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Originally Posted by Juha
(Post 10333628)
That's interesting. Around where I live, if one wants to advertise reduced prices, they'll actually have to have sold the product at the non-reduced price earlier. They cannot just grab the non-reduced price out of thin air and claim the "now" price is 70% or 400 EUR lower.
--J ShamWow. |
Originally Posted by billyymc
(Post 10332304)
I'm not sure why this issue bugs people. Go to your LBS and you'll see list prices on bikes, but no bikes are sold at those list prices.
I get the impression that the large majority of BD customers are satisfied with their purchases. There are a few very vocal people who've had some problems, and published the news on the internet -- including ONE site with a broken frame. Want to bet there are a few Trek's, Speccy's and Cdales out there with problems? I don't own a BD bike, but the next bike I buy I will very seriously consider one. |
Originally Posted by Toddorado
(Post 10324036)
It is well documented, and backed up by my reputable LBS that these (Motobecane/Dawes/Windsor) frames are made in the same places the big boys get their frames. .
I have a BD POS here. Based on the "Experts" it's made by Fuji. Based on the VIN sequence that's cast in at the factory it's not. Experts aren't always right, and those that espouse them frequently have their head up their ass :P |
Originally Posted by njkayaker
(Post 10332395)
If you aren't talking about comparable bikes (frame, drive train, wheels) then who knows what the heck you are saying here!
:roflmao2::innocent: The $600 Walmart Corsa FA bike (now $500) was originally $1000 in 2007! http://www.bicycleretailer.com/news/newsDetail/268.html The impication is that it is an Italian frame (I'm guessing it was assembled in Italy). Seems equivalent to this $700 BD bike. http://www.bikesdirect.com/products/windsor/fens_IX.htm Never once did I mention bikes are the same. Like every poster here one can only provide comparable alternatives based on price & components. It is very obvious now that you have comprehension issues or just bent on being argumentative. :innocent: But reading your post does make chuckle... keep it up! :) |
Originally Posted by dynodonn
(Post 10334618)
Just be aware that looking at a picture of a bike is no substitute for actually getting on a bike and riding it. I have one BD bike that I thought would really fit my needs, but when I received it, it ended up having considerable flex in the frame, wheels, fork and stem. In original condition, the BD would not compliment my riding style/conditions with the amount of flex that the BD bike originally had, and not only that, I had to repair shipment damage as well. With several upgrades, I was able to get rid of most of the bike's flexing issues, but I was not able to correct the flex that was in the frame itself. Needless to say, that the bike now hangs in the rafters until I find a better frame in which to transfer all the BD bike's components to.
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Originally Posted by [URL="http://www.bikeforums.net/member.php?101834-njkayaker"
njkayaker[/URL]]
The impication is that it is an Italian frame (I'm guessing it was assembled in Italy). A note on comparison of different bikes: It happens all the time, as there are sooooooo many manufacturers getting their bikes made in the same factories, and so many Taiwanese and CHinese companies making similar components and other products, it is very common (and not incorrect, IMHO) to compare a 105 equipped Specialized with a 105 equipped Trek with a 105 equipped BD bike with an (ugh) 105 equipped Megalo-Mart bike. When doing this comparison, however, you need to be concerned with more than the model name of the parts on the bike. Example: My brother bought a bikesdirect bike for my 11 YO nephew - and it was a pretty good looking bike - Alivio or Altus derailleurs, I think, Tektro cable disk brakes, aluminum frame - I think the price he paid was like $250 US + shipping - about $300 less than what a similar LBS bike would have cost in their town. But there are other things to factor in to the comparison.... things like the bottom bracket, handlebar/stem, and hubs (and other parts) are of unknown origin. ANd the welding looks like bird poop... but the bike has not broken, and is safe to ride to this day (my bro payed a LBS to assemble and continues to pay them to maintain it). Not identical to a LBS bike, but certainly not an unfair comparison. The fact of the matter is, there are comprimises in very low cost bikes compared to more expensive one, and you definitely pay for something when you buy a bike at an LBS - it is up to each and every one of us to decide what that something is worth when we go bike shopping. |
