Gluey_trails
Likes Dirt
TBSM.com???
The LBS v.s. Online Shopping
- Thread starter grimzentide
- Start date
Nerf Herder
Wheel size expert
pretty sure it also affects New Zealand, Parts of Asia, South Africa and other countries of comparable size, not inter-connected to Europe or the US.
All about scale.
Moving along:
One thing you should consider as a consumer is where your dollars are going ... I'm not talking about profits staying in Australia vs Os ... I'm talking about supporting riders. Whether via sponos, clubs structures to organise races, tech support, lobbying councils for more or better tracks, or a minimum, somebody you can depend on to go to when you botch up tuning your forks, shocks or other odds and ends, or if you have a problem with your new recent purchase.
My knowledge of the "Ïndustry" is at zygote levels of development ... however, the few industry types I have interaction with have made me change my tune somewhat.
For example, Although I'm not a racer, I've seen which LBSes actually put into the local scene.
Through my trail advocacy stuff, I've similarly gained insight into the stores and individuals connected to these stores, that have been plugging away at building tracks, lobbying councils and gaining Government grants (usually after years of effort).
Sure, there is a symbiotic relationship ... "Ïf you build it they will come" ... or "if I spono young Pinna or Mr Hucka, then I will get free marketing and exposure" ... but in the majority the people that support riders, races, clubs and or trail advocacy truly love this shizz, but unfortunately need to make a living as well.
Now, I'm not telling you that you should go blindly throw your money at your LBS ... especially if they are sometimes charging double the price you could get else where, or have shite service and product knowledge ... but what I would suggest is you look further into your LBS ... what do they do for the sport ? ... are they ticking any (sometimes even all) of the boxes I've mentioned above ? ... are they offering decent product at "reasonable" prices with appropriate levels of knowledge?
If yes then, I think whatever markup they may have might just be that little bit less painful. If No, then find yourself another LBS, even if it is online.
Disclaimer: By no means do I believe the current Distributor / Retailer model in this market is optimal ... we can see change already (eg, Spez, direct distribution models etc). However, there is more to it then just price competition IMO.
Roly
Likes Bikes and Dirt
This entire situation comes down to a question of convenience and security of product type. As mountain bike parts become increasingly reliable (ie one-piece forged metals etc) and consistent, one can easily buy them online with the safety of knowing exactly what one will subsequently receive in the mail.
Look at the one of the biggest online retailers in the world - Amazon.com. Consumers feel no danger in ordering online as they know EXACTLY what their product will be like (for example books, CDs, encyclopaedias)
Now take a look at the other end of the spectrum - surfing, for example. I surf, and I would never, EVER buy a surfboard online as you cannot assume the exact dimensions of a surfboard, and how it will therefore perform for you.
This latter scenario used to be the case for mountain biking. However, with increases in technology not only in componentry but also in accuracy and consistency of geometry, the online consumer can enjoy heightened security of what they will be getting delivered. This eliminates the need to go to your LBS at all, other than for checking sizing. The question remaining is thus one of morals; whether its the right thing to do to go into your LBS, use their facilites for sizing and buy elsewhere (which it obviously is not).
Look at the one of the biggest online retailers in the world - Amazon.com. Consumers feel no danger in ordering online as they know EXACTLY what their product will be like (for example books, CDs, encyclopaedias)
Now take a look at the other end of the spectrum - surfing, for example. I surf, and I would never, EVER buy a surfboard online as you cannot assume the exact dimensions of a surfboard, and how it will therefore perform for you.
This latter scenario used to be the case for mountain biking. However, with increases in technology not only in componentry but also in accuracy and consistency of geometry, the online consumer can enjoy heightened security of what they will be getting delivered. This eliminates the need to go to your LBS at all, other than for checking sizing. The question remaining is thus one of morals; whether its the right thing to do to go into your LBS, use their facilites for sizing and buy elsewhere (which it obviously is not).
I work in snowsports wholesale, and although not quite the same as the bike industry, we face very similar problems. The reason online retailers such as wiggle and crc can undercut local retailers so dramatically is due to the fact that they are able to order in such large quantities that they get substantial "buying in bulk" discounts from wholesalers. They sell far more units than a traditional retail, so can afford to be more aggressive with their pricepoints (ie less margins, more sales), shipping discounts.
