Zen Bicycle launches into a boom
By Erik Siemers
Zen Bicycle Fabrication, Portland’s newest bicycle frame manufacturing plant, launched at a time that the need for their services is on the rise.
David and Jen Woronets have been met with a few surprises in the three months since they opened Zen Bicycle Fabrication, Portland’s newest bicycle frame manufacturing plant.
For one, they didn’t expect the Portland-area’s only other high-volume bike frame maker to get out of the business just as their North Portland shop opened.
They also didn’t foresee that, by just opening their doors, they had inadvertently enabled a marketplace expansion.
“What we didn’t see coming was the amount of people interested in developing a new brand based on our existence,” said David Woronets.
In his own conservative estimate, Woronets believes his fledgling operation could generate $5 million in revenue within three years. And if production volumes rise as he now hopes, his workforce of nine could soon double.
But he had a vastly different vision for Zen a year ago, with slightly lower expectations.
Woronets is a former professional road and track racer with more than 20 years in the bike-making industry, including stints at large brands such as Irvine, Calif.-based Felt Bicycles.
He came to the Pacific Northwest in 2007 when he took the job as operations manager for Ramona, Calif.-based Ellsworth Handcrafted Bicycles Inc., which ran a manufacturing plant in Vancouver, Wash.
|Take a peak behind the scenes at Zen >>|
During his time at Ellsworth, the company got a steady stream of inquiries to build bikes for other brands. But Ellsworth, David Woronets said, wasn’t set up to be a contract manufacturer.
Seeing a business opportunity, he reached a deal with Ellsworth CEO Tony Ellsworth to buy out the manufacturing business and open up his own shop in Portland.
At the very least, Woronets expected to have business from Ellsworth and the other brands that made inquiries. He saw three classes of customers: large brands looking to develop a model in the U.S.; small custom builders — including the cluster of them in Portland — looking for a small run of stock models; and companies looking to in-source manufacturing from Asia.
All of those have come through. But he was caught off guard by the inquiries from potential customers looking to get into the business just because there was a new fabricator.
And then there was the news with Sapa Extrusions.
A division of Swedish aluminum conglomerate Sapa Group, Sapa Extrusions employs 550 people in a Portland division that shapes aluminum parts for several industries. It also makes aluminum bike frames.
Ray Goody, a product manager for Sapa’s Portland operations, said that over the next six months the company will be winding down its local bike frame-making business.
The bike business has dwindled as bike consumers have drifted away from aluminum toward products made from carbon fiber, Goody said. Bikes were less than 1 percent of monthly sales.
Initially, Woronets never thought he would occupy the same space in the market as Sapa. For one, Zen’s 10,000-square-foot production space has a capacity of around 300 bikes per month on a single shift, and Woronets figured Sapa’s production runs were significantly larger.
“It turns out most of the runs they did fit within our model,” he said. “If we went to two shifts, we could do 600 units per month, which is what Sapa was doing.”
Woronets believes Zen brings other advantages to the market.
For one, unlike Sapa, it can work with more than just aluminum.
It’s also a pure contract manufacturer. Some competitors, Woronets said, also make their own brands, leaving customers to worry that their production runs could get bumped in favor of the manufacturer’s in-house brand.
Woronets is also marketing a degree of discretion.
It’s a competitive industry, and Woronets said he doesn’t want customers to worry about competitors visiting his shop and spying their innovations.
Zen’s offices on the mezzanine level of the building will soon have frosted windows, so business meetings can be held without fear of eyes wandering toward the production floor.
“It’s a small industry in the U.S. The chance of us getting conflicting brands in here is 90 percent,” Woronets said. “We’re running a tight ship.”
It’s also one of the few of its kind in the U.S., said John Baxter, the administrator at the United Bicycle Institute in Ashland — the only bike frame-building school in the U.S.
“As far as the United States is concerned, Zen occupies a pretty small niche,” Baxter said. “Most of the OEM manufacturing, even from American companies, is happening in Asia.”
To some brands, that’s the appeal of Zen.
“Proximity matters in everything we do. Procedure and processes matter, and maintaining those in your own back yard, in a language you share, is much easier for a small company than doing it in another hemisphere in a language you don’t understand,” said Tony Ellsworth, CEO of Ellsworth Handcrafted Bicycles.
“I’m confident this is a positive thing for the bike industry in general, and customers will enjoy handmade bikes versus containers of Chinese production recreational equipment that has become prolific in the bike industry.”
@ErikSiemers | email@example.com | 503.219.3418
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