Another note on BD -
SOmeone in this thread mentioned receiving BD bikes with the wrong parts. I have heard of this very rarely... about as often as it happens with LBS bikes - seldom - but the bikes are assembled in the same Chinese factories as at least some of the big companies, and people are people and mistakes get made. Most of the stories I have heard about BD are about the cheap parts BD freely admits to speccing on the bikes fail, or the customers are surprised that the cheap parts are really as cheap as they are, and they gets a lesson in competitive marketplace economics - you get what you pay for (sometimes). There are probably dozens of reasonable CHinese and Taiwanese mfctrs now, where a decade or so ago there were maybe half or a third of todays companies capable of competeing in the western market. THe ones who make bikes and products you see in LBSs and at BD are the absolute cream-of-the-crop - for every nice Chinese bike product you see in an LBS or at a box store, there are probably ten similar products of such low quality that most of the Western product managers either laugh or turn their heads away in disgust or shame. |
Originally Posted by billyymc
(Post 10333538)
Fair enough Platy. The two local shops that I frequent -- one actually puts the MSRP on the tag, along with their price. The other doesn't, but they sure are aware of the MSRP and will even pull out their dealer catalog to show customers.
With the exception of iAnything, almost nothing is sold at MSRP in this world. So I disagree that the actual selling price should = the MSRP. I do agree with you that BD puts some pretty inflated MSRPs on most of their bikes though. I tend to ignore the MSRP and simply go straight to a comparison of components. People can argue frame quality all they want - but we don't have the details to really know the truth. I want my LBS to stay in business, make a profit, put food on the tables of the guys who work there, etc. But I work hard for my money as well, and if I'm getting a hardtail MTB for my daughter (like I did this past summer) I'm going to be very hard pressed to spend $750 or $800 on that Rockhopper in the LBS when I can get arguably more bike by going to, in my case IBEX bikes, and spend $500. Now...IBEX went out of business, so I coudl get a little burned. But my 11 y.o. daughter isn't likely to break the frame anytime soon and the components will all go on a new frame if she does -- and I'll still be less than that Rockhopper in total cost. There is simply too much price gap and not enough value add from the LBS to fill it in that situation. I asked if they could do better on price, they said no. I'm not sure where the tipping point would hve been -- the IBEX was normally sold for $600, with an MSRP of $750 (heh) -- so maybe if the delta was less than $100 in price I would have spent the extra and stuck with the LBS. If that doesnt' give the LBS enough profit margin, then the manufacturers need to revise their pricing model to get in line with the reality that their dealer network is suffering. A LBS is a business, not a charity. BUT -- I would very much look down on people who would go into their LBS to reap their knowledge and expertise, with no intention of buying product there. I've said it before, but direct sales will only continue to grow. A smart LBS will find a way to take advantage of that reality. At one of my former employers, we helped a guy for an hour to find just the right wetsuit for him. In the end, when we asked if he wanted to take it with him that day, he replied "Oh! No, I'm buying it online....I just needed to know which one to buy." A lot of people don't seem to understand that if online sales keep increasing, there won't be any stores left for them to take advantage of the staff's time for such things. I understand the allure of shopping online, believe me; I've done plenty of it, too. There's a big difference between buying a bike online and buying a motherboard online, though. Most of the BD bikes that I've seen are made by either Ideal/Fuji or Kinesis. I haven't actually seen any of the carbon bikes in person (except for the Bottecchia that I owned briefly), but I would guess they're made by ADK. All of those manufacturers make pretty nice frames. They also make some crappy ones. That applies to BD bikes AND LBS bikes. There are some bikes sold by major companies that I wouldn't stock in my store. It may not actually matter to the customer, but I don't feel comfortable selling a bike that has questionable welds on the frame. As such, my limit is $300. I don't sell any bikes that retail for less than $300. At that price point, you're getting