Is this the start of the end?

[dasilvarsa]

52 minutes ago, love2fly said:

When a set of OEM brake pads for my SRAM Levels cost the same as for my VW Golf, and the same goes for tyres yet the material weight of the bike part is 1/20 of the car part and probably only lasts 1/20 of the distance I have a problem. Some sort of correction in the market can't come soon enough IMHO. I also like to see the new (Chinese) brands starting to challenge Shimano & SRAM iron groupsets...

Where Can You Buy Chinese Groupsets Locally ?

[DieselnDust]

Aliexpress

[love2fly]

38 minutes ago, Prince Albert Cycles said:

I am always puzzled by high end bike prices so am intrigued by your remark that prices are unrelated to value . Being a small shop none of the popular brands are available to me from the importers so I have to buy from shops and get a discount . One of these shops disclose to me what they pay for a particular bicycle and according to that the margin is not excessive . So my question to you is this , where does the huge markup occurs . Manufacturer or importer ?

I reckon manufacturers Mark frames up huge. Plus there's often a middleman between manufacturer and importer, leaving importer and LBS with the scraps. It costs around the same to produce a Giant or decent Chinese frame etc as a Spez or a Scott, Pinarello and so on so why the big premium?

[love2fly]

8 minutes ago, dasilvarsa said:

Where Can You Buy Chinese Groupsets Locally ?

Not yet AFAIK but it's only a matter of time.

[117]

I think everyone is missing the point... 

Brand name says to supplier they will hold payments because they are not selling. Supplier says go jump, the rest is written in history over and over again because of the decisions made in the board room. 

This to me is the start of the end of big brand names. It's not about us at retail level with shelling out lots of beer coupons for stock

 

[daveno7]

This is happening up in the northern hemisphere as well....looking at a new disc road bike as a point of reference...delivery time? Due next summer...A Giant....Tiagra...ok...about £1600 or more...105 forget it sadly....ok you could ride Sora....but it's hard to go back..

But lets go back a few years...the market leader Giant Defy £1000 and 105 spec...bikes specs are being abused and the makes are going for the profit margin while they can get it...its everywhere at present..

popped into a prime bike shop recently....odd sizes in stock...

yes....bike prices are on steroids.....its crazy....nil new bike for me for a few years...

[BaGearA]

1 hour ago, love2fly said:

I reckon manufacturers Mark frames up huge. Plus there's often a middleman between manufacturer and importer, leaving importer and LBS with the scraps. It costs around the same to produce a Giant or decent Chinese frame etc as a Spez or a Scott, Pinarello and so on so why the big premium?

Cause the Scott, Spez and Pinarello seem to give decent life and don't wear out bearing seats and bores in the first year 

 

Maybe that's not the full picture but those types of issues seem very common on these Chinese frames but very rare on the brand name stuff

[Paul Ruinaard]

The thing is we forget what happened with Schwinn and where Giant came from. Go google it. Giant was Schwinn's contract manufacturer in far east - schwinn saw lots of savings so got them to do everything. Next thing Giant closes the tap on Schwinn and starts making Schwinn's bikes basically as their own. Thats the precis version and the summary of the lesson, and they weren't the only high end American manufacturer caught in the trap.

So now play this back again in the light of Pinarello, Specialized etc. being made in far east essentially as are all ally frames. See what can potentially happen and especially if the margins are nice and fat. As an LBS I would willingly support a high margin brand of no name brand bike if i could get it reliably.

There are many stories about the bike industry but the simple truths of economics are really at play here and supply and demand and bubble markets caused by aberrations and false conditions which will normalise. 

An XTR equipped Specialized Sworks M5 alloy in 2005 with everything on from Fritz was R 35k and then I thought I was crazy. The same level of bike is now 6 x to 7 x the price. An Epic Entry and costs in 2006 was R 30k all in. Now R 100k for the entry alone and add on all the extra costs.

The maths dictate that theres a lot more fat in these equations. Where it is in the supply chain TBH i don't know but my instincts tell me its the manufacturers who are making 100% margins - the Shimano's etc. 

