Ridiculous Prices (rant thread)
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Ridiculous Prices (rant thread)
Postby mezla » Sat Sep 22, 2012 7:57 am
Recently, I destroyed my Ui2 RD. Local quotes: $420 and $400 from two of the bigger and more reputable bike stores in Canberra. I got it shipped from the UK for $215 (Evans Cycles). A 48% saving online.
Called a couple of stores (Trek Retailers) for a quote on a saddle yesterday. One said $299, the other said $229. I can buy it from the Trek web site for $180, and I got it brand new from Germany including shipping for $145. A 37-52% saving online.
A few months ago I bought a Dura-Ace 7900 C35 wheelset... the Australian prices for this are completely outrageous. I paid $1070 including shipping from the UK (Ribble). Cycling Express is selling them at $1,499 (a claimed 38% discount and almost a decent price). Another Aussie retailer has them at $2279.20 (also at a discount they claim). I've seen them priced even higher in local Canberra shops (~$2.5k). Admittedly the prices for these wheels vary wildly online, but they're just another example. A 29-53% saving online.
High quality knicks and Jerseys are similarly overpriced... as are tyres, pumps, and from what I can see... everything else.
When it comes to buying parts, if you shop locally, you're probably paying 1.5-2+ times the prices you can find online. This all makes me a bit sad, and a bit angry. I wish I lived somewhere that I could buy things from a local shop, but sadly I do not. I'd even be happy to pay 10/20% more if it meant supporting my local cycling scene
What the fudge causes these hugely inflated prices? Is it really the distributors? If so, is there any end in sight?
MEH! /endrant
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Re: Ridiculous Prices (rant thread)
Postby gabrielle260 » Sat Sep 22, 2012 11:12 am
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Re: Ridiculous Prices (rant thread)
Postby g-boaf » Sat Sep 22, 2012 11:50 am
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Re: Ridiculous Prices (rant thread)
Postby __PG__ » Sat Sep 22, 2012 12:12 pm
You have to remember that much of the components you get from Wiggle/Pro Bike Kit etc is excess OEM stock dumped by Giant, Trek etc. It is not bought from Shimano/SRAM/Campag directly by Wiggle. Rather, Giant and other big OEMs will sell excess components. The overseas retailers put a small mark-up on the components and then ship it to you.mezla wrote: What the fudge causes these hugely inflated prices? Is it really the distributors? If so, is there any end in sight?
MEH! /endrant
You can image that the price that Giant buy 10,000 Shimano groupsets is vastly different from the price your LBS gets.
Electronics/lighting etc seem very competitive in Australian LBSs. Components aren't (for the reasons given above).
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Re: Ridiculous Prices (rant thread)
Postby yarravalleyplodder » Sat Sep 22, 2012 1:00 pm
well what ever it is the price difference can be quite significant and when its so important to get the most for every dollar you spend. Even if they add gst the savings will still be to big to send me down to my LBS, which is a shame but I dont have cash to throw away__PG__ wrote:You have to remember that much of the components you get from Wiggle/Pro Bike Kit etc is excess OEM stock dumped by Giant, Trek etc. It is not bought from Shimano/SRAM/Campag directly by Wiggle. Rather, Giant and other big OEMs will sell excess components. The overseas retailers put a small mark-up on the components and then ship it to you.mezla wrote: What the fudge causes these hugely inflated prices? Is it really the distributors? If so, is there any end in sight?
MEH! /endrant
You can image that the price that Giant buy 10,000 Shimano groupsets is vastly different from the price your LBS gets.
Electronics/lighting etc seem very competitive in Australian LBSs. Components aren't (for the reasons given above).
2012 Fuji Nevada 2.0
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Re: Ridiculous Prices (rant thread)
Postby AndyRevill » Sat Sep 22, 2012 2:28 pm
I suspect the LBS can't buy from Shimano, they'll have to go through a distributor - seems to be a common setup in Aus. So it's easy to see how prices get inflated once there's an extra mark-up and lower volume sales.__PG__ wrote:
You can image that the price that Giant buy 10,000 Shimano groupsets is vastly different from the price your LBS gets.
).
