• This topic has 95 replies, 43 voices, and was last updated 8 years ago by Daffy.
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  • 'Price fixing' by the Bike Cos?
  • theotherjonv
    Full Member

    But in the internet age a savvy consumer can find the deals relatively easily, whether anyone’s advertising or not.

    I know bikes and the ‘death of the LBS’ is an emotive subject to many on here and I understand why. But honestly, who buys a big ticket anything nowadays without first googling it to see what others are selling it for even if the purpose is only to give you a target price which you can weigh against your local shop’s ‘price plus benefits’ offer?

    My customers are far less forgiving – when I put a bid in for a piece of business, if I’m off they’ll give me a price match opportunity if I’m lucky, and if I’m good they’ll give that chance to my competitor. And repeat until all our pips squeak. That’s market forces.

    bencooper
    Free Member

    And repeat until all our pips squeak. That’s market forces.

    How do you factor in the intangibles? Like having a local dealer you can go back to if there’s a problem in 5 years? Like having it properly assembled by a mechanic who’s well trained and not in a rush or unmotivated because they’re underpaid? Stuff like that.

    jamj1974
    Full Member

    Otherjonv- sorry if that came across as criticism. Certainly wasn’t meant to be.

    theotherjonv
    Full Member

    That’s fine jamj – that’s what the forum’s for, to have discussions and exchange viewpoints.

    [edit – just repeating myself]

    wrecker
    Free Member

    With Giant and Trek, it looks like a cheeky discount might be a thing of the past anyway. Giants frankly absurd direct sales thing (which benefits everyone except the customer) is going to hold their prices stricter than ever.
    At a time when Canyon and YT are on the rise, I can’t help but think that trying to maximise everyones margin isn’t going to end well.

    bereavementmonkey
    Free Member

    Sorry I didn’t read all the posts so apologies if this has been mentioned.

    Do you have any proof that this conversation actually happened? I mean the one between the shop and the supplier and the other dealer? Sounds, possibly, like a dealer trying to scare you into buying from them???

    Like a few people have said on here they can’t actually police the price but they can choose who to sell to as an appropriate ambassador for the brand and to keep it’s value at the right level. I used to work at a store that sold Trek amongst others and they never sent letters round stating what you could or could not sell your old stock for … ever.

    The world of buying stuff is constantly evolving and each of us must make a decision on where we stand within. If you value your LBS then use it and pay the premium. If you know your stuff and can deal with the internet or distance seller then so be it. But then don’t be surprised if your LBS isn’t interested with your £100 cheaper bike when you walk in and need the reverb post sorted under warranty and so on and so forth. That kind of service is worth a large chunk of the margin the dealer makes.

    I certainly wouldn’t worry about reporting any ‘he say she say’ stuff to any Government agency. Waste of your breath, ink or typing if you ask me.

    Cheers for now and whatever you decide enjoy your bike!

    theotherjonv
    Full Member

    Do you have any proof that this conversation actually happened? I mean the one between the shop and the supplier and the other dealer? Sounds, possibly, like a dealer trying to scare you into buying from them???

    No. But either way, whether they are pulling the rug out from under me or just telling me fibs to try to get me to buy from them, neither sits well.

    Have also had an email from the shop where I ordered, advising the bike is out of stock, needs to be ordered from the supplier, and they’ll get back to me with a date. Which could well be the precursor to a LLLLOOOOONNNGGGGG schedule……

    trail_rat
    Free Member

    The 100 quid will taste supersweet taking it out or its first ride in october im sure.

    Enjoy the new bike !

    jamj1974
    Full Member

    But honestly, who buys a big ticket anything nowadays without first googling it to see what others are selling it for even if the purpose is only to give you a target price which you can weigh against your local shop’s ‘price plus benefits’ offer?

    Me. Last bike I bought. Found a shop that stocked the brand I liked and ordered it. I then found another shop I liked too, also with good people. I offered the RRP and got a good deal.