FWIW I just built a simple hard tail ally bike for pedalling around locally to ride some of the more risky routes where i want to be able to ride on gravel cause theres no shoulder.  All in for R 11k with 1 x 11 and a Rock Shox Revelation I had lying around. The bikes spec would have been seen as very high end hardtail 8 to 10 years ago - now its cheap as chips. Its super light, low maintenance and easy as pie to take off the rack and just pedal. And lots of fun to ride (although hard tails and old people who are used to full sus are always going to be a bad mix :-)).

The point is i could have spent R 45k getting exactly the same thing or more of it. So its also the fact that we always want the carbon wheels , the new frames and the 1 x 12 groups that is the craziness. You don't need it. What you are riding is probably way better than you are at any given time. You want it. And that want is what makes you rationalise spending silly money on bikes.  I have done it many times - bought the ultimate in groups and put it on cutting edge frames and then had this beautiful bike thats lovely to ride but no real difference from my previous bike when it comes to the actual riding. We buy in to all the BS about FACT carbon and Sworks and Pinarello Dogma and the electronic shifting with 1 x 12 and the need for XTR or Dura Ace or Record or AXS which the whole industry touts, but if you are clever and buy something a bit older second hand and then keep it for some years you can ride last years cutting edge which isn't good enough for someone else but way better than what you had or what you are capable of actually finding the limits of. 

The industry is designed to perpetuate the myth but the truths around cycling and building simple bikes that ride well,  will always remain the same. Whether on an R 11k hardtail or a R 270k ebike you still can only go riding with your mates and the sensation of the ride is all the same for the R11k rider when you come back for coffee after the turn for home. The guy on the fancier bike gets the same experience of being out with mates and the same enjoyment of his race or his ride as what the guy on the cheapest bike does. And thats why we do it - or am i wrong?

FWIW when I went to TDF for the last week in 2004 the Europeans were astounded to see the bikes the South Africans unloaded from the bus. They couldn't believe that there were so many Colnago C40's, Pinarellos, Litespeed etc all specced to the best with record or Dura Ace in one place. They honestly thought we were semi pro cause there was no way they would spend that amount of money on recreational toys. Most of them were on ally frames Giant TCRs, Trek and the like or even older Steel.  And they rode them well and stayed with us and dropped us on many climbs. The thing is they weren't focused on the bikes and the peeing contest of who had the best hardware, they were there for the riding.

Long story - but it all really rides the same give or take a bit. So the top end Specialized Epic Sworks MTB is as good as the ally low end give or take 10% TBH. IMO that is. And the skills needed to extract the difference in the two platforms dont exit in 98% of the riders. So 98% of us would be better off with the cheaper bike or wouldn't be any faster.  Same for all brands. The Ally ebike is as good as the carbon one TBH. The pedestrian mid range fork is good enough for weekend warriors if tuned correctly.

You dont need the fancy stuff.

You want the fancy stuff.

Thats what the big brands know and they work on that marketing and psychology.

My 2 cents worth.

 

[The Ouzo]

On 1/1/2023 at 6:54 PM, Prince Albert Cycles said:

I am always puzzled by high end bike prices so am intrigued by your remark that prices are unrelated to value . Being a small shop none of the popular brands are available to me from the importers so I have to buy from shops and get a discount . One of these shops disclose to me what they pay for a particular bicycle and according to that the margin is not excessive . So my question to you is this , where does the huge markup occurs . Manufacturer or importer ?

If its anything like the motor industry the Parent company decides they want to pitch their product at xyz segment, therefore it needs to be priced accordingly. They then sell it to the local importers accordingly priced and dictate to the importers what segment their product needs to be pitched at. The importers then need to sell it on to the retailers at a certain price point. They have paid a premium for the product, so they need to recover this cost and still make a little bit to keep the doors open.

So now the retailers have bought for x amount and need to sell at minimum x, but preferable x + y% in order to make some money to keep the doors open.

 

Will we see new bike prices coming down ? I doubt it. At best we will see prices frozen and perhaps some favourable discounts to move standing stock. You would not be happy if you just bought a top of the range bike for 270k and 6 months later its now selling brand new for 240k before discount.

