Originally Posted by
KantoBoy
I have no idea, but I used to work for a company that can see invoices of major bike brands. One day, we had a shipment of a frame for this popular bike brand (ridden in the World Pro level) and the frame
cost was $200 (if I remember correctly the retail for the particular frame was at the 3k mark)
They also had a saddle shipment one day and I checked the
cost price. It turned out to be 500% markup.
Noticed that I underlined the word
cost. I absolutely have no idea what drives the price but that's the only info I can give to the public. When they ask you to pay for a frame "at cost" for your crash replacement best believe they're still making money regardless
What you saw was unlikely to be the actual cost and it's certainly not representative of the margins made at the retail level. If it is tell be where to sign as I'd buy a bike store in a heartbeat.
For larger bike manufacturers their margins are in the 20-40% range meaning if they sell it for $100 the cost is between $60 and $80. Manufacturers don't sell direct so there are a couple more layers of distribution that take a slice before a product reaches the consumer. The bike market is competitive enough that no one is making unreasonable margins.