Andy
Trek Domane 4.5
- Mrfenejeans
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Re: Ridiculous Prices (rant thread)
Postby Mrfenejeans » Sat Sep 22, 2012 2:41 pm
Ordering online i can get 2for the same price and have them in less than a week.
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Re: Ridiculous Prices (rant thread)
Postby __PG__ » Sat Sep 22, 2012 2:47 pm
Probably right. A local bike manufacturer in Australia said if I wanted to put Shimano components on the bike I'd be better off buying them myself as he wasn't able get competitive pricing. He makes about two bikes a week. He said his pricing on SRAM was much better and competitive (and it was).AndyRevill wrote:__PG__ wrote: I suspect the LBS can't buy from Shimano, they'll have to go through a distributor - seems to be a common setup in Aus. So it's easy to see how prices get inflated once there's an extra mark-up and lower volume sales.
Andy
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Re: Ridiculous Prices (rant thread)
Postby antipodean » Sat Sep 22, 2012 4:42 pm
First I have ever heard of this and I trawl most of the bike forums, any evidence that this is correct?__PG__ wrote:You have to remember that much of the components you get from Wiggle/Pro Bike Kit etc is excess OEM stock dumped by Giant, Trek etc. It is not bought from Shimano/SRAM/Campag directly by Wiggle. Rather, Giant and other big OEMs will sell excess components. The overseas retailers put a small mark-up on the components and then ship it to you.
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Re: Ridiculous Prices (rant thread)
Postby zero » Sat Sep 22, 2012 5:33 pm
Going to have to call BS on that story. I've bought shimano components from c r c. Major components like cranksets come in shimano retail boxes. ie they are selling retail shelf product. There is no way they could keep a comprehensive product line based on over-estimates by bicycle manufacturers.__PG__ wrote:You have to remember that much of the components you get from Wiggle/Pro Bike Kit etc is excess OEM stock dumped by Giant, Trek etc. It is not bought from Shimano/SRAM/Campag directly by Wiggle. Rather, Giant and other big OEMs will sell excess components. The overseas retailers put a small mark-up on the components and then ship it to you.mezla wrote: What the fudge causes these hugely inflated prices? Is it really the distributors? If so, is there any end in sight?
MEH! /endrant
You can image that the price that Giant buy 10,000 Shimano groupsets is vastly different from the price your LBS gets.
Electronics/lighting etc seem very competitive in Australian LBSs. Components aren't (for the reasons given above).
Bicycle manufacturers overshoot groupsets by 20, not by 20,000, and they buy components in box loads for each assembly point on their line, not as complete groupsets. That is why when 20 OEM groupsets turn up on ebay, its in some plastic bag, unless its coming out of a shop liquidation.
if you are trying to figure out why accessories are cheap, its because there are 50 manufacturers, not 3, and the manufacturers are far more willing to assist parallel importation, because they need the sales more than they need to prop up a distribution chain, and accessories need less advice for selection and no qualified ability to fit.
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Re: Ridiculous Prices (rant thread)
Postby The 2nd Womble » Sat Sep 22, 2012 5:51 pm
Huge fan of booted RGers who just can't help themselves
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Re: Ridiculous Prices (rant thread)
Postby adrian_d » Sat Sep 22, 2012 5:59 pm
With a lot of things in my life I can't see myself buying certain parts new, and often support the second hand market just as much.
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Re: Ridiculous Prices (rant thread)
Postby Bentnose » Sat Sep 22, 2012 6:03 pm
I'd like to buy from lbs's but the price difference and lack of range/availability just puts me off, actual bicycle purchases are probably worthwhile though.
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Re: Ridiculous Prices (rant thread)
Postby ldrcycles » Sat Sep 22, 2012 6:53 pm
I got a set on ebay from a seller in victoria, brand new for $410.
Just as an aside, re knicks and jerseys, i reckon cell are the bomb, great quality and crazy cheap.
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Re: Ridiculous Prices (rant thread)
Postby __PG__ » Sat Sep 22, 2012 7:16 pm
How many components do you think Shimano make in one production run?zero wrote: Bicycle manufacturers overshoot groupsets by 20, not by 20,000, and they buy components in box loads for each assembly point on their line, not as complete groupsets. That is why when 20 OEM groupsets turn up on ebay, its in some plastic bag, unless its coming out of a shop liquidation.
