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Do Special orders help an LBS

Old 04-20-16, 09:54 AM
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marcoocram
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Do Special orders help an LBS

My question is basically whether special orders help or hurt the bottom line of an LBS.

I need to get new tires for my hybrid style bike. Most LBS in the area do not typically keep that width of tire on hand at least in any variety of tread. .

I could order online or go to a box store, however I like to support the LBS that is right across the street from my apartment. However, my concern is that a special order would actually hurt the LBS by creating an additional freight or other variable expenses that eat up any profit margin.

If special orders are processed simply as a favor to the customer I figure I would save everyone some time and just purchase them somewhere else.

I wasn't sure how to ask the owner this, so I thought I'd bring it up in the forum. What do you think?
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Old 04-20-16, 10:16 AM
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I was given a long lecture about the fact that, no, special orders do not help LBSs by someone in the industry, after I posted here about problems I was having after having bought a SMP saddle from my LBS.

Long story short, yes, save everyone time and hassle and just buy it online unless it's something really profitable to them, like a different model of bike in a line that they already carry.
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Old 04-20-16, 10:26 AM
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Doing business with a Business, helps keep a Business stay in business.

Last edited by fietsbob; 04-21-16 at 10:01 AM.
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Old 04-20-16, 10:32 AM
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I am very loyal to my LBS and have had mixed results from special orders. Most of the time, with common components (like tires), they can order through QPB and have the parts for me in a day or two. However, this spring I wanted some custom brake/shifters. QBP didn't carry this brand, the LBS tried to get set up as a distributor. It was a big time-drain for the LBS so I ended up ordering directly on-line.

So if the LBS can easily order the part, and it has a reasonable margin, I'd say it helps. It there's no margin or it's challenging to acquire, you're not doing them any favors.
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Old 04-20-16, 10:37 AM
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You dont have to pay postage to return things that didnt work for you, just a store credit is issued , refund-exchange for different size (or its put on consignment)

some places have a Re stocking Fee, big city kind of charges, not a Ma& Pa Home town shop Practice , for regular Folks
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Old 04-20-16, 10:47 AM
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Originally Posted by fietsbob View Post
The shipping to the shop cost is Part of the retail price, online that is separate , in addition to the stated Price .

Summer restock Orders are frequent .. less frequent in winter

Of course The Shop Has to have an account with that distributor..
Exactly right. I owned a shop for a few years, and during the busy season, it was common to do at least a couple of orders a week that surpassed the free shipping threshold. Most distributors would ship by overnight courier, so an order that goes in before noon today will be at my door tomorrow.
During the off season, the order frequency will be less, maybe one order every couple of week, so if you can wait a few days, it's not a big deal.
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Old 04-20-16, 10:55 AM
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QBP has surprised Me with a more costly 2 day shipping from 1 warehouse and less costly longer transit, from another

to fulfill a combined Order .
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Old 04-20-16, 10:55 AM
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If a business sells something at a price that loses them money, the business is not well run. When you ask a shop to order something they should know the cost to them and a price they can sell it at to meet their margins. If you have seen the item you want for less online, tell the shop and ask if they can match it or come closer. If they would lose money trying to match the price then they would be foolish to do so, but they might be able to narrow the gap between their price and the online one to make the sale.

In short, if they are selling things at a price that loses them money, you might as well buy it from them because they won't be around for long anyways.
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Old 04-20-16, 11:11 AM
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Assuming that he can combine your order with his next purchase from that same vendor, and that there's a reasonable profit margin, the special order can't but help the shop.

There are many ways to look at costs and profits, and the biggest debates revolve around how to allocate overhead or fixed costs. Most people divide the gross annual overhead into the gross annual sales to come up with a percentage overhead cost, which is appropriate in the big picture, but not applicable to a specific situation.

