[Closed] new frame LBS mark up

I think you'll find most non-food retail margins are in the 100% range.

Margins will invariable be higher the higher up the product line you go to cover slower stock turnover and higher initial stock costs.

If there was any profiteering going on, a) it wouldnt last long as other retailers will undercut* and b) there'd be many more LBS owners driving around in Porches rather than clapped out Toyota panel vans 🙂

* unless you have a restrictive distribution policy in place e.g. Santa Cruz & Jungle, Brompton, Bose etc.

You think that bike shops make 75% on bike frames? Youve got to be kidding me, its no where near that amount. The shop needs to make money on what it sells otherwise it will go out of business especially with the finacial situation that a lot of shops are in at the moment but there is no way that they are making 75% on a bike frame costing 2k thats bollox

your maths are sarazin

not staggering at all, bullsh1t is closer to the mark.

I've worked in a bike shop before (admittedly some years ago) still having mates that do, and generally trade on the major brands (spesh, trek etc) is around 60% of retail, and boutique the margins are tighter as there's another player (the importer) in the picture.

Yep your insider is talking horseshit

Higher end bike parts generally attract lower margins, everyday bike brands and essential spares like tubes/tyres make the most margin.

Nowhere near a 100% on bikes/frames though.

Apparently the place for margins is jewellers, into the hundreds of percent on some items.

LOL, i wish my margins were that big!

I agree on the bullsh!t line....would maybe sell for 900 retail.

If you are concerned about capitalism, don't buy clothes or drink take-out coffee again....

More like £500 (or less) profit on a £2k product, the way I heard it from the LBS last week.

But loads of people on here work in the trade, let's have some concrete examples please guys...

Absolute horseshit.

Frame only margins are usually much smaller than full bikes (which are also pretty low) certainly compared to everything else in the shop clothing/acces etc.

Im not going to give concrete examples as everyone here is on different trade rates and its generally frowned upon. But i can confirm that whats been given by your 'insider' is absolute tripe. 🙄

Most retailers in most high street sectors work on between 25 and 35% GP.

It will be higher on low value items in bike shops (think tyre levers and stickers for example), but bikes, parts, accessories and clothing will make about 30% GP at full retail. If a shop owner is lucky, then they might make enough to pay the rent, rates and staff. God forbid they should want to pay themselves too.

I don't work in the bike trade. But I'm right.

I remember trying to buy a high end frame from an importer and the price they gave me was more than it would cost if I went to another shop and just bought it in a sale.
Since the bike industry really isn't that big the actual profits the shops make are very low for retail.

a close mate used to run his own shop and a mail order company. I had everything at trade. Markup was about 20-30%.

Male order? Pervert. 😉

😆 Edited just in time!!

Got to say i really had to question the figures hence the post

He used to work at a bike shop and knows a sponsered rider whos sponser (frame manufacturer) 'sold' him a £1200 RRP bike frame for £350

Can this be true or just more bullshite?

It's such a shame bike shops have to pay rent/rates/staff/expenses etc, otherwise biking would be cheap.

Tomorrow I'm going to go to work & tell them not to pay me as I just love my job & that is thanks enough. If everyone else joins me I think biking will become a very cheap hobby, but I still can't see how we would be able to fund it 🙁

a manufacturers price is different from an importers price is different from a trade price is different from RRP.
that's 3 profit margins not forgetting the governments share of duty and vat (and possibly another government/states tax to pay too).

a full RRP frame could possibly be £350 at the factory gate in another country.

i know for a fact that a £900 RRP product made in taiwan for a north american company is about £500 import inc vat. i guess the trade value is roughly split between these values.

you are living in cloud cuckoo land if you think a LBS is buying frames from importers/distributors for £350 and selling them for £1200

Bone. Are you making an assumption that 350 represents a cost price? Any number of reasons why they sold him a frame for that price that have no relation to cost or profit.

So yes, it could be true. But it is not necessarily linked to cost, either from the factory, importer or retailer. It could be completely arbitary.

I've worked in a bike shop before (admittedly some years ago) still having mates that do, and generally trade on the major brands (spesh, trek etc) is around 60% of retail, and boutique the margins are tighter as there's another player (the importer) in the picture.

Spot on. My experience entirely.

Inner tubes and spokes are about the only things that have ridiculous markup on them (hello, £4 for a rubber bag, or £1.21 for a thin bit of wire with a thread on the end!), pretty much everything else is not that great to be honest.

I think the manufacturer/sponsor's price of £350 may have a slither of truth. This may be a break even price to the manufacturer, who knows

Its how the world goes round this profit game, i mean you pay £3.20ish a pint of Stella in a restaurant, yet it only costs us 67p to buy in, steaks cost £3ish to buy in and sell for 13-14 quid.

Its life, it pays gas, electricity, rent, wages, consumables (till roll etc), depreciation, window cleaning etc, delivery charge, storage, breakdowns, the list goes on

Spokes don't have silly margins, inner tubes certainly do though!

God wish that were true - boutique frame margins are any where from 15% for some odd ball two bit importer frames to about 33% - if you get a good 'stockist' deal. on which you pay carriage and vat - plus you'll be expected to build it up free normally (you have to pay for staff for this) plus tool wear and tear, facing tools etc. On the whole a 'boutique' frame i.e something american made and well known will be about 28% margin. Oh and also you loose money when a new model comes out and your left with old stock you have to discount! stop being tight!

I'm with Stoner.. in BC, distributer to retailer markup on bike parts is 100% for everything.. cables, drive train, wheels, bike racks, brake pads, tyres etc. This holds true for Norco [parts], OGC, Cycles Lambert etc.

Difference between retail and cost on a full bike or frame is price point dependant but iro 30% less.

I've never had to deal with manufacturer to distributer magins.
I also have no experience of UK margins and I'm sure its different everywhere.

Iron Horse frames and full bikes are currently being cleared out at 50% off MSRP (RRP) in the US online shops.

Its how the world goes round this profit game, i mean you pay £3.20ish a pint of Stella in a restaurant, yet it only costs us 67p to buy in, steaks cost £3ish to buy in and sell for 13-14 quid.