Going Long and Hard.

jimvreeland said:
Yes. Unfortunately there's not enough margin on Bikes for everyone to survive. Cutting out Reps and Dealers is necessary to compete against DTC brands like Canyon. Customers aren't willing to pay 4 or 5k more just to save my job or shop so we gotta do what we gotta do...
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So the bike shop stays open, does repairs, business as usual but a corporate shop - Crazy.

Target markets only, right?
 
thegock said:
I think this deserves its own thread somewhere other than Jim's blog. But, someone else can start it.

After Trek bought High Gear and opened up a shop in Summit, the big S bought SEVEN shops and a warehouse comprising the biggest set of shops in the NYC area. This is in addition to the 25 other shops they own and the 100 that they are planning to acquire.

This reminds me of when the IT guy where I was CFO in 1996 told me about Amazon and I ordered three books online. One of the books that arrived five days later was a guide to motorcycle gang customs and culture, which I didn't order. (Who knew that the Pagans had a west coast chapter way back then?)

View attachment 170041

Fast forward 25 years and B Daltons is gone and my shoes that I ordered on Amazon will be here in eight days.

Is it possible that the retail bike industry is changing?
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Trek just filed a patent on their bike box, so DTC is 100% where the bike industry is headed.
 
one piece crank said:
So the bike shop stays open, does repairs, business as usual but a corporate shop - Crazy.

Target markets only, right?
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IDK. The plan seems aggressive. Though NYC and the surrounding areas are a huge deal.

I think the deal is good for shops in general. The fan boys will hit corporate stores and the anti-corporate folks will hit the mom and pops. I do feel for mom and pops with a big brand though because that's seriously numbered days left. With the PON deal who knows where the cards fall but I'm extremely confident the Industry is going through a huge change.
 
cassinonorth said:
Trek just filed a patent on their bike box, so DTC is 100% where the bike industry is headed.
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Off course, targeted/selective markets. When Sam chose Summit as the first HB site, my former Lehman Bro buddy said: "Ah, Hedge Fund East.". One of the customers there has a snow machine in the yard so the kids can snowboard all winter. One of my clients' CFOs was paying >$100k property tax 10 years ago.

PXL_20210123_202530162-01.jpeg
 
jimvreeland said:
Within 5 years the whole industry will be DTC. If you're in the industry already, this Winter will be a good time to start bulking up your service staff.
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So what's the workflow here?

1. Customer buys bike from bike company
2. Bike company sends it to customer in 50 pieces
3. Customer tries this for like 30 minutes and gives up
4. Customer brings it to shop and pays $250 to assemble bike and has to wait another few weeks to get it
 
Norm said:
So what's the workflow here?

1. Customer buys bike from bike company
2. Bike company sends it to customer in 50 pieces
3. Customer tries this for like 30 minutes and gives up
4. Customer brings it to shop and pays $250 to assemble bike and has to wait another few weeks to get it
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Currently,
1. Bike company advertises the bike comes 95% assembled.
2. Customer attempts assembly.
3. Customer calls shop asking how much to adjust the front brake on a new bike.
4. Customer brings bike to shop with fork backwards, handlebar loose, brakes rubbing, derailleurs not adjusted and no air in tires.
5. Bike shop informs customer that this bike still needs to be properly assembled.
6. A bunch of back and forth.
7. Customer leaves negative review that bike shop is trying to rip people off when all the bike needed was a quick brake adjustment.

Looking forward to more of this.
 
When Trek took control of High Gear four years ago, there were 40 Trek stores in the US. Guy I talked to yesterday said Trek is probably well over 100 locations now.

As a customer, I never had the impression that the reps had any value to me, except the Shimano guy, of course.
 
Norm said:
So what's the workflow here?

1. Customer buys bike from bike company
2. Bike company sends it to customer in 50 pieces
3. Customer tries this for like 30 minutes and gives up
4. Customer brings it to shop and pays $250 to assemble bike and has to wait another few weeks to get it
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...this or..

1. Customer buys bike from bike company overpriced by $500
2. Bike company sends it to shop in 50 pieces and at its own leisure because the customer has already paid for it
3. Customer harasses the shop to know if he bike has arrived (this may or may not involve swedish fish)
4. Bike arrives at the shop and get assembled and delivered to the now pissed customer
5. Shop gets paid $50 for the hassle
6. Customer thinks next time he/she will assembly the bike, see below.

Bike N Gear said:
Currently,
1. Bike company advertises the bike comes 95% assembled.
2. Customer attempts assembly.
3. Customer calls shop asking how much to adjust the front brake on a new bike.
4. Customer brings bike to shop with fork backwards, handlebar loose, brakes rubbing, derailleurs not adjusted and no air in tires.
5. Bike shop informs customer that this bike still needs to be properly assembled.
6. A bunch of back and forth.
7. Customer leaves negative review that bike shop is trying to rip people off when all the bike needed was a quick brake adjustment.

Looking forward to more of this.
Click to expand...

No shortage of frustration at any time, always available in stock for everyone to enjoy!
 
thegock said:
When Trek took control of High Gear four years ago, there were 40 Trek stores in the US. Guy I talked to yesterday said Trek is probably well over 100 locations now.

As a customer, I never had the impression that the reps had any value to me, except the Shimano guy, of course.
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Trek owned HG long before they "took over."

----

Seems a new business of final assembly at the customer's premise may emerge.
Perhaps as an add-on to the price of the bike?
Or - "here is the tool kit you'll need" - so they can get add-ons that way

Anyway, it is still going to break, assuming they ride it.
 
serviceguy said:
Customer buys bike from bike company overpriced by $500
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I guess my question here is...is this true? If you're paying more than why buy direct? If I order Door Dash I expect the f'ing food to be cooked & ready to eat when it gets here. So paying more makes sense. If it came raw I would expect it to be less than a restaurant.
 
I would guess that the bike companies don't want home wrenches messing up the bikes, so the shops will still clean, inspect and lubricate the final product. Customer service is trendy.
 
Norm said:
I guess my question here is...is this true? If you're paying more than why buy direct? If I order Door Dash I expect the f'ing food to be cooked & ready to eat when it gets here. So paying more makes sense. If it came raw I would expect it to be less than a restaurant.
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The rationale behind the price hike in my scenario is that you can only buy the bike directly from the manufacturer, which means they can basically price it whatever they want. So answering your question...no, it wouldn't be technically overpriced. You can replace overpriced with more profitable (for the manufacturer). Only competitions other manufacturer (if there's going to be any at the end).
 
serviceguy said:
The rationale behind the price hike in my scenario is that you can only buy the bike directly from the manufacturer, which means they can basically price it whatever they want. So answering your question...no, it wouldn't be technically overpriced. You can replace overpriced with more profitable (for the manufacturer). Only competitions other manufacturer (if there's going to be any at the end).
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Once they cut the retailer out they don't need to raise the price to make the additional profit.
 
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