Koyote

Well you did write this in post #45 : "In fact, I'll go so far as to say the shop in question seems to be exploiting the customer, when evidence was provided that a dozen others have the same, much lower price."

CliffordK

As I pointed out above, there are two different concepts.
..
We often get an MSRP, and see dealers offering for less than the MSRP, especially with cars.

MAP, on the other hand is considered price fixing in some countries, and is illegal, but the practice is legal here in the USA.

“Minimum advertised pricing is not legal in either the UK or Europe as it infringes the Competition Act in the UK and the general EU provisions concerning competition law in the EU. Essentially, any agreement between a manufacturer and distributors as to pricing is caught by these provisions. Competition law demands that there be free pricing by all competing in a market. Any attempt to set pricing is caught by the competition law provisions.”

Unless the dealer is actually publishing the MSRP (in which case they will come in below it), then it may be difficult to discern the MSRP. However, if the manufacturer has an online store, they will almost always sell at the MSRP, and thus, any retailer can sell for the same price, or less than the manufacturer sells it direct.

HerrKaLeun

I have to mark sarcasm better.

I hate this outdated distribution system where artificial barriers keep inefficient and expensive supply chains alive at the expense of the customer. Region restrictions pricing, MAP. ..... All don't belong in the 21st century.

Just buy online and install yourself. That's what they want anyway. If you want to support the LBS, you can send them the cost difference.

phughes

You seem to have a decent attitude towards the shop. Talk to them, and ask about the price. It may have been a mistake. Talking to them sure seems like it would be more productive than debating it here. Once you do, let us know what the end result is. Good luck.

CliffordK

What about the lawyers that bill for elevator time, and bill two or more clients concurrently for the same time?

Another thing that happens in many industries is billable time vs non-billable time. So, the plumber may have billable time when they're actually in the house, but if they are waiting for a call, or on a slow day, they don't get billable time. Transportation? Restocking?

Then there are issues with say company billable rates vs wages. So, your local mechanic may bill for $100 an hour, but pay the mechanics substantially less.

Nonetheless, they have to pay the mechanics for non-billable time, vacation, sick leave, as well as paying for the shop and tools.

CliffordK

A couple of years ago I stopped at a local bike shop and got hit for $8 for a tube. And, I wanted to order some brake pads, but they didn't have the right ones, and wanted to sell pads that didn't fit properly in my calipers, saying the ones I needed weren't available... yeah, right... I think I did end up buying a pair of tubes for $16, but that was the last time I've been in that shop.

Most other stores/shops I've seen had been selling tubes for about $5 each. And my pads were bought on E-Bay from Europe.

Now I generally pay around $1 to $2 for standard tubes online.

c0rbin9

Where I live we have a lot of mobile bike mechanics that will come to you. The prices tend to be lower than an LBS, they have no problem installing customer-supplied parts, and I dare say they perform better work since their only job is repair. I don't know why anyone in a major city would even go to an LBS these days.

One thing that irks me about these threads is that when people complain that something is too expensive, sometimes justifiably, people respond by saying "well yeah, but you should pay extra to support your local bike shop". If the shop needs charity to stay in business, their enterprise is not an effective use of resources and they shouldn't be in business at all. Markets work because everyone is trying to get the lowest price possible, there is no charity required.

Bmach

Sram lists msrp and the GX is $125. I have never paid msrp at any bike shop. This shop is a rip off. The better your prices and service is the more people that will walk through your door. The more people that come through your door the more you make. Maybe it is because it is a new shop and he has not learned the ropes but with those prices he won’t last long enough to learn the ropes.

Oneder

If it was a set small dollar figure over msrp or set small % like 5% and it were a very expensive city then I might see it. It seems more like random and extortionist prices to me and it's hard to believe anyone is supporting this nonsense.

downhillmaster

Based upon this thread, everything you post is best thrown away

indyfabz

So...How much do you get paid?

dedhed

A retail consumer shouldn't, or doesn't care, whether their vendor is buying the item they want from QBP, Merry sales, SRAM directly, or Joe's Parts. They do care about their vendors pricing, and will comment if they feel that the price is out of line with similar vendors. Ultimately they will decide with their pocketbook whether convenience, speed, support, quality, or price is their greatest concern.

asgelle

They can comment on the price relative to other vendors, but until they understand a shop's wholesale cost, they shouldn't comment on the fairness of the price. Sure, say LBS is charging 20% more than mail order; just don't say the LBS is marking up 20% more unless you know what the shop had to pay for the item in the first place. It's hardly out of line for the LBS to have an equal or lower margin than mail order because of a higher price from the shop's distributor.

ZHVelo

We have to decide what market we want LBS's to be in - selling goods or selling service (mechanical/knowledge/expertise). And LBS have to decide that for themselves.

The irony in my eyes is that these shops can see prices online, too...So in theory they, if they don't have a piece, just order it online, charge a minor markup and charge a price for their labor fixing it once it is there.