[NotSoBigBen]

Hobby is when you buy a new bike. Passion is when you keep the old ones running 🤪

[Mongoose!]

Just because a few first world YouTube'rs recon prices will drop due to an oversupply, does not necessarily mean Coolheat ; Cape cycle systems and the rest of our monopoly suppliers will allow it here...

But it can have an effect on offshore online purchases maybe....after duties and double VAT in some cases.

[DieselnDust]

On 1/1/2023 at 8:45 PM, BaGearA said:

Cause the Scott, Spez and Pinarello seem to give decent life and don't wear out bearing seats and bores in the first year 

 

Maybe that's not the full picture but those types of issues seem very common on these Chinese frames but very rare on the brand name stuff

Really…!!?! The so called top end brands are the ones with the most manufacturing problems from bb shell sizing problems to bearing seats to head set tolerances. They produce more frames and therefore don’t QC every single frame , just samples .

the problems with the Chinese brands isn’t the quality of manufacture by the quality of bearings they fit to keep the cost down. Replace those factory fitted bearings with units from SKF or similar reputable bearing brand and the problems are greatly reduced.

[sirmoun10goat]

3 hours ago, Paul Ruinaard said:

The thing is we forget what happened with Schwinn and where Giant came from. Go google it. Giant was Schwinn's contract manufacturer in far east - schwinn saw lots of savings so got them to do everything. Next thing Giant closes the tap on Schwinn and starts making Schwinn's bikes basically as their own. Thats the precis version and the summary of the lesson, and they weren't the only high end American manufacturer caught in the trap.

So now play this back again in the light of Pinarello, Specialized etc. being made in far east essentially as are all ally frames. See what can potentially happen and especially if the margins are nice and fat. As an LBS I would willingly support a high margin brand of no name brand bike if i could get it reliably.

There are many stories about the bike industry but the simple truths of economics are really at play here and supply and demand and bubble markets caused by aberrations and false conditions which will normalise. 

An XTR equipped Specialized Sworks M5 alloy in 2005 with everything on from Fritz was R 35k and then I thought I was crazy. The same level of bike is now 6 x to 7 x the price. An Epic Entry and costs in 2006 was R 30k all in. Now R 100k for the entry alone and add on all the extra costs.

The maths dictate that theres a lot more fat in these equations. Where it is in the supply chain TBH i don't know but my instincts tell me its the manufacturers who are making 100% margins - the Shimano's etc. 

FWIW I just built a simple hard tail ally bike for pedalling around locally to ride some of the more risky routes where i want to be able to ride on gravel cause theres no shoulder.  All in for R 11k with 1 x 11 and a Rock Shox Revelation I had lying around. The bikes spec would have been seen as very high end hardtail 8 to 10 years ago - now its cheap as chips. Its super light, low maintenance and easy as pie to take off the rack and just pedal. And lots of fun to ride (although hard tails and old people who are used to full sus are always going to be a bad mix :-)).

The point is i could have spent R 45k getting exactly the same thing or more of it. So its also the fact that we always want the carbon wheels , the new frames and the 1 x 12 groups that is the craziness. You don't need it. What you are riding is probably way better than you are at any given time. You want it. And that want is what makes you rationalise spending silly money on bikes.  I have done it many times - bought the ultimate in groups and put it on cutting edge frames and then had this beautiful bike thats lovely to ride but no real difference from my previous bike when it comes to the actual riding. We buy in to all the BS about FACT carbon and Sworks and Pinarello Dogma and the electronic shifting with 1 x 12 and the need for XTR or Dura Ace or Record or AXS which the whole industry touts, but if you are clever and buy something a bit older second hand and then keep it for some years you can ride last years cutting edge which isn't good enough for someone else but way better than what you had or what you are capable of actually finding the limits of. 

The industry is designed to perpetuate the myth but the truths around cycling and building simple bikes that ride well,  will always remain the same. Whether on an R 11k hardtail or a R 270k ebike you still can only go riding with your mates and the sensation of the ride is all the same for the R11k rider when you come back for coffee after the turn for home. The guy on the fancier bike gets the same experience of being out with mates and the same enjoyment of his race or his ride as what the guy on the cheapest bike does. And thats why we do it - or am i wrong?

