LBS Pricing?
#27
Senior Member


Joined: Feb 2007
Posts: 15,410
Likes: 188
From: Tariffville, CT
Bikes: Tsunami road bikes, Dolan DF4 track
On the 20%, I think the original reply was intended to say that "I'd ask for 20% off the aero bars", not "20% off the bike". Maybe I missed any clarification on that but that was my take on it.
Margins on higher end bikes are pretty low. Consider that it takes, probably, $65 income per employee per hour to run a profitable shop. I don't know rent in other areas but if I could have gotten that amount that would have been pretty good. To clarify, although I charged that rate, I didn't always collect it. Okay, I almost never collected it, except for tune-ups, wheel builds, and flat fixes. And bikes under ~$400.
To sell, fit (even a "free" fit), assemble, etc a high end bike may take 4-6 hours. The "free" tune-up, although good for the customer and the shop, will add to that time. Take margin off for extra work like swapping stems or cable housing or cassettes etc. Some of that work results in wasted/unusable parts, like bar tape, already-cut-housing, already cut cables, even a chain (if you change gearing significantly).
LBSs can sell bikes at a discount if they got it at a discount. Two ways that happens - manufacturer discounts, or employee discounts.
The best way to get a deal at an LBS is to buy a bike they want to get rid of - then they'll set a discount and you two can go from there. You can also inquire about getting blow out deals from the distributor, but I think this year won't have too many opportunities for that. I bought a $1200 bike for my brother through a now defunct shop. I was good friends with the owner, asked about any scratch and dent offers through his distributors with a certain level component group. He let me look (no time off his back), I found a bike for $300 with a scratched fork, crank, and frame. Since my brother commuted on his bike and we wanted to keep the frame the same (stealth), it was a good deal. I paid the dealer $500 for the bike (what I thought was a fair margin, and I insisted on that amount). The dealer combined shipping to get free shipping, and I did work on the bike myself. The dealer made $200 in about 30 minutes. We got a great deal on a bike kit. And although it's in there somewhere that the dealer has to assemble his bikes and this one didn't, he sort of did - I'd go into the guy's shop and do repairs, build bikes, etc for free, so I was sort of a guy working there. Sort of.
If you find an extremely busy store with an extremely busy employee with an extremely nice bike, chances are that that bike is in pristine condition (never ridden, assembled with no regard to schedule, etc). Ask about that bike. He got it at employee discount, doesn't care about margin, and may be able to get another beautiful bike for the price that you pay him for his. Usually the manager or a guy in charge of one part of the shop is a good candidate. The owner is too, but usually they'll still have "margin" on their heads, at least a little bit.
cdr
Margins on higher end bikes are pretty low. Consider that it takes, probably, $65 income per employee per hour to run a profitable shop. I don't know rent in other areas but if I could have gotten that amount that would have been pretty good. To clarify, although I charged that rate, I didn't always collect it. Okay, I almost never collected it, except for tune-ups, wheel builds, and flat fixes. And bikes under ~$400.
To sell, fit (even a "free" fit), assemble, etc a high end bike may take 4-6 hours. The "free" tune-up, although good for the customer and the shop, will add to that time. Take margin off for extra work like swapping stems or cable housing or cassettes etc. Some of that work results in wasted/unusable parts, like bar tape, already-cut-housing, already cut cables, even a chain (if you change gearing significantly).
LBSs can sell bikes at a discount if they got it at a discount. Two ways that happens - manufacturer discounts, or employee discounts.
The best way to get a deal at an LBS is to buy a bike they want to get rid of - then they'll set a discount and you two can go from there. You can also inquire about getting blow out deals from the distributor, but I think this year won't have too many opportunities for that. I bought a $1200 bike for my brother through a now defunct shop. I was good friends with the owner, asked about any scratch and dent offers through his distributors with a certain level component group. He let me look (no time off his back), I found a bike for $300 with a scratched fork, crank, and frame. Since my brother commuted on his bike and we wanted to keep the frame the same (stealth), it was a good deal. I paid the dealer $500 for the bike (what I thought was a fair margin, and I insisted on that amount). The dealer combined shipping to get free shipping, and I did work on the bike myself. The dealer made $200 in about 30 minutes. We got a great deal on a bike kit. And although it's in there somewhere that the dealer has to assemble his bikes and this one didn't, he sort of did - I'd go into the guy's shop and do repairs, build bikes, etc for free, so I was sort of a guy working there. Sort of.
If you find an extremely busy store with an extremely busy employee with an extremely nice bike, chances are that that bike is in pristine condition (never ridden, assembled with no regard to schedule, etc). Ask about that bike. He got it at employee discount, doesn't care about margin, and may be able to get another beautiful bike for the price that you pay him for his. Usually the manager or a guy in charge of one part of the shop is a good candidate. The owner is too, but usually they'll still have "margin" on their heads, at least a little bit.
cdr
#28
Senior Member
Joined: Aug 2007
Posts: 296
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And yes, I do work at a shop which luckily for me has a no haggle policy.
