A disruptive business model can ratchet company value UP!
Demand for pedal power has simply exploded during the pandemic as this disruptive business model proves. We explore how using IIoT, blockchain and a long-term investment ethos could make German bike-maker, Canyon Bicycles GmbH, worth over 500 million euros overnight.
Founded in 2002, Canyon Bicycles GmbH manufactures a range of mid to high-performance road, race and mountain bikes with a USP as “freedom of choice“. Claiming to make the “best bikes in the world“, Canyon offers the customer fantastic value for money by selling direct from the manufacturer.
So how has this manufacturer built such significant value in just 18 years?
The answer appears to be a combination of experience, vision, relentless investment and a deep understanding of their customers. Underpinning all of this, they have developed a killer model for each key area of the business that is unparalleled.
Design is data driven but brave. They ensure they have an accurate sense of what’s going on through ongoing thorough research of customers and product managers. New models are designed from the ground up to fit targets including weight, cost, strength etc. No “shrink and pink” imitations or cursory nods here. Product managers and engineers are fully aware of materials coming over the next 5 years. When built, the functional prototypes are tested extensively by engineers and pro riders.
In-house assembly is designed to be as effective and efficient as possible. Machines optimally pick parts that are stacked up to 12m high. Having worked backwards from the assembly line for the optimal storage position, the team knows exactly where everything is in the huge warehouse to exact coordinates. Every part has a QR code with full material traceability on the supply chain. This product tagging ensures that each part can be interrogated granularly down to the exact torque a particular bolt was tightened to. So, in the unlikely event that something goes wrong Canyon can recall and check a particular batch quickly.
Canyon made huge investment in quality control including a CAT scanner at their Koblenz factory in Germany, plus 5 more in Asia! All carbon fibre parts are scanned before assembly. They believe in customer safety first over company profit and have definitely put their money where their mouth is! This process also prevents costly product recalls.
Take an inspirational tour round the factory with Tom Marvin from BikeRadar for a deeper peep behind the scenes in the Secret Life of Canyon – The Brains Behind the Bikes here.
Whether it’s a €500,000 CT scanner or a product development engineer looking 5 years into the future, Canyon Bicycles are one of the most disruptive bike companies of the moment. Capitalising on these technological advancements through a true customer centric approach has enabled Canyon to draw fierce takeover interest from private equity giants including Carlyle Group and KKR & Co.
True innovation needs a revolution. If you believe that your company owns commercially valuable IP or it has disrupted a current industry with a new business model your company could be worth more than you think. Learn more in our 121 Exit Masterclass© where you will learn the lowdown specific to your company sale*.
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Tags: business model, disrupt, disruptive business model, IP