    RamseyNeil
    Free Member

    Working in a bike shop it’s amazing how many people come in and want you to price match something that is being advertised cheaply but when you check it’s actually out of stock and unavailable or the product is advertised as “from” a certain price but when you investigate it turns out that what they need is quite a bit more .I agree with bereavementmonkey on this.

    MTB-Rob
    Free Member

    “Have also had an email from the shop where I ordered, advising the bike is out of stock, needs to be ordered from the supplier”
    Thats prob why why is on offer! old trick, discount items they don’t have in stock and using the “supplier” to hold stock, but if sipplier is out of stock oh well doesn’t look good on them, (and in my eyes bad practice) I also wouldn’t be surprised you get a email saying they out of stock but we have “another” bike that similar they can sell you.

    Also it the Other bike shop you asked to price, got the bike in stock and also checked suppliers levels, then why should they price match? it’s a sort after item. supply and demand!

    MTB-Rob
    Free Member

    Also there been plenty of “online” shops having the “RRP” prices HIGHER than what they really are, in doing so give higher XX% £YYY savings when really they not much below the normal RRP
    Making people think it a great bargain!
    But it is common practice in else where.

    theotherjonv
    Full Member

    it the Other bike shop you asked to price, got the bike in stock and also checked suppliers levels, then why should they price match? it’s a sort after item. supply and demand!

    I don’t know if bike shops have live capability of stock checking at suppliers or rely on phoning the rep / getting a weekly stock list or whatever, but neither shop initially gave me any indication getting the model / size combo would be any issue. Now one shop is awaiting a delivery date and will inform me when they know more, for an item the other said was available in a couple of days at the supplier.

    Remember – this is not my interpretation. That’s what the LBS said to me as a counter – “they won’t allow them to sell for that level of discount, you won’t get it from them if they don’t have it in stock”

    I suppose there’s technically still a chance the online retailer was taking a flyer with the intention of doing a ‘bait and switch’ to something they do hold in stock. But I’m not that green, and frankly most times if it looks like a duck and quacks like a duck, it’s a duck.

    deviant
    Free Member

    This is hilarious, there are a load of people on here who take great pride at supporting the LBS yet want the best possible discount from said bricks and mortar store and then go online, price match, have a hissy fit etc when they can’t get it cheaper.

    Jesus wept, go direct sales it’s a damn site easier…the prices are unrivalled, no need to go to a ‘concept’ store and deal with the gob shites in there….any problems can be solved by a trip to the LBS….seriously, has anyone ever had a bike shop turn away a YT bike because it wasn’t bought there!?…..don’t make me laugh, they’re glad of the business and will happily true the wheel that was bent in transit etc.

    The sooner LBS as bike shops are gone the better, then we can just have good service centres in their place instead.

    jamj1974
    Full Member

    seriously, has anyone ever had a bike shop turn away a YT bike because it wasn’t bought there

    I once had a Specialized dealer tell me they were doing me a favour as they didn’t usually do work (In my case, truing a wheel), but they would make an exception “just this once”. Disgusting!

    They have never got any further business from me.

    mikewsmith
    Free Member

    Jesus wept, go direct sales it’s a damn site easier…the prices are unrivalled, no need to go to a ‘concept’ store and deal with the gob shites in there….any problems can be solved by a trip to the LBS

    Exactly with their demo and sizing service, assembly in store, full check prior to handing over to the customer. Fast efficient dealing with warranty issues, generally 1 or 2 checks/services free and back up when stuff goes wrong. Simply unrivalled in terms of what you get for your money.

    The direct sales models all employ much more efficient price fixing, they just don’t sell to anyone else. Anyone got a decent discount on a canyon? Found somebody doing them cheaper? How about those awesome delivery times?

    I manufacturer has more than profit invested in their retailers, they are the sales people and the face of the brand. They also invest their time in them so seeing them try and run stuff out dirt cheap and try and screw over other dealers for one sale means they manufacturer loses dealers and reputation.

    It sounds like the shop offering the deal didn’t have the bike but wanted people through the door. If they do that all the time I doubt they will be in business long.

