Specialized UK has said it may have to cut staff at newly acquired bike shop chain Rutland Cycling (opens in new tab) to make its business "sustainable".
The American bike brand announced today it had taken over the family-owned Rutland Cycling business, first founded in the 1980s.
Simon Homer, managing director of Specialized UK said the acquisition was an "exciting opportunity" but added: “Immediately, we will have to make some decisions to secure a sustainable future for Rutland and this may involve a restructuring of its network and cost base.
"We will do this with complete clarity and transparency, and with full consideration and consultation for those who may be affected."
He added the brand would be "investing to ensure we strengthen the rider experience" at Rutland.
Homer said: “Specialized will be working very closely with the Rutland team as ownership transfers across. Riders will begin to see some changes to Rutland’s stores as supplier relationships are finalised, but both parties remain committed to ensuring minimal disruption to service."
The acquisition of Rutland follows on from the brand's takeover of Infinity Cycles in Durham, as well as the concept store in East Anglia that Specialized opened in April this year.
Homer said adding Rutland to the Specialized "ecosystem" would allow it to “better serving riders; when, where, and how they want".
Specialized taking over Rutland Cycling mirrors similar acquisitions that have taken place in the USA in recent years.
Trek and Specialized have both made store buyouts in America on a regular basis, and in the UK, Trek has opened several of its own stores such as the one in Bath, Somerset. Furthermore, Specialized has also recently opened a store in Australia as it looks to expand its global reach.
Rutland Cycling was set up in the 1980’s and was in its second generation of family ownership prior to the acquisition. The business has rapidly expanded since it was first established, and attracted £2.8 million in Big Growth Fund money in March 2014 (opens in new tab). At the time, the deal meant that the fund became the largest shareholder in the company.
News of the acquisition by Specialized represents a full exit from the Big Growth Fund.
Rutland had recorded pre-tax losses for years but it benefited from a cycling boom caused by the Covid-19 pandemic to record a pre-tax profit in the 12 months to 1 August 2021 of £874,820. In the prior account period, the 18 months to 26 July 2020, the business recorded a pre-tax loss of £1.4m.
The two brands have a longstanding relationship. The Nottingham branch of Rutland Cycling opened in 2018 with a Specialized logo featuring above the door. The brand initially had an in-store ‘concept area’ on the ground floor of the branch in the city before it then became a specific Specialized concept store.
Rutland is currently a stockist of multiple different bike brands including Cannondale, Scott, Bianchi, Cube, Giant and Whyte and prior to the takeover by Specialized, was one of the leading independent cycle retailers in the UK.
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