FWIW when I went to TDF for the last week in 2004 the Europeans were astounded to see the bikes the South Africans unloaded from the bus. They couldn't believe that there were so many Colnago C40's, Pinarellos, Litespeed etc all specced to the best with record or Dura Ace in one place. They honestly thought we were semi pro cause there was no way they would spend that amount of money on recreational toys. Most of them were on ally frames Giant TCRs, Trek and the like or even older Steel.  And they rode them well and stayed with us and dropped us on many climbs. The thing is they weren't focused on the bikes and the peeing contest of who had the best hardware, they were there for the riding.

Long story - but it all really rides the same give or take a bit. So the top end Specialized Epic Sworks MTB is as good as the ally low end give or take 10% TBH. IMO that is. And the skills needed to extract the difference in the two platforms dont exit in 98% of the riders. So 98% of us would be better off with the cheaper bike or wouldn't be any faster.  Same for all brands. The Ally ebike is as good as the carbon one TBH. The pedestrian mid range fork is good enough for weekend warriors if tuned correctly.

You dont need the fancy stuff.

You want the fancy stuff.

Thats what the big brands know and they work on that marketing and psychology.

My 2 cents worth.

 

This is called life. We don’t need the Old Khaki or WW clothes, Pep clothes will do just fine. We don’t need multi room houses, we can share a single room. We don’t need fancy  TVs, actually we don’t need TVs at all. We don’t need a high stress job that pays millions when a job that pays a few hundred k will suffice.

The basic human news are pretty basic, and everything else is just a want.

There are bicycles skiing trips people to in that are far more expensive than an S-works or the Epic.

Most people like to excel in life absa achieve. If they measure how the excel and achieve by the bikes they ride out the events they partake in, good luck to them.

If you feel your bike is all you need, good luck. I personally like my carbon frame and wheels and my 12 speed electronic shifting, and I thank the manufacturers for all the R&D that goes into these things for me to enjoy.

Let’s stop bashing people doing their jobs, and rather commend them for all that has been done.

[Paul Ruinaard]

11 minutes ago, sirmoun10goat said:

This is called life. We don’t need the Old Khaki or WW clothes, Pep clothes will do just fine. We don’t need multi room houses, we can share a single room. We don’t need fancy  TVs, actually we don’t need TVs at all. We don’t need a high stress job that pays millions when a job that pays a few hundred k will suffice.

The basic human news are pretty basic, and everything else is just a want.

There are bicycles skiing trips people to in that are far more expensive than an S-works or the Epic.

Most people like to excel in life absa achieve. If they measure how the excel and achieve by the bikes they ride out the events they partake in, good luck to them.

If you feel your bike is all you need, good luck. I personally like my carbon frame and wheels and my 12 speed electronic shifting, and I thank the manufacturers for all the R&D that goes into these things for me to enjoy.

Let’s stop bashing people doing their jobs, and rather commend them for all that has been done.

Okay i think I understand what you are saying (post is a bit garbled) however I think you are evidence of what i was trying to say

1.) Agreed you can spend your hard earned cash on what you want - your choice. I know this very well I can assure you.

2.) The point is that when value becomes disconnected from the underlying asset and you are quantifying lifestyle (which is what the bike brands have learned to do).

3.) This equation creates bubbles which eventually lead to crashes in markets. the price of lifestyle and the money chasing the expression of success is a much larger pie than people wanting to ride bikes for example for transport. As long as the manufacturers can equate achievement in the world and status with their goods (or the acquisition thereof) you will be willing to demonstrate your ascendancy through acquiring increasingly expensive goods which have marginal gains. The concept of a 2023 Sworks Epic being better than a 2022 is very tough to defend, unless it is as you say demonstrative of your hard work and achievement in the world. then its an outward manifestation of how well you are doing, but its value isn't related to cycling any more, its related to having the best most expensive bike at the start line.

