An Open Letter To Chain Reaction Cycles

[carpetrunner]

I was wrong - everyone is screwing us

a few months back I said....
Local wholesalers and manufacturers are screwing the LBS.

I thought that the LBS was a victim - I was wrong they are just as guilty in the screwing of consumers, in particular me.

The Au importer/distributer for Campagnolo, bikesportz is so sick of wearing the blame for stupidly high prices at the LBS that they publish the RRP.

There are 2 small G springs in a Campag ergo lever brake/shifter, these need to be replaced every couple of years. These are consumables so the volumes are reasonable - there is about 10c of spring steel and maybe 20c of processing in each.

G Springs pack of 4 RRP = $14.95 (OK so this is expensive for maybe $1:50 worth of parts but that's OK-ish.)

One well known bike shop on the upper north shore of Sydney; $15 each spring
A well known Australian on line shop that distributes campag; $15 each spring
WTF??? 400% markup???

I asked bikesports why they publish a RRP if none of their distributors take any notice? they said sorry but had no answer to the question.

Whatever - online to USA looks like the answer.

- carpetrunner

 

[teK--]

Reminds me of Rock shox lower leg plastic crush washers. a 1c or less part to manufacture. LBS and online retailers selling them for $5.00 EACH either under rockshox or Fox guise. (same part).

I bought a bag of 50 shipped from the US for $25.00

 

[wombat]

I asked bikesports why they publish a RRP if none of their distributors take any notice? they said sorry but had no answer to the question.

The first 'R' stands for "recommended". Trying to force retailers to abide by an RRP is a practice known as price maintenance, and is illegal in Australia (as a certain bike wholesaler well and truly knows).

 

[Alo661]

I thought that the LBS was a victim - I was wrong they are just as guilty in the screwing of consumers, in particular me.

The Au importer/distributer for Campagnolo, bikesportz is so sick of wearing the blame for stupidly high prices at the LBS that they publish the RRP.

There are 2 small G springs in a Campag ergo lever brake/shifter, these need to be replaced every couple of years. These are consumables so the volumes are reasonable - there is about 10c of spring steel and maybe 20c of processing in each.

G Springs pack of 4 RRP = $14.95 (OK so this is expensive for maybe $1:50 worth of parts but that's OK-ish.)

One well known bike shop on the upper north shore of Sydney; $15 each spring
A well known Australian on line shop that distributes campag; $15 each spring
WTF??? 400% markup???

I asked bikesports why they publish a RRP if none of their distributors take any notice? they said sorry but had no answer to the question.

Whatever - online to USA looks like the answer.

- carpetrunner

Try these guys, http://www.bikebug.com/

Email them about the part you want, they might be able to sort it for you at the price you want.

Distributors are a little bit pissed off with what this site is doing, good for the consumer thou!

 

[SummitFever]

The first 'R' stands for "recommended". Trying to force retailers to abide by an RRP is a practice known as price maintenance, and is illegal in Australia (as a certain bike wholesaler well and truly knows).

Only illegal if you're trying to force retailers not to discount below RP. You can legally require retailers to sell at no more than a RP (as this would be beneficial for consumers).

 

[Josh Seksy]

I thought that the LBS was a victim - I was wrong they are just as guilty in the screwing of consumers, in particular me.

The Au importer/distributer for Campagnolo, bikesportz is so sick of wearing the blame for stupidly high prices at the LBS that they publish the RRP.

There are 2 small G springs in a Campag ergo lever brake/shifter, these need to be replaced every couple of years. These are consumables so the volumes are reasonable - there is about 10c of spring steel and maybe 20c of processing in each.

G Springs pack of 4 RRP = $14.95 (OK so this is expensive for maybe $1:50 worth of parts but that's OK-ish.)

One well known bike shop on the upper north shore of Sydney; $15 each spring
A well known Australian on line shop that distributes campag; $15 each spring
WTF??? 400% markup???

I asked bikesports why they publish a RRP if none of their distributors take any notice? they said sorry but had no answer to the question.

Whatever - online to USA looks like the answer.

- carpetrunner

You forgot to add in the $15 freight that the bike shop will be charged on that pair of springs...
So realistically, these springs probably wholesale at $10 a pair... so $25 Landed at the LBS, $5 mark up isn't much for the shop at all...

 

[ozdavo]

You forgot to add in the $15 freight that the bike shop will be charged on that pair of springs...
So realistically, these springs probably wholesale at $10 a pair... so $25 Landed at the LBS, $5 mark up isn't much for the shop at all...

What? He is saying $14.95 is RRP for the pack of 4 springs, so wholesale would be in the vicinity of $5 to $10 for the pack of 4. As they are a consumable, they should be adding these to their regular orders, ensuring they always have stock, i.e. no additional shipping charges for them.
So if we assume the wholesale price is $10 for the pack of 4, then they are paying $2.50 each spring. So selling for $15 each is a 600% mark-up, or $12.50 mark-up.