Consider:

option 1 - you don't involve the dealer and he makes zero on you, but is spared any cost, ie. nothing ventured, nothing gained, net sum ZERO

option 2 - you ask the dealer and he offers you a price greater than his direct cost including any shipping. He makes $X and his general operating cost is unchanged other than a few minutes of his time. This is in addition to his otherwise sales base on which he calculated his cost margins, in other words it's plus business. It may not be what he'd normally like or need to make, but it's still more than zero, other than the cost of the phone call, so whatever he makes is more than the zero of option 1.

Now, it depends on things like how busy he is, and if he's using otherwise dead time, and of course whether he's trading a low margin sale for a higher one. But if it's purely plus business, and not disruptive of other business, he's better off with it. Also, he might use the additional buying power to score better volume discounts or rebates from vendors, and keeping your loyalty might lead to more from you or friends you recommend.

At the very least, you should give him the option of taking the bite or passing.
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Old 04-20-16, 11:44 AM
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I've long wondered this myself, there is one by me that always offers to order me parts if they don't stock it. It never seemed to me that it would be quite that profitable, especially because most of what I am looking for isn't high value to begin with, but they always offer so I figure it must be in some way.

In any case, if I have to wait a few days for it to come in and drive back to pick it up, the convenience of buying locally goes completely away. I've got no problem paying a couple dollars more to walk in, touch it, and have it now, but if I am ordering from a catalog picture and waiting days anyhow, I just prefer doing it myself and have it sitting at my door.
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Old 04-20-16, 03:25 PM
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Anything my LBS normally stocks, including minor variants they can just add to their next distributor order, I buy from them. Other not that expensive bits no real profit, more trouble to them than worth I buy on-line. Tires and tubes are two of those things.
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Old 04-20-16, 03:54 PM
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Originally Posted by Hypno Toad View Post
I am very loyal to my LBS and have had mixed results from special orders. Most of the time, with common components (like tires), they can order through QPB and have the parts for me in a day or two. However, this spring I wanted some custom brake/shifters. QBP didn't carry this brand, the LBS tried to get set up as a distributor. It was a big time-drain for the LBS so I ended up ordering directly on-line.

So if the LBS can easily order the part, and it has a reasonable margin, I'd say it helps. It there's no margin or it's challenging to acquire, you're not doing them any favors.
Originally Posted by jefnvk View Post
I've long wondered this myself, there is one by me that always offers to order me parts if they don't stock it. It never seemed to me that it would be quite that profitable, especially because most of what I am looking for isn't high value to begin with, but they always offer so I figure it must be in some way.

In any case, if I have to wait a few days for it to come in and drive back to pick it up, the convenience of buying locally goes completely away. I've got no problem paying a couple dollars more to walk in, touch it, and have it now, but if I am ordering from a catalog picture and waiting days anyhow, I just prefer doing it myself and have it sitting at my door.
Originally Posted by ltxi View Post
Anything my LBS normally stocks, including minor variants they can just add to their next distributor order, I buy from them. Other not that expensive bits no real profit, more trouble to them than worth I buy on-line. Tires and tubes are two of those things.
That's me too. I like the guys at my local bike stores, I just don't buy from them very much. I make a lot of goofy modifications to my bikes. No LBS carries the particular parts that I want and I'm too particular to compromise. Almost every bike shop purchase turns out to be a special order.

I doubt the bike shop makes very much, if any, money off of my purchases. They have to have somebody look up whatever it is that I ordered. Then, when the order comes in, they have to have somebody sort through the order, pick out my special ordered parts and call me to say my parts are in. There's also a degree of idle chit chat time both when I place the order and when I pick it up. That's a lot of employee time involvement on usually a small dollar purchase.

For me ordering on line is always more convenient because I save two trips to the bike store. Shipping costs are generally washed out by not paying sales tax. I get to choose from a much wider range of products and, if I'm willing to pay the added cost, I can have virtually anything delivered to my door tomorrow. That's a business model that's hard to beat.
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Old 04-21-16, 05:56 AM
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Very interesting question!

