'Bicycle prices fixed'

[capecyclist]

...sometimes we have to disagree with our friends and stand by our principles.

+1

Glad someone had the balls to stand up for everyone here. You guys should all be thanking Johan. In the long run, he is helping to shape a better industry. cheers

[Swart Skaap]

Jaco, your comparison is not valid. This whole scenario and the ensuing case enamated from a secret meeting where the minutes was leaked.

 

The following is applicable here.....

 

collu´sion, geheime verstandhouding, kollusie; heuling, samespanning.

 

 

My reply is based on the comments made on this page, and also in reply to "idea's" on how the shops must be run. Also my reply is to expain what we need to survive. Im sorry you missed it.

[Swart Skaap]

I'm sorry but I don't see your point. This has absolutely no relevance to the consumer. In the real world; If I lose a tender due to price I don't go back to the company that put out the tender and explain to them that my water & electricity account is very high and give them a breakdown of all my overheads. I also don't go to my competitors to fix our prices. In any business, your overheads is your problem, manage it like the rest of the world.

 

Every business has overheads. That doesn't give you the reason to go and fix prices. Like mentioned before, it's not about the % markup. It's about everyone having exactly the same markup!

 

 

Ok, valid point. So i guess all the businessis that went bank the past year was beacause of mismangement? Certain trades are down because of recession, other trade are down because of competitors. If guys in the cycling industry pay more from their wholesalers than from CRC, im sorry, but thats not mismanagement. You can cut overheads to a point. Please tell me where to cut/manage any further. Ps. We did all have the same markup, and we as a shop did NOT agree with the higher markup structure. But to understand why guys wanted to push up the margin, you need to go to the root of the problem. And that root my friend is no layalty to SA trade. More SA buyers= More competitive pricing.

[Tumbleweed]

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.

3)File out your cable stops to create space for continuous cable housing.

 

All of the above practices are legitimate upgrades to frames for which the distributors penalise you.

 

* I understand that removing paint by sanding on some frames that are shot-peened could structurally affect the frame. However, chemical removal will not jeapordise the frame's integrity and approved painters should be allowed to paint frames.

 

I think the next target should be the people who flagrantly sell OEM parts at discounted prices to the public, and those who have no shame in making pirated parts and components.

 

Warrantees? We're dragging out that old chestnut again? Johan, you failed to provide answers to this when you first made your claims about the Consumer Protection Act (for curious people, it is under Tech Q&A somewhere). The wording of the Act is unambiguous when it comes to warantees. Your vague quoting of chapters to prove your point was flawed.

 

 

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.

 

A reporter's notebook? Interesting. Was the subject aware that you were recording his comments? Was he talking to you on- or off-the-record? If you are confident of this quote and your notes, why not name the person who said it? Methinks, your attempt to ride on the coat-tails of this one is questionable to those of us who know a bit more about this case than appears in the presser from the Comp Comm.

[Swart Skaap]

To all of those who want to change bike brands / LBS because of this referral to the Competition Tribunal: Who of you still use / consume products from Tiger Brands?

 

 

Very valid point!

[AndreZA]

More SA buyers= More competitive pricing.

 

That will maybe work if supply can meet the demand. Otherwise prices will rocket more.

[zeepee]

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.

 

Thanks johan, your 15 years as a journalist helps puts my point into words allot more eloquently than i could.

Your LBS might not be as guilty as some of the other parties on the list, but they are all being painted with the same brush.

A blanket boycott off all the shops on the list will do more harm than good. Like I said, there's people working in those shops that earn their livelihood from it.

Someone likened it to the BP oil spill and boycotting BP service stations because of it. Good point, we're all angry at BP, but boycotting their service stations will harm people that had nothing to do with the spill in the first place.

Thats why we have to trust the authorities to punish the individuals involved, and not those that has been dragged into this unknowingly naively.

[Swart Skaap]

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

 

 

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.

 

 

I hear you. But it looks more like this. R2600 + 14%=R2964

R2964+35%=R4001

R4001-10%=R3601

R3601-R2964=R637

That is a 21.5% profit.... and then comes SARS and a free service after a few weeks.

 

The wholesalers claim not to have a higher markup than the shops, but i guess in most cases we will never know. Cape Cycle Systems are working very hard with SRAM to keep prices low. I have seen some markups, and there are products where they run between 5% and 7% markup. Good thing is SRAM is growing VERY fast in SA, hence the better prices we are seeing. They are getting better pricing structures from SRAM International.

[YUMEYA]

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

 

To think that they got where they are today by not ripping the consumer a new one. They employ 300+ people and have a building the size of Cape Town Airport and still offer good prices. LBS and Suppliers need to catch a wake up!