    In the short term a price war may be good for a consumer, long term it’s certainly not.

    theotherjonv
    Full Member

    It sounds like the shop offering the deal didn’t have the bike but wanted people through the door.

    I think I covered that above – neither shop is holding stock and is relying on getting it from the supplier, both indicated no problems beforehand, and in fairness the shop hasn’t told me there is a problem, I just said the email might be a precursor to that. They might call me today and tell me that the supplier’s been in contact and it’ll be here on Friday.

    If they do that all the time I doubt they will be in business long.

    I’ll tell them to put their 40th birthday celebrations on hold. I suspect it’s because they move with the times and amend their business model that they do survive.

    hora
    Free Member

    ‘A local shop’. How local are they?

    eshershore
    Free Member

    things are changing (in the bike industry) very quickly and this year is rumoured by many to be ‘the year’ where there will be a paradigm shift in the currently broken retail model

    as it stands, the bricks and mortar independant retailers (and many chain retailers) have no trade pricing parity when selling the same branded goods from the same brands, that bypass in country distribution and sell cheaper to big on-line retailers

    the factory still gets paid whether the goods are sold to the on-line retailer, or to the in country distributor. BUT, this then puts the power in the hands of a small number of sellers, which is not good for anyone

    the shift will be (and its coming as a recent large investment by a certain Japanese drive train company in a UK based distributor indicates) the brands selling direct to everyone and cutting out the sales role of the distributors who will move to becoming an in country service and training centre

    the B2B model is well established and said Japanese brand has a European facility in the Netherlands that is already able to ship across the EU.

    Costs must be pared down if LBS and even chain retailers are to continue stocking the branded goods, and the best method is vertical integration by reducing the number of operators in the supply chain (i.e. doing away with the middle man).

    The “WiggleChain” (wiggle and chain reaction) is now larger than many of the distributors and brands they sell, and you will see a situation like Tesco where they can squeeze their suppliers to the nth degree.

    The brands that refuse to supply Wigglechain will be in a strong position as long as they can streamline their supply chain and make their goods more competitive on price whilst their retailers have enough margin to pay for the costs associated with running a quality retail operation with trained and motivated staff

    interesting times…

    bencooper
    Free Member

    I suspect it’s because they move with the times and amend their business model that they do survive.

    Past performance is no indication of future success, or some waffle like that. They might be going under – lots of long-established shops have.

    Long-term, I think deviant might be right – too many outlets to buy bikes online, customers don’t really value the intangibles that a bike shop offers, most manufacturers will probably have to go customer-direct at some point to compete. Then most bike shops will disappear, apart from a few left to repair the bikes bought online.

    Or other good shops will find a niche where online competition isn’t a problem – I’ve found mine.

    jamj1974
    Full Member

    customers don’t really value the intangibles that a bike shop offers

    This is exactly why I have increased my use of good, physical shops. I had with only one exception bought my bikes from them, but often for other stuff had bought a lot via mail order – including before the Internet was a real commerce platform. I then realised about two years ago that some of these great shops with great service were disappearing nonetheless. So, I reduced my online shopping and really focused on the amazing stores. This meant I also became a lot more choosy about the physical shops I would use too. I stopped using some of the more convenient ones – if the service was poor.

    theotherjonv
    Full Member

    customers don’t really value the intangibles that a bike shop offers

    This is where we came in though. I do value the intangibles, as do many others. I wouldn’t be having this discussion over £20 difference, but I would if there was £500 difference. Or £400, or in this case, £150. That’s still too high for me to just accept. Somewhere between – we might have found agreement but that wasn’t the question in the OP.

    But they didn’t try to find that middle point, they used the supplier to cut supply to another shop, which is dubious / possibly illegal, anti-competition, and ultimately abuses the relationship I had with them.

    It’s not as if I was suggesting I’d stand outside their shop with a banner saying “15% cheaper at X” – I wouldn’t do that to them, I don’t think it’s morally OK to do the opposite to me, whatever the legal situation. And they’ve lost a customer over it.

    sync
    Free Member

    My favourite lhs offers 20% back on the bike purchases in accessories or components. This is a publicised local offer.