In the snowsports industry, manufactures and distributors are more aggressive with online retailers and refuse to stock them if they ship internationally to a different market. This seems to be working to an extent, but requires a lot of good will on behalf of the brand.
But getting back to the point, the online vs lbs debate is simply a case of economies of scale, on the assumption that they are both providing the same service, but perhaps they're not...
In the snowsports industry, manufactures and distributors are more aggressive with online retailers and refuse to stock them if they ship internationally to a different market. This seems to be working to an extent, but requires a lot of good will on behalf of the brand.
But getting back to the point, the online vs lbs debate is simply a case of economies of scale, on the assumption that they are both providing the same service, but perhaps they're not...
It's a topic that has come up a lot of late and I expect unless the local shops/distros pull their heads out of the sand it's going to get a lot worse. In the last year and a half I have probably spent 10K (probably 95% of it on 2 bikes) at my LBS and about 2K on CRC. If I bought the parts I got from CRC at my LBS it would been been 4.5K instead of 2. Now i'm loyal, to a point, but i'm not going to piss 2.5 grand away just so I can feel good about supporting my LBS and anyone who would is fiscally insane.
I'd like to support my LBS and if the prices were within 10-15% I would but the amount you can save by buying online entirely justifies doing it.
I'd like to support my LBS and if the prices were within 10-15% I would but the amount you can save by buying online entirely justifies doing it.
grimzentide
Likes Dirt
Yeah. Noted the source on the first line of the original post.
[Source: Cycling Tips]
[Source: Cycling Tips]
industry insider
Cannon Fodder
Note: LBS cost of Saint RHS shifter is $68.00 +GST
Note: The cost of the Saint RHS shifter to your LBS is $68.00 + GST +Freight..Now You tell me how your LBS can make any money selling the Saint RHS shifter at CRC pricing !
Note: The cost of the Saint RHS shifter to your LBS is $68.00 + GST +Freight..Now You tell me how your LBS can make any money selling the Saint RHS shifter at CRC pricing !
The old LBS vs the internet argument.Note: The cost of the Saint RHS shifter to your LBS is $68.00 + GST +Freight..Now You tell me how your LBS can make any money selling the Saint RHS shifter at CRC pricing !
Sure the LBS can't match CRC on price -> economies of scale, distributors in the middle, GST, etc and so on.
But say I want a shifter. I want install it myself. Why exactly do I get up, go out of my house, down to the bike shop who may or may not have it in stock, pay a bunch more money, potentially wait a few weeks for it come in, go back to the shop and get it?
I can go "click, click, CC details, click" and it arrives at my door, for half the price in a few days to a week.
There aussie BMX online stores like Strictly and Backbone who seem to be able to, once discrepancies in shipping and currency conversion are taken into account, consistently have a large inventory of items that are price competitive with the US online stores. Why not MTB?
grimzentide
Likes Dirt
They need to buy it from CRC tooNote: The cost of the Saint RHS shifter to your LBS is $68.00 + GST +Freight..Now You tell me how your LBS can make any money selling the Saint RHS shifter at CRC pricing !
Everyone is getting hit with the prices of components in this country. The importer, the distributer, the LBS and the consumer.
The question is, would we buy the part if it were only 15% markup?
$86 + 10% = $74.80
Lets call delivery from an Australian distributer $5.20 to make it a nice number.
So $80 for the LBS
LBS = $80 + 15%
= $92 for the consumer
CRC = $92 vs 65.14 + $17.35 delivery
= $82.49 to the consumer
Who would pay $10 more to get it to from a LBS?
Sadly, the bike stores cant affort to stay open on a 15% mark up and I doubt the manufacturers will lower their prices to help out such a small market such as Australia.
CP
Likes Bikes and Dirt
So I've got a question. Are LBSs actually in pain from losing out to online sales? What I mean is, is there still enough new bike buyers, service customers etc to maintin a decent business and be happy, or is it the case that they are quite reliant on accessories sales as well?
Another thing to add. If prices were not so cheap buying online and overseas, it doesn't mean that people would be buying from their LBS. If I had $600 to spend on forks and could currently get some runout Fox 32 action at CRC brand new, but CRC shut shop, I wouldn't go to my LBS and buy some elastomer Suntour jobbies for $600. I'd be straight onto this forum, trading post, ebay etc to find a used set of Fox 32s. So I purport that the cheaper online prices don't correlate as closely to slowing LBS sales as some might initially think.....for some people, it just means they can afford new items instead of used. It's still an issue, I'm not dumbing it down, just wanted to add a different perspective.