a bicycle-shaped object, not a real functional bike. I just worked on a new BD Mercier yesterday. It was a Kilo TT with the "orange crush" colour. It looked pretty nice. The frame was Reynolds 520, and the welds looked good. He had me replace the chain with a white one, and he also wanted me to go over the bike. The only thing I really found was that there was almost no grease in the headset bearings. Lots of LBS bikes show up that way, too. Of course, we don't sell them that way, since you buy assembled bikes at an LBS. The only other thing I noticed was that after one ride of 2 miles, one screw on each of the toeclips had fallen out. Luckily, I had warned the kid about this, which is why he brought it in to me - after I had helped him pick out which one to buy. I know how much the kid makes, and I knew he needed a new bike. The closest I could come on a fixie that was worth building was $500. He couldn't afford that. So I sent him to BD. He seems happy, I made a little money (I charged him $15 for installing the chain, lubing the HS bearings, and tightening everything; including the new screws in the toeclips), and he'll send his friends in to the store. Sure, I didn't make the $100 I would have if I had sold him a fixie that I had built up, but I didn't have to build his bike, either. Or order the parts. |
Originally Posted by njkayaker
(Post 10330430)
http://www.fastcompany.com/magazine/77/walmart.html http://www.fastcompany.com/magazine/...n_snapper.html
Originally Posted by njkayaker
(Post 10330430)
One of the reasons they can do this is due to depreciation. Anyway, this is a well-known thing and if a customer wants to take advantage of it, they are free to do so (hopefully, the right size would still be available). |
Rogue Leader - depreciation is an accounting treatment. Bikes = inventory = assets = depreciable. The shop can probably depreciate x% of a bike for each year past it's model year. The depreciation helps them when tax time rolls around, the bike is worth less from an accounting perspective and so then can be sold for less without incurring a loss.
I think that's the general idea of how it works. Some accounting guru correct that if it's wrong. |
Originally Posted by billyymc
(Post 10337603)
Rogue Leader - depreciation is an accounting treatment. Bikes = inventory = assets = depreciable. The shop can probably depreciate x% of a bike for each year past it's model year. The depreciation helps them when tax time rolls around, the bike is worth less from an accounting perspective and so then can be sold for less without incurring a loss.
I think that's the general idea of how it works. Some accounting guru correct that if it's wrong. I don't think what you said was wrong at all, only misleading in the statement:"..without incurring a loss". |
Originally Posted by chewybrian
(Post 10338099)
The loss is still the same no matter the depreciation treatment. All that can be done is to move the impact of the loss from one fiscal year to another. You can realize the loss as depreciation in 2009, instead of a margin hit in 2010. The benefit is to postpone tax payment. You lower your profit in 2009, and therefore your tax bill. You can invest the difference, but the net profit, and the resulting tax bill, come back to you the next year. But, you get to keep the interest on the difference (less taxes again!).
I don't think what you said was wrong at all, only misleading in the statement:"..without incurring a loss". BUT -- all this is probably less important to a bike shop than cash flow. Ok, i will not talk about accounting on BF anymore! |
Originally Posted by billyymc
(Post 10338159)
Brian - I don't think the profit would come back to you next year necessarily...
The only benefit to the shop is that they can take the tax they would have paid on the $100, say $30, and invest it in the interim, maybe getting a couple bucks in interest. It doesn't matter if they sell the bike above or below book, the net impact is the same. |
Ponder this. Even if you take the bike down to it's components, there are still people assembling things that aren't really qualified. Do you think ALL of the people on the line at the derailluer making company, know or care, what they are doing? Do you think there are two lines, one for the cheapo groupset and one for the top of the line? Monday morning look around at work. If your business was instead building bikes, would you want everyone helping on yours? This discussion came up yesterday. As more large employers succumb to layoffs and fold, there are less places for the incompetent to hide.
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Originally Posted by billyymc
(Post 10338159)
Then they have a depreciated asset, ...
