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Old 03-06-08, 05:45 PM   #1
J B Bell
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High retail prices in Canada

Hi folks,

I've been shopping for doing some touring, and notice that retail prices still remain pegged at half again their US counterparts, or even more. What is up with this? Retailers about 6 months ago were quick to point out the vagaries of the supply chain--well, it's now been 6 months, and I think the chain has sorted itself. And I know that 2008 bike orders had to have been made recently. Yet, a Surly Long Haul Trucker is $1200 here, $900 in the USA. An Ortlieb Pannier that's $140-$150 in the USA is $230 at one local shop that I think has representative prices.

Colour me confused, if not outraged. Anyone know the scoop? Are we just being taken, or is there some other factor?
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Old 03-06-08, 11:48 PM   #2
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This subject is near and dear to my heart. While there are many different reasons (and many excuses) it's hard to see the price differences as they are currently. Keep in mind that Canadian retailers still pay for the duty (on some products), higher taxes (in general). Retailers also do not control what the suppliers charge....(Trek Canada* sets its its MSRP not your LBS) I think part of the issue is that the supplier's have not lowered prices and therefore some of them may be absorbing the dollar difference. The retailers in Canada do have to deal with a much smaller economy of scale and therefore the products will always be slightly higher here. ie Trek sells 10x? (number pulled from my ass) more bikes in the USA then in Canada so they pay less per bike on set costs.....but within Canada Trek's* expenditures still must cover the whole country for advertising, sales reps, training etc. All of this should cause the price to be higher here. Having said that, should the price be 30% higher here? Nope. The only way that anything will change is to put pressure on the suppliers. Write a letter to the supplier of the products, ask your dealer what gives. Unless people complain nothing will happen. Keep in mind most dealers aren't making a killing on you, they're just trying to provide you with the best products at a price that they can live with.

*I used Trek as the example cause their Canadian prices on bikes don't seem to be that different (at the levels I've looked at anyway)
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Old 03-07-08, 12:38 AM   #3
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Some of the component manufacturers have deals with both U.S. and Cdn. distributors where they will not allow U.S. retailers to ship their products to Canadian customers and the Cdn. distributors apply a much higher mark-up based on the claim that they operate in a smaller market and they will not allow their products to be sold on-line in Canada.

I have been writing to gov't reps at the Federal level and in Quebec where I live as I cannot agree with this protectionism. In the U.S. these kind of actions would end up in the courts. Quebec has a large slice of the cycling industry in Canada and Quebec has the 5th highest density of cyclists in the world.

The consequence is that the Gov't is getting the shaft b/c people buy the stuff off U.S. web sites and ship it to a U.S. address and then the person forwards it to the Canadian as a gift with No taxes or duties applied.

Example. Universal cycles had a Fox 80 RLC fork for 550$ U.S. and it included a CK no-thread set but the site indicated that it could not be shipped to Canada.

The LBS where I bought the fork paid the Cdn. distributor 647$ Cdn just for the fork and 90$ for the head-set and with mark-up I paid almost 1000$ Cdn for what I could have bought on-line for 550+90 taxes or 640$.
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Old 03-09-08, 02:55 PM   #4
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Ok i can at least understand higher costs from US owned companies but what about bikes from Canadian companies like Cervelo, Guru and Argon 18? The Argons sold in the US are still cheaper than the ones sold here, i assume the others are the same.
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Old 03-10-08, 07:19 AM   #5
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Ok i can at least understand higher costs from US owned companies but what about bikes from Canadian companies like Cervelo, Guru and Argon 18? The Argons sold in the US are still cheaper than the ones sold here, i assume the others are the same.
Although I cannot speak for Guru and Argon....Cervelo, although a Canadian company, does not make its bikes in Canada (they may be assembled here). Carbon Cervelos come from Asia. And again this still does not take into account the higher taxes here and the higher costs of a smaller market in Canada. Cervelo sells ten times as many bikes to the USA and therefore will give them a lower price. If you go to Home depot and buy 100 nails you'll pay more than if you buy 1000 nails.........at least per piece.
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Old 03-10-08, 08:39 AM   #6
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People charge what the market will bear. Look at cars, the prices did not come down until people started making noises. Magazine prices in Canada are outrageous compared to the U.S. ,I just stopped buying them. Bike prices will remain high in Canada until the industry begins to lose sales.
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Old 03-11-08, 07:34 PM   #7
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I don't mind paying a bit more buying from a LBS in Calgary since they take care of shipping and any warranty issues. They also have to maintain a store front and are available to me for help or service.

