'Bicycle prices fixed'

[AndreZA]

It made it to the RSG news this morning, ahead of the Escom strike.

[MadScientist]

Its funny how the cycle shop owners and wholesalers are always the bad guys. What about people doing the buying for big clothing chains? (personally told me they buy jeans for R17 and sell in store for R300) This is one of many. But people are happy to get ripped off when buying clothing name brands.

 

Lets look at a average cycle shop. Rent R20000, mechanics R9000, phones, electricity, useables R5000, shop van to collect + deliver R3500. Total=R37000. Thats overheads EXCLUDING salaries for sales personel or managers or advertising or sponserships. So lets add sales personel for another R10000. We round it off at R50000. To break even at 35% margin, you need a approximate turnover of R150000. Try not selling anything, and covering your overheads doing only workshop jobs at R300 a service. Thats 500 services a month. Okay, services have a bigger profit (and higher taxes to SARS) So lets say 250 services a month??? Thats 125 services per mechanic, and thats 6.25 services a day.

 

Please go open a bike shop, then we will see how quick you understand the CRC etc problems.

 

Jaco, i've done those calculations a while back. The point most of us are missing is the fact that even the honest LBS' are being implicated as the suppliers/distributors are the ones causing the issue, as someone mentioned earlier no matter who to phone the price stays the same.

 

This is pretty much how thing looked 2 months back. all I know is the okes who saw a price drop in the last couple of months must have been shafted big time, but then again i haven't been to any bike shop since may

The maths looks as follows: All figures rounded to 1 decimal

Will do before discount first.

Selling Price: R 4200.00

Cost Price: R 2684.70

Markup: R 1515.30 (sp-cp)

Markup %: 56.4% (m/cp)

Gross Margin: R 1515.30(sp-cp)

GM %: 36.1

 

After what is claimed to be 10% discount:

Selling Price: R 3900.00

 

Cost Price: R 2684.70

 

Markup: R 1215.30 (sp-cp)

 

Markup %: 45.3% (m/cp)

 

Gross Margin: R 1515.30(sp-cp)

 

GM %: 31.2%

 

Before you say this looks within your idea of fair just remember that the suppliers side (i feel) looks pretty much the same, that means the markup % is close to 100% when a product reaches us.

[splat]

It made it to the RSG news this morning, ahead of the Escom strike.

 

& 5fm - with no snotty comments from Gareth.

[AndreZA]

http://www.youtube.com/watch?v=sVGqVj4bIxQ

 

now how can anybody compete with that? They employ almost as much people as the whole industry in SA.

[SURFER]

Now for the next target - companies denying gaurantees because of modifications that have nothing to do with the initial failure of the product.

 

Examples:

 

1)Paint your frame and lose your gaurantee*

2)Drill a drainage hole in your BB shell to increase the life of BB bearings and lose your gaurantee.

 

 

Johan

 

i would like to drill drainage hole in my BB shell on roadbike (Scott CR1 carbon). What size hole? Anything I should carefull when doing it? Specific position?

 

Thanks

[Mojoman]

A sad show by the LBS's here, one that I use and support is on that list. Someone said that they still have families to feed etc, well bad luck cause my business (even if it is only a few K per year) will now be going to CRC or CWC instead.

[AndreZA]

Johan

 

i would like to drill drainage hole in my BB shell on roadbike (Scott CR1 carbon). What size hole? Anything I should carefull when doing it? Specific position?

 

Thanks

 

I used a 4mm on my alu BB. Just make sure you bike stands 100% level when you mark the hole. A nice sharp drip and it looks better then factory done.

[GrumpyOldGuy]

Now heres another scenario.

 

Everyone supports the local "proudly South African" trade. Wholesalers gets more buying power. Wholesalers get bulk discount and company incentives from the international suppliers. Sponsors get back into the sport, shops get more involved. Shops gets better deals from wholesalers and pass it on to the consumers. SA bike trade doesnt lose millions (approxemitely R100 million last year) to international trade, and starts to boom! We have trails everywhere, we have more products in SA and stock is easy to get, because our wholesalers can afford to carry more stock. Local employment goes up, we have race support at all the races, maybe even some small stores or dispays at the races?? The possibilities are endless.

 

But i guess CRC and all the others out there does the same. I mean, why would you support the local trade if its fun complaining and being unhappy about it?

 

Oh, please, give me a break.

 

I guess all these industry player accused of colluding and raising prices unilaterally were just doing it to benefit us poor consumers huh.? I guess their underlaying motive was to improve our race experiences or employ more staff.?

 

Dang, had I only known.!

 

Do yourself a favour and google the SHERMAN ACT - This act is internationally regarded as the foundation of good business principles, but in case you dont feel like doing so I have included the relevant bit below -

 

XI – Consumer Protection Act – Which prohibits businesses from engaging in “unfair or deceptive” practices in connection with the sale of consumer goods, consumer realty, consumer services or consumer credit

 

It cant be clearer than that - if collusion is not unfair and deceptive, then I am afraid I dont know what is.

