Ibex Interview

We’ve recently had a chance to sit down with Jack Ailion, owner, and founder of IBEX Bicycles.  The IBEX brand is sold direct to the consumer, primarily via the Internet.  The company was formed specifically to fill this niche.  Still a relative newcomer to the scene, IBEX started with 10 models in their first model year, 200,2 and has since expanded to an impressive high of 30 individual bike models as well as several frame styles available separately. In case you find yourself unfamiliar with IBEX, rest assured you will be hearing a lot about them in seasons to come. 

 Q. With IBEX available strictly from the manufacturer, what are some of the benefits of buying factory direct for consumers?

 JA: “First and foremost is price.  Prices on our website are generally set about 25% to 35% below MSRP on any given model.  Our MSRP’s are a pretty accurate reflection of what our IBEX models would sell for if we sold through dealers, and what comparable bikes in other brands do sell for there.

From the customer’s point of view, I think there are two ways to approach this… either you already know the level of bike you’re looking for and you can save some big dollars with IBEX… or you have a set budget in mind and you end up getting a lot more bike from us for the same money.

 There are other benefits, as well.  If you don’t have a bike shop near you or just don’t want to be bothered, it’s nice to know that you can look over our website and order a bike anytime, day or night… and then have it delivered to your door. 

 Another big issue is sales tax.  Unless you live in Georgia, where we are based, there’s no sales tax on out-of-state purchases.  I know the rate is different all over, but where we are sales tax is 7%.  Our shipping charge is $35 per bike on most models, and that works out to be about the same as the tax a $500 bike.  On higher-end bikes you actually end up saving even more over a local purchase just by not having to pay tax.  So, if you’re looking at a bike we sell for $1,500, the chances are it would run about $2,000 in a bike shop.  So, you’re saving $500 on the price and another $70, or so, on the tax… after deducting the shipping.

 Finally, and I’m certainly biased on this, but I think we make a heck of a good product, so to me, just being able to choose an IBEX for your next bike is a benefit in itself.”

 Q. Are there any disadvantages?

 JA: “On the surface there do seem to be, but I think we’ve done a very good job of working them out.  A lot of folks are initially skeptical about buying online.  After all, we are asking you to buy based on specs and photos… and many of our customers are concerned about whether the build quality will be what they expect, what size and model to choose, what sort of post-sale support they can count on and what sort of challenges they will face with final assembly.  In other words, they figure there must be a catch… and there really isn’t one.

 We use quality materials and do our best to select name brand components so that you know exactly what your bike is going to be equipped with before you buy it.  Still, we do offer a 30-day Satisfaction Guarantee… so you’re not going to end up stuck with something you don’t like.  I think our bikes are better than our customers are usually expecting them to be and there’s nothing I like more than to hear ‘I can’t believe I got this nice a bike for what I paid’.

 We support our bikes with great customer service... or at least I certainly think so.  We’ve got people here who know what they’re talking about whether it’s helping with selecting or sizing a new bike or just trying to solve a problem later on.

 Final assembly is an especially big worry for most newbies.   But, we fully assemble and tune our bikes then take them apart just enough to pack in a reasonably sized shipping carton… so, final set-up on our bikes is very easy.  Front wheel, pedals… drop in the seatpost & saddle… bolt the handlebars in to the stem… air up the tires (and shocks on some models) and you’re ready to ride.

 I know a lot of bike shops offer free tune-ups with a new bike purchase, but it’s not been a huge issue for us.  If the bike is properly tuned at the beginning, post break-in tune-ups mostly involve re-tensioning the cables as they stretch… and we find that most people who really get into it eventually want to learn to do minor maintenance like that themselves, anyway.”

 Q. Having ridden several Ibex models in the past myself, I must say that build quality and component selection are top notch. And, the prices are very good. How do you manage to price your bikes so competitively?

 JA: “It’s pretty simple!  There are no dealer profits added into the price of the bike!  We also run a very lean operation… keep our overhead costs down.  We don’t have fancy office buildings and we don’t have meetings on the golf course or hold corporate seminars in the Bahamas.  I work at this.  I’m involved in just about every aspect of the business, from answering phone calls and email, to product development and so on… I’ll even roll up my sleeves and pitch in with shipping when we get backed up.  Everyone around IBEX has to be able to handle a lot of different jobs.”

