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Saw this severing of Specialized's ties with a LBS

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Saw this severing of Specialized's ties with a LBS

Old 09-11-21, 01:44 PM
  #26  
chaadster
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Originally Posted by PeteHski View Post
It's the cancelling of 400 existing orders that I don't really understand. I got the impression that's what surprised Mike's Bikes too.
Whatís the option? Mikeís ordered the 400 units; itís not 400 people who ordered from Specialized. Specialized probably donít know who ordered what or have contact info for them, but most importantly, we know they donít have their money because Mikeís said they have it in the letter. So whatís Spesh supposed to do? Sell the bikes through an unofficial dealer channel? Of course not. They had no choice but to cancel the orders, and evidenced by the way Mikeís is throwing Spesh under the bus, they made the right call; it would have been even messier any other way.
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Old 09-11-21, 01:44 PM
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Sounds like you are an unsecured creditor to the bike shop if you pre-order for a bike & pay interesting.
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Old 09-11-21, 02:29 PM
  #28  
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Originally Posted by chaadster View Post
They had no choice but to cancel the orders
Of course they had a choice. Presumably those bikes had been ordered by Mike's when they were still a Specialized dealer right? The money is available to pay for them, so Specialized could have simply supplied those remaining bikes and refused to accept any further new orders.
But instead Specialized decided to cancel all outstanding orders. I'm guessing they simply don't have any stock available in the near future and cancelling makes their life a bit easier, while inflicting maximum damage to their ex-dealer.

I don't have a dog in this fight (never even heard of Mike's Bikes), but it seems like sour grapes to me.
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Old 09-11-21, 03:49 PM
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Originally Posted by PeteHski View Post
Of course they had a choice. Presumably those bikes had been ordered by Mike's when they were still a Specialized dealer right? The money is available to pay for them, so Specialized could have simply supplied those remaining bikes and refused to accept any further new orders.
But instead Specialized decided to cancel all outstanding orders. I'm guessing they simply don't have any stock available in the near future and cancelling makes their life a bit easier, while inflicting maximum damage to their ex-dealer.

I don't have a dog in this fight (never even heard of Mike's Bikes), but it seems like sour grapes to me.
But thatís my point, that the choices were all worse outcomes; there was no better choice that I can imagine.

I detailed upthread just a few of the problems created with other choices, but youíve not proposed any alternate pathway, so I donít know what more to tell you. And if you think it would be anything other than foolish for Spesh to furnish bikes to an unofficial dealeró at what, dealer prices?ó then I really donít know what to tell you. And what incentive is there for Pon to ink the deal with Mikeís while turning over the sale of hundreds of bikes to another company?

To be sure, I donít **** about the actual deal, contractual obligations, or monies involved in any of this, so Iím just considering and talking biz basics here, but if you can weave a viable counter narrative where Spesh doesnít cancel the orders, do explain it for me.
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Old 09-11-21, 04:37 PM
  #30  
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So much speculation in this thread about what Spesh did or didn't do, and so much lack of knowledge of contract law as well.

Lots of Specialized haters beatin on Specialized while having no real knowledge of what exactly was going on between it and Mike's.
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Old 09-11-21, 06:19 PM
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Originally Posted by chaadster View Post
But thatís my point, that the choices were all worse outcomes; there was no better choice that I can imagine.

I detailed upthread just a few of the problems created with other choices, but youíve not proposed any alternate pathway, so I donít know what more to tell you. And if you think it would be anything other than foolish for Spesh to furnish bikes to an unofficial dealeró at what, dealer prices?ó then I really donít know what to tell you. And what incentive is there for Pon to ink the deal with Mikeís while turning over the sale of hundreds of bikes to another company?

To be sure, I donít **** about the actual deal, contractual obligations, or monies involved in any of this, so Iím just considering and talking biz basics here, but if you can weave a viable counter narrative where Spesh doesnít cancel the orders, do explain it for me.
I simply don't see how Specialized are going to be very popular with those 400 customers who now have cancelled orders. They won't care why Specialized cancelled them. But I don't know anything about Mike's Bikes or the contract they had with Specialized. So I'm out.
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Old 09-11-21, 06:31 PM
  #32  
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Originally Posted by PeteHski View Post
I simply don't see how Specialized are going to be very popular with those 400 customers who now have cancelled orders. They won't care why Specialized cancelled them. But I don't know anything about Mike's Bikes or the contract they had with Specialized. So I'm out.
On the flip side, those same 400 are maybe wondering what the point was in giving Mike's the full selling price in advance, if it never even made it out of their shop and to Specialized.
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Old 09-11-21, 06:49 PM
  #33  
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Originally Posted by Sy Reene View Post
On the flip side, those same 400 are maybe wondering what the point was in giving Mike's the full selling price in advance, if it never even made it out of their shop and to Specialized.
That's not how it works. A customer's deposit becomes pre-paid income to the retail store. The money doesn't go to the supplier/manufacturer. Once the product is delivered to the retailer, the retailer must pay the supplier/manufacturer's invoice on the terms specified in the contract between the retailer and supplier/manufacturer.