[Zeps]

"Two weeks before the meeting one of the dealers on the list told me how they (the dealers) are going to get together and '**** up these guys that think they can just come in and start a bike shop and do what they like.'"

 

Statements like this on a public forum I assume can be backed up by either a recording (I doubt that) or another attendee at said 'meeting' and that it is verbatim what was said - just asking ......

 

My understanding is that (as per my much earlier ignored post) some of the dealers on the list went to an 'industry meeting' without knowing what the 'agenda' was. Now purely by having attended (not agreed or acted upon) they have been found guilty, seems a bit unfair to me but ja like I said go for the jugular guys!

[Johan Bornman]

Johan

 

i would like to drill drainage hole in my BB shell on roadbike (Scott CR1 carbon). What size hole? Anything I should carefull when doing it? Specific position?

 

Thanks

 

I think Moegoe did the topic justice. I drill 6mm holes but that is neither here nor there. In the old days the holes were huge, often in the shape of the company's logo. Colnago had Clovers in their BBs IIRC.

 

I remove the BB first. In alu, use a centre punch to prevent the drill wandering around. On Carbon, do the same but with a more gentle smack of the hammer. Deburr the inside of the hole (a good worksman would do that as a matter of routine).

 

On some carbon bikes there is a void between the BB liner and the BB shell. You'll notice that you cannot see into the seat tube from the inside of these BBs, thanks to the liner. Although these frames don't destroy the BBs, water between the carbon BB shell and alu BB liner destroys the aluminium liner. Here you only drill into the carbon, not the liner. If this doesn't make sense, I'll post some photos.

 

Replace the BB and see how much longer your BB lasts. It is a crime that the frame manufacturers don't do this in the first place.

[Brakkies Sport Fotos]

When Chris willemse started to asked fair prices for products, it was these guys who was the main peanuts in the fight against CWC.

 

So, its pay back time and I hope they feel it in their pockets.

 

Remember, its not that they dont have the money, they already got it from you after the sale.

 

 

To YELLOW SADDLE and those who stand with them ... WELL DONE

[Velouria]

I have a question (which was raised in my LBS yesterday) concerning bike insurance. What value do you put on the form for the insurers? I built up my own bike over several months, some stuff sourced locally, some stuff from CRC, Ebay etc. The value I put on the form is the amount it cost me, which is considerably lower than what it would cost if I had sourced everything locally. The argument is that if my bike were to be stolen, I could not replace it right away, as the payout wouldn't cover a new bike in this country. I would rather get the payout and resource everything myself. I am sure the insurers would be happier with this arrangement too, as it would cost them less.

 

So - because of this collusion, we are paying higher premiums on insurance. Basically - we am being screwed over twice.

 

And JacoCMC - what about my family - I too have mouths to feed and others that depend on me. I fail to see we why should feel sorry for you because you can't run a proper business. Here's a T-Shirt for you:

 

http://store.hayibo.com/media/catalog/product/cache/1/image/365x/5e06319eda06f020e43594a9c230972d/j/a/jammer_365_2.jpg

[Johan Bornman]

"Two weeks before the meeting one of the dealers on the list told me how they (the dealers) are going to get together and '**** up these guys that think they can just come in and start a bike shop and do what they like.'"

 

Statements like this on a public forum I assume can be backed up by either a recording (I doubt that) or another attendee at said 'meeting' and that it is verbatim what was said - just asking ......

 

My understanding is that (as per my much earlier ignored post) some of the dealers on the list went to an 'industry meeting' without knowing what the 'agenda' was. Now purely by having attended (not agreed or acted upon) they have been found guilty, seems a bit unfair to me but ja like I said go for the jugular guys!

 

I worked as a journalist for 15 years. By now I know how to cover my back with notes and I know what value a reporter's notes have in court or elsewhere. This is not hearsay but a first hand quote. Maybe some didn't know what they were in for. I am sure 60% of those there were just there to see what's going on and had no intention to do what they're now accused of. They were naive if they didn't have their objection minuted and had it put on record that their attendance was an error due to miscommunication. Some were coerced in going to the meeting and did so in support of good friends. However, sometimes we have to disagree with our friends and stand by our principles.

 

I think now is the time for the accused to approach the commission and settle with a fine. I am sure they still have time to get away with less than 10%. I am just amazed at how naive some business people are. The recent celebrity photo story comes to mind.

[AndreZA]

I have a question (which was raised in my LBS yesterday) concerning bike insurance. What value do you put on the form for the insurers? I built up my own bike over several months, some stuff sourced locally, some stuff from CRC, Ebay etc.

 

I never price my bike myself. I send the list of parts to LBS and let them give me a price on what it will cost to replace locally.

 

 

 

And JacoCMC - what about my family - I too have mouths to feed and others that depend on me. I fail to see we why should feel sorry for you because you can't run a proper business.

 

True Velouria, how many of them live in the northern suburbs and children are in private schools.

[manbearpig]

Looking at the list of those implicated it seems that Cajees can't even fix a price. No wonder no one takes their bikes there.

[SURFER]

Johan, Moegoe

 

Thanks for feedback