:) we now have orangebikes.com.au :( they're a bit fecking expensive

[floody]

Ok - I was using Chain reaction as an example of a bike shop that doesn't charge postage and no, they don't sell Orange bikes. I was simply questioning the 25% mark-up on RRP not the fact that they had a mark-up at all. I would expectit of a premium for what is a small scale UK manufactured set-up to ship stuff out and sell here but I think they are taking the piss in this instance.

EDIT - I forgot to add that 17.5% of the UK RRP is VAT (sales tax)

Let me try again. Read it slowly.

EVERYTHING up to the frame landing at the importer will be more costly out here in Australia. Shipping, duties, the price the importer pays the manufacturer, ad infinitum.

The importer then wants to make some money for himself, so puts a mark up on his cost price.

This markup is probably higher than that of the high volume UK market; low volume high markup, high volumes lower markups. The entire Australian market for some brands is smaller than what they sell in the UK to one shop or chain of shops, fact.

All the same applies to the shop who then buys the frame. Except they might end up having to sell at a cut throat markup so you don't just buy it from leisurelakes or someone out of the UK because of what you seem to think is rampant profiteering.

So it all costs more. In the scheme of things 25% is a lot but probably not out of the realms of plausibility.

 

[Welshy]

Let me try again. Read it slowly.

EVERYTHING up to the frame landing at the importer will be more costly out here in Australia. Shipping, duties, the price the importer pays the manufacturer, ad infinitum.

First off, I know this doesn't apply to Orange, as they are unique in that they are handmade in the UK, and if you were referring to them alone, disregard this.

Is Taiwan not closer to Australia than it is the rest (most of) the world? The whole (we pay more because of shipping costs) is just a pitiful excuse. Hell, Specialized bikes are in Australia now, simply because this was the boat's first stop. Surely then shipping should cost less than for the other major companies?

On top of that, in Australia sales taxes are 18%, whereas in the UK they are 17.5%, so where is the major diference in price there? Sure, it's accountable for a small percentage (0.5% to be exact) but that doesn't account for the hundreds of dollars in difference.

So again, it comes to this. Australian importers are ruining the business they themselves work in by inflating the prices to such a point to where they become unrealistic to the average public!

 

[skwiz05]

Now you will say "Oh, but it's ok, because now we get warranty!"

Well, no, actually. Buying through CRC still gives you excellent warranty at no cost, and you know what? Thanks to most of the importers over here who don't know a single iota about running a business, the warranty turn over times are actually just as fast!

And, on top of that, certain importers (I won't name names) will do anything they can to avoid paying a genuine warranty case.

I agree with some of Welshys comments, in a round about sort of fashion, but heres food for thought (in a lateral sort of way...)

Warranty is an interesting excuse...Really, why should "I" pay for warranty anyway? Hell If im going to pay more than a premium for any product, warranty should be the Manufacturers problem, NOT MINE.
Unfortunately, laws here dictate that importers wear the issue. But still, if your real about business, import a Quality product, them there shouldnt be a need for a mark up to cover the importer/sellers loss because they chose to import crap. And really, what business do we know of that went broke (bike related in Oz) , because they lost out on a million warranty claims? None come to mind. But theyre all happy to take an "insurance" premium out of my wallet without my real consent or knowledge, to cover their "potential" loss. Great business ethics I say. If I want insurance, I think Ill pay myself.....

Oops on the thread de-rail.....

 

[golden path]

I like the single pivot duallies, but they are just too expensive for what they are.

 

[0psi]

@ the infinite wisdom of Welshy. Out of sheer curiosity, have you worked in the Australian cycle industry?

And Orange choose to make single pivots. CHOOSE. They believe it's the best way to build a bike and given how many shoot outs they've won and great ratings they get can you argue? Anyone who says otherwise has obviously never ridden one. If you think they are lazy and can't be bothered making some fancy linkage bike maybe you should have a look at the next 224 (if that's what they are going to call it) that's coming out. And no, I don't ride an Orange, I ride a Yeti, which is a . . . .

Edit- Again @ Welshy's infinite wisdom. Warranty isn't the call of the importer, it's up to the manufacturer. Most warranty cases will be refered back to the manufacturer unless it's a know issue. The manufacturer will also wear all costs (excluding labour and freight) by either providing the replacement or providing a credit should the replacement be taken out of the suppliers stock.

 

[floody]

I agree with some of Welshys comments, in a round about sort of fashion, but heres food for thought (in a lateral sort of way...)

