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From bedroom start up to multinational distribution

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Top customer service, exclusive products and rock-solid international relationships helped Merlin Cycles go from bedroom start-up to selling in 40 countries.

It is 26 years since John Moss turned his passion for cycling into a successful business. Today, Merlin Cycles employs 43 people and ships bikes to 40 countries across the globe. From advertising in the back of specialist cycling magazines to become a leading online player, the company has successfully negotiated a world of changing business practices and technology to become a well-known name among the cycling community.

Moss, who started the business from his bedroom and is now chief executive, says that the company has thrived because of its strong international partnerships, family-run ethos and willingness to expand at the right time.

“I set this up as a mail-order business,” he says. “I’d worked for other people in the industry and thought, ‘We should be doing this ourselves, really.’”

Business with a personal touch

When Merlin Cycles started, e-commerce was more of a nice idea than a commercial reality. Instead, Moss built his company by advertising to other enthusiasts in the back of the cycling press.

“It was a mail-order business, and very much about lifestyle,” he explains. “We grew quickly in the first year and then we acquired a warehouse. A little later, we grew more internet savvy, and as e-commerce started to grow, we grew with it.”

He attributes the company’s success in a competitive world to its family-owned nature. “We’ve always been known for customer service,” he says. “It’s still a personal service. Unlike bigger competitors, we aren’t owned by a private equity firm – so we can afford to be different.”

Merlin has worked hard on maintaining strong international relationships, which helps it to offer bikes at competitive prices. It is the sole UK distributor for a large Dutch brand, and has excellent relationships with other businesses.

“Having exclusive products means we aren’t having to compete solely on price,” says Moss. “We also pride ourselves on our relationships. Initially our way into the market was to offer similar products to the bigger brands, but at better prices.”

Merlin’s relationship with HSBC stretches back 10 years, when the company received a visit from one of the bank’s relationship managers at its offices in Chorley, Lancashire.

Making the most of the cycling boom

Cycling has always been a popular pastime in the UK, but two key events earlier this decade propelled it into the limelight and produced a boom time for bicycle sellers.

The success of Sir Bradley Wiggins in the Tour de France – and the publicity given to the sport in the 2012 Olympics – pushed up sales and awareness hugely. By 2016 more than two million people across the country were cycling once a week, and Halfords and its rivals posted rising sales.

“That was definitely the boom time,” says Moss. “It has allowed us and others to grow quite nicely, really.” Moss says that he was lucky to be “in just the right place at the right time”, but that HSBC’s flexibility and support really helped the company to take advantage of the boom.

“HSBC had quite a fresh and different attitude, and helped us to increase our facilities. This allowed us to buy better and buy more and really did help us grow.

“We were already established in the marketplace and our name was at the forefront of people’s minds. We expanded the warehouse quite a lot during that period – from 6,500 sq ft to 35,000 sq ft now.”

“They were different from our previous bank, and a lot more flexible,” says Moss. The relationship led to Merlin achieving the finance needed to upsize its office in order to cope with increasing demand – just as Britain got the cycling bug in the early 2010s.

Moss says that he has valued the stability of the HSBC staff during his time with the bank. “Throughout all that time we’ve had just two different relationship managers. With the previous bank they were always changing.”

New terrain for cycling brands

Despite uncertainties over Brexit (“Like everyone else I wish there were more visibility,” says Moss), he has ambitions to grow the business further. In the UK, he says, gravel bikes are particularly popular as they suit the range of terrain that British cyclists encounter. As well as producing popular ranges such as the light and versatile Malt-G1, for the UK market, Moss is making the most of international sales.

Plans for the next few years include taking advantage of the increased interest in cycling in countries that haven’t traditionally been associated with the sport, such as much of South America.

“America is our biggest customer overseas, followed by Japan and Australia, but there is a lot of growth to come as cycling becomes more popular in places such as Colombia. We hope for new countries to sell to, and to find our way to those markets.”

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