Open letter to Chain Reaction Cycles

[Big H*]

Then we might as well boycott Park tool too as they publish a big blue book, showing riders how to service their own bikes...

 

O ja, I remember that book now, it is the one they us at my LBS

[Paul Ruinaard]

I do the sums. CRC seems to be about 30% cheaper than local retail (if they have the item in stock), landed with VAT and duties. That's the upside. But how big is the upside?

- Not all my overseas orders arrive. Many disappear in the mail;

- My LBS generally discounts between 10% and 20%;

- My LBS changes out immediately any defective parts or workmanship, even stripping a bike on their floor if needed;

- I get to see in the flesh potential new stuff. I'm more selective and therefore save, when I buy off the floor;

- My LBS trades in my old stuff on new at realistic prices and straight away (no waiting for weeks or months for a nibble on TheHub);

 

 

The savings from dealing with a conscientious and well-run shop have exceeded the discounts on CRC's prices in the long run for me.

 

But I've also had rough experiences with bike shops (one in particular) other than my preferred shop and I well understand how customer loyalty can be lost. Conceivably forever to the likes of CRC for some.

 

I want to know who your LBS is?

[HairyLegs]

So, all that this twit has done, by writing this letter, is given CRC some free advertising. Should've rather taken their money for an ad.

[Paul Ruinaard]

Pretty silly letter, as most people are saying.

 

Its not just about the bike(shop), it applies to e-commerce in general & thats not going away any time soon, if ever.

When people start to get how technology drives cost down then they will see the lbs is just one of many business models that are being changed by This.

 

The LBS won't go out of business, but their customers are not captive to them and a few like the Hubbers who realize MTB'S are not a black art and won't buy the bs about warranty etc on bicycles, will be able to choose. Some people will choose to buy from them, some not, You as the customer benefit as you have choice.

 

I don't buy my bikes locally,as I can save lots of money (new Cannondale scalpel 2 for R 35k landed compared to R54k in the shop in SA was a recent example).

 

I use a local LBS for service. They get lots of business on servicing as they are good at it and as i am anal they charge me more but service brilliantly. I sent them at least 4 mates as they were so good. Their business is growing and they know that I was the person that helped them with word of mouth so they treat me well.

 

I work too hard for my bucks so if I can save 30 % relatively easily then I will.

[Lucky Luke.]

When people start to get how technology drives cost down then they will see the lbs is just one of many business models that are being changed by This.

 

Agreed, the local shops should accept CRC and use their status as part of the local bike scene / community or whatever you want to call it, to distinguish themselves.

 

They might as well put a few computers in the store and let the customers order CRC stuff on their shop account. Charge a handling fee and fit the parts where appropriate. Sell them a nice cup of coffee while they're doing it. Offer advice on what to buy. Order placed? Collect at the shop and save on delivery. The customer must now visit you again - more feet through the front door.

 

Use specialised product lines, put on local events, sponsor them, sell training and maintenance clinics - anything that focuses upon building a relationship with local riders - use this stuff to distinguish yourself from the CRC experience. It really is a no-brainer.

 

After all, for me at least, the point of going to an LBS, in most cases, is to talk to a friendly face you can trust, who can keep you up to date on what's happening in the local cycling scene, who might already know your bike etc etc.

 

If this type of thinking is too far out of the LBS comfort zone - unfortunately the commercial landscape has already changed - it's adapt or die.

 

No amount of cry-baby letters is going to change the basic economics of the situation. Don't hate the playa hate the game as they say.

Edited November 17, 2012 by Lucky Luke.

[javadude]

- Not all my overseas orders arrive. Many disappear in the mail;

 

You must be really unlucky. I have over 50 seperate orders on ebay and about 10 from crc and have never lost a single item.

[mazambaan]

@Lucky Luke; I think you are on the right track. Some LBS may go or shrink but maybe they'll have to focus on service and expertise to set up, improve and service bicycles and particularly the bits a little tricky for home mechanics like rims, brake internals and shocks. I've had some ridiculously poor service from disinterested lighties at my LBS.

[The Guy in Pink]

how many LBS owners do you see driving Porche's??

There is your answer...

You know, the owner of the bike shop where I bought my first lightweight equipment from (It was then little place in Main Street Jhb before they moved to make room for the Carlton Hotel) bought a Ferrari when he eventually sold his business.

Ok, was not a Porche but only a Ferrari Dino, but he built his business at a time when a major cycling event in Johannesburg would expect to attact as many as 100 riders.

[Lotus]

 

Ok, was not a Porche but only a Ferrari Dino,

 

A Dino is arguably far more valuable today than any Porsche (with the possible exception of the Carrera GT or the GT1). Top quality Dino's went through the roof in terms of prices during the 2000s, and have kept value (more or less).

