Market Research (sort of): An Alternative to BikesDirect?
 

If there were an alternative to bikes direct; without the ripped-off brands, sketchy marketing, ugly graphics, and so-so customer service, would you purchase a bike from them?

The reason I ask, is while I think bikes direct has its place, the company could be portrayed so much better. While this is sort of dreaming, I’m thinking of creating a bike company similar in business model to BD, but more legit feeling.

Custom designed frames (aluminum and carbon), understated yet clean eye-pleasing graphics, a quality company image, and good customer service.

The product line wouldn’t be complex like BD’s; it would probably consist of 2 or 3 carefully designed frames, with a choice of build kit for each, with pricing similar to BD.

Do you think that there is a market for this?
Would you buy a bike from me providing I can deliver the product as promised?

I appreciate any input. (I'm starting to get the entrepreneurial itch again!).

Thanks,

es

I would but you'd need to be able to provide the bang for the buck aspect.

Is there a market? Yup. Sure.

You know what Bikesdirect's real asset is though? Their relationship with the manufacturers who are building them those bikes.

Just who do you send that first check for $10,000 (or $100,000? I really don't know) to when you need them to ship your first set of frames? How do you trust them not to completely hose you deliberately or through poor quality control?

Anyway, seems like a really good way to make a small pile of money out of a large one, like any entrepreneurial venture. But if you decide to go for it, best of luck!

Maybe you can consult with Pedal Force?? :D

bike direct is also good for its variety. 2 to 3 frames probably won't be as well received as youthink.

Bikes Direct probably buys in bulk - way more than a small hole in the wall shop. So they are able to offer aggressive pricing. Their main selling point is value.

If you call a manufactuer and are wanting to spend 3-5k they will probably refer you to a distributor that maybe sells you a product a few bucks than what you can get on ebay. I'm guess in some cases they'd charge more than ebay prices since they would expect you to resell their merchandise at retail in order to make a profit.

Did I say what resources I have available? I would assume that I would have to buy at least 50 frames to get started. Additionally, a bike shop's margins are around 50%. If a manufacturer can offer that to a local bike shop, then a frame factory isn't going to be selling frames to a wholesaler for ebay prices.

es

I would, but custom designed frames, my choice of groupset, etc...these are variables that always raise cost.

Personally, I love BD bikes....I bought 3 from them and know many people who did...and no one ever felt they got scammed or felt they bought a lesser quality product than what local bikeshops offer.

I'm sorry but 50 frames means a couple of removes from the manufacturer. Even the smaller companies demand at least an order of 100. Start doing your numbers with 100 frames as the starting point and way more than that if you want your own design.

Good luck though.

Great idea. My suggestion before you even start is to go to work for a place like Bikesdirect. You can get first hand experience of how they work. Looking in from the outside is a lot different than being on the inside. Good luck

Tim

+1

Vertr,

PM your resume to Mike. I'm sure he needs someone to man the customer service department. ;)

:roflmao:

You are a very bad boy....

Isn't that what Performance is?

This topic comes up every now and again . . .
First off, if you allow different groups on different frames or any type of customization, there goes your pricing. This is how Mike sells these bikes at prices that are often lower than just the group on the bike. He makes a deal to have a frame made. He makes a deal to get the group. He makes a deal to get the rest of the parts. He makes a deal to have an overseas shop put all this together in a relatively small box and it hops on a boat for the US. BD never opens these boxes. The go somewhere until they ship to you.

This is why he IMHO is successful - it is a niche market. Sell a bike so cheap that even if you have to change out a few parts on your own for fit (and sell the stuff on ebay) you are still ahead.

As far as the names, I agree with you - the old names do nothing for me. However, Mike is savvy and he says that the names help sell. I stripped all my stickers and put on www.bikesdirect.com decals.

Aren't there a couple of companies like this already? Airborne...err...Flyte...err whoever they show up as next seems to be struggling with the concept. Ibex seems to be doing better.

The issue is the time/money it costs to design and test something rather than use a factory's off the shelf designs like Bikesdirect.com does. Now the graphics/naming issue is another one all together. I know Mike will argue that Motobecane is his hottest selling "brand" and that there are people that search it out (um yea sure) but the fact is that if he had started from the begining with some original name rather than the names ripped from old companies they should have gotten to the same place with the same quality product.

The common advice I've heard and in turn give about just about any foreign manuf. & import business is:

If you want to make a million dollars, start with two.

IMHO Flyte WAS this company of which you speak. Perhaps you could track Jamie down and ask why they went out of business...

BikesDirect is the king because of price. If you can't beat their prices (which you can't if you want to start adding the things you mentioned), then you're just another company like Fezzari offering no-name bikes at a price that can be beat elsewhere.