 Q: What inspired you to take the initial plunge into the competitive field of bicycle manufacturing?

 JA: “Two words… ‘sticker shock!’

 When I first dreamed up IBEX there really weren’t a lot of bikes available on the Internet.  This was around late 1999 or early 2000.  I was shopping for a new bike for the first time in several years and really wasn’t prepared for the high prices I found on the bikes that I was interested in.  I looked on the Internet and just didn’t find much there.  I figured I’d find online dealers offering the same brands as the LBS at lower prices … but, mostly found either low-end department store bikes or extremely high-end customs.  I discovered pretty quickly that the mainstream brands don’t allow their bikes to be sold over the Internet and, in fact, give dealers very little leeway for discounting.  In mid-priced bikes, I did locate a few 2^nd tier brands being offered online… by resellers, not direct… but nothing that seemed all that impressive or all that great of a deal.

 It looked like there was definitely a hole in the market for better bikes at lower prices and I thought I saw an opportunity to do something with it.  I had not been involved in the bicycle industry before this, but I had a pretty good head-start… a lot experience in other businesses with setting up overseas manufacturing, dealing with import regulations, warehousing and such.  I had one venture going already doing some marketing over the Internet, but I wasn’t real happy with the products… so, I dropped that and started working on putting IBEX together.

 IBEX certainly wasn’t the first brand to be available directly from the maker and wasn’t the first brand available on the Internet, but it may very well have been the first in our range of bike classes designed specifically for direct-to-the-consumer sales on the Internet… and absolutely the first to offer as wide a selection as we do for this type of marketing.”

Q: What were some of the biggest challenges you faced as a new brand?

 JA: “I guess just getting the word out about IBEX has been our biggest hurdle.  IBEX is, by no means, a household name at this point.  We advertise, mostly online since that is our ‘location’, and we get a lot of very good ‘word of mouth’.  But, we’re still just now making it on to the radar screens of the biking community at large.  It’s a lot of fun to see the excited reaction some of our new customers get when they first discover IBEX.”

 Q: It does indeed appear that your products are well tailored to the market segment. How are you keeping on top of what riders really want?

 JA: “I talk to a lot of our customers myself and I have good feel for who they are.  I think our basic demographics are split pretty evenly between dedicated bike enthusiasts, new riders and those returning to the sport after a long hiatus.  This may be much the same for the LBS market, but, the one thing our customers all tend to have in common is that they’re all looking to get the most bike they can get for their money!  Whether it’s a newbie looking for an entry-level bike or a more experienced rider ready to upgrade to a higher-end bike, bang for the buck is a huge factor for them… and for us.  That’s a big part of what we focus on.  I mean, we don’t want to cut corners on our bikes.  We have to streamline our distribution process so that we can put out a really good product at a price that stands out from the crowd.”

 Q: Do you foresee Ibex eventually selling bicycles through the traditional channels in the future?

 JA: “We have no immediate plans to sell through dealers, if that’s what you mean.  Frankly, we get requests from dealers all the time and, early on, we actually did sell through a few.  However, it just doesn’t jibe with the main focus of what we intended to do in the beginning.  To find IBEX in your LBS would mean that you’d be paying much the same as for comparable models in other brands found there.  Not to blame the dealer either, there is simply no way to price a bicycle so that the dealers get a profit margin compared to with what we can do selling direct.”

 Q: According to many of the online communities, IBEX is developing quite a reputation for standing behind their products; tell me a little bit about the warranty comes with an Ibex Bicycle?

 JA: “Our frames carry a lifetime warranty to the original owner and the components are covered to the exact same extent as with any other bike brand.  For example, Shimano has a 2-year warranty… most shock makers offer 1 to 2-years coverage… and so on…”

 Q: What bikes seem to be selling best for IBEX right now?

 JA: “Well, full-suspension bikes are really hot right now.  Our top selling model, volume-wise, is our Ignition-2.  It’s got decent components…. disc brakes, a Shimano 24-speed group with Rapidfire shifters and a Marzocchi fork… priced in the $500 to $600 range… It’s a surprisingly solid bike for the money.  Our upper-end full-suspension bikes seem to be doing quite well, too.  Interestingly enough, we’ve witnessed a comeback in hardtails lately as well.

