that including a product video on a bike increased the sales conversion rate by 40 per cent.
Allara believes using the cloud gives emerging businesses an edge in that they do not have to splash money building on-premise hardware and software systems.
"We are completely in the cloud," he says.