Loss of Sales - Why you haven't hit the numbers?

Again, you folks at Specialized are the experts. But from my 8 years of experience servicing retail stores, I have identified these factors.

Economic Slow Down.
This is obviously the case right now in most industries. When consumer spending is down, how do you stay afloat, or even grow? You have to create value. A solid value proposition will pry the cash from a buyer's hand. Unfortunately value in a down economy is frequently closely related to price.

I think the bike business stands to benefit from this situation and here is why. Consumers have never been so "Green Conscious". Plus times are tight and cost of transportation is high. So you don't have to have the cheapest product, you have to convince the buyer that your brand will solve the cost of gas and environmental issues in the news.

Competition.
If your brand isn't growing, but your retail base is not showing a lack in sales, you may be loosing market share to a competitor. Put your ears to the ground and listen. If consumers and shop staff are a buzz about another brand its time to meet with the R&D department to drum up some new tricks! You may short term boost sales against a superior product by creating value with your brand. Lower the price or increase the product's specs for the same price.

Retailer's Performance.
Is your retailer doing his job. Go back to square one: is the store merchandising the product correctly?

A first class Specialized retail environment needs to be clean and well lit. Lots of windows are nice but not required. You need to identify your customer (see this post), and the corresponding market area.

In the case of Kinetic Cycles, the store may have been too Performance Buyer oriented in a Comfort Buyer market.