Part of the reason BD can sell bicycles for less is because they take advantage of the money the LBS has spent to have a brick-and-mortar shop full of inventory where BD's customers can try bikes at. That is, BD would have a much harder time selling BD bikes without LBS's to try bikes at!

LBS's can't sell the "same" bikes for the same price as BD because the LBS's costs are higher. Ideally, the LBS should be providing some extra value for their higher prices. (Note that I am not expressing any opinion about where people should buy their bikes.)

This situation is interesting. I'd like to understand what the business relationship is between Fuji, the factory, and BD for these frames.