Warranty is an interesting excuse...Really, why should "I" pay for warranty anyway? Hell If im going to pay more than a premium for any product, warranty should be the Manufacturers problem, NOT MINE.
Unfortunately, laws here dictate that importers wear the issue. But still, if your real about business, import a Quality product, them there shouldnt be a need for a mark up to cover the importer/sellers loss because they chose to import crap. And really, what business do we know of that went broke (bike related in Oz) , because they lost out on a million warranty claims? None come to mind. But theyre all happy to take an "insurance" premium out of my wallet without my real consent or knowledge, to cover their "potential" loss. Great business ethics I say. If I want insurance, I think Ill pay myself.....

Oops on the thread de-rail.....

Every product of every description you buy has loss built into the price, right down to milk and loaves of bread. Fact of life.

I like the single pivot duallies, but they are just too expensive for what they are.

HA! Says the person with a Cannondale logo as their avatar.

 

[Welshy]

@ the infinite wisdom of Welshy. Out of sheer curiosity, have you worked in the Australian cycle industry?

I don't directly work in it, but I've dealt with people who are heavily involved (bike shop owners and importers.) I was also personal friends with one of the guys at Hope when I lived out there. I also had a friend of mine (R.I.P) who was an importer in the states.

So whilst I don't work in the industry, I know many in it.

Satisfy your query?

 

[darrenjm1]

Orange are a funny brand of bike. They ride well but look like something I rode in the 90's.

 

[boysik]

Any publicity is good publicity!

Orangebikes.com.au may be an Australian site, but it is actually run from the Caribbean the weather here now is sublime...

Pricing for Oranges bikes in Australia was one of the main reasons of going direct and Orange bikes are now cheaper than ever before. All RRPs are now approx 25% cheaper than what they have ever been.

A Five frame in 2010 was $3999 rrp. This year is $2899. While still expensive a positive step in the right direction.

Freight prices from the other side of the world are increasing daily, maybe not form CRC but I can assure you anyone who is bringing product into Australia will tell you their freight, and customs bills are the largest component to pricing here downunder. People seem to forget that we live in a remote, isolated part of the world with only just over 20million people.

Keep checking back on www.orangebikes.com.au regularly for current updates, news, team information and videos. Components and spares now added, stage 2 in progress.

 

[0psi]

I don't directly work in it, but I've dealt with people who are heavily involved (bike shop owners and importers.) I was also personal friends with one of the guys at Hope when I lived out there. I also had a friend of mine (R.I.P) who was an importer in the states.

So whilst I don't work in the industry, I know many in it.

Satisfy your query?

Really? Are these guys driving around in Pagani's and Ferrari's that they've aquired through ripping off the Australian public?

 

[Welshy]

Really? Are these guys driving around in Pagani's and Ferrari's that they've aquired through ripping off the Australian public?

Because every bike shop owner and importer that applies mark ups can afford it.

Bike shops aren't to blame, they have to cop it just as much as the public do. As for the importer - no, it's a tiny one with two or three small trials brands under its belt!

In every scenario you have the good and the bad, and unfortunately those who are entirely focussed on lining their pockets have picked up the larger, more reputable brands.

Have you ever noticed that 90% of the marketing that most importers do is through fear? "Yes, you can get it overseas, but you won't get warranty!" is the most common of those. Importers need to learn that it is only themselves that drive people to go overseas, because at the end of the day, CRC (for the example in this) has the better ethic, and is prepared to put the customers over their own greed. (God that sounds cliche.)

 

[0psi]

Unfortunately that's just not the case. There are some things that just can't be matched for price, not even close. I'm not exagerating when I say that there are products for sale on OS sites that are retailing cheaper than Oz suppliers are able to buy them for. No word of a lie, that's how bad it is. In the grand scheme of things we are but a little pimple on the arse of the cycle industry. Buying OS is only making it worse.

 

[Welshy]

Unfortunately that's just not the case. There are some things that just can't be matched for price, not even close. I'm not exagerating when I say that there are products for sale on OS sites that are retailing cheaper than Oz suppliers are able to buy them for. No word of a lie, that's how bad it is. In the grand scheme of things we are but a little pimple on the arse of the cycle industry. Buying OS is only making it worse.

That's exactly what I'm talking about. My LBS down on the Gold Coast pays more to buy in Shimano stuff from the importer than I do to buy it from CRC.

So where does all this money go?

For ease we'll use shimano, as I know for a fact that the price difference between USA and AUS Shimano is erring on 45%.

So from the factory the parts are sold to the respective importers for select countries, and various shipping costs are applied. Issue #1. Taiwan is a fuck load closer to Aus than it is to the US ( 3,500 miles to Australia as apposed to ~11,000 miles to America).

