And they wonder why we buy online!

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Re: And they wonder why we buy online!

Postby sb944 » Fri Dec 07, 2012 12:19 pm

Ross wrote:I'm not saying that Wiggle et al don't have many times the turnover and customers of LBS, I was simply refuting what Byke wrote saying costs for rent and staff are greater at LBS than large online retailers.


Wiggles rent and staff costs would be MUCH lower as a percentage of their sales, and I'm sure this is what people mean when they talk about high rent for the LBS.
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by BNA » Fri Dec 07, 2012 12:37 pm

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Re: And they wonder why we buy online!

Postby bosvit » Fri Dec 07, 2012 12:37 pm

Ross wrote:I'm not saying that Wiggle et al don't have many times the turnover and customers of LBS, I was simply refuting what Byke wrote saying costs for rent and staff are greater at LBS than large online retailers.

Per sale those costs to a lbs would be significantly higher
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Re: And they wonder why we buy online!

Postby Ross » Fri Dec 07, 2012 1:03 pm

Maybe cheaper, you would need to crunch the numbers. Turnover (not profit)* was £90 million in 2011 with growth of 50% for the past few years so maybe closer to £120 million with some 600,000 customers in 80 countries.
Some interesting figures here - http://cyclingiq.com/2011/11/24/more-wi ... lian-home/
Say Wiggle have 300 staff (reports I've heard of up to 500), they probably pay them on average $1000 gross each per week (NFI about UK pay rates). Anyone know how much a 45,000 sq ft warehouse costs to rent? How many millions of dollars worth of stock do they have with over 250,000 lines?
They would have a pretty hefty postage/freight bill as well with all the free shipping deals they give out. Most LBS charge customers for mail/freight for phone/web/mail orders.
Being a warehouse they would have literally miles or racking and shelving. Machinery such as forklifts would be needed as well and probably a delivery/pickup vehicle or two as well.

Chain Reaction Cycles employs upwards of 330 people, sends out 30,000 orders every week, and reportedly turns over some £77.5 million. People should take these order numbers into account when having a whinge that their order got screwed up. $h!t happens when you are dealing with that much stuff!

Average LBS might pay (guessing) $1000 week rent. Might have 6 employees and have $150,000 worth of stock? Not many do deliveries, though the boss most likely has a company car.

Any LBS employees care to give us some accurate figures?

* £33.2m turnover in the year 2009 to the end of January and pre-tax profits of £2.6M
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Re: And they wonder why we buy online!

Postby Undertow » Fri Dec 07, 2012 1:52 pm

Ross wrote:
Average LBS might pay (guessing) $1000 week rent. Might have 6 employees and have $150,000 worth of stock? Not many do deliveries, though the boss most likely has a company car.

Any LBS employees care to give us some accurate figures?


That will really depend on where they are. I know shopfronts in the CBD in brisbane (where this is at least 3 bike shops, or were when i last checked) can go for between $5-10k in rent. So are larger premises with enough room for stock and a workshop in the surrounding suburbs might go for something similar.
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Re: And they wonder why we buy online!

Postby ming » Sat Dec 08, 2012 11:49 am

The other day i was surfing the net admiring carbon bike frames.On one site ,they were advertising a top of the range Specialized carbon fibre frame for $2600.
Out of interest i got onto the chinese Denge Sloppy Kiss web site. Denge Sloppy Kiss make a number of carbon fibre frames for different companies.Along with photos of the frames, they provide frame dimensions. I located the exact same frame that specialized advertised. So i sent Denge Sloppy Kiss an email inquiring if they would sell a one off frame, and what would be the price? I received a prompt reply stating yes, they would supply me with the frame and the cost would be $680 Aus.Painting to your specifications could be provided if required. Taking into account that the frame would fall under the $1000 import duty requirements ,and the only other cost would be shipping costs ,why wouldn,t a person take the chance and buy online. Ok, you could argue that there is no warranty ,but the frame is going to be exactly the same, as the frames ordered by Specialized or any other company. For too long the Australian public have been ripped off by the middle men. I feel sorry for the LBS owners. they face a difficult decision. Australians are about 10 years behind Europe and America with online purchasing, that will change. Australians adopt new technology very quickly. I say, more power to the people.
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Re: And they wonder why we buy online!

Postby Ross » Sat Dec 08, 2012 12:21 pm

ming wrote: Ok, you could argue that there is no warranty ,but the frame is going to be exactly the same, as the frames ordered by Specialized or any other company. For too long the Australian public have been ripped off by the middle men. I feel sorry for the LBS owners. they face a difficult decision. Australians are about 10 years behind Europe and America with online purchasing, that will change. Australians adopt new technology very quickly. I say, more power to the people.


This is a different issue. The cheap chinese carbon frame isn't the same as a genuine Specialized. Might have similar geometry but it would be made differently and probably use different carbon. Even Specialised have different frames in their own range. The lower spec bikes get SL2 FACT IS 8r carbon wgere the top of the line S-Works SL4 has FACT IS 11r carbon, making them lighter and stiffer.

Not saying they (the chinese copies) are terrible, there are many happy customers I'm sure, but they aren't of the same quality as a genuine Specialized.
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