Why has Taiwan become the leading supply-source in the global bicycle industry? In mid-August a representative from The Weber Group's Taipei office contacted me about an article that they were preparing for CETRA relative to Taiwan companies' participation in the European bicycle trade shows this season. I was asked several questions about Taiwan's bicycle industry that started me thinking about why Taiwan has become the leading source in the global bicycle industry of not just bicycles and related products, but also of manufacturing and management expertise, and capital investment.

"The "Flexible Tiger!" One of the first things about Taiwan's bicycle industry that popped into my head was the "Flexible Tiger" title given to it by Cycle Press in its April 2000 issue. The Taiwanese bicycle industry was awarded this most appropriate title because of its ability to adapt to change better than any bicycle-producing country in the world. In Taiwan, the bicycle industry has quickly adapted to the changes in global demand and the inconsistency between economic globalization and the regional and local politics of non-tariff barriers and protectionism on the one hand and the threats and hassling of reunification on the other.

Why compliment Taiwan's bicycle industry? I am sure there will be some who will wonder why I am taking this space and their time to compliment the Taiwanese bicycle industry. After all, this is a Bicycle Business B2B web site that is owned and operated by a Taiwan company. The fact is that not enough people in the worldwide bicycle industry fully understand or appreciate the strategic role that Taiwan's bicycle industry plays, and the significance that role has on the global industry. My purpose is not to praise, but to present, the facts so that others in the industry can use this information to make their own situation analysis and determine the strategic significance to their business plans.

A long-term strategy of globalization. Taiwan's bicycle industry has followed a strategy of globalization for more than two decades that has resulted in major investments in both export and in-country bicycle, frame and component manufacturing in mainland China. This strategy, along with customer demand and the inconsistency between economic logic and regional and local protectionist politics, has driven the development of Taiwanese investment and ownership in manufacturing, assembly and distribution operations in Europe. Japan is also a tough market to penetrate, and members of Taiwan's bicycle industry have invested in operations in Japan, along with forming distribution and sale alliances.

Good Morning Vietnam! As we have referenced before, Vietnam has appeared almost like magic on the international bicycle industry stage. However, Vietnam wouldn't mean as much in the mix of source countries for bicycles and related parts if it were not for its connection to Taiwan's bicycle industry.

What is the Taiwanese bicycle industry's "core offering to the world?" This was one of the questions The Weber Group representative asked me. After thinking about my response in more detail, I have not changed my initial opinion that the Taiwanese bicycle industry's core competencies are the following:

• Unparalleled entrepreneurial expertise.
• An absolute passion for product development and innovation.
• World-class quality, manufacturing, engineering and technical skills.

The leading supply-source, partner and ally going forward. It is my view that the Taiwanese bicycle industry will be the leading supply-source, partner and ally going forward because it has already firmly established a proven ability to be flexible and adapt to fast-paced changes in market demand, market conditions, manufacturing environments and local and regional politics.

No hesitation in making investments. I might also add that a large number of companies in Taiwan's bicycle industry have not hesitated in making financial commitments and investments whenever they have to or whenever an opportunity arises. Many of these same companies have helped sub-contractors and their services and supplier networks with loans and capital infusion over the past two decades that are now paying off in the form of strong and reliable Pacific Rim supply and logistics networks.

Is the Taiwanese bicycle industry a true "innovator or just a follower?" This is another of the questions I was asked, and overall the Taiwanese bicycle industry is, in my opinion, much more an innovator that a follower. However, with that said, I would like to point out that sometimes being a fast follower is also a very good strategy.

The ability to move and act quickly. Taiwan's bicycle industry has used its network of customers throughout the world to help determine when it should lead and when it should be a fast follower. One of the Taiwanese industry's great strengths is its ability to move and act quickly ˇV both as individual companies and collectively.

Industry support for trade association and R&D Center. One of the reasons that the Taiwanese bicycle industry has the ability to move and act so quickly is its very strong industry association, the Taiwan Bicycle Exporters' Association (TBEA), and additionally the Taiwan Bicycle Industry R&D Center (TBIRDC). The Taiwanese bicycle industry competes very hard amongst its members for business, but is unanimous in its collective support for the TBEA and the TBIRDC.

The only International Bicycle Design Competition! A significant indicator of the Taiwanese bicycle industry's leadership in innovation is the annual International Bicycle Design Competition conducted by the TBIRDC. The 5th International Bicycle Design Competition is now underway and the Award Ceremony will be held Saturday, March 31, 2001, at the Taipei International Cycle Show. It is also significant that this is the only International Bicycle Design Competition of any type in the world! For more information visit www.tbnet.org.tw/competition.

What is the Taiwanese bicycle industry's "next real market opportunity?" This last question also asked if the "next real market opportunity" was E-bikes or Mag alloy components. I offered the opinion that the Taiwanese bicycle industry has several potentially big bicycle market opportunities going forward.

Demographics within regions will determine the level or degree of each opportunity. E-bikes are one such opportunity. But, like all the real opportunities in today's global marketplace, E-bikes will be more and more focused on demographics within regions of the world. Accordingly, E-bikes will not represent the same level or degree of opportunity in all geographic markets at the same time. Currently the biggest market opportunities for E-bikes are in the EU and Japan, followed by mainland China.

Recumbents are the ultimate comfort bike. Comfort bicycles represent another big opportunity in North America, the EU and the Pacific Rim, although the product category is very broad, and includes any bicycle that is easier, more comfortable and more fun to ride! Recumbents are the ultimate comfort bike and there are already companies in the Taiwanese bicycle industry that are aggressively serving the growing demand for the variety of recumbent bicycles, tricycles and tandems.

Folding E-bikes and Mag alloy-frame folding bikes. Folding bikes are another product segment that has exploded this season. Their popularity is in rapid growth in the EU and Japan, and is gaining in popularity in North America. Variations that are getting a lot of interest are folding E-bikes and Mag alloy-frame folding bikes.

Electronics and computerization will drive component development. Components also present some huge opportunities for the Taiwanese bicycle industry. Mag alloy components have already taken off in almost all categories and applications. I also believe electronics and computerization will drive bicycle component development going forward, and with a well-developed electronics and computer industry to partner with, the Taiwanese bicycle industry is absolutely in the best position to capture and develop this opportunity to its fullest potential.

Strategic Significance: The Taiwanese bicycle industry is the leading global supply-source and has to be taken into account and seriously considered in all strategic planning. Because the Taiwanese bicycle industry and its members have adopted and followed a long-term strategic policy of globalization, it is highly likely that this position of leadership will be maintained, and possibly even expanded, over the next decade.

1 The terminology "Flexible Tiger" was used to describe the Taiwanese bicycle industry by Cycle Press (No. 155), April 2000.

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