Originally Posted by
Rick Imby
Bonzo
You are right. Folding bikes are a fairly small niche in the US. Dahon has made a commitment internationally to use the bicycle dealer network. So Dahon sells the bikes to local Distributors (In the US this is a Dahon Company) and they stock the bikes and put their margin on the bikes (usually 30-35%). Then the dealers buy the bikes from the distributor. Then the dealers assemble the bikes and mark them up 30-50%. Whereas the mail order bikes the distributor is also the retailer and may mark the bikes up 30-50% but there is one less step. Used bikes are often a great deal if you are knowledgeable. For the total bike newbie----not so much.
Also manufacturing itself may involve many more parties. In Europe Dahon bikes are mainly manufactured/assembled by maxcom in Bulgaria so they will need their cut. It's clear when Tern was created due to the management split at Dahon they used a wide range of manufacturers to source frames and assembly of their bikes as that information came out in the paperwork for the Tern recalls. Surely likely a similar arrangement at Dahon and the Dahon factory in China doesn't look like it is manufacturing the aluminium frames although I could be wrong about this but the factory basically looks a bit low tech, more focused on assembly and steel frames in-house, there's no robot welding and you never see anyone handle a hydro-formed tube, it just looks a very basic welding operation.
On the video below you can see sparks as the frame is cut and on frame parts being grinded indicating steel. Many bicycle factories in China buy in aluminium frames from some of the big high quality manufacturers like fuji-ta even if they design the frame and also manufacture steel frames themselves in-house just because I guess manufacturing and certifying frames is more complicated with aluminium and can often be more cost-effective to buy in a bare manufactured frame. Not that I think Dahon would be doing this because they don't have the resources to certify they clearly do some testing I think it would just be more cost effective for them to buy in aluminium frames. Happy to be proved wrong but it certainly looks that way to me.
Just making the point that not just the distribution logistics but the manufacturing logistics may add significant costs especially as Dahon goes for such a wide range of models and frequent updates to their models. Lots of logistic issues there in constantly changing designs and providing spares to such a wide range of models. Aluminium frame manufacture would certainly be better done by one of the big OEM frame suppliers in this instance who are used to rapid prototyping and manufacture. It wouldn't surprise me if their in-house steel frames aren't as frequently changed or at least stay broadly similar to past models.