 

I was offered a clean Dino around 1985 for R30000 - still regretting not taking it!

 

Back to the original post now - I don't suppose the publisher of this BMX mag has any qualms about dispensing advice to his readers? Advice that might do the Aussie LBS out of some business, like how to maintain your BMX?

 

This article really makes the point for Darwinism and survival of the fittest (okay, Darwin didn't exactly say that but it sort of comes down to it).

[The Guy in Pink]

I have been trying to buy a bike for my daughter who relocated to Perth from London.

She sold her bike in London when she left and I said I will replace it for her.

 

So I contacted 5 Perth Bike shops via their very nice web sites this week.

Only one bothered to respond and he did not offer any discounts so CRC will be cheaper even with the postage etc.

[javadude]

I have been trying to buy a bike for my daughter who relocated to Perth from London.

She sold her bike in London when she left and I said I will replace it for her.

 

So I contacted 5 Perth Bike shops via their very nice web sites this week.

Only one bothered to respond and he did not offer any discounts so CRC will be cheaper even with the postage etc.

 

And if the price of the bike is under $1000(aus) she wont have to pay tax or import duties.

[Music Pirate]

This debate reminds me of the late '50's/early 60's controversy regarding the advent of supermarkets in SA..... cries of anguish from corner grocers, butchers, dairy outlets, etc, etc........ it was indeed the death knell for many of these "Ma & Pa" shops, but to the advantage of the consumer, due to greater buying power, economies of scale and supposedly lower prices......... please note the word supposedly...... we have no way of knowing whether or not we are currently benefiting from lower prices (nothing to compare the supermarket prices against)...... maybe we are left with an oligopoly that manipulates/fixes prices anyway?

[Adrian4Four]

The fact of the matter is also, that SA is so over priced with many things... Just look at cars. Buy a car from another country and you pay less for it, even in Bots its cheaper. Look at tyres for your car. Its cheaper everywhere else even in Bots. The suppliers make such huge profit margins on everything and the consumer must just cough up and for what??? Why not look after your own pocket instead of the local fat cats? Im not saying that LBS are make a killing, but probably the supplier themselves as Stretch has mentioned. yes many things are not worth importing cause of cost difference, but there are definitely a lot thats worthwhile importing and its up to the local suppliers to cut their profit margins and make it easier for us to just buy locally.

 

Ideally it would be nicer to buy everything you want locally or just down the road from your LBS, but with some of the price differences being so high that you pay twice as much and sometimes even 4 times much locally, why would people not rather use CRC to buy the same good for soooo much less... Its time for local distributors to come to the party, cycling is already such an expensive sport, come "fat cats" make a plan!

[Bike Mob]

I also dont get it. as far as i see it, it is not CRC that is affecting local sales and development, but rather the suppliers who supply local shops. If CRC are able to source parts and still make a profit then surely local suppliers can still do the same. I think the whole model here in SA especially needs to be rethought.

 

Secondally, with regard to development, sure some local shops provide development and event sponsorship, buton the whole, it is independant skills courses, and event organisers who are responsible for the events.

 

that said i only buy major parts from CRC - everything else is from my LBS

 

Not exactly - CRC have massive buying power and get bigger discounts and more stock allocation than your local distributor can get - especially in a relatively small market like SA. So to directly compare the cost and assume your LBS is making a killing would be wrong.

 

so when you complain that there is not stock or its too expensive indirectly wer are all to blame because of shopping online.

 

In the short term its great for the consumer, cheaper prices mean better bike and higher end parts, but I have already seen it kill the used prices of the mid level bikes and low end groupsets etc.SRAM groupsets that should retail for 25K are easily available for R15K and that means that Force groups are given away... and so it goes.

 

In the long run and as a retailer (not in the cycle industry) I can see how the global distributor model is a closed loop as per the 2020 mags mail.

 

If you try and buy from CRC and fail and then resort to using your LBS - then don't quote the crc price and ask for a match. He is laying out his cash to serve your needs immediately - STFU and pay the man his money so he can be there in future. You are paying a premium for convenience.

[Goodbadugly]

The last time I ordered articles form CRC, the order was incomplete. But I paid for everything.

I emailed them. They requested a photo of the box the goods were shipped in and the invoice. I obliged. The next day I received a tracking nr for the missing articles. And received it in the next week. Now THAT is good for an online shop.

A few months ago I ordered grips form CWC. The set I get had 2 left hand grips. I phoned them. The next day I got a parcel with the correct stuff. And their courier picked up the odd pair of grips. Now that is excellent.

[JGR]

I didnt read the entire thread so this might have been mentioned - the kodak story. Once the market leader in their industry and now its gone due to technology/digital ect. I think his point is valid regarding involvement at grass roots/events ect. There will always be a place for the LBS but the relationships/sales will be build on trust/service rather than price which perhaps is a good thing?