Ok, so that's the first cost out of the way, with the Australian importers supposedly paying less, right? The goods travel a third of the distance after all!

Supply and demand does play a part, of course but isn't accountable for everything, and it's safe to say that given location and distance to Australia, the supply and demand inflation of costs from Shimano MFG to the importer wouldn't be astronomical.

So where does this additional cost come in?

Australia is over 7,000 miles closer to Taiwan than America, so it's not shipping costs, and bike shops are faced with the same inflation we are, so what's left in the middle? Only the wholesalers and importers...

Doesn't leave much else does it?

And no, I'm sorry, but that's such a cop out. If every Australian importer / bike shop blames overseas for being 'too cheap' but refuse to drop their prices, who's at fault then? It's business. Don't have the heart to compete, then it's not for you. If Australian shops want sales, then they have to do more than pass the buck. It's their responsibility to work on their pricing, and make it more attractive to the public!

OK - Going to stop clogging this thread now. 0psi you're welcome to PM me if you would like to continue this - always nice having a chat.

 

[0psi]

OK - Going to stop clogging this thread now.

Haha! Agreed.

 

[MARKL]

I am going to lean towards Welshy's side of the argument here but from a different angle.

First of all I don't work in the bike industry and as far as this thread goes I think that is entirely irelevant.

Basically retail prices are not determined by the cost of producing the product, retail prices are set according to what the company thinks the market will put up with, in this case $2,899...maybe...obviously Welshy won't pay $2,899 but maybe enough people will????

 

[frenchman]

Supply and demand does play a part, of course but isn't accountable for everything, and it's safe to say that given location and distance to Australia, the supply and demand inflation of costs from Shimano MFG to the importer wouldn't be astronomical.

I can't believe you glossed over this.

The ratio of bikes purchased in America in 2005 is almost 17:1 in comparison to australia. It's about buying power ffs.

click here For aus bicycle purchases

Click here For US bicycle purchases

Also none of you guys have seen Rickyboy's keys to his new 458 italia, he said he left them Armani suit inside his super-yacht?

 

[boysik]

Basically retail prices are not determined by the cost of producing the product, retail prices are set according to what the company thinks the market will put up with, in this case $2,899...maybe...obviously Welshy won't pay $2,899 but maybe enough people will????

True in some cases, Orange bikes have always been on the pricey side. In this instance it is primarily the cost of construction and associated fixed costs in running a business as opposed to trying to squeeze more margin in there becasue of the possibility of getting a few hundred extra dollars out of a fellow MTBer.

Orange offer each bike with a range of upgrades and at last count over 12 colour options. A customised service is the focus at the moment, while Orange cant be everything to everybody they are trying to break away from mass prodcution and that sometimes comes with a price.

 

[MARKL]

True in some cases, Orange bikes have always been on the pricey side. In this instance it is primarily the cost of construction and associated fixed costs in running a business as opposed to trying to squeeze more margin in there becasue of the possibility of getting a few hundred extra dollars out of a fellow MTBer.

Orange offer each bike with a range of upgrades and at last count over 12 colour options. A customised service is the focus at the moment, while Orange cant be everything to everybody they are trying to break away from mass prodcution and that sometimes comes with a price.

I am not having a go at you, that is just business you have to make money out of it otherwise you don't eat, can't get the Armani drycleaned or put fuel in the 458 Italia (once you have found the keys).

 

[0psi]

It's about buying power ffs.

I've said it before I'll say it again. In some instances it is cheaper for a Supplier (Australian wholesaler) to buy a product from CRC, wiggle etc. than it is for them to buy it from the manufacturer. Think about that. That is what we deal with in this country, if you want to whinge about the price of product X then whinge to the manufacturer, not the supplier. It's the manufacturer who sells product X to the Australian distributor, who then mark it up accordingly. It's not distributor X's fault that manufacturer Y will sell a product to CRC (yes CRC are also a wholesaler, does that explain some things?) for $12 but then sell the same product to an Aussie distributor for $45. That isn't an exageration, it happens, a lot.

 

[boysik]

I am not having a go at you, that is just business you have to make money out of it otherwise you don't eat, can't get the Armani drycleaned or put fuel in the 458 Italia (once you have found the keys).

Likewise, was just trying to highlight to the average joe (who may be following without comment) some of the differences with Orange and why they do cost more and not know the history of Orange or why they cost so much as opposed to other brands or to distinguish against said 'Shimano' example.

Thats enough from me,,, I have to go find my keys.