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12.10.04
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25 years of success
Devinci is now widely distributed in Canada with 150 dealers, and the company is ramping up for a renewed push into the States.
25 years of success
Devinci is now widely distributed in Canada with 150 dealers, and the company is ramping up for a renewed push into the States.
Bicycle retailer
Gauthier spent much of 1991 to 1993 fixing frames. Then he hit the road, explaining the new heat treatment process and slowly rebuilding trust among retailers.
Determination
Devinci’s roots | CHICOUTIMI, Québec—Félix Gauthier didn’t get much sleep in the 1990s. As a new investor in the fledgling made-in-Canada bike brand Devinci, he worked 12-hour days, seven days a week to get the brand off the ground. Gauthier kept going even when the odds were stacked against him. Like a year after he made his initial $50,000 investment to buy half the company when a retailer picked up a frame and snapped it in front of him. Then did it again with a second frame. Gauthier knew he was in trouble.

He turned to the research center at Alcan Aluminium, the massive metals supplier based in Chicoutimi, the same city Devinci calls home. There, he learned that Devinci was heat treating its aluminum frames at the wrong temperature. It was nothing an $80,000 oven couldn’t fix, but Devinci didn’t have that kind of cash. Gauthier’s initial investment was gone within six months, and the only turnover was coming from machining and welding jobs for other industries. “With all the recommendation they tell us, we decide to build the oven ourselves,” Gauthier says in a thick Québécois accent. “More frames were coming in for warranty than coming out for sales. It wasn’t easy. I told myself these customers put confidence into Devinci and we have to respect the warranty and fix their bikes.” Gauthier spent much of 1991 to 1993 fixing frames. Then he hit the road, explaining the new heat treatment process and slowly rebuilding trust among retailers. “They were thinking I was living in the back of the shop. In reality, the closest dealer was 200 kilometers from us. I was three weeks a month on the road meeting these guys. I had no catalog, no pressure, no Internet. I was just talking to them. Many of them are still dealers today,” Gauthier said. “Once,” he continues, “the accountant told me, ‘You should stop investing your time and your money in this company.’ I had the dream and that guy didn’t share it.” Devinci was started in 1987 by a mechanical engineer and a designer attending university, but Gauthier considers 1993 the first real distribution year for the company. By then, Gauthier had become sole owner, and had moved from Devinci’s original Determination drives Canada’s Devinci down road to success 800-square-foot space to one nearly four times its size. And he funded an R&D division, a move that soon proved pivotal. The investment bore the innovations that Devinci would build its brand around, such as the Optimum frame design; Ollie freeride bikes; the “instrumented” mountain bike, a concept bike equipped with sensors to measure mechanical loads; and the CX carbon monocoque frame road bike.

Devinci is now widely distributed in Canada with 150 dealers, and the company is ramping up for a renewed push into the States. Its first go-round seven years ago cost the company about $1.2 million due to unfavorable exchange rates and a patent issue that prevented it from selling two popular Horst Link full-suspension bikes in the U.S. This time around, Devinci is better prepared with a new line of full-suspension bikes designed around Dave Weagle’s Split Pivot platform. Gauthier also buys futures to lock in a long-term exchange rate. The goal is bring the U.S. on par with Canada, and so far, progress is coming quickly. Devinci inked a deal last June to be sold in 15 Western Performance Bicycle locations, and has signed on 50 IBDs.

Chris Kelly, owner of Topanga Creek Bicycles in Los Angeles, first carried Devinci from 2003 to 2006 and rekindled the relationship at last year’s Interbike. Kelly came back for the bikes—they’ve always been phenomenal, he said—and Devinci’s genuine interest in the long term. “The fact that we’re on round two, that’s a pretty good argument for a brand. So many of these manufacturers burn their
dealers instead of trying to create good relationships,” Kelly said. Devinci is now run from a 30,000-square-foot factory in Chicoutimi, where all the company’s top-end aluminum frames are still welded, painted and assembled. All bikes below $699 retail are sourced from Asia, as are carbon fiber frames. As a Canadian manufacturer, Devinci has outlasted big factories like Raleigh and Victoria Precision, which left around 2005 when anti-dumping regulations on Asia-sourced bikes were lifted. It has been helped by a contract Devinci won in 2008 to manufacturer bikes for the Bixi bike share program in Montréal, which has since expanded to seven other international cities. That business makes up about 30 percent of Devinci’s bottom line. At the factory, workers can make about 700 Bixi bikes per week. For Devinci bikes, the volume is 50 to 150 bikes per day.

Two decades after Gauthier took a risk on an unknown brand, Devinci is profitable and pulls in $10 million to $20 million in sales annually. And Gauthier is finally catching up on some of that lost sleep. Sort of. “It’s a challenge every day. You should never think you’re good. You should always think something can happen, and you have to be awake every morning,” he said.

By Nicole Formosa
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