 If that sounds overly diplomatic, it’s because we tailor our production to what we expect to sell.  We’re going to sell a lot more $500 bikes than $1500 ones.  So, if we sell 3 times as many of the $500 model, the two are actually dead even in total sales measured in dollars.

 In terms of which models surprised us the most… selling faster than we expected… that would probably be our kids’ bikes.  We make kids’ models that are spec’d way beyond what you find in the bike shops. Our typical customers for them are parents who are cyclists themselves and want something better for their kids than they’re finding on the general market.  We’ve done quite well with this category and last year, we sold-out way early.  Needless to say, we’ll be increasing production for 2006.”

Q: So what’s IBEX got in store for 2006 and beyond?

 JA: “One of our biggest current projects focuses on new full-suspension models.  The All-Mountain category is quickly sub-dividing into lightweight models that blur the line between XC and heavy-duty bikes (that also serve for light Freeride).  Our new Asta series, coming out in April of this year, falls into that first group.  We’re coming out with three models including an Asta Comp, with Rapidfire LX, slated to sell ‘direct’ for under $1000… we’ve got an Asta Expert with LX Dual-Control and remote lock-out, front and rear. And finally, an Asta Pro with full XT Dual-Control and Manitou’s new SPV equipped R-7 fork and S-Type rear shock.  Some really exciting stuff in the hopper.  The Asta is a 4” travel frame and we’re also working on another new design for 2007 with 5”-6” for the heavy-duty All-Mountain / light Freeride category. 

 The working name for that frame is ‘Atlas’ and we’re playing with a single-pivot design that looks very promising.  With the advent of ‘smart’ shocks like SPV’s, the single-pivot design is starting to make a lot of sense again.  We’ll have a 5” travel Apogee (an existing 4-bar model) available in the meantime.

 We’re also exploring a few ideas for niche models including a 29er and single-speed bike… maybe even a single-speed 29er!  We’ve had a lot of success with some specialty items like our X-Ray Cyclocross bikes and Zone Freeride models.  While there are certainly a lot of choices already in these categories, they’re not always easy to find.  As our audience continues to expand, so too can we offer a broader selection of these kinds of bikes, and keep them in-stock for immediate delivery.”

 Q Okay so now that you are an insider, who would you say is the most interesting person you’ve encountered so far (if nobody, who would you like to meet)?

 JA: “I think I’d have to say that it’s my own right-hand-man, Will Cato.  He’s a really talented guy and a real ‘bike guy’- An artist who has an innate understanding of engineering and all things mechanical.  He’s worked in the bicycle industry for something like… I don’t know… 12 or 15-years… since he was just out of school and knows everything there is to know about bikes. Well, most everything, anyway!

 I met Will shortly after we launched our first bikes and he did some consulting with us and a little moonlighting for a few years.  He finally joined the company permanently about 6 or 8-months ago.  We haven’t quite figured out a proper title for him yet… like I said, everyone at IBEX has to wear a lot of hats and Will wears more than most.  I guess, for lack of a better name, he’s our Vice-President of Operations.  His impact on IBEX has been huge already, but I think it will be even more pronounced as we go along.  Among so many other things, Will is taking the lead on the ‘Atlas’ project that I mentioned and is the one who fought tooth-and-nail for it to be a single-pivot design (which appears to be the right fit.)

 I’d also include a fellow I met who is the General Manager at Continental Chains, the US distributor for KMC.  David Huang is his name and he’s a really brilliant guy… engineering degree from Georgia Tech and all that.  You figure someone out there knows the true ins-and-outs of what makes one chain better, or more appropriate to a certain application… and David is that guy.  He sat me down at one of the OEM bike shows and taught me just what’s what with bicycle chains… drawing diagrams at lightning speed and whipping out specs and dimensions and physics theory off the top of his head… like I said, he’s a really brilliant guy.”

Side note: KMC produces Shimano chains under license, as well as their own in-house designs and have several different styles to choose from.

 Q: Finally, where can customers go who wish to learn more about IBEX Bicycles?

 JA: “Our website is www.ibexbikes.com and that’s the best place to start.  We welcome phone calls, too… our toll-free is 1-888-741-1464… but it’s still best to look over the website first.”