OTOH I won't pay a ridiculous amount more to buy local. I've got a good relationship with a couple LBS in town so if something is way out of line I'll talk to them about it and see what they can do - at least 50% of the time we can reach a reasonable compromise. There are some things that it just makes sense to mail order due to time & cost factors.
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Old 03-25-08, 06:17 AM   #8
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Often times it is the distribution chain that is at fault, other times it is a smaller company and prices are less affected by the economy, and still other times it is the local shop. I for one have never seen prices in the U.S.A. to be half of that in Canada. You first examples of Surly and Ortlieb are both distributed in Canada by NRG, a very small distributer out of Nelson B.C. These are both brands that are small, and specialized in the Canadian market, thus a higher retail in then in the states.

As for some of your other examples of Canadian bike brands, I still have not seen that great of price variation.
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Old 04-10-08, 10:41 PM   #9
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I'm not sure why people expect Canadian prices to go down, if anything American prices should be rising. It's their economy going down the tubes not ours going up.
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Old 04-13-08, 09:00 AM   #10
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I agree that US prices should be going up but it still a relative thing we should not be paying a third more than the Americans do. I would love to support a local shop but living in the hinterland my local shop is a ways away. I tend to mail order, which may give me the best price but it lacks the face to face contact which is worth something. I tend to agree with VIC support local if possible.

If you think that the price of bike and bike stuff is out of whack take a look at motorcycle stuff, its even more goofy.
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Old 05-08-08, 06:53 AM   #11
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I'm looking Surly LHT too. It's $1250 at a local shop A . I'd love to order it from Local Shop B (better service) but the company (NRG distributors) has some sort of exclusive deal with shop A, and won't let Shop B sell Surly's bicycles or frames.

This is all making me very grumpy. I'm already going to have to pay an extra few hundred on top of the cost. I'm under the assumption that QBP (Surly's stateside distro) sells to any bike shop.
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Old 05-13-08, 12:21 AM   #12
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Just about any shop can get parts through QBP including Surly parts and accessories but not every shop can get Surly frames and bikes.
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Old 05-14-08, 04:54 PM   #13
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I was just at Denman Bike Shop in Vancouver this past weekend looking for something to cruise around on and the lady was saying that prices are going to jump mid season due to increases in manufacturing costs. Now, I'm super skeptical of anyone who's selling me something that I don't know much about (I'm a total noob when it comes to proper bikes) so I was wary of what she was telling me? Has anyone heard about this yet?
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Old 05-15-08, 12:44 AM   #14
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Low retail prices at MEC

Just one little item I've been thinking of mentioning for awhile. They don't sell bicycles or even frames but for the parts they do sell, Mountain Equipment Co-op has the best prices I've ever seen. My most frequent purchase there is tubes for the old 10 speed tires, 27 X 1 1/4 inch. They have been $2 for about 5 years now. I don't go there very often and pick up 6 to 10 at a time. A 5 gear Shimano rear sprocket was $8.