Ok, i will not talk about accounting on BF anymore! Also, it's a BIG mistake that many businesses make to focus on the profitability of a single transaction. With last years' model it's generally better for a shop to dump it just before the new models come in, and preferably to someone that would not be buying the new model. The benefit is that they can usually recoup their cash outlay to invest in new inventory and may sell accessories at a nice profit. |
Originally Posted by chewybrian
(Post 10338099)
The loss is still the same no matter the depreciation treatment. All that can be done is to move the impact of the loss from one fiscal year to another. You can realize the loss as depreciation in 2009, instead of a margin hit in 2010. The benefit is to postpone tax payment. You lower your profit in 2009, and therefore your tax bill. You can invest the difference, but the net profit, and the resulting tax bill, come back to you the next year. But, you get to keep the interest on the difference (less taxes again!).
I don't think what you said was wrong at all, only misleading in the statement:"..without incurring a loss".
Originally Posted by billyymc
(Post 10338159)
Brian - I don't think the profit would come back to you next year necessarily. The business should get the benefit of lowered taxes in the year they have the depreciation expense. Then they have a depreciated asset, which the can sell and either make a profit (pay tax on), breakeven (no tax), or sell at less than the depreciated value (take a loss). I don't know what the depreciation would be on a bike, but I bet a good accountant would be able to justify an accelerated depreciation method instead of simply a straight line one -- so maximize the tax benefit up front, and possibly allow the depreciated asset to be sold at a much discounted price and still (on an accrual accounting basis) make a profit in the next year.
BUT -- all this is probably less important to a bike shop than cash flow. Ok, i will not talk about accounting on BF anymore!
Originally Posted by chewybrian
(Post 10338169)
Yes, the NET profit would definitely roll back on you when you sold the bike the next year. If you book it at $900 instead of $1000, then you avoid paying tax on $100 in 2009. But, if you sell it for $2000 this year, you will make $1100 profit instead of $1000, meaning you now owe the tax you avoided the year before.
The only benefit to the shop is that they can take the tax they would have paid on the $100, say $30, and invest it in the interim, maybe getting a couple bucks in interest. It doesn't matter if they sell the bike above or below book, the net impact is the same.
Originally Posted by rogerstg
(Post 10338252)
Good idea;). FYI, a business can't depreciate inventory so the whole depreciation discussion is moot.
Also, it's a BIG mistake that many businesses make to focus on the profitability of a single transaction. With last years' model it's generally better for a shop to dump it just before the new models come in, and preferably to someone that would not be buying the new model. The benefit is that they can usually recoup their cash outlay to invest in new inventory and may sell accessories at a nice profit. LOL a lot of accurate stuff was said though about depreciating assets, lots of people know their accounting here, just missed that one fine point hehe. And you're also right, better to have that positive cash flow to get more new items in stock then let a pile of year old bikes sit in the back that noone wants to buy cause they can get the 2010 at the same price. However, they still only broke even or lost money, keep doing that and you are using that cash flow to keep the lights on as opposed to getting new bikes in. |
RL, that is funny. I am not an accountant (obviously). I understand the basics of depreciation and how it would affect the bottom line. But I got involved in the discussion without thinking that inventory would be a short term asset. Doh! You can depreciate a deep fryer, but not a donut, even if you wait 20 years to sell it!
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Originally Posted by chewybrian
(Post 10338738)
RL, that is funny. I am not an accountant (obviously). I understand the basics of depreciation and how it would affect the bottom line. But I got involved in the discussion without thinking that inventory would be a short term asset. Doh! You can depreciate a deep fryer, but not a donut, even if you wait 20 years to sell it!
PS the company I work for is a large international consumer and business product company... The thought of having to find a way to depreciate our extremely varied inventory on top of depreciating the normal assets we have would make me quit LOL. |
I was hoping to see more posts by people who actually ride BD or WalMart bikes in here.
