Stucky

Who's gonna pay for that warranty? The company selling $400 frames sure isn't going to pay; nor the builder; nor any LBS.....

Of course, ya could put a tail light on it, so it can have a "tail light warranty" [Is warranted for as long as I can see the tail light when you ride it away!][

Maelochs

Well, as I mentioned, the person would need to buy in bulk--retail would never work. Still, $2500 to $3000 (the $500 for the builder comes out of the markup) and they would probably sell very slowly.

I don't know ... $2500 for a 15-lb CF bike? I'd have to check the market ... but I don't have the capital anyway, so it really doesn't matter.

Fly2High

As for a warranty replacement, why be concerned? If a name brand costs a couple thousand and this frame was under $600, a replacement will still keep you under half the price of the big boys.

BoSoxYacht

the 1 year old Venge was $1800? What components did it have, and how did you get it for that pricce?

Stucky

It was 10-speed Ultegra, with the stock FSA SL-K Crank... and it had upgrades- like Aerofly carbon bars; carbon rail saddle and Praxis chainrings. It was a '13, I bought it in Dec of '14. I made the offer, and the guy called me back like two weeks later and took it- guess he needed the cash for Xmas- and probably didn't want to Ebay it (It's virtually impossible to sell a road bike around here- no one rides). The thing was like new- Still had the original tires with the little nubby-mold thingies still intact.

I'm almost tarting to miss it- I liked those aerofly bars!

I <3 Robots

^^This.

The business that built the bike provides the warranty. The customer would deal direct with the local business. Most of the open mold China frames have a two year warranty. There are huge threads on RBR and MTBR regarding open mold frames. Many have had good results when dealing with China frame dealers. You just need to do your homework when it comes to finding a reliable party.

LaMere out of Minnesota is doing this exact thing. He straight discloses which open mold frames he uses. He seems to have a 50%+ markup with his frames...but I guess that's the extra price you pay when having a shop to deal with that you can call that's in the US. The guy just slaps his decal on the frame...but you have service and a brick and mortar store you can call.

The other "benefit" of having an open mold frame is that when I ordered my MTB frame...I was given a choice of any BB type I wanted and rear axle (135 or 142). I spec'd a BSA BB and 135 rear end. They included the 142 axle and dropout parts on top of the 135.

rpenmanparker 

The online retailer can pay. Warranty service is incredibly rare and therefore cheap. What, 1% at most?

DaveWC

I disagree with the bold section. I'd keep the labor separate from the profit. First, it pays you for your time while the profit pays for your risk. Second, it allows you to hire someone to do the labor and just run the company for profit. IMO it's a big mistake as an owner of a company to either not pay yourself or assume that your wage will be covered by profit.

As for warranty, everyone here seems to be discussing warrant as if the frame is the only thing being warranted or the only thing that can fail. If you sell a complete bike & offer a warranty you're dealing with all issues related to that bike. Sure you can follow up warranty claims with your drivetrain vender & frame claims with your frame builder, but they're all going to go through you. I also think that a 1% warranty rate is really conservative. People find amazing ways to break things & don't kid yourself that you'll only deal with legitimate claims. They'll all be JRA and will all think that you must replace the bike/component.

Maelochs

To start with I would be the only employee and I would take my wages from the 1/3 markup--that is standard business practice, as far as I know (taking employee wages out of profit.) My actual "earnings" would be cash flow and my own business.

If it worked, I would have to restructure some to hire employees and also probably to find more space (garage is only so big) but I also assume I would get a greater discount on parts with greater volume.

if I was really serious I would have to write up a business plan, assume I would be hiring and assume I would be renting commercial space, and seek investors based on that. I was thinking more small-scale.

I would have to hire a lawyer to write up the warranty agreement--the frame might be warrantied but I doubt the components would be, not sure (haven't done the research.) In any case I would need a stock of replacement parts for warranty claims which I thought were legitimate--part of the cost of doing business. Good customer service is key.

No cash for it right now anyway, as I am looking at another venture which would be a lot less fun but would include a partner which makes everything a little easier.

Just looking for a way to make money dealing with bicycles in some capacity because it is fun compared to most of the stuff I do/have done to earn a living--and I'd meet more cyclists, which is potentially not a bad thing.

But not today ... today I will look into that guy LaMere and see how he is doing it.

look566 rider

And who will you direct from China frame buyers hold responsible when your frame fails for no reason and you end up with serious injuries or worse? This concern alone is not worth my saving money over the peace of mind that I have with a factory serial number and purchase record.

You can call me a media following sheep person, but look at the most recent issue of Bicycling for evidence of a poor Chinese copy.

rms13

Honestly, the only time I can find where a bike failed "for no reason" and caused "serious injuries or worse" was the one person that was paralyzed by the Trek failure that caused the recall and maybe a few people on Spinergy wheels 20 years ago. This issue doesn't seem too prevalent unless dozens or hundreds of people's Chinese bikes are self destructing and the Chinese government is keeping it quiet.

BoSoxYacht

I've worked in bike shops off and on for 3 decades and can honestly say that warranty issues are not very common. Most warranty issues are covered by the component manufacturers, not the frame manufacturer.