The "order" is between the retail customer and Mike's. Mike's order is then placed with Specialized. When Mike's receives the product it ordered from Specialized, then it pays Specialized. When Mike's sells the product to its customer, then it collects its money from the customer. Deposits placed by the retail customer never becomes the property of the supplier/manufacture, and the supplier/manufacturer never receives that money.

If Specialized cancelled Mike's orders, it was likely because Mike's did something to breach its contract with Specialized. Since Mikes likely sold its business to PON in the form of an asset sale, Specialized probably had a right to cancel its contract with Mike's since the Mike's Bikes entity would no longer be in business. Mike's Bikes put itself in a position where it could not deliver on its promises to its customers. That is not Specialized's fault.
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Old 09-11-21, 06:56 PM
  #34  
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Originally Posted by Mojo31 View Post
That's not how it works. A customer's deposit becomes pre-paid income to the retail store. The money doesn't go to the supplier/manufacturer. Once the product is delivered to the retailer, the retailer must pay the supplier/manufacturer's invoice on the terms specified in the contract between the retailer and supplier/manufacturer.
That's not how what works? I think we're saying the same thing. The full payment for a bike in advance, does NOTHING for the purchaser in getting a bike any sooner. An order into the manufacturer from whatever shop, is just like any other order. Specialized it seems, has no idea which orders were prepaid, vs which only had deposits. So Mike's taking full payment, was all on them -- and not sure what, if any, promises were made to customers to get them to pay in full at time of order.
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Old 09-11-21, 07:04 PM
  #35  
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Originally Posted by Sy Reene View Post
That's not how what works? I think we're saying the same thing. The full payment for a bike in advance, does NOTHING for the purchaser in getting a bike any sooner. An order into the manufacturer from whatever shop, is just like any other order. Specialized it seems, has no idea which orders were prepaid, vs which only had deposits. So Mike's taking full payment, was all on them -- and not sure what, if any, promises were made to customers to get them to pay in full at time of order.
Yes, you are correct. The burden is on Mike's to take care of its customers. Those customers are not Spesh's customers.

I was more addressing those who have posted that Spesh may owe Mike's customers something. It does not.
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Old 09-11-21, 07:12 PM
  #36  
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Originally Posted by Mojo31 View Post
Yes, you are correct. The burden is on Mike's to take care of its customers. Those customers are not Spesh's customers.

I was more addressing those who have posted that Spesh may owe Mike's customers something. It does not.
ok. Though I think both parties could have behaved better and worked something out. Specialized had 400 customers (albeit through an intermediary and they maybe don't know who they are) who in general aren't going to be exactly happy (with anyone or either party).
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Old 09-11-21, 09:37 PM
  #37  
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I'm just struggling with the whole "hand over some cash and not get a bike then and there" thing.
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Old 09-12-21, 03:44 AM
  #38  
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Originally Posted by znomit View Post
I'm just struggling with the whole "hand over some cash and not get a bike then and there" thing.
A lot of bikes are on crazy back-order. A few shops have suggested that I need to order a bike now if I want to see it by the middle of next year. So they would naturally want a deposit to secure the order. The days of just buying whatever bike stock is in the shop are over - unless you really don't care what bike you end up with.
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Old 09-12-21, 03:47 AM
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Originally Posted by Sy Reene View Post
ok. Though I think both parties could have behaved better and worked something out. Specialized had 400 customers (albeit through an intermediary and they maybe don't know who they are) who in general aren't going to be exactly happy (with anyone or either party).
That was my thought too. Ultimately both Specialized and Mike's will lose customer goodwill by Specialized cancelling those orders. Especially as bikes are now so difficult to get hold of.
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Old 09-12-21, 05:05 AM
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Specialized once sued a bike shop called The Roubaix Cycling Studio in Canada for copyright infringement. As if they themselves hadn't "borrowed" the name. Between their corporate antics and Trek's throwing LeMond under the bus over Lance Armstrong, I've never bought a Specialized or Trek. Never will.
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Old 09-12-21, 05:50 AM
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Originally Posted by PeteHski View Post
A lot of bikes are on crazy back-order. A few shops have suggested that I need to order a bike now if I want to see it by the middle of next year. So they would naturally want a deposit to secure the order. The days of just buying whatever bike stock is in the shop are over - unless you really don't care what bike you end up with.
That's great that giving them your money now lets them see clearly through the devolving labour, materials and supply chain uncertainties all the way into the middle of next year.
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Old 09-12-21, 05:58 AM
  #42  
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Originally Posted by znomit View Post
That's great that giving them your money now lets them see clearly through the devolving labour, materials and supply chain uncertainties all the way into the middle of next year.
Have you been living under a rock since the end of 2019?
There are very few bikes currently in stock and everything I would have been interested in buying is sold out until 2022 in my size. Nobody is giving exact time frames for delivery next year, but people are getting in line with their deposits.