Seems like the general consensus is: - Supporting LBS is a good thing, but LBS isn't a charity and everyone has their own budget / needs and threshold on how much more they'll pay at an LBS (also considering LBS services that you don't get online) - It's VERY nice to be able to ride a bike before buying it - Walmart / BD frames PROBABLY aren't as nice or advances as the higher-end Giant/Specialized/Whatever frames - Walmart saves money by only making 3 sizes and buying massive quantities AND by not providing any support, warranty, test-rides, or full assembly. I don't really think it matters if BD is posting an outrageous fake "list" price. Who cares? What matters is if the bike is worth what they're charging. To some it is, to others it isn't. They've balanced it out so that they can stay in business. Anyway, I took a big risk and ordered a Corsa FA. I buy plenty of stuff at my LBS, but I wasn't prepared to spend $1200+ on a 105-equipped bike. I'm well aware that the brakes, wheels, etc. on the Walmart bike aren't the greatest and that the frame MIGHT be crappy. If it turns out to be a real piece of junk I can just buy a frameset and wheelset, move over the other components (which I'm sure are exactly the same as any other 105 parts) and still come out under $1000. It's practically impossible to find ANY information about the Corsa frames. There is no geometry information and I haven't been able to find any forum posts about the quality or weight. It's a big gamble that I wouldn't blame anyone for not wanting to take. |
Sam - it is a mistake to put BD bikes in the same category as Wallymart bikes. Not even close.
BTW, if I needed/wanted to buy a bike from a big box store -- Target actually gets an occassionally decent bike in its mix. |
Originally Posted by billyymc
(Post 10357946)
Sam - it is a mistake to put BD bikes in the same category as Wallymart bikes. Not even close.
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to respond to the original post, my experience(s) were good. Ordered a cross bike for my old man who has 10k worth of road bikes from our LBS, and he wanted a beater to try cross on, and he wanted it now, handed me his CC and said order it. It arrived in 5 days and was packaged well, was as described etc, and after assembled and tuned up, no problems
I rode that bike for a couple hundred miles, and ordered the same frame style (diff component set) in a size that i knew would work for me. I was able to do this 'confidently' because i had found my fit on a borrowed BD bike, decided i needed 1 frame size up (1-1.5cm in the top tube), and bingo, i got a bike that fits well, and a 2nd great experience with BD |
Originally Posted by billyymc
(Post 10357946)
Sam - it is a mistake to put BD bikes in the same category as Wallymart bikes. Not even close.
BTW, if I needed/wanted to buy a bike from a big box store -- Target actually gets an occassionally decent bike in its mix. Then again, the Corsa FA is $200 cheaper than the comparable BD bike (Fens) and is not on the same level as $150 GMC Denali Walmart bikes. Part of my choice was that my curiosity got the better of me. |
Originally Posted by nivekdodge
(Post 10338178)
Ponder this. Even if you take the bike down to it's components, there are still people assembling things that aren't really qualified. Do you think ALL of the people on the line at the derailluer making company, know or care, what they are doing? Do you think there are two lines, one for the cheapo groupset and one for the top of the line? Monday morning look around at work. If your business was instead building bikes, would you want everyone helping on yours? This discussion came up yesterday. As more large employers succumb to layoffs and fold, there are less places for the incompetent to hide.
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Originally Posted by PlatyPius
(Post 10336966)
I just worked on a new BD Mercier yesterday. It was a Kilo TT with the "orange crush" colour. It looked pretty nice. The frame was Reynolds 520, and the welds looked good. He had me replace the chain with a white one, and he also wanted me to go over the bike. The only thing I really found was that there was almost no grease in the headset bearings. Lots of LBS bikes show up that way, too. Of course, we don't sell them that way, since you buy assembled bikes at an LBS. The only other thing I noticed was that after one ride of 2 miles, one screw on each of the toeclips had fallen out.
Luckily, I had warned the kid about this, which is why he brought it in to me - after I had helped him pick out which one to buy. I know how much the kid makes, and I knew he needed a new bike. The closest I could come on a fixie that was worth building was $500. He couldn't afford that. So I sent him to BD. He seems happy, I made a little money (I charged him $15 for installing the chain, lubing the HS bearings, and tightening everything; including the new screws in the toeclips), and he'll send his friends in to the store. Sure, I didn't make the $100 I would have if I had sold him a fixie that I had built up, but I didn't have to build his bike, either. Or order the parts. |
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