I think Flyte was pretty much what you are describing, but look what happened there. Then again, I'm not sure if Flyte went out of business for a lack of demand or for other reasons.

If you want to compete with BD you're going to have to have prices very close to theirs, and I'm not sure how you'd do that.

A agree. I just ordered my second BD bike. Customer service has been satisfactory (I got what I paid for with no problems), and brands and graphics aren't that important to me. Unless you can match Mike's prices, I'd have no reason to consider your product. It sounds like you're competing for a different customer base.

I loved my Flyte. Sucks to see them disappear. :(

bikes direct could revamp their website. it looks like the coupon section in the newspaper, which gives it a illegitimate feeling.

but, you're getting the same quality bike as any LBS. it's all the same frames and components anyway. you're just getting it partially assembled shipped directly to you with a different decal on it. and that is what is saving you perhaps as much as $500 or more.

I think we'd need to know the depth of your experience in the bike biz, or some other sort of commodity sales, to know if this will really take off. I hate to say it, but if you're using Bike Forums as your primary means of market research, that in and of itself doesn't look good... ;)


Probably not. Ibex, which others have mentioned, basically hits this niche. But unlike some folks, no matter what the price: if I can't test ride it, I won't buy it.


If no one knows who you are, and you don't have years of frame-building experience, how will people know or learn about the reputation of your work? How do you enforce quality control? How's your insurance? Are you prepared in case you get sued? Who will do the graphics and the website? (Good branding design isn't cheap, y'know....) Where do you store your inventory? Are you protected against theft? And how will these items impact your costs?


People are always looking for a bargain (or more precisely, cheap crap). Unfortunately, what you will quickly learn is that the less your customers are willing to pay, the more demanding the customer gets. Most of the customers will take the low-cost bike and be happy, but the ones who are unhappy will do everything in their power to utterly ruin your day. (Including bad-mouthing your business on Intarweb forums. ;) )

Also, the less you charge, the more your potential customers will presume that your bikes are not only low cost, but low quality as well. ("How else can this guy sell such cheap bikes?")

I think you will have to find a very specific niche in order for this to work. If you do a custom frame, you need to know frames in and out and up and down; you need to know how to run a business; how to work the word-of-mouth angle. It can be done, but the field is kind of crowded, so it won't be easy to build a truly viable business.

On the website . . . and most of you know I am a huge BD.com fan . . . I do agree that some money and effort would be well spent to improve the website. It really does look cheap and sort of sketchy. To be honest when I first found it I thought scam. It took a month or 3 of me reading everything I could find on them (on this and other sites) and MANY emails back and forth with them before I was willing to shell out $1500.
I am sure a lot would not have spent that effort to overcome their first reaction.

Now, I know they want to keep overhead low and I get that. I am not saying it has to be a top end site with all types of cutting edge features. Just a more polished and professional image.

I agree...here in San Diego

see

Ibex and others do what you suggest. A better plan would be to sell eveything for bikes but not bikes at a discount. Bikes are the low margin part of the industry. Accessories, apparel and parts are the high margin part of it. That's why Nashbar and others do their business there primarily and only secondarily in complete bicycles.

I've looked into it myself. A major obstacle is the distributors who want you to have a store before opening account. This is to protect retail stores from this very sort of thing. I almost opened a store of sorts just to open up the service of supply but I got distracted by other things and lost interest because I didn't really want to have a bicycle retail store that wasn't designed to do anything but be there. I just wanted to sell accessories and parts on an internet web site and be done with it. It may be doable without a store but it would take some time and patience to get it going. I think I could have managed it. I just lost interest. I still have the URL's for the web sites.

I do some importing from China. It isn't particularly difficult. The Chinese manufacturers are all geared toward helping Americans import their products so they are really pretty easy to work with. I handle it all by Email and electronic funds transfers. I may take a trip there next year but, then again, I may not. I find the Chinese manufacturers to be honest and efficient. Prices are dirt cheap.

It shouldn't be too hard to find some products that you can put your brand name on in order to get started. I don't know who or where the Chinese bicycle part manufacturers are since I'm in a different industry.

Taiwan is a little different. There you need an agent to watch after your business with the manufacturers. The agents are paid by the manufacturers but the costs, obviously, are built in to what you pay. It is a much more organized and sophisticated manufacturing community than the wild and wooley mainland Chinese operations. If you go around the system, you will end up paying for that. I haven't gotten involved with any imports from Taiwan yet. I may next year. The quality and pricing there is higher than on the mainland.

My sincere advice. Don't get into the complete bicycle business. Get into the bicycle accessory and part business if you can.