Another thing to add. If prices were not so cheap buying online and overseas, it doesn't mean that people would be buying from their LBS. If I had $600 to spend on forks and could currently get some runout Fox 32 action at CRC brand new, but CRC shut shop, I wouldn't go to my LBS and buy some elastomer Suntour jobbies for $600. I'd be straight onto this forum, trading post, ebay etc to find a used set of Fox 32s. So I purport that the cheaper online prices don't correlate as closely to slowing LBS sales as some might initially think.....for some people, it just means they can afford new items instead of used. It's still an issue, I'm not dumbing it down, just wanted to add a different perspective.
grimzentide
Likes Dirt
Not sure if your laughing at the general thought of surviving on 15% or you misread my post.
think about any piece of clothing you have bought, this stuff typically has margins of several hundred percent over the wholesale price.I wasn,t going to, but i will give you the $ involved.. The bike i bought cost $5300. They made $1000. As i said, i had been loyal to them and only shopped in "their" store for around 4 years ( and spent a F@#ken lot of hard earned coin ) .I just felt that they could have looked after me a little better . Hence my decision not to commit to a bike shop again !! Specials / Bargains Only - Otherwise it,s online browsing for me.
20% margin is pretty cheap.
.:ROBBO:.
Likes Dirt
I really don't get your point in this threadNote: The cost of the Saint RHS shifter to your LBS is $68.00 + GST +Freight..Now You tell me how your LBS can make any money selling the Saint RHS shifter at CRC pricing !
I see what you are saying but it doesn't make it right. Im not totally blaming the LBS. The entire industry is to blame. From the manufacturer to the importer to the LBS. They are all trying to make too much out of a very small industry that is now revolting and buying what they need online and from over seas.
Now explain to me why im better off paying $144.95 Locally when I can buy it in the comfort of my own home for $65.14?
.:ROBBO:.
Likes Dirt
The fact is they will not survive on the margins they are making now if people continue to buy online. The more people that buy from places like CRC the cheaper their prices are going to get.
They also have the chain stores that are going up everywhere to contend with now as well.
I do very much agree, I don't think that every item bought at CRC would then be bought locally (if CRC et al shut down) or even that every cent spent at CRC would be spent locally.
Although the closing of CRC would change the second-hand market too. Prices would go up based on the fact that a brand new fork would cost $1,200, not $600 plus p&h (made up prices), so you could justify selling that 1 year old fork for $900, which you couldn't do now.
Then over time, people would be less likely to upgrade as much, because it would cost more (for both used and new), so less second hand gear would enter the market, which could increase used prices a little more.
ultimately it would probably reduce the market anyhow as buyers revert to holding onto bikes and components for longer periods, preferring to maintain bikes/components rather than replace them.
iscarrr
Likes Dirt
What saddens me is that these guys are typically perceived as cheap price wise, and pretty good guys. But because of stupid distributor pricing, prices on big ticket items like frames or complete bikes are mind boggling.
Quick example:
TBSM - Santa Cruz Tallboy frame: $3699 (apparently $3800 Aussie retail) from TBSM
Competitive Cyclist (US based) - Santa Cruz Tallboy frame: $2350 (USD, and US retail), so ~ $2600 AUD
Now ok thats not completely fair, you've got to add 10% for GST, factor in a dodgy exchange rate, some shipping charges. But still, does all that really add up to $1200?
Ultimately im going off track. What im talking about is massive discrepancy of US vs. Aust retail prices, but the result of that means we buy online from overseas because we're getting ripped off quite disgustingly here.
r.ayres1
Likes Bikes and Dirt
I,m a 47 year old plumber... You should see the shitty clothes i wear ! i,m not joking .If you want to buy snazzy clothes to wear, thats up to you. I just want reasonably priced bike stuff , that,s all.
thecat
NSWMTB, Central Tableland MBC
There is a perception that if it's on the net it's cheap. Strictly are far from cheap
They do however do a great job on having pretty much everything in stock.
That's the main issue with smaller LBS. it's hard to keep large inventory and keep websites up todate. TBSM and Phantom do a great job at this.
2600 + 5% import duty on stuff over $1000= 2730
+ 10% gst = $3003
and your $1200 becomes closer to $600 and there's still wages, rent and electricity before profit kicks in
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