They don't even have frames or exotic parts, but for basic tools and everyday stuff they are really good.
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Old 06-05-08, 12:10 AM   #15
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I bought my last 3 bikes in the States. Way cheaper and better components. Canada has a 13% tarriff on bikes sold in the country. The last bike I bought on Ebay new I paid $635 US for it, when the CAN was almost at par with US. The same bike here would sell for $2,500 minimium. I had a hell of a deal. I had it professionally assembled and their jaws dropped when I told them what I paid for it.
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Old 06-05-08, 11:33 AM   #16
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Still, my fav soxs in the USA are $6.99, here they are still $15.99. Wow, FAIL.
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Old 07-26-08, 08:13 PM   #17
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Maybe there is hope. I just bought a Catrike Recumbent Villager, MSRP on their website is $1550, US$. I bought it in Bentley Alberta for $1,900. That is $350 more. The Canadian vendor said that is their costs for shipping and border crossing (some agent fee?). While that is a 22% over US prices I can understand the costs and didn't feel ripped off. The dealer custom fit the bike to me and installed accessories at no charge, and threw in a few extra's. Catrike's I'm told are built in the USA.
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Old 07-08-09, 04:05 AM   #18
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I'm looking Surly LHT too. It's $1250 at a local shop A
Where are you located? My LBS wants $1,600!
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Old 07-08-09, 12:46 PM   #19
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No one has mentioned the increases we have experienced since 9/11 either: The cost of paying for Homeland Security (biggest damn bureaucracy on the planet), as well as our own increases in Security have caused a "bump" in costs; as well as the cost of FUEL.
I was incredibly disconcerted to see a Brooks Saddle in Portland going for $110.00 USD, and then returning to my LBS and seeing the same model for $149.00 CDN.
Factor-in both taxes (BC, and Fed. Oregon has no tax on this item) and it becomes an absolutely ridiculous comparison.
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Old 07-10-09, 07:54 PM   #20
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*meh*

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Old 07-10-09, 08:00 PM   #21
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bump

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Old 07-14-09, 04:30 PM   #22
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Don't even start with MEC. Did you know they abuse their co-op status so they pay very little corpoate tax? canadian suppliers will not sell to them, so they are forced to use grey market suppliers out of the states. They have an unfair competitive advantage over IBD's because the dividends they make (profit for everybody else) can be put back into their business while a for-profit store must first pay tax on their profit before re-investing it. pretty slimy if you ask me.
Here's an article off their blog which exposes them for who they really are:


"As an MEC member and bike dealer I have some views to share.........(edited to save space)

In fairness you might have added that the text you quoted was a response posting to a blog written by a member of the public and not written by the author of the blog "Bike Industry - Green & Hype" http://blog.mec.ca/2009/05/bike-industry-.html . Thus it's a point of view of a person who does not speak for MEC. It's not necessarily factual nor is it an article.

Here's the response to the quoted text by the author of the blog:

Hi MT,

Thanks for the valid comments. The economics of what you say are debatable but some of your points are true.

I would like to make a few corrections. MEC DID NOT get into bikes because of some messianic need to clean up factories. It is getting into bikes based on member demand and the goal to get Canadians more active. Of course this is debatable for some as you have noted in your earlier comment.

In terms of factories in Asia being the state of art in terms of working conditions and wages. I find that questionnable. No doubt there is likely a handful of progressive factories in Asia but the bulk have significant challenges. You're right. We don't provide proof in the public domain for verification (for libel reasons with factories). We can in private conversations.

Based on your eye-witnessed account you have not encountered any major challenges. Based on our fairly extensive work with NGO's, environmental engineers, labour auditors and other bike brands in these factories, we're seeing something else.

I hope your first hand experience is right because if you are, MEC is definitely chasing the wrong factories. And the world of Asian bike factories is not as dark as what my colleagues at other bike brands and I are are encountering.


I'm a MEC member and I'll support the the LBS when their prices are reasonable. On the other hand, as I'm a regular guy who works hard for his money, I need it more than someone who owns a business.

As for MEC being a cooperative, I fail to see how reinvesting in the cooperative is slimy or underhanded. Nor do I understand what you mean when you claim that MEC is absuing their co-op status. It's not like some guy is siphoning profits off into his own pocket.
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Old 07-14-09, 09:43 PM   #23
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On the other hand, as I'm a regular guy who works hard for his money, I need it more than someone who owns a business.

I really don't understand this line. Are you saying that a bicycle shop owner makes too much/doesn't work hard? (or any business owner for that matter)
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Old 07-14-09, 10:50 PM   #24
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I find Canadian Tire are now carrying some good decent bikes for the price brackets. Ignore their silly full suspension bikes and look into their simpler hybrids and you can find some bikes with good quality components.
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Old 07-15-09, 08:35 AM   #25
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I really don't understand this line. Are you saying that a bicycle shop owner makes too much/doesn't work hard? (or any business owner for that matter)
I did not say that. I said I work hard for my money and I need it. I was not referring to the work ethic or finances of business owners. Businesses are not charities but if they act like they need to be treated as such to survive then I suggest that the problem lies with the management and not the marketpalce.
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