    Others will not budge on price at all even selling the same bike.

    deviant
    Free Member

    This is exactly why I have increased my use of good, physical shops.

    I reduced mine when they straight faced wanted £50 for a tyre.

    ajantom
    Full Member

    TBH this is why I’ve not used a LBS for nigh on 15 years – the service is so patchy. Yes, I know there are some great ones out there, but if you can do it all yourself then why pay for those ‘intangibles’. I just buy myself the chocolate biscuits nowadays 😉

    Learn to do your maintenance yourself, be self-sufficient, and buy what you need online. It does help that I like fettling and have access to a decent workshop.

    ghostlymachine
    Free Member

    This is exactly why I have increased my use of good, physical shops.

    Ah, the luxury to actually have a choice of good shops. I haven’t got any within a two hour drive that i’d either use to buy bits from, buy a bike from or service anything.

    Long live the mail order business model.

    Either that or i’ll have to set up on my own :/

    hora
    Free Member

    I love using good shops but I draw the line when I need to make my money go as far as possible when nursery fees were soo high, utility bills, etc etc.

    Then there is no contest, everyone is the same.

    ghostlymachine
    Free Member

    And FWIW, it is price fixing, it is illegal, people do lose contracts if they don’t toe the line. Unsurprisingly, it never ever appears in writing (as it’s illegal). I have been party to bollockings of shops by reps for discounting. I’ve also seen the eventual fall out of this.

    Other industries get dragged through the courts on a fairly regularly basis for being naughty. So far, no one from the bike industry has.

    Though, to be completely fair, the way the bike industry is structured, even a partial free for all on pricing would be bloody disastrous. For reasons already stated above.

    chakaping
    Free Member

    the shift will be (and its coming as a recent large investment by a certain Japanese drive train company in a UK based distributor indicates) the brands selling direct to everyone and cutting out the sales role of the distributors who will move to becoming an in country service and training centre

    This makes so much sense and could be great for local bike shops. I’m sure most of us only pick up drivetrain stuff from an LBS if we need it there and then – as it’s sooooo much cheaper from CRC, Merlin etc.

    Have they already started with this model in the US?

    jamj1974
    Full Member

    It’s not as if I was suggesting I’d stand outside their shop with a banner saying “15% cheaper at X” – I wouldn’t do that to them, I don’t think it’s morally OK to do the opposite to me, whatever the legal situation. And they’ve lost a customer over it.

    Your position is totally understandable.

    I don’t have an issue with mail order – I just choose most often to do something else. It’s not immoral to use mail order – I’m just lucky to have a couple of good physical shops not far away.

    MTB-Rob
    Free Member

    Well said Mikwsmith.

    Deviant said
    “The sooner LBS as bike shops are gone the better, then we can just have good service centres in their place instead.”
    So are you peppered to pay £50+ per hour on labour charges? (I know one shop charges £48 already!) Because that what will happen if they can’t/unable to sell bikes and parts to help keep the workshop rate down?

    Deviant (again! don’t think he works in retail or knows much about it?)
    “I reduced mine when they straight faced wanted £50 for a tyre.”
    Why was the shop trying to sell a tyre above it RRP?
    Because the are tyres that RRP for that money and for more!!
    And the diff in performance between a £30 tyre and a £50 is big!
    It’s not the shop setting the price (well I do know of a shop that adds a few £ on to the RRP)

    End of the day it is your money and your time, If you can spend hours searching for the cheapest part/tyre & do your research on the item. then good for you, you make your choice and pay you money.

    Do you go into Wh Smith, pick up a bag of Bic pens and go, “I seen them 10p cheaper in the suppermarket round the corner, can you price match?”
    I doubt that you do, you prob put the bag down and go back to the super market, if you can be brothered & have time.

    wrecker
    Free Member

    Why compare a 10p saving with a few hundred pounds?
    A more accurate example would be with motorcycles perhaps? A KTM 200cc enduro bike is approximately the same as a specialized stumpjumper S works after all. Anyone have any examples of haggling/discount levels when buying a new motorcycle?

    plyphon
    Free Member

    When I used to work in the IT distribution industry, this would happen all the time.

