Disruption in the global supply chain is dragging on Halford's cycling business, though the retailer has said it is well-positioned to manage the challenge.
The UK's largest bike retailer, which also sells car parts and auto accessories, said it expected the cycling supply chain issues to continue for some time. Problems include factory production constraints, raw material inflation, freight disruption and driver shortages.
Retailers, supermarkets and restaurants are struggling to cope with a shortage of drivers and food processing staff in the wake of the Covid pandemic, which has also created a world-wide shortage of container vessels and is feeding inflation for raw materials.
In a trading update this morning, Halfords it is sticking to its full-year target for pre-tax profits of more than £75 million, buoyed by higher sales in its motoring business which has been boosted by the trend for staycations.
During the 20 weeks to August 20, underlying sales in cycling were down 23 per cent compared to last year, although Halfords noted that trading in 2020 was unusual due to the pandemic. Sales for motoring products rose by 52% in the latest period.
Last year the company benefitted from a pick-up in cycling as Britons tried to avoid public transport due to Covid, and bought or repaired bikes instead. Halfords said it remains confident in the long-term outlook for the cycling market.
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