Viewing 13 posts - 41 through 53 (of 53 total)
  • Bikes/kit profit margins.
  • mindmap3
    Free Member

    With regards to the margins, I don’t know what it is like now but I remember that when I worked in a shop there wasn’t that much margin on bikes but quite a lot on accessories especially stuff like tubes. Admittedly we bought a lot being a biggish shop but the mark up was pretty massive.

    We also used to get a lot of deals from distributors that would enable us to have special offers. I remember the Michelin reo trying to clear a load if tyres…I bought some Hots for three quid each and some DH tyres fir not much more.

    mikewsmith
    Free Member

    What most seem to miss is that the difference between what you pay for something and what you sell it for is not profit 🙂

    On the distribution thing, I’d be fairly pissed if someone was selling stuff in an area that I had exclusive distribution in, you put in the hard work marketing, selling, supplying etc then you get undercut by someone doing none of the work. Especially if you have a written agreement for distribution. (if thats whats going on) great for the consumer for 10mins then crap after that.

    elliptic
    Free Member

    Often thought this, why are they so expensive in the first place?

    Because expensive helmets are fashion items.

    And fashion items == bigger margins right through the chain (manufacturer, distributor, shop) because it’s more speculative than selling everyday bread-and-butter stock, i.e. (a) people will pay a premium for the “in” brand/style/colour but (b) there’s more risk of getting stuck with a pile of unsold last-years-model which then has to be dumped at 50% off.

    Does this bother you? Get a cheap mass market one for £24.99, it’ll protect your head just as well…

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    thisisnotaspoon
    Free Member

    There is no VAT on helmets however some retailers/brands will fill this gap with profit!

    Think it changed about 5 years ago. I seem to remember buying a Xen in a hurry for £70 as they were going up by 20% the next month.

    mathewshotbolt
    Free Member

    It amuses me when consumers make wild speculations about margins/costs on items.

    Helmet margins are better on cheap branded stuff like raleigh helmets or the stuff out of Aldi.

    High end brands from entry level cost to top level cost make the same margin.

    Our of intrest, has anyone read why more expensive helmets cost more to make? I’m not saying people will get more out of them but at least be open to reading up on a manufacturer as to why they are what the are.

    simons_nicolai-uk
    Free Member

    I seem to remember buying a Xen in a hurry for £70 as they were going up by 20% the next month.

    really?

    VAT

    Mister-P
    Free Member

    There is definitely no VAT on cycle helmets.

    brakes
    Free Member

    be open to reading up on a manufacturer as to why they are what the are.

    I spent a lot of time deciding between a Specialized Propero II helmet (£70) and a Prevail (£160). They look virtually identical and I could not see a material ‘performance’ advantage with the more expensive one.
    I would be amazed if there wasn’t a significantly larger margin on the more expensive helmet.

    mathewshotbolt
    Free Member

    you’ll make more on a more expensive helmet but the percentage margin will stay the same.

    generally helmets spend longer ‘baking’ and will have more inmold features, better materials going on.

    scrumfled
    Free Member

    marketing folks call it ‘value based pricing’, but in reality its ‘charge what you can get away with’.

    The cosmetics industry makes sports goods providers look like caveman at this.

    Mind you, if you buy an expensive brand you’re the source of the problem, not the victim 😉

    thisisnotaspoon
    Free Member

    Got it the wrong way round, must have waited a month for them to go down, and it was 13 years ago.

    http://www.bikebiz.com/news/read/its-no-joke-vat-dropped-from-cycle-helmets/05400

    chief9000
    Free Member

    I seem to remember from when I had a Saturday job at an lbs helmets used to be one of the biggest margins to make sometimes up to about 65%.

    Couple of quids worth of materials squirted ito a mold and retails at £90

    These are very true statements. I believe that helmets are one of the biggest earners in the bicycle industry, precisely because they are only a few pence worth of materials squirted into a mould.

    Moulds can be quite expensive of course, but they are usually made in the east (approx 35%cheaper than the UK) and of course the cost is amortized over all f the helmets made. Not to mention that some are modified to produce next years helmets.

    If coal is cheap and iron ore cheap, why are cars so damn expensive?

    Only 50% of a car cost is manufacture related. The remainder comes from marketing, forecourts bla bla bla. A typical car body in white comes in at just over 100quid fully formed and welded.

    ti_pin_man
    Free Member

    its sad, but we all want cheap stuff and I used to get annoyed when I found out the retail industry typically buy something at 50% of what they are selling them for.

    A 10 quid top, they buy for 5.
    That 5 quid usually costs 2.50 to produce the top.
    So it sounds mad to pay 7.50 on top right?

    But having recently done a lot of work sourcing raw materials for a clothing line and the cost of prototyping, manufacturing, marketing etc chances are most of us are getting good value. on top of that the shop has to pay rent/rates/wages/utilities and to hold stock…

    … I reckon you got a bargain and they were selling to clear space for new stock or new lines coming through. Either way well done.

Viewing 13 posts - 41 through 53 (of 53 total)

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