Its not going to improve your cycling or your sense of achievement unless your peers you associate with are identifying similarly.

The thing is when the bike sellers start to align with that need and desire then they can charge you what you are willing to pay for it. And if you are doing well and you want the goods then hey you can afford it so thats all lekker and well. No criticism there.

But to close the loop this is what has happened. The bikes aren't costing more, they are costing less. You are buying the lifestyle and the image more, which is driving the price.

This is well done to the marketers at the bike shops and manufacturers to get this and make their goods align with it. No question its what made them so much money.

However when those get uncoupled and the money chasing the bikes is now subject to inflationary pressures and the recessionary climate the chances are there is less of it. Thats when markets tumble. 

Thats the point IMO. 

[sirmoun10goat]

23 minutes ago, Paul Ruinaard said:

Okay i think I understand what you are saying (post is a bit garbled) however I think you are evidence of what i was trying to say

1.) Agreed you can spend your hard earned cash on what you want - your choice. I know this very well I can assure you.

2.) The point is that when value becomes disconnected from the underlying asset and you are quantifying lifestyle (which is what the bike brands have learned to do).

3.) This equation creates bubbles which eventually lead to crashes in markets. the price of lifestyle and the money chasing the expression of success is a much larger pie than people wanting to ride bikes for example for transport. As long as the manufacturers can equate achievement in the world and status with their goods (or the acquisition thereof) you will be willing to demonstrate your ascendancy through acquiring increasingly expensive goods which have marginal gains. The concept of a 2023 Sworks Epic being better than a 2022 is very tough to defend, unless it is as you say demonstrative of your hard work and achievement in the world. then its an outward manifestation of how well you are doing, but its value isn't related to cycling any more, its related to having the best most expensive bike at the start line.

Its not going to improve your cycling or your sense of achievement unless your peers you associate with are identifying similarly.

The thing is when the bike sellers start to align with that need and desire then they can charge you what you are willing to pay for it. And if you are doing well and you want the goods then hey you can afford it so thats all lekker and well. No criticism there.

But to close the loop this is what has happened. The bikes aren't costing more, they are costing less. You are buying the lifestyle and the image more, which is driving the price.

This is well done to the marketers at the bike shops and manufacturers to get this and make their goods align with it. No question its what made them so much money.

However when those get uncoupled and the money chasing the bikes is now subject to inflationary pressures and the recessionary climate the chances are there is less of it. Thats when markets tumble. 

Thats the point IMO. 

My point is this is not a cycling issue, it’s just how the world works. We can make money and spend it how we like. 
 

Bicycle manufacturers make bicycle frames and the cockpit essentially. They then spec that with components by sram or shimano. I’m pretty sure the price of components is going up quicker than that of bicycle frames, but nobody is hating on them. 

Also, the marginal gains you talk about are important for the pro’s, it’s the difference between winning and coming second. But the cost of carry to have multiple SKUs for the pros, and for the competitive casual rider and just the rider who wants to have fun would probably make the cost of bicycles even more. The cost of cars is being contained by manufacturers sharing platforms (chassis, engines, gearboxes, etc). That’s probably never going to happen with bicycles. 
 

Again, let’s stop criticising people for doing their jobs.

[Jacques93]

All being said I think this is a good thing happening too the industry. This will hopefully reintroduce new people into the cycling world yet again & hopefully market/demand will stabilize. 

Bike prices has somewhat become priced for the elite, and think it kept a lot of people out of cycling the last 2 years, your typical entry level bike is now 15-18K. it's a lot of money to invest if you don't even know if you would like the sport ect.

Unfortunately I don't see prices going down on new bikes, but definitely a lot of sales, perhaps clearance sales. It feels like the world have become very greedy after covid, if you can make money you make sure to drain that tap to it's fullest. 

I read a topic/quote a while ago on a major biking brand (Specialized, Scott or Giant can't seem to remember the brand) which the dream of the founder was to get as many people access to his cycles as possible and give everyone the same opportunity to enjoy the hobby at a low price point. Looking back at the brand now I though damm has time changed for this company, no one can afford their bikes now.