The problem they face right now is overhead costs - they have to pay rent. They have to have certain inventory in stock. Online sellers they can just have anything, buy bulk, and store it somewhere cheap and ship. There is no competition there. And I don't think that's bad. It means cheaper prices to end consumers.

To me it is clear that the way forward is not that LBS are supported by well-meaning customers paying more for parts just so the LBS can cover overheads. The future is in small inventories of necessities and the most commonly bought parts (if only to have a customer be able to look at something, and be advised what is needed, have one example and have other options explained, and that is then ordered) and providing a service and advise and expertise, as well as one key part - the equipment. If you really wanted to do everything at home, you'd need to invest in the right equipment. Might be worth it for some, but I dare say not for most.

So yea, I think a store selling something way above what you can get elsewhere, they deserve to lose business. They should charge the same and if they are good and friendly, charge enough for the service, for the mechanics, for the friendly service. For that I am sure many people will even be happy to pay. But not for some random part for which the LBS anyway is just a middleman.

Koyote

I have a fave shop. They have always treated me exceptionally well: they do good work, they stand behind it, they work hard to make me happy - even when it diminishes their profit. When I take in a bike for work, or order something through them, I don't even ask for a price estimate. Maybe I could get a few items for a few bucks less by shopping online -- but when things go sideways, my shop will be there for me.

asgelle

Most people don't understand that they can't do this. Under the distributor agreement, they must order through the distributor when possible; usually at prices well above manufacturers wholesale and often above mail order retail.

ZHVelo

What are these agreements and why do online companies not have them?

In any case, the next best is "listen, get it online, come in and we install it for you". If these agreements are a way of manufacturers to try and squeeze profit from customers, then a) **** that and b) why are they selling so much cheaper to online sellers, allowing people to circumvent it.

Edit: If am being too direct with the questions, I am not having a go at you for this, I am just very surprised that this is how it works. These dynamics are quite mindboggling.

OhLylo

That stinks. I went to my LBS a while back looking for an esoteric part. It took a little bit of fiddling for us to figure out if they had it, but they didn't have it in their inventory system (it was a BB tool adapter for Shimano that usually comes packaged with the BB). I pulled it up on Jenson USA and that's how much they charged me. Very reasonable.

I like my LBS and I try to support them, but I don't think paying a 25+% markup on MSRP is in the realm of reasonable. Have you asked if they'll price match?

CliffordK

I've heard the argument that wholesale prices in the USA are sometimes equal or higher than online retail prices.

In some cases the argument makes sense. Want a part next day, and one needs a wholesaler that can get it delivered to the shop.

In other cases it doesn't make sense. For example the $8 tubes at the LBS... (is that getting more widespread ) If I can purchase tubes for $2.38 online without much hunting. . Is that bulk packaged? The box doesn't really matter when installed in the tire.

So, the LBS is doing a 336% markup on stock items.

One may well be able to get better bulk prices on Alibaba. Perhaps down to $1 each if one buys a bunch.

And it matters... a lot... keep customer satisfaction up and the shop will keep customers. Lose customer satisfaction, and one loses customers.

Oneder

When a shop consistently has 5% or 10% over msrp (not online prices) then it may be due to their supply chain and them being not able to get wholesale. When one item is 15% over and another 50% over it's just someone being ripped off. Possibly not even with the knowledge of the shop owner but by the employee himself.

SlvrDragon50

Lmao. Yes I missed it.

This exactly.

Sy Reene

However, what you seem to be missing is that from the original example, half of the options for purchasing online, are from LBSs who had enough initiative to also have created a web storefront. Or at the very least, we have no evidence that all of those shops that also sell online are obtaining their merchandise for a lot lower price than the OP's LBS, or an explanation on how they got these great deals? (that they also can offer with free shipping somehow)

unterhausen

I have noticed that most of the online prices on Shimano stuff is basically a few pennies off of MSRP, so I can get it cheaper from my LBS. Not sure about SRAM. My lbs rewards my loyalty and they make sure I don't make mistakes when I buy things so I only buy through them. In general, they need the few $ extra I might spend more than I do.

This seems to have engendered a lot of bitter back and forth and I deleted a couple of posts. If your post is only about another member here, it's probably against the rules. So don't post it. Thanks. I hate reading threads about LBS's and if I have to do it again there is going to be some bitter moderating going on.

Homebrew01

OK FOLKS, No Need to get Personal.

CliffordK

I'm not sure if any of the Eugene shops have large mailorder fronts.

Some of the Portland shops do.

BikeTiresDirect.com is just a LBS up in Portland, as is UniversalCycles.com

Universal Cycles appears to carry the SRAM SX Eagle Rear for $85 (available for pickup in their store in Portland).

However, the companies that have chosen to do both a LBS and an online store front are able to move much more bulk through than the smaller Mom & Pop LBS stores, potentially reducing their stocking prices and increasing inventory. As well as improving employee utilization.