Stucky

Even if there were NO legit warranty claims, it costs money just to have someone to deal with it/answer the phones...not to mention the potential legal liabilities- which is another reason that the Chinese frames can be sold so cheaply- they're immune to that stuff. Those who choose to buy 'em generally understand that and are willing to take the risk.

Maybe move to China and then sell the bikes here...now that might work! (My cousin moved his business to China...)

Maelochs

Wait, weren't we also talking about the guy or company LaMare that was already successfully doing this in Michigan or Minnesota or somewhere? Seems it is Not absolutely impossible. Not the right option for me at this time, but not impossible.

colombo357

These ideas of starting a business importing noname frames from questionable Chinese frame builders is comical. I've seen it in other industries. You never gain any traction because your business caters to a bunch of tightwads. They'll fight you for every last dime, like shipping charges, and write a horrible review online for everybody to see if you refuse to warranty their paint scratch. They'll also give you zero customer loyalty. Forget about repeat business. They will experiment with another noname frame the next time around, if that ever happens. If it does, it'll be so far into the future that you probably won't be around by then anyway.

If anyone is seriously contemplating this business, do yourself a favor and keep your day job.

On the other hand, if you're willing to invest time and money into a Chinese manufacturer and establish an exclusive business relationship, and put real engineering effort into qualifying the builder and performing QA on the product (including destructive testing), that's a different story. But the cost of all this will ensure that you won't lead the industry in rock-bottom pricing. That puts you in the middle range, and the name brands already have middle market offerings. They also have their used products going up on ebay, which works against you.

DaveWC

Standard business practice when valuing a business is to put a reasonable wage in under expenses for the labor of the owner. That way you get a true picture of how profitable the company is. In my previous example, if you remove the wage you end up with a cost of the bike of $2,150 plus 33% profit ($709.50) and a total cost of $2,859.50 for the bike. So you've reduced the cost of the bike, making it easier to sell and now you're paying yourself a wage of $500 (the assumption being that this is a reasonable wage to make a bike) and you're earning $209.50 profit. That's unreasonable payback for taking risk IMO. Either you're shortchanging yourself by placing 0 value on your time building the bike or you're earning far too little profit. As I said, you need to separate & place a value on your time & your risk.

But whatever, it's not going to happen. I guarantee you could easily end up with a million bucks with this company... but only if you started with about $5 million.

redfooj

hypermagnified scaremongering.

95/100 bikes on craigslist that started their lives as a 100$ box store special - the roadmasters and murrays and ironhorses and univegas - and the innumerable bikes of all vintages that are used daily across campuses and streets of america , that are all guaranteed less robust than these "chinese frames" , arent exactly spontaneously exploding left and right and injuring riders in some cycling medical pandemia

caution is fine until it goes into hysteria

dwing

It's always cheap 'n' easy when there's no skin in the game. I see guys all the time rave about their mic knockoff graphite Xhot driver claiming there's no discernible difference to the real thing. lol, enjoy.

redfooj

great comparison. what do genuine callaway xhot drivers, or any other fancy clubs, do for 95% of the golfers out there on the range?

Stucky

But to be fair: Those box store bikes are made of heavy steel. They're virtually indestructible. When I was a kid, and everyone had cheap steel bikes, I never once heard of anyone breaking a frame. I saw kids who'd purposely try and break their frames, and couldn't! Now with CF, broken frames are rather common.

I'd have no problem though, taking a chance with the Chinese companies which have acquired good reputations....

Stucky

Yeah, with many small businesses, the owner is really just making a job for himself (as opposed to a business which can stand on it's own and generate a real profit). -A job with long hours and lots of headaches, for which they receive no compensation. But to many of us, it still beats working for someone else....

dwing

Point well taken. My own personal opinion... it does nothing for those that can't break 90 on a regular basis whatever that percentage is. Take lessons. As you start scoring at and below 90 your swing & knowledge of is starting to become consistent enough to potentially benefit from the performance of the big name clubs. And of course everyone will say it's the indian not the arrow.. and Phil Mclelson could play with Kmart set of clubs and score. Agree, but I'd bet his avg over the course of a pro season will be "higher" with the Kmart set.. and that will add up big in dollars lost.

Performance gains come in small increments the better you get. I believe you start noticing the difference in performance from mic knockoff crap at some point as you become more experienced and better at something. But if you're fine with the mic knockoff.. by all means enjoy. Just know, it is NOT the same.

Stucky

Trouble is, the bike market is already over-saturated. Price is about the only arena in which to compete- and the manufacturers themselves would be better suited to doing that...and likely will at some point. Then again, they really don't even need to- just selling the frames is enough- 'cause all the components are readily available and building up a bike is not hard, and can even be done for a very modest fee for those who can't/don't want to do it themselves.

What would an LBS charge to build a bike? $150-$200. So unless one could get a substantial discount on the frames and components, figure that that's the maximum gross profit you have to work with per bike, because any consumer can just buy the parts and then have them assembled for the price of the parts and that $150-$200, so why would they pay more for the very same bike we assembled and sold?

The real small business can't compete on price- it never works. Where we shine, is in added value and/o0r service or convenience or fulfilling a niche that is too small for the big guys to mess with.

Bluechip

Doesn't he want his score to be lower? Kmart set it is then.

BoSoxYacht

In golf, the lowest score wins.

(edit) too slow.