Imported parts prices

[Captain Fastbastard Mayhem]

The UPS dude told me that we now only allowed 3 international purchases a year. ..thereafter you have apply for an importers permit ...if true do you pay different rates as an importer ?

No. You are just able to import more, more often. 

[Eddy Gordo]

This has been discussed in the past.

 

If memory serves short version was: Buy International if you choose, normally cheaper, but it is at your risk. If you buy local you have the benefit of having the item immediately, or delivered within a day or 2, the local guys carry the risk of "dead stock" on their shelves but also they assist in support for the item as well as honoring the warranty.

 

Personally, I opt for local if there's only a 10%-15% difference. More than that and I shop best value for money.

More or less the same, however, for the price of most stuff from overseas, I dont mind waiting for parts to come. I bought a part which arrived a few weeks ago. I payed 1500 landed. Locally the about 2500. What I also noticed(maybe I am wrong) but on some items the wholesaler will sell at almost retail overseas price. Then the local retailer has to still make something from that.

 

I do buying of stock for our company. The price variance between different wholesalers is huge. For example the same item at one will cost lets R5 and then at another for exactly the same thing you pay R8. In some cases the Place selling for R5 is the local distributor. So they sell to shops and anyone off the street for the same price the sell to wholesalers.  This here is what is killing businesses in south africa. Alot of places dont have min order quantities and allows for any home based business to buy one item. If min number are put in place then things most likely will change. 

 

We supply a few factories and home based businesses( we give them bulk discount prices) however, we have to be extremely competitive with the wholesaler otherwise we loose the business. One way I have managed to overcome this is by re branding everything we sell. So there is no way you can identify the supplier.

[Eddy Gordo]

do this with mates all the time

I tried to get something like a stokvel going where we can basically end up buying a brand new bike  starting with the person who needs it most and then rotate from there. It didnt work

[Captain Fastbastard Mayhem]

I tried to get something like a stokvel going where we can basically end up buying a brand new bike  starting with the person who needs it most and then rotate from there. It didnt work

Tried this as well with a few others. Only 2 of us were willing to commit in the end. 

[Primer]

I wanted a new airshaft for my rockshox pike, cheapest I could get it in SA for was R1900.

 

I bought one from europe and with paying 19 euros for couriers and VAT etc I landed it for R800.

 

To be honest I don't think it's the local bike shops making all the money, it's the distributor, they taking us for a royal ride in this country

[lerouc]

I wanted a new airshaft for my rockshox pike, cheapest I could get it in SA for was R1900.

 

I bought one from europe and with paying 19 euros for couriers and VAT etc I landed it for R800.

 

To be honest I don't think it's the local bike shops making all the money, it's the distributor, they taking us for a royal ride in this country

 

If i just compare my local bike shops prices in the same town then i can see that some of the bike shops have a massive markup even though they are the "bigger" shop so should sell more items.

[Grebel]

And let's not even get started on Customer Service....

 

Often times Customer Service dealing with an international supplier is 1000% better that dealing with a LBS.

 

Half the time the LBS "can't get it" or they blame the supplier or come up with some other crap excuse why they can't get it or try to justify why it's twice the price of the imported part or even just forget to order or inquire about your stuff.

 

At one point G2G were placing a weekly order for parts from CRC. You gave them a list, they placed the order and you payed them. Price including vat, ATV, duties and a 10% service charge to the shop. They then charged you a fee to fit the parts or you took it home and fitted it yourself.

 

Now that's a shop with foresight    

[the nerd]

Was in a bike shop the other day, a customer wanted a quote for a shimano part... 

 

The bike shop cost price was 15% higher than the client could land it here from CRC so its definitely not the LBS making the money in this story... 

[Eddy Gordo]

Here is a very nice bend you over scenario.

I needed some retaining clips for my hopes.

Locally they over R100 ~R150. One place quoted me R350.

I then found it for 1 Pound overseas. So I decided to purchase some tyres as well.

 

And to add, the tyres I purchased are conti's and the one you dont get locally where as the other you either do or dont but at a price of around R800. I payed R350 each. Thats landed!