Have a read of this Cycling IQ series about the modern bicycle industry.
This article gives an idea of the amount of bicycles Giant sells annually.
I'm sure some websites sell 'boxed' components, but a lot sell old OEM stock.
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Re: Ridiculous Prices (rant thread)
Postby jcjordan » Sat Sep 22, 2012 7:54 pm
I have never recivieved anything but retail boxes.
More likely it has to do with buying power and low margin high turn over selling.
Unfortunately we have to purchase through a middle man (distributer) who adds a second level of profit and can't purchase enough product to get a real discount from such a small market.
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Re: Ridiculous Prices (rant thread)
Postby jacks1071 » Sat Sep 22, 2012 8:30 pm
The stuff that comes without the packaging is OEM. Shimano give special pricing to OEM (Bike Manufacturers) to use their groupo and it comes like that - they sign a contract stating NOT to sell the loose components. It seems that Shimano don't police the policy. The people who play by the rules have higher pricing which is part of what is seen. The price difference for OEM groupset is a significant discount over components destined to be sold (in retail boxes).Bentnose wrote:A lot of Shimano stuff I've bought recently came in plastic bags at great prices. That would be an Ultegra and XT cassette in c r c plastic bags and an OEM XT crankset from Evans cycles in a plain cardboard box. A large proportion of the Shimano stuff I buy seems to come like this.
I'd like to buy from lbs's but the price difference and lack of range/availability just puts me off, actual bicycle purchases are probably worthwhile though.
Do I care if I get the box or not? No, couldn't care less - in fact I'd prefer there was less or no packaging, just providing a little industry insight.
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Re: Ridiculous Prices (rant thread)
Postby zero » Sat Sep 22, 2012 10:24 pm
c r c and wiggle will turn over £200m ($325mil usd) this year combined. Their distributors essentially wield their buying power. Giant revenue reported in Taiwan for 2011 was $627.9 million USD, and giant has significant internal R&D, fixed, manpower, and raw material costs and will thus have have a substantially smaller proportion of their turnover applied to oem parts purchasing.__PG__ wrote:How many components do you think Shimano make in one production run?zero wrote: Bicycle manufacturers overshoot groupsets by 20, not by 20,000, and they buy components in box loads for each assembly point on their line, not as complete groupsets. That is why when 20 OEM groupsets turn up on ebay, its in some plastic bag, unless its coming out of a shop liquidation.
There are plenty of grains of truth in the articles (ie the groupset+frame valuation, and the existance of off-the-pegs), but he studiously avoids numbers. Most importantly he can never place a scaling number against any of his factoids or strawman examples. ie for all we know, "systemic problems" with shimano oem grey parts could be 25% or 15% or 5% of the total shimano parts market, and could even be less by value, as more attention inevitably occurs on flagship products.
I also think that the opportunity he identifies is multi year cyclic (ie was available in 2009, but probably difficult to achieve in 2010-11 due to rising cycle production). I also think that the major e-tailers set the upper bounds for grey market prices, rather than the grey market setting a serious bar for the serious e-tailers.
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Re: Ridiculous Prices (rant thread)
Postby DW260 » Sun Sep 23, 2012 6:41 am
Evidence is anecdotal at best, but two independent lbs's have mentioned to me that's what goes on.antipodean wrote:First I have ever heard of this and I trawl most of the bike forums, any evidence that this is correct?__PG__ wrote:You have to remember that much of the components you get from Wiggle/Pro Bike Kit etc is excess OEM stock dumped by Giant, Trek etc. It is not bought from Shimano/SRAM/Campag directly by Wiggle. Rather, Giant and other big OEMs will sell excess components. The overseas retailers put a small mark-up on the components and then ship it to you.
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Re: Ridiculous Prices (rant thread)
Postby Xplora » Sun Sep 23, 2012 10:52 am
Do you realise how much money that is? For many of us, that's 2-3 annual wages after tax... two people would need to be laid off to break even, and these places aren't hiring extra staff without cause.
If you can afford to wait for all your stuff, if you can afford to buy in advance, if you can afford to take chances with misfitting product, if you can be bothered fitting all your stuff yourself, then perhaps the LBS isn't for you. You have the flexibility to decide for yourself, you aren't in Communist Russia.
