I Feel Justified

[GrumpyOldGuy]

i dont think all cyclists shop online.

 

Iam convinced that a quicky survey at the world fun ride champs will show that most people who ride bicycles in this country dont even know who CRC are ......

 

Yeah, very possible. It depends how much you spend on your hobby really, if you only buy three tubes and a tyre once a year then sure, why bother going international, but if you spend a lot of money, then it makes sense to save where you can.

 

Its like anything, I buy a lot of electronic parts, special filters etc, I save 30-50% minimum going on-line, but if I only bought one filter and two diodes a year then I would walk into the local store and buy them there.

[Caerus]

Even the Adidas sneakers that I bought online from the UK(they also have high street shops) only cost me R350 with p&p, vat etc. The guy here wanted to charge me R850, when I questioned him he just says thats what they cost and that I will not be able to get them cheaper even if I imported them.

 

The look on his face when I walked into the shop - Priceless

[Dicky DQ]

along the same lines , i would like to know if we use xmas as an example.

days before xmas shops are crowded and doing well, the general public are pretty much all getting ripped off, but the "vibe" makes them forget (ijits {i am also one})

 

then a week after xmas all the shops have like a 25 - 50% sale, my question is if they had that 25% sale before Xmas wouldnt they sell more than 25% more stock and make an even larger profit? If i was a retailer i would rather be sold out of an item before xmas than have to have sales after, incrementaly increasing the sale margin until the stock clears.

 

if you port the same logic to bike shops, why logically are they not cutting the margin with the goal of selling more stock?

 

This same question has probably been asked many times over on the hub, so we dont have to talk about it....but i find it doff.

 

Simple answer is NO they will not sell more. There are only so many customers buying at a particular time.

 

After season specials are to get rid of stock that was not sold during the rush, you don't want to sit with stock that does not sell quickly enough. Remember stock on hand means money you can't spend elsewhere.

 

And the idea is to milk the last few cents out of the customers that did not blow it att at Xmas.

[DMD 1]

Yeah, possibly, but are they both not made here, I think so, but not sure, so then it would stand to reason its more expensive there.

 

Sure, its not everything, and in some cases its just not convenient to go international, its all about time / effort / cost / convenience / and loyalty to a supplier. You just gotta do whats right for you.

 

 

They are made here in Jo-berg. But both brands are owned by international companies. Oh and buy the way it is ilegal to export them for profit.

Edited February 28, 2011 by DMD 1

[Dicky DQ]

Yeah, very possible. It depends how much you spend on your hobby really, if you only buy three tubes and a tyre once a year then sure, why bother going international, but if you spend a lot of money, then it makes sense to save where you can.

 

Its like anything, I buy a lot of electronic parts, special filters etc, I save 30-50% minimum going on-line, but if I only bought one filter and two diodes a year then I would walk into the local store and buy them there.

 

This is the issue, the local boys need to carry stock, pay rent and and and. and then only sell 10 units/year. So the cost must be higher to cover this. Vote with your wallet, but never complain that there is no stock locally. Every item you purchase online takes a sale away from a local store, so it has an impact on profitability, and how much more you are gonna have to pay locally for it.

[Grebel]

This is the issue, the local boys need to carry stock, pay rent and and and. and then only sell 10 units/year. So the cost must be higher to cover this. Vote with your wallet, but never complain that there is no stock locally. Every item you purchase online takes a sale away from a local store, so it has an impact on profitability, and how much more you are gonna have to pay locally for it.

 

So basically this is a catch 22 situation. If we bought locally the stock would be higher and the prices would be lower, but because we are buying online, the prices are getting higher and the stock holding is less because we are not buying locally... This hole that they have dug themselves into didn't appear overnight. The SA consumer is getting wiser and not prepared to get @ss raped everytime they go into a shop. A lot more people have realised that they can get stuff cheaper online and if the local guys don't wake up a lot more of them will end up shutting doors and joining the unemployment line. As consumers, we have the power to make or break a retailer and more and more people are starting to realise this.

[MDW]

It's all over inflated pricing. The distributor most probably gets a discount on the goods anyway, so is making a huge profit.

 

Even local price discrepancies are huge, and unjustified:

Shop A 32GI - 2 X 1kg tub for R205 each or 1 X 1kg tub for R225

Shop B 32GI - 1 X 1kg tub for R259 no discount on 2. After some hard haggling, I get 2 tubs for R220 each. (The only reason i spent the extra cash is Shop B is easier for me to get to after work.)

 

Shop A - First Ascent Top R399.00

Shop B - First Ascent Top R349.99

Shop C - First Ascent Top R335.00 (bought 2 from these guys)

 

Lets just all bend and take this punishment!

 

The is no point in shopping locally and paying more. Unless you want to piss your money away.

 

My new wheel-set was R1500 cheaper from over the seas. With the spare cash got new rotors and cassette and had left over change.

Chubba I want to point out one thing to you, just so you are aware. 32Gi retailers purchase directly from 32Gi and on sell to the public. All retailers get out product at exactly the same price. There is no middle man at all.