    Manufacturers will make deals with, say, Amazon that no one else can sell below X price, and Amazon will take a large quantity.

    Then if someone is caught slashing their margins the manufacturer will get pissy and refuse to deal any more with that reseller.

    Resellers can sell at what price they like – no one can force them to sell at a certain price directly. But equally a manufacturer can decide who they sell too if a reseller is cutting their margins too much and disrupting the channel.

    Ewan
    Free Member

    [Quote]Though, to be completely fair, the way the bike industry is structured, even a partial free for all on pricing would be bloody disastrous. For reasons already stated above.[/quote]

    In the same way that email was disastrious for the postal service or supermarkets were for butchers/groceriers etc. I.e. For everyone bar the consumer.

    bencooper
    Free Member

    In the same way that email was disastrious for the postal service or supermarkets were for butchers/groceriers etc. I.e. For everyone bar the consumer.

    And actually the customer ends up losing out as well. Remember when there used to be two mail deliveries a day? People get obsessed with making things cheaper, and forget that there ain’t no such thing as a free lunch.

    ghostlymachine
    Free Member

    Yeah. It was really good that the consumer suddenly had no choice. Crap meat and veg from asda or crap overpriced meat and veg from sainsbury. Nice. It’s taken 20 years to get back to having a reasonable choice. And the suppliers are still being royally shafted.

    A complete free for all in the bike industry will probably see anyone smaller than massive disappear within weeks. All you’ll be left with is warehouses and cycle supermarkets full of Trek, Giant and Specialized bikes.

    konabunny
    Free Member

    And FWIW, it is price fixing, it is illegal, people do lose contracts if they don’t toe the line.

    It wouldn’t be price fixing (which is anticompetitive behaviour between competitors), it would be retail price maintenance (which is anticompetitive behaviour between a supplier and its customer)…if it happened at all.

    I don’t really value the intangibles of LBSs…certainly not enough to want to pay more for bikes or bits because manufacturers and retailers are breaking the law.

    deviant
    Free Member

    “The sooner LBS as bike shops are gone the better, then we can just have good service centres in their place instead.”
    So are you peppered to pay £50+ per hour on labour charges? (I know one shop charges £48 already!) Because that what will happen if they can’t/unable to sell bikes and parts to help keep the workshop rate down?

    Yep that’s fine by me, small stuff like changing over brakes, swapping tyres, changing stems and bars etc I’m fine with, as i suspect most others on here are too…..but I can’t build a wheel and would happily pay those prices, likewise although I can fit BB and headsets they’re a ballache and if I was building a frame up project I’d happily pay them the £50 they want to fit the bastard parts.

    It’s a changing market and the LBS days are numbered…..look at the number of 3k+ bikes on the trails these days, you’re telling me they won’t pay decent money for a good service!?

    mikewsmith
    Free Member

    Yep that’s fine by me, small stuff like changing over brakes, swapping tyres, changing stems and bars etc I’m fine with, as i suspect most others on here are too.

    You know this place is not very representative of the people who ride bikes don’t you?
    Seeing the amount of trade a LBS does on both the simple mechanicals and actually selling bikes to people who have no real idea about sizing or what the components are or if they are any good. Exactly the sort of people who would soon bring down the world of mail order by returning their wrong sized bike 3 times…

    puddings
    Free Member

    People in general will not pay for regular servicing when they see the market rate costs for it (assuming they are not the self maintaining sort). You just have to listen in trail centre or surrey hills carparks to the mis-shifting gears and grinding brakes on those £3.5k bikes. My four LBS’s generally don’t see the bikes until the damage is serious at which point the customer moans loudly about the labour charge and the cost of spare parts, that if correctly maintained, would never have needed replacing so quickly (they all offer discount on supplied parts or charge corkage if you supply your own)

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