Graham Turner's Pedal Group Is Giving The Bicycle Industry The Flight Centre Treatment

Cameron Spencer/Getty

Everyone’s doing it – from Prime Minister Tony Abbott to the colleague who comes into the office in lycra after their morning ride to work.

So travel entrepreneur and cycling enthusiast Graham Turner saw an opportunity bring together another fragmented industry, worth about $1 billion annually, with more than 1500 players and no dominant leaders.

Turner launched a joint venture with Flight Centre, The Pedal Group, in 2008. It operates two retail franchises, 99 Bikes and Bicycle Network. So far, $20 million has gone into the business and last year, it returned $2.5 million EBIT.

Turner argues independent bicycle retailers will struggle on their own.

“You need big brothers to help you do the things you don’t have the resources to do,” Turner told The Australian Financial Review.

With plans to grow 99 Bikes store numbers from 17 to 50 and the Bicycle Centre network from 26 to 100 stores by 2017, Bicycle Centre general manager Andrew Garnsworthy says the Group will explore the option of an IPO once it achieves “critical mass”.

Turner hasn’t ruled out the possibility that Flight Centre could acquire the Group at that time.

Flight Centre’s net profit fell 16% to $207 million in the year to June 30. In March it was hit with a $11 million fine for price-fixing from the Australian Competition and Consumer Commission.

Read more here.

Now read: THE NEW GOLF: Tony Abbott And 8 CEOs Tell Us Why They Love Cycling

NOW WATCH: Briefing videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.