 

So now you know the retailer determines their own price. Now some retailers you need to look at where they are situated and if they are in an expensive centre say, then you should know there margins will be higher to cover costs, some of the stores drop the price to try for volume sales and work off a lower margin.

 

The thing is its not the distribution chain here its the retailer deciding how best to sell the product in his own store.

 

At 32Gi we make a recommended retail price on the product, some of the retailers listen to us, some dont at all.

 

Hope this helps

later

Me

[Grebel]

Chubba I want to point out one thing to you, just so you are aware. 32Gi retailers purchase directly from 32Gi and on sell to the public. All retailers get out product at exactly the same price. There is no middle man at all.

 

So now you know the retailer determines their own price. Now some retailers you need to look at where they are situated and if they are in an expensive centre say, then you should know there margins will be higher to cover costs, some of the stores drop the price to try for volume sales and work off a lower margin.

 

The thing is its not the distribution chain here its the retailer deciding how best to sell the product in his own store.

 

At 32Gi we make a recommended retail price on the product, some of the retailers listen to us, some dont at all.

 

Hope this helps

later

Me

 

I think that is what Chubba was trying to highlight. How the retailers are letting us the consumers have it from all angles. Now buying online would be like buying from a distributor who is happy to put on a small markup and move high volumes. We would be saving a lot by bypassing the greedy retailer.

[GrumpyOldGuy]

They are made here in Jo-berg. But both brands are owned by international companies. Oh and buy the way it is ilegal to export them for profit.

 

Yeah, I thought so, but I cant quite understand why its illegal to make a profit.?

[Danger Dassie]

Having worked in a bike shop before, it's not the "greedy retailers" at all, for most the mark up far below the percentages of other retail industrys. Also if shop A is in 7de laan whilst shop B is in Eau de Kugel Cougar Centre, then there will be price differences, or higher markups on other items.

Do some digging and find out what markup you pay on cell phone calls.

 

The more prevalent things like CRC becomes, the more it compounds the issue for local distributors and retailers alike, who do all the branding, marketing, stock holding and training of staff and are expected to honour warrantys.

 

The manufacturers need to move away from the outdated supply chain that our local distributors are forced to adhere to and make the distribution point directly to South Africa. It's an outdated concept of keeping our distribution level under that of Europe, then expecting our local agents and retailers to be competitive, yet they seem to be constrained by manufacturer's demands and flamed by consumers who feel they are being fleeced.

This isn't just in the cycle industry either, it's a standard practice across many markets, South Africa falls under the distribution of Europe. Stuff docks here by shipment, carries on upto the EU, then gets redistributed and shipped back down to us.

[bontie]

Here we go again...

[Chubba]

I think that is what Chubba was trying to highlight. How the retailers are letting us the consumers have it from all angles. Now buying online would be like buying from a distributor who is happy to put on a small markup and move high volumes. We would be saving a lot by bypassing the greedy retailer.

That would be spot on!

[GrumpyOldGuy]

The manufacturers need to move away from the outdated supply chain that our local distributors are forced to adhere to and make the distribution point directly to South Africa. It's an outdated concept of keeping our distribution level under that of Europe, then expecting our local agents and retailers to be competitive, yet they seem to be constrained by manufacturer's demands and flamed by consumers who feel they are being fleeced.This isn't just in the cycle industry either, it's a standard practice across many markets, South Africa falls under the distribution of Europe. Stuff docks here by shipment, carries on upto the EU, then gets redistributed and shipped back down to us.

 

Yeah, very true. I have often said the distribution model here is a dinosaur and simply not in line with our small economy, and as you say its across the board in most respects.

 

However, the internet is here to stay, its not going away and it will get stronger, some manufacturers do recognise this and are competing with internet sales, international warranties, drop shipments to reduce costs, setting up agents as opposed to full distributors etc - others not, but I think its just a matter of time and they will die off, just like the dinosaurs.

[The_Break]

I want to know why we never see end of season sales in this country. Overseas you get 60-80% discount at the end of seasons.

 

3rd world syndrome. 1st world countries don't want to buy last years stuff. They want and can often afford new current stuff.

 

I think SA in general is the way it is because the average south african has a very 3rd world mentality, that being an inward self-seeking one. It plays out in all spheres of our lives and society. On the road, in business, in the service sector, etc, etc, etc. In business it plays over in that the businessman will take as much as he can. When last did you get anything for free in SA.

 

When I was in the USA last season I was often getting stuff for free or at a huge discount because of things like slow service, waiting too long, regular customer, surveys, etc, etc. A very customer based society. It is all about service and keeping the customer happy there at any cost. Here it is the other way around. Businesses are there to make money often at the expense (on a human level) of the customer.

[Burts]

On the flip side

 

Try and buy a Baracuda, Kreepy Krauly pool cleaner overseas and then compare the local prices. In good old SA we are about four times, yes that four times cheeper.

 

So in some yet rare cases it is alot cheeper in SA.

 

Pitty one can't ride the Argus with a Kreepy Krauly.

[Chubba]

Pitty one can't ride the Argus with a Kreepy Krauly.