[Swart Skaap]

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.

 

As i metioned on another reply... my reply is a reply to comments made in this thread. I dont agree with the higher markups they wanted to impliment either! So do yourself a favour, and go read my reply WITHOUT preconcieved motives, ideas or conclusions. Thanks

[Pappa Bear]

This is indeed a sad day for cycling in SA..... Most people are not happy with one or more LBSs due to bad service, bad customer service etc. and now this.... to find out that we have indeed been screwed with prices aswell.

 

There is a couple of shops that wont see me again (Fritz Pinaar and Cycle lab). So my 10K a year won't hurt them - at least now I don't have to b!tch and moan about them anymore because I wont go there.

 

Has there been any response from Fritz Pienaar or Cycle lab?

[Gatiepie]

It is obvious that we have 4 camps here. Dealers not on the list, dealers on the list, customers that think the LBS' had the right to collude and those of us that say that we do not deal with people who are not honest. I couldn't care less what you do for the sport or not. If you gain illegally, you will not see my money. And it has nothing to do with the prices. I paid overinflated prices for more than 2 years with the idea that at least I get good service from my LBS. If it is true that they did collude, I will take my business to some other LBS that is equally expensive, but also have good service and is NOT on the list. Let us forget about how the thing got reported. The important thing is we have people that notified the authorities of an illegal practice and the authorities acted on it. The shops and wholesaler implicated can state their case and appeal the findings. Until it has been finalised I reserve my judgement. I did give my LBS owner an opportunity to give his side of the story and he just point-blank told me he had nothing to do with it. Now his shop is on the list. I want answers. I cannot take it when people lie to me. I cannot take it that I toe the line and other people break the rules left right and centre and get away with it.

 

So let us all be adults and wait for the final findings. Let us stop the name calling, insults and personal attacts as it is not going to help anything.

[Molifi]

Have to agree with Rookie. The LBS have to make a living. The distributors are the problem which need correcting.

[ridr]

CRC probably would still be cheaper even if they only used 10% mark ups locally?

Spend your money wherever you want to. I don't think any of this makes a difference. I think as a consumer, you should know how much a certain item costs usually before you buy it, otherwise you'll generally get screwed over (not just the cycling industry). Some people don'y mind paying any price, other's do. That's how Cajees can get away with marking an item at R900 that they'll sell you for R300 if you know the real value. Branded carbon frames vs unbranded compared to branded denims vs unbranded. I've never seen the point in spending R2000 on a pair of denims with a 'label' when I can wear a pair that look just as good and won't fall apart either for R200!

[Oertel]

Those of you that want to boycot the shops...dont forget about the wholesalers. So no more of the following for all of you...

 

Thule carriers

Trek Bikes

Bontrager

GT

Schwinn

Cannondale

Fox

Easton

Bell

Giro

Ryder

Kenda

Blackburn

Sigma

Camelbak

Sram

Silverback

Shimano

FSA

Cervelo

Hope

Bianchi

Campag

Fulcrum

Selle Italia

Met

Hutchinson

ToPeak

Mark Beneke

Specialized

Crank Brothers

Rav X components

etc

[Swart Skaap]

It is obvious that we have 4 camps here. Dealers not on the list, dealers on the list, customers that think the LBS' had the right to collude and those of us that say that we do not deal with people who are not honest. I couldn't care less what you do for the sport or not. If you gain illegally, you will not see my money. And it has nothing to do with the prices. I paid overinflated prices for more than 2 years with the idea that at least I get good service from my LBS. If it is true that they did collude, I will take my business to some other LBS that is equally expensive, but also have good service and is NOT on the list. Let us forget about how the thing got reported. The important thing is we have people that notified the authorities of an illegal practice and the authorities acted on it. The shops and wholesaler implicated can state their case and appeal the findings. Until it has been finalised I reserve my judgement. I did give my LBS owner an opportunity to give his side of the story and he just point-blank told me he had nothing to do with it. Now his shop is on the list. I want answers. I cannot take it when people lie to me. I cannot take it that I toe the line and other people break the rules left right and centre and get away with it.

 

So let us all be adults and wait for the final findings. Let us stop the name calling, insults and personal attacts as it is not going to help anything.

 

Gatiepie, you are a wise man

 

Ps. I dont know about the Joburg shops, but in Cape Town all shops were invited to a meeting. Not all pitched up, and it was a discussion to see how to save the trade. There was maybe 3 of us who disagreed with the plan, and a few that just kept quiet. Further than that, we dont actually know whats happened/happening either. So im impressed by the knowledge of the guys outside the bike trade.