[Grease_Monkey]

Speaking as an importer myself (Funn Mtb Components), I must say that it is very hard to get my products to clients at reasonable prices.

 

You sit with 2 options:

 

OPTION 1. Import and sell to consumers through dealers - I bring in for Y, I sell to bike shop for Yx1.3, bikes shop sells to customer for Yx1.3x1.3 (I use 30% as an example it is not in reality as much). By the time it gets to the consumer the price is so high that it is not worth it for them anymore. As a result the bike shop has to drop their price, and consequently so do I - as a result I cannot cover overheads.

 

Now here the problem comes in - in order for it to makes sense for the consumer one of two things can happen, bike shops can get directly from the manufacturer (not how it's done but let's just say it is possible), or I must sell direct to consumer. The problem is that bike shops cannot possibly put down the capital to carry all brands, in all varieties, and have reasonable stock levels. So that leaves the option of me selling directly to consumers.

 

OPTION 2. Importer sells directly to consumer (I do follow this model). This allows the importer to drop prices, where the customer gets it at Yx1.3, not Yx1.3x1.3 as with option 1. This does also have it's downsides though - essentially by doing this you are cutting your LBS out of the picture completely, and although that is okay with the sorts of parts I bring in, it is not practical with all parts. You are turning your LBS into a service only centre- bad for you and bad for the bike shop owner. The second downside is that my sales volumes will drastically reduce, resulting in me having to hike prices up to cover overheads.

 

As you can see from my post I am bringing up problems, not solutions - but this is the reality unfortunately. All major manufacturers trade in USD, and for the importers in SA this means that our parts are drastically more expensive than say an importer in the US, or UK. 

 

Now, I am not saying that all importers are struggling, there is money to be made, and lots of it. But, people (myself included before I started working in this industry) assume that all manufacturers are coining it by ripping off end users of the products - although sometimes true, this is not always the case. 

 

My prediction is that you will see more and more brands such as Rapide and cSixx pop up who manufacture locally. Importers will also start following a direct to consumer approach (as I do), but like I have mentioned this is not possible for all parts and brands - especially when it comes to consumables (tyres, drivetrain, etc.). What we are left with as consumers is the option of paying stupid amounts of money for products locally, or taking our money elsewhere.

 

I suggest we take a middle ground, when something costs exponentially more in SA, take your money overseas, but when something costs a little more, consider spending it in SA and supporting our economy and local businesses. On top of this support companies who manufacture locally, which will invariably result in more such companies popping up - in the end driving prices down.

 

And please... support the guys that give you good service and actually want your business - there are plenty of them in sunny SA.

 

Just my 2c worth.... I don't claim to know what the solution is, and understand the frustration that consumers feel - so much so that I got into this industry aiming to take a different approach - but what I can say, is that changing the status quo look allot easier from the outside than it is in reality.

[Sepia]

Here is a very nice bend you over scenario.

I needed some retaining clips for my hopes.

Locally they over R100 ~R150. One place quoted me R350.

I then found it for 1 Pound overseas. So I decided to purchase some tyres as well.

 

And to add, the tyres I purchased are conti's and the one you dont get locally where as the other you either do or dont but at a price of around R800. I payed R350 each. Thats landed!

This is the reality of the situation, time and time again.

 

It seems to always be cheaper (including courier) to buy from Europe - excluding clothes etc, etc.  And, don't use the SAPO.

Range, price, service seem to be the norm there.  Granted you will get an odd pear shaped deal.

 

If the prices are only15% higher it is better to stay local and support the LBS.  This is what I do.

[Heel Drop]

Parts attract no duties, so just the VAT & ATV which comes to 15.4% over the  Ex Vat cost on the site (need to indicate that you're in SA for that to be reflected)

 

Full bikes - 15% plus 15.4%. And it's multiplicative, not additive. So you add 15% then you add 15.4% to the already increased value

 

Clothing is 40% Plus VAT

 

Helmets are (sometimes) 30% plus VAT - IIRC the country of origin has a lot to do with whether it's duty free or not. 

 

Frames are duty free, so just VAT. 

 

Remember to account for the DHL handling charge as well. Normally R 150. 