I don't think I'm patient enough to wait for the current place I'm buying from if they were missing a mechanic and salesperson from their staff. They are a shopfront, and those things cost time and money. You're entitled to think it's BS; perhaps you need to build better relationships to get better discounts. They can move if they know you will buy your next 3 bikes from them. Are you buying your bikes from them? Servicing? Maybe they know you're an internet !! BAN ME NOW FOR SWEARING !! with no shop loyalty?
These places DO NOT compete on price.
I'm not much different mate - I buy on price too... but we have to look at the REAL market reality, and if you can only see yourself in that picture, then you don't see it.
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Re: Ridiculous Prices (rant thread)
Postby ball bearing » Sun Sep 23, 2012 11:40 am
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Re: Ridiculous Prices (rant thread)
Postby usernameforme » Sun Sep 23, 2012 12:41 pm
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Re: Ridiculous Prices (rant thread)
Postby biker jk » Sun Sep 23, 2012 1:26 pm
Sorry but that's not the case. Bike 24 (and a host of others ) sell Shimano groupsets in the boxes (not OEM) and are often cheaper than c r c (they do sell OEM groupset parts). The problem is that Shimano Australia are making unreasonable markups over the cost of production. Take the Shimano RS80 C24 wheelset as an example. They're made in Malaysia but the LBS price is close to double the overseas online price even after shipping costs.jacks1071 wrote:The stuff that comes without the packaging is OEM. Shimano give special pricing to OEM (Bike Manufacturers) to use their groupo and it comes like that - they sign a contract stating NOT to sell the loose components. It seems that Shimano don't police the policy. The people who play by the rules have higher pricing which is part of what is seen. The price difference for OEM groupset is a significant discount over components destined to be sold (in retail boxes).Bentnose wrote:A lot of Shimano stuff I've bought recently came in plastic bags at great prices. That would be an Ultegra and XT cassette in c r c plastic bags and an OEM XT crankset from Evans cycles in a plain cardboard box. A large proportion of the Shimano stuff I buy seems to come like this.
I'd like to buy from lbs's but the price difference and lack of range/availability just puts me off, actual bicycle purchases are probably worthwhile though.
Do I care if I get the box or not? No, couldn't care less - in fact I'd prefer there was less or no packaging, just providing a little industry insight.
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Re: Ridiculous Prices (rant thread)
Postby ColinOldnCranky » Sun Sep 23, 2012 1:35 pm
It is now $299. Similar price at CircusShop in Maylands.
I looked on unicycle.com and it is $320 via their Oz presence. I look on unicycle.coms US presence and it is only $half that price.
In the time since I bought mine the Oz buck ahs gone from buying around 70 cents US to fifty percent more than that. Certerus parabus i would expect that landing things from overseas should be around a third cheaper. Yet my mates now have to spend about 70% more. Simplistically my $180 unicycle should now be costing around $110, not $300.
Something stinks and the Gerry Harveys of the world wonder why their buyers are now shopping overseas via the internet.
(To be clear - this is the identical model to mine. In model number and in actual build.)
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Re: Ridiculous Prices (rant thread)
Postby JustJames » Sun Sep 23, 2012 3:05 pm
Online brands can't compete on service.
My LBS - in walking distance, and I would dearly like to use them - have goofed up with me twice in the last few weeks. First they told me that a Shimano seven speed trigger shifter would not work with my son's twist-shift equipped seven speed bike. Well, that piece of expert advice was flat out wrong. And yesterday they didn't have a headset. Nothing exotic, just a regular 1 1/8" external headset. There is another LBS, but they are not in walking distance...they had no problem supplying. Unsurprisingly, LBS #2 was heaving with punters and LBS #1 was very quiet.
To add something a bit more on topic: Aussie distributors seem to be used to having an "Australian market" to operate in. I work in an unrelated industry, and have given up trying to source product from local distributors, and have become a grey importer. Whenever I've tried to support Aussie distributors, their price to me has been in excess of what I can charge my (online savvy) customers. The reality is that there are no more local markets, there are local patches of the global market, and if local distributors can not supply into local patches of the market, they will disappear.
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