 

[MARKL]

You forgot to add in the $15 freight that the bike shop will be charged on that pair of springs...
So realistically, these springs probably wholesale at $10 a pair... so $25 Landed at the LBS, $5 mark up isn't much for the shop at all...

And if they are paying postage on each spring and not holding any stock I might as well buy them online myself - I do not need to pay the LBS to be a post office.

 

[C0na]

Maybe local bike stores need adjust the way they operate. For example focusing manly on repair's, re-builds, part installations, maintenance and proper friendly service; rather then to compete with online stores for actual part sales. What local bike stores have over online stores is face to face communication & service , I think they need to focus on this if they want to continue as successful company in the future. That would also mean a lot less costs are involved with the business too. (i.e smaller shop, less rent, less employees & the employment of bike mechanics with good people skills).
Or you could cater for a 50/50 market, offer only lower-end bikes for the general users, So stock turnover would be adequate. And also offer top shelf (advanced) services regarding re-builds, part installations, bike maintenance & technical knowledge (along with a good range of tools so they can do all bike related work) to cater for the 'bike nuts' like us.


OR
All Australian bike shops should combine their powers and create an Australian bike Superstore! :high5:
Seriously though, I think there are actually too many small bike stores. In Brisbane at least. So each store not only has to compete with online stores, they also have to compete with all the local stores too.hwell:

I think the best outcome for stores is not to fight with online store prices. They need accept it and use the in-flux of OS bike purchase & bike owners in Australia to their advantage.

 

[rone]

What? He is saying $14.95 is RRP for the pack of 4 springs, so wholesale would be in the vicinity of $5 to $10 for the pack of 4. As they are a consumable, they should be adding these to their regular orders, ensuring they always have stock, i.e. no additional shipping charges for them.
So if we assume the wholesale price is $10 for the pack of 4, then they are paying $2.50 each spring. So selling for $15 each is a 600% mark-up, or $12.50 mark-up.

Campagnolo springs that need changing every 2 years? There are a million things that an LBS will keep in stock before that. Shimano parts? Yes. SRAM parts? Yes. Campagnolo? Just send it to De Grandi.
Bike shops aren't going to stock an obscure part on the odd chance that somebody with Campy shifters may wander in and buy them once every two years or so. It's unrealistic. If they do, then they are paying to have that part sat there until it's needed. You have to expect to pay for that convenience. Don't like it? Vote with your feet. They're not going to lose sleep over a $5 spring.

 

[floody]

My record brifters are 15 years old and have never been opened. Paying a premium for a low volume, obscure part in Australia is disappointing but not entirely unprecedented or outrageous.

 

[Josh Seksy]

Campagnolo springs that need changing every 2 years? There are a million things that an LBS will keep in stock before that. Shimano parts? Yes. SRAM parts? Yes. Campagnolo? Just send it to De Grandi.
Bike shops aren't going to stock an obscure part on the odd chance that somebody with Campy shifters may wander in and buy them once every two years or so. It's unrealistic. If they do, then they are paying to have that part sat there until it's needed. You have to expect to pay for that convenience. Don't like it? Vote with your feet. They're not going to lose sleep over a $5 spring.

Amen to that.

 

[C0na]

My record brifters are 15 years old and have never been opened. Paying a premium for a low volume, obscure part in Australia is disappointing but not entirely unprecedented or outrageous.

I Do not even think it should even really be disappointing; If that part is an uncommon/low volume part, you will always pay a premium. This applies not only to bike stores but the entire retail industry as a whole. You are essentially paying for the bike shop to do your 'part sourcing' & ordering for you. Just like rone said you pay for the convenience in this situation.

 

[harmonix1234]

Campagnolo springs that need changing every 2 years? There are a million things that an LBS will keep in stock before that. Shimano parts? Yes. SRAM parts? Yes. Campagnolo? Just send it to De Grandi.
Bike shops aren't going to stock an obscure part on the odd chance that somebody with Campy shifters may wander in and buy them once every two years or so. It's unrealistic. If they do, then they are paying to have that part sat there until it's needed. You have to expect to pay for that convenience. Don't like it? Vote with your feet. They're not going to lose sleep over a $5 spring.

This. 10 char.

 

[HamboCairns]

I'd walk into a store for three reasons -

1. I need a part right away
2. I need to fix my bike
3. I want to buy something that requires a person's attention

I think it's unfair to take up a shop's time and then buy online. If it's a commodity item (like another set of tires or tubes etc) then yes I'd buy online but for something I need to try on like a crash helmet or a new bike then I'd go to the store all the way.