You can import a complete bike at no  import duty - just VAT - EUROPE has a treaty - just need to stipulate the wording on the invoice - I imported a complete bike from Netherlands and only paid VAT - just be careful over 50k you need a import license - which I had luckily - maybe we should start importing in BULK on popular items 

[Eddy Gordo]

What about renting floor space in various LBS?or maybe a commission based system.

Is it viable? that way you are responsible for your own stock.

[Heel Drop]

Speaking as an importer myself (Funn Mtb Components), I must say that it is very hard to get my products to clients at reasonable prices.

 

You sit with 2 options:

 

OPTION 1. Import and sell to consumers through dealers - I bring in for Y, I sell to bike shop for Yx1.3, bikes shop sells to customer for Yx1.3x1.3 (I use 30% as an example it is not in reality as much). By the time it gets to the consumer the price is so high that it is not worth it for them anymore. As a result the bike shop has to drop their price, and consequently so do I - as a result I cannot cover overheads.

 

Now here the problem comes in - in order for it to makes sense for the consumer one of two things can happen, bike shops can get directly from the manufacturer (not how it's done but let's just say it is possible), or I must sell direct to consumer. The problem is that bike shops cannot possibly put down the capital to carry all brands, in all varieties, and have reasonable stock levels. So that leaves the option of me selling directly to consumers.

 

OPTION 2. Importer sells directly to consumer (I do follow this model). This allows the importer to drop prices, where the customer gets it at Yx1.3, not Yx1.3x1.3 as with option 1. This does also have it's downsides though - essentially by doing this you are cutting your LBS out of the picture completely, and although that is okay with the sorts of parts I bring in, it is not practical with all parts. You are turning your LBS into a service only centre- bad for you and bad for the bike shop owner. The second downside is that my sales volumes will drastically reduce, resulting in me having to hike prices up to cover overheads.

 

As you can see from my post I am bringing up problems, not solutions - but this is the reality unfortunately. All major manufacturers trade in USD, and for the importers in SA this means that our parts are drastically more expensive than say an importer in the US, or UK. 

 

Now, I am not saying that all importers are struggling, there is money to be made, and lots of it. But, people (myself included before I started working in this industry) assume that all manufacturers are coining it by ripping off end users of the products - although sometimes true, this is not always the case. 

 

My prediction is that you will see more and more brands such as Rapide and cSixx pop up who manufacture locally. Importers will also start following a direct to consumer approach (as I do), but like I have mentioned this is not possible for all parts and brands - especially when it comes to consumables (tyres, drivetrain, etc.). What we are left with as consumers is the option of paying stupid amounts of money for products locally, or taking our money elsewhere.

 

I suggest we take a middle ground, when something costs exponentially more in SA, take your money overseas, but when something costs a little more, consider spending it in SA and supporting our economy and local businesses. On top of this support companies who manufacture locally, which will invariably result in more such companies popping up - in the end driving prices down.

 

And please... support the guys that give you good service and actually want your business - there are plenty of them in sunny SA.

 

Just my 2c worth.... I don't claim to know what the solution is, and understand the frustration that consumers feel - so much so that I got into this industry aiming to take a different approach - but what I can say, is that changing the status quo look allot easier from the outside than it is in reality.

Consumers are getting clever and the world is changing - currency is going digital and supply of product and shopping the way we know it is changing - amazon is leading the way. Watch this space - Retail as we know it is at its end and even online shopping is going to change , with it brands , marketing and everything else in the SUPPLY chain. 

[madbradd]

Speaking as an importer myself 

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Out of interest, when you buy something "as an importer", do you pay the same price that I can land it from CRC/wiggle/evans, or do you pay a special "importer" price?

[Geronimo]

Exactly what I am saying.  Tired of getting ripped off.

I have now experienced the savings which can be made, legally.

Proud importer I am of now!

I've been doing it since 2012. We don't all have unlimited budgets, so if I can buy something LEGAL, for 30 to 50% less online, then that's where my money goes. My LBS services my bikes and supplies me with gels, tubes, lubes etc. I'm certain that SA bike shops are losing big money because so many of us are buying from the UK. Someone is enjoying a BIG piece of the cake and I don't think it's the LBS's.....