Combination of both. I try my LBS first, but if they can't come within a reasonable range of pricing, I order online. For example, I wanted a Veloce cassette ($60 online) and all they had was a Record cassette for $350, or would take 2 weeks to get the Veloce one for $89. No thanks. Also, for hard to find or older items, I search ebay. As for new stuff, I prefer a bike shop or online retailer though.