It is not a normal situation.
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Old 09-12-21, 07:00 AM
  #43  
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Originally Posted by PeteHski View Post
Have you been living under a rock since the end of 2019?
There are very few bikes currently in stock and everything I would have been interested in buying is sold out until 2022 in my size. Nobody is giving exact time frames for delivery next year, but people are getting in line with their deposits.

It is not a normal situation.
A deposit is one thing. Eg. a 20-25% deposit or thereabouts I guess can make sense. In this Mike's story, however, the letter anyway is written intimating that payment in full was made.
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Old 09-12-21, 07:50 AM
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Reporting from Bicycle Retailer about the sale of Mike's

UPDATED: Bay Area retail powerhouse Mike's Bikes sold to Pon Group, the owner of Santa Cruz and Cervelo | Bicycle Retailer and Industry News

The new owner of Mike's

Pon Bike - We are one of the top five players in the global bicycle industry
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If this thread doesn't go 10 pages I'm quitting BF.
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Old 09-12-21, 09:17 AM
  #45  
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Specialized has a long history of not being a welcome player in the bike world. I was oblivious to this until I read of the law team contracted by Specialized going after a small shop in a small town in Canada for using the name Roubaix. This despite Specialized not owning the name but leasing it from the parent of Fuji. (Someone learned of this, posted it and it went viral.) While this was current news, I heard about them going after a bikeshop in Maryland, shutting down a small Portland outfit and forcing a Portland wheelbuilder to rename her operation. Basically the bully in the playground. The law barely applies to protect bike shops. None of them can afford to contest a cease and desist letter from Specialized with its basically unlimited deep pockets.

Specialized has lost me as a customer (of parts and clothes; I was never likely to buy one of their bikes). They've lost me as a kind or even neutral voice towards them who is someone listened to by some in bike circles. This by their deliberate choices.
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Old 09-12-21, 09:41 AM
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Not sure why the hate for Specialized. Mikes was a dealer for Specialized and must have known selling their shop to a direct competitor would result in the cancellation of the dealer agreement. It was Mike’s which screwed over their customers as well as assisted in the deterioration of the local bike shop model. It is almost impossible for a locally owned bike shop to compete against a factory store, access to credit, training, marketing as well as preferential pricing give huge advantages to the corporate shops. The real disappointment should be with Pons as well as Mike’s.
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Old 09-12-21, 09:47 AM
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Originally Posted by Atlas Shrugged View Post
Not sure why the hate for Specialized. Mikes was a dealer for Specialized and must have known selling their shop to a direct competitor would result in the cancellation of the dealer agreement. It was Mikeís which screwed over their customers as well as assisted in the deterioration of the local bike shop model. It is almost impossible for a locally owned bike shop to compete against a factory store, access to credit, training, marketing as well as preferential pricing give huge advantages to the corporate shops. The real disappointment should be with Pons as well as Mikeís.
But it's still 400 bikes that Specialized cancelled the sales on. That's money that may be directed to their competitor now.
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Old 09-12-21, 09:55 AM
  #48  
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Originally Posted by Sy Reene View Post
But it's still 400 bikes that Specialized cancelled the sales on. That's money that may be directed to their competitor now.
Regardless, either Mikes is a dealer or not and unfortunately Mikes in conjunction with Pons knowingly put themselves in a situation to have their dealer agreement terminated. I am sure Pons did some fancy math and guessed how many of those on the wait list could be converted to their products and Specialized will retain some as well through their existing dealer network. Itís like someone cheating on their spouse then blaming the faithful partner for breaking up the family.
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Old 09-12-21, 10:16 AM
  #49  
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Originally Posted by Atlas Shrugged View Post
Regardless, either Mikes is a dealer or not and unfortunately Mikes in conjunction with Pons knowingly put themselves in a situation to have their dealer agreement terminated. I am sure Pons did some fancy math and guessed how many of those on the wait list could be converted to their products and Specialized will retain some as well through their existing dealer network. Itís like someone cheating on their spouse then blaming the faithful partner for breaking up the family.
I guess, though as a manufacturer, why not just look at it as 'sales are sales. If our competitor wants to own a shop that is selling a lot of our product and no more of their own, that's hilarious; we're still getting the revenue back at the home office.' I do wonder if Pon would have from their side had no issue if Mike's continued indefinitely selling Specialized bikes?
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Old 09-12-21, 12:23 PM
  #50  
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From the article:

"Nothing is going to change around here. They like who we are and what we are and our culture and that's what they want," Martin said on the video. "If we didn't tell anybody, no one would know the difference."

hmm...
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