The United Kingdom [UK] has a steady growing cycling market with a retail value of £1.62Billion and much of this growth has been encouraged by the market retailers; In 2010 it had a gross contribution of £2.9Billion to the UK economy [Grous, 2010]. As at 2010, the gross cycling product [GCP] was £230 per cyclist, there was a 28% increase in the volume of cycle sales and health benefits saved the economy £128million per year in absenteeism.
Over the years, the government has participated actively to encourage cycling as a means of transport promoting reasons such as health benefits, created more cycling lanes and also cycling events across the country. This has led to an increase in the number of cyclers over the past five  years with the addition of 1.3million new cyclists in 2010 and this trend is expected to increase in the future. The increase in the number of cyclists has also modified types of cycles being manufactured in order to suit the different taste of individuals [Grous, 2010]. Currently, three major types can be clearly identified; frequent, regular and occasional cyclers. An average of 40% of households own a bike and £141million Bikes are expected to be sold over the next two years.
A combination of the growth of cyclers and active government involvement in activities that encourage cycling, bicycle component manufacturers are experiencing sales boom, it is estimated that the market will be worth £800million by 2016. Manufacturers report that recent trend includes having a custom made bike and steel which was once used in the 90s is making a comeback into the market for racing bikes [Murray, 2014]
Factors affecting the cycling industry
There are two key factors affecting cycling environmental factors and demographics. Environmental factors that affect the demand for cycling include, availability of cycle lanes, infrastructure and weather conditions. According to Grous  ever since the 30s travel policies in the UK have favoured car traffic and declined cycling activities not until the 90s before there was a turnaround which was also supported by the British Medical Association [BMA] after highlighting health benefits that can be gained from cycling. Government then began to introduce policies to support cycling and cycling activities. In Oxford, the council is working to improve the cycling experience and anticipates that by 2021, over 20% of journeys to work will be made by bike. The council is currently working on a Cycle City Ambition Grant to promote cycling and future growth [Oxford City Council, 2014]
Adverse weather conditions also affect the demand for cycling, demand is always high in the spring and summer compared to autumn and winter because it gets very cold and visibility may also be affected. Demographic factors that affect cycling can also come in different way; sex, age, immigration status, family circumstances etc. The UK has an ageing population and a few percentage of them cycle. There are also lots of immigrants in the UK who are not used to cycling in their own country and generally men are more likely to cycle than women.
Oxford is a compact city which makes cycling and walking a lot faster to get around than other means of transport. However, there are several competitors which the shop will have to contend with in the market but a positioning statement and a strategy should distinct them from others. We will advise that the target market for the Bicycle shop be students and young adults, this is because Oxford is a city that has two great schools, Oxford Brookes University and Oxford University, it is also a tourist city that has people coming in to have a view for themselves. Therefore marketing strategies can include student discounts, bulk sales, free repairs, short term contracts and creating general awareness; this should be its positioning statement.
Inputs and marketing mix
There are necessary inputs which need to…