'Bicycle prices fixed'

[_im_from_earth]

Well said Shaun 231.

 

Morewoodkid, would you say that your international market is more important than the local market, hence the premium for morewood products here ?

 

Premium for morewood products here? How so?

[Danger Dassie]

A little birdie told me a delegation of local, lets call them stakeholders in line with the current jargon fashion, have approached the DTI to request just that - higher duty on specific imports from specific overseas retailers such as CRC.

 

I don't know enough about the DTI's mechanics to verify this or to know whether or not such a request is put in the public domain. I'm itching to know though.

 

That may be half the story, part of the problem with local pricing here is also the fact that taxing and shipping structures are resulting in higher pricing on the goods arriving in SA.

This isn't just in the cycling/sporting industry either.

 

Goods are shipped from Asia to the distributors (Africa falls under the European supply chain) who then distribute to us. Irony being that more often than not, those very goods being shipped actually dock on our coastline before carrying on their journey to Europe for distribution to us.

 

If the manufacturers could wake up and wake up and ship directly to SA, making SA the distribution point, it would greatly reduce cost.

Likewise if the DTI investigated the taxing implications alongside SARS and reviewed the current structure of taxation on certain goods.

Cameras and videography equipment faces the same issues, a Nikon D3 here costs approx 60k, I can bring it in myself for approx 30k.

[Nettie R]

Duties is to protect the local market of manufacturers and for extra government revenue. There is no local bike manufacturer to protect from the flood of imports. The trade industry won't change the duties and vat on bicycles and parts if a couple of bike shop owners asked nicely.

[Swart Skaap]

Well, then open a hot dog stand on the corner and sell sausages and rolls for a 200% mark up with an investment of 10k.

 

Surely, opening a bike shop was your own decision, and if you went into it without investigating the apparently poor margins and low profitablity before hand then I say you only have yourself to blame, why do you expect others to feel sorry for your business decision when they played no part in it?.

 

All industries have issues, but the cycling industry is the only one I know of that laments them daily.....but maybe thats another thread.

 

Grumpyoldguy, both me and the other guy posting running costs on shops, did it to explain why prices cant always drop as low as we would like. This is not actual running costs or profits from our shop, and i dont think his either. So stop missing the point, and read what we are trying to expain.

[Sharkie 2]

Grumpyoldguy, both me and the other guy posting running costs on shops, did it to explain why prices cant always drop as low as we would like. This is not actual running costs or profits from our shop, and i dont think his either. So stop missing the point, and read what we are trying to expain.

 

Thanks Jaco you at least see the point, bicycle shops don't do million rand turn overs and rental space is expensive. Still most people replying don't understand CRC supplies the world so their purchases are huge, for those that say the motorcycle and car industry has small profits....my whole family is in the car industry their mark ups are the same as the cycling industry

[Swart Skaap]

I find that hard to believe.!

 

Actually, from my experience its never been the case.

 

I would dearly like to read these cases,can you post some verifiable case studies where countries have raised protectionist duties to 80% against requests for relief from the local cycle industry.?

 

 

Denmark recently introduced 80% import duties on CRC. Australia banned CRC, dont know if its still in effect though. SA will soon have a few systems in place too. The list goes on.

[Pappa Bear]

Hi Pappa Bear, found response from Cycle Lab on their website. See link:

 

http://www.cyclelab.com/default.asp?id=357554&des=article

 

Regards,

 

Hansd

 

The Competition Commission has referred a complaint of price-fixing in the cycling industry to the Competition Tribunal for adjudication.

The media has identified Cycle Lab as one of the Respondents in such referral.

 

Although the background to the referral predates the sale of the whole of Cycle Lab in January 2009, the new owners of Cycle Lab, who are not affected by the referral, co-operated with the Commission's investigations.

 

Cycle lab assures the public that it embraces wholesome values and visions and offers a wide range of products at fair prices in an environment that converts customers to family.

 

Cycle Lab

 

BLA BLAH BLAH BLAH BLAH BLA,,,,,,,,,,,,,,,

[Seeker911]

Glad to see my LBS Westdene cycles is not included in the list. Been going to Westdene for almost 20 years. They have the best prices in Joburg and discounts are always negotiated and vary considerably based on the color of your money. Cash is king. Thanks to Faizel and Faruk.

[onetrackmind]

Denmark recently introduced 80% import duties on CRC. Australia banned CRC, dont know if its still in effect though. SA will soon have a few systems in place too. The list goes on.

Jaco - can you point us at links to the ban in Australia, and Denmark's effort?

[AndreZA]

Glad to see my LBS Westdene cycles is not included in the list. Been going to Westdene for almost 20 years. They have the best prices in Joburg and discounts are always negotiated and vary considerably based on the color of your money. Cash is king. Thanks to Faizel and Faruk.

 

 

Faizel left about 6 years ago and is now part of Planet Cycles that does Planet, Pyramid and Orbea.

[Swart Skaap]

Duties is to protect the local market of manufacturers and for extra government revenue. There is no local bike manufacturer to protect from the flood of imports. The trade industry won't change the duties and vat on bicycles and parts if a couple of bike shop owners asked nicely.

 

 

I guess Morewood is not local, or part of the Proudly South African group?

[Swart Skaap]

Jaco - can you point us at links to the ban in Australia, and Denmark's effort?

 

 

Dont have links. Its info i got directly from SRAM. Ill see if i can get them to forward e-mails to me. Dont know if its confidential.

[bontie]

I buy where I get the best price, a lot of (not all) shops have a distorted view of service vs profit. You get better service when you are one of the regulars who spend a lot of money in the shops.( Been there , done that :-))

i also think the wholsalers are to blame in a big way - these SRP's are bull... How can Kieran sell a top-end Bottecchia frame handmade in Italy at R19k vs any of the others. A top end CIOCC devilry (900gr ISP frame) can be supplied in SA at around R20k.

 

I am on my way to Europe and have received quotes for a new Pinarello at 50% of the local price.

 

Eat... or be eaten

[AndreZA]

We must get Afri-forum to take this on. They are good at winning. Just tell them most of the customers are Afrikaans while the shop owners and distributors are English.

[Christopher Brunsdon]

A little birdie told me a delegation of local, lets call them stakeholders in line with the current jargon fashion, have approached the DTI to request just that - higher duty on specific imports from specific overseas retailers such as CRC.

 

I don't know enough about the DTI's mechanics to verify this or to know whether or not such a request is put in the public domain. I'm itching to know though.

 

I heard a similar birdie tell me this last year. That particular birdie has interests in DTI enforcing this, especially since that little birdie also has to cough up for being a naughty boy with price fixing.

[Pappa Bear]

At the end of the day it is very simple....... some LBSs got greedy (read want more money with out improving service) and now they are going after the competion (read CRC and other local Bike shops).

 

We will buy at LBSs that gives good service, after sales service, isn't arogant, rude, phones back when they say they will, treat a guy riding a 3K bike like he is riding a 60K bike.