Usually I do my research and then know very specifically what I want, which color, etc. (Helmets for instance) I feel like when I go to the bike shop for those items, they would always try to steer me in the direction of something they have in stock. So I usually just order online. I find it very uncomfortable to deal with a shop when they don't have that item I want.

Sometimes they are nice and offer to order it specifically for me though. I figure if they offer, it will make them money.

I do give local bike shops business when it comes to things where I dont care about the color etc. If I am in there for maintenance, I will pick up some spare tubes, lube, bottle cages, etc. I dont really care if I save 50 cents on a spare tube by ordering online.

Interestingly, a local bike shop owner told me recently that selling new bikes is actually a low profit margin business. He makes most of his money on repairs and accessories. Go figure.
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Old 04-21-16, 06:07 AM
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Normally in a retail price, the cost includes the shipping and any overhead. Sometimes that price is then marked up instead of just the cost of the unit. I know when I worked retail it was a pain to do special orders and would cost the owner more because there was more employee involvement.
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Old 04-21-16, 06:58 AM
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Your LBS may offer to get special orders in for you, even if it is at a small loss, if they think that it will build goodwill with you as a customer and in turn lead to repeat, and more profitable, business.
If they go out of their way for a small part, will you think of them first next time you want a new bike?
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Old 04-21-16, 07:10 AM
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At an LBS that I'm familiar with, special orders are considered a very important part their business. It's a big shop so economies of scale help. They're always ordering special parts for service too, of course. You pay list price and it's 100% refundable if the item is not what you wanted or expected.

If you want to support your LBS, give them the opportunity to order it for you. It's up to them to decide if it's worthwhile or not.
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Old 04-21-16, 07:23 AM
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Originally Posted by MuddyBikeRider View Post
I know when I worked retail it was a pain to do special orders and would cost the owner more because there was more employee involvement.
My LBS is never so busy that there isn't someone available to look up a couple of parts and add them to an order. I don't know how it could cost the owner more for someone to order my parts than to browse ****** on their phone, or sample the beer on tap, which is usually what they're doing when I get there!
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Old 04-21-16, 07:51 AM
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Originally Posted by kevindsingleton View Post
My LBS is never so busy that there isn't someone available to look up a couple of parts and add them to an order. I don't know how it could cost the owner more for someone to order my parts than to browse ****** on their phone, or sample the beer on tap, which is usually what they're doing when I get there!
Your LBS has beer on tap???

There is one that I would frequent!
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Old 04-21-16, 08:04 AM
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Originally Posted by jefnvk View Post
Your LBS has beer on tap???

There is one that I would frequent!
Yep. One of the owner's sons is a fantastic brewmaster, and they have several taps in the store. If you're in the area, it's Snitger's, in Beaver, PA. Great bike shop, and really good refreshments!
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Old 04-21-16, 09:35 AM
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Originally Posted by kevindsingleton View Post
Yep. One of the owner's sons is a fantastic brewmaster, and they have several taps in the store. If you're in the area, it's Snitger's, in Beaver, PA. Great bike shop, and really good refreshments!
My wife's been bugging me about taking a trip to Pittsburgh for some reason. Looks like I'm bringing the bike with me.
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Old 04-21-16, 09:50 AM
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Originally Posted by dr_lha View Post
My wife's been bugging me about taking a trip to Pittsburgh for some reason. Looks like I'm bringing the bike with me.
Eat before you come, then. Unless you enjoy french fries and cole slaw on EVERYTHING!
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Old 04-21-16, 09:54 AM
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Originally Posted by kevindsingleton View Post
Eat before you come, then. Unless you enjoy french fries and cole slaw on EVERYTHING!
As a rule, I don't live in Pennsylvania for the cuisine!
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Old 04-21-16, 03:54 PM
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Originally Posted by dr_lha View Post
As a rule, I don't live in Pennsylvania for the cuisine!
I grew up in PA. Took me decades to unlearn/undo the culinary damage.
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