Bicycle cartel brought to task by competition commission

[HowardSteele]

Every time I read anything from the Competition Commission, I am left with the very strong smell of bull**** in my nostrils.

 

Their intended function is to look after the interest of the consumer........in that they have TOTALLY FAILED in the last decade. They "took on" the "bread cartel", the "medical cartel", the "lawyer cartel" and it has led only to "negotiated" fines. Fines that were paid to the Competition Commission to fund their admin and, I assume, the surplus into the state coffers. That is just another tax.

 

Not a cent has gone back to the consumer that was ripped off in the first place. No price reductions happened. The crooks just became smarter, stopped taking minutes and still colluded as before, now just legally. 

 

Free market? Not this way! 

Yep in fact the price of bread went up 

[ratherberidin']

The problem is WE PAY. We, the passionate supportive cycling community, PAY. It's like money for jam for the shops, they'll listen to the whining because we still want what they're selling - bad circle.

 

Something like the Sahmurai Sword sells for ZAR350, an absolutely genius product that I buy with a smile for it's use, but am left bitter knowing the the actual production cost of the small plastic bits with cheap metal. I encourage a healthy profit on such an awesome product - but R350 for a product that sells in big volume that's very cheap to make - I feel ripped, just like the tyre I used this lekker product to fix

 

Maybe I just don't want to make enough money, or feel bad ripping people off knowing they'll pay and making them.

 

Anyways, long live retail therapy.

[JXV]

I know this all too well, as I work in an industry (health) that got investigated and fined very early on by the Competition Commission as well. Actually, the first fine went to the Pretoria Law Association, for setting recommended fees for lawyers. They decided not to fight it, co-operated and was given a small fine. Basically, the Competition Commission did this to set a legal president. Thereafter, it was easy to get the other industries in the same way, with bigger fines.

 

The point I was trying to make, is this: Right or wrong, according to the letter of the law, that law and how it is wielded by the Competition Commission, has not at all benefitted the consumer it is meant to do. It has only benefitted the Competition Commission. If anything, it has had a negative effect in that it raised prices to the consumer.

 

Where do you think the bread cartel got the money from to pay their hefty fine? From the same consumer they ripped off to start with. How did they do this? By upping their prices "independently" but legally. Where did the fine money go? Not back to the consumer, for sure!

Agree that it it only truly serves us if the penalty is passed back to the consumer somehow.

 

Not saying my LBS ripped me but based on the reported increase in markup for new bikes it would be nice to get R10k back on the bike I bought last year....I would probably plow it back into upgrades anyway.

[khm4252]

Typical Saffa mentality... complain complain complain.  If the competition does it jobs then we throw in the "why dont they solve real crimes".  This is a real crime.  Each function of society has its own job, some are more important than others but all have a purpose. 

 

I for one always look for a deal and am fortunate to have people in the UK and US so I get lots of my stuff from there all the time.  But sometimes we are cheaper.  Look at the recent deals on Assos Neo Pro and Equipe on Chris Willemse - granted they were for short periods but you can not get a cheaper price anywhere in the world than that. 

 

When we import goods we have to pay duty (in some cases) and VAT.  If you take the Samurai sowrd you have to deal with the manufacturer (a Chinese company most likely), then the Samurai sword company will have its markup and costs then it goes to the local distributor who has his markup and costs and then to the retailer who add his markup.  Lets say the components cost R20, labour R20 and distribution and markup take it to a total of R50.  A 100% markup by Samurai Sword takes it to R100.  Local agents adds 100% takes it to R200 wholesale price and the retailer puts his 75% on then you get to R350.  Those markups have to pay for wages, rent, distribution, fixed assets etc.  If we had direct dealings with companies and no agents things would be a lot cheaper. 

 

The consumer will benifit with the Comp Com not by giving back as they use the fine income to pay their costs but by allowing a free market approach.  We are not a big market and will have issues with free market economics as we have oligopologies (few large players).  They can collude without actually ever chatting with each other.  They can just see what the others do.  

 

Cycling is expensive.  We all want the latest, greatest, lightest thing and it costs big money anywhere in the world.  We do get ripped off here like people to everywhere in the world but you have the free will to buy or not buy or import, invent or choose something else. 

[velomonatiCT]

Typical Saffa mentality... complain complain complain.  If the competition does it jobs then we throw in the "why dont they solve real crimes".  This is a real crime.  Each function of society has its own job, some are more important than others but all have a purpose. 

 

I for one always look for a deal and am fortunate to have people in the UK and US so I get lots of my stuff from there all the time.  But sometimes we are cheaper.  Look at the recent deals on Assos Neo Pro and Equipe on Chris Willemse - granted they were for short periods but you can not get a cheaper price anywhere in the world than that. 

 

 

actually we are complaining because unlike you

we don't have people in the UK and US so we have to buy it here from crooked price fixing dealers...

 

 

so maybe its just a 'saffa' thing but we are allowed to complain  

 

[DJR]

Agree that it it only truly serves us if the penalty is passed back to the consumer somehow...................

The day I would start clapping will be when the Competition Commission takes on the BIGGEST price fixer in the country.......yes.......PETROSA........because strictly according to the letter and spirit of the law, that is exactly what they are doing with the petrol price, isn't it? I don't for a moment think that they will and that we'll get cheaper fuel though, most likely we'll pay more, but if you want to play free market with one industry, you have to play free market with them all.

[khm4252]

 

Typical Saffa mentality... complain complain complain.  If the competition does it jobs then we throw in the "why dont they solve real crimes".  This is a real crime.  Each function of society has its own job, some are more important than others but all have a purpose. 

 

I for one always look for a deal and am fortunate to have people in the UK and US so I get lots of my stuff from there all the time.  But sometimes we are cheaper.  Look at the recent deals on Assos Neo Pro and Equipe on Chris Willemse - granted they were for short periods but you can not get a cheaper price anywhere in the world than that. 

 

 

actually we are complaining because unlike you

we don't have people in the UK and US so we have to buy it here from crooked price fixing dealers...

 

 

so maybe its just a 'saffa' thing but we are allowed to complain  

 

You miss the point. It is not an issue about complaining per se but having double standards. If you upset about high prices and then the comp com looks into it then how can one (not you necessarily but others on this thread) say why are they doing it when there are rapes and murders going. Why do we always have to be so negative. At least have some balance.

 

Just on high prices. Cycling is a really expensive sport and when you importing everything you going to have to pay for duty, shipping and in a small market you have to pay a premium to the local agent for support. If you take that into account I don't think our cycling equipment as a whole (there are outliers) is that bad. Like golf equipment in SA is very well priced. Actually most goods for cycling are still at factored at R10 to the $ so we seeing excellent prices till stocks wear down or forward cover expires.