The only time we consider coming down on a bike is when it has sat collecting dust for a year and we need the space. If you don't mind getting a year old model, you can generally get a good price without too much negotiation this way.
Good luck finding a bike that suits your needs and a shop which you are happy and confident in
#29
Member
Joined: May 2008
Posts: 32
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Lol
#31
Mitcholo
Joined: Aug 2006
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From: Oost Vlaanderen in mind, Cleveland in body
Bikes: 2010 Mitcholo w/ Sram Force/Red
Don't like our prices? Go to Wal-Mart or another local shop where build quality and service are non-existent.
#32
Senior Member

Joined: May 2004
Posts: 1,225
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The shop I bought my Soloist Team from just up and offered me a $250 discount to take it off their hands; I walked in expecting to pay full MSRP for it. MSRP was $2000 at the time, and I paid $1750 with some upgraded parts. This was about a year ago.
I gather that they had had this particular one kicking around their shop for a while, though.
#33
Senior Member
Joined: Apr 2009
Posts: 310
Likes: 0
From: Seattle, WA
Bikes: Cervelo R3, Trek 6500, Brompton M6R, Dahon Speed D7, TidalForce S-750 custom, Breezer Uptown
My LBS (small chain) wouldn't deal much in pricing (basically from 0 to maybe $100). On the S1, they implied that they would be willing to deal a little bit but not much.
I did end up finding a much more reputable shop (basically one of the best in the region) who worked with me and ended up giving me an 18% discount which I felt was awesome ($3500 bike for $2880) that comes with lifetime fitting (as opposed to 1 yr by my local shop), etc. The only downside is that this shop is 100 miles away but they have some great routes over there so I drive out there every now and then anyway.
If your local shop is not willing to budge on price, you should look around for a better deal. The economy isn't so good and I'll be that these bikes are harder to move. I was also looking at the Cervelo S1 and their price to me was $1820. They may not go that low anymore (it was a special promotional day) but I'm pretty sure that they will go down to $2000 on that bike.
I did end up finding a much more reputable shop (basically one of the best in the region) who worked with me and ended up giving me an 18% discount which I felt was awesome ($3500 bike for $2880) that comes with lifetime fitting (as opposed to 1 yr by my local shop), etc. The only downside is that this shop is 100 miles away but they have some great routes over there so I drive out there every now and then anyway.
If your local shop is not willing to budge on price, you should look around for a better deal. The economy isn't so good and I'll be that these bikes are harder to move. I was also looking at the Cervelo S1 and their price to me was $1820. They may not go that low anymore (it was a special promotional day) but I'm pretty sure that they will go down to $2000 on that bike.
#34
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Joined: Aug 2005
Posts: 12,769
Likes: 38
From: Rocket City, No'ala
Bikes: 2014 Trek Domane 5.2, 1985 Pinarello Treviso, 1990 Gardin Shred, 2006 Bianchi San Jose
It's called Mutally Agreed Pricing and it's to protect the dealerships. If a large dealer can undercut the others, he'll steal all the business. After a while, he's the only guy selling that brand. It can be hard to set up a network of dealers without MAP.
It is also useful in keeping jack@sses from test riding bikes and wasting a bike shop's time and then buying the bike elsewhere for less money.
It is also useful in keeping jack@sses from test riding bikes and wasting a bike shop's time and then buying the bike elsewhere for less money.
#36
#37
I'm a network consultant. Part of my job is going to small companies, doing network audits, and writing up a proposal for that company to address the issues we found in the course of the audit. Sometimes we get the work, sometimes we don't, and sometimes they use our quote to price shop and play other company's quotes trying to get what they need for the best price. We understand we need to provide the most compelling proposal based on thoroughness, service, and, yes, cost. Sometimes we get the work at a higher cost because the company determines we're a better fit for them than another provider. Do we get bent out of shape when we lose a proposal or know that folks use us to price shop? Well, it's not fun and yes we "waste" time when that happens but it's an essential part of our business or any other business.
Face it, if nobody walks though the bike shop door for a test ride they aren't going to sell a lot of bikes. The goal then should be to convince the customer when you have them there that the only logical decision is to buy from you. But referring to people as jack@sses because they might not buy from you because you couldn't (or wouldn't) provide them a compelling reason to do so may be the reason you're not selling them in the first place. From your description it sounds as you're describing a very confrontational selling style, "Test ride this bike ONLY if you intend on buying it from us." That's not going to get anybody anywhere.
I don't know if you work at an LBS, but it sounded like you did...
#38
The Truth
Joined: Apr 2006
Posts: 2,289
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From: Miami
Bikes: Felt f4c, Felt RXC, Guerciotti Khaybar,Guerciotti EM-2, Cervelo P-3.
That's rather arrogant. If you have a bike, at the best price, compel me with the service you provide, and have knowledgeable, friendly employees why would I go elsewhere? If you're missing one of those shouldn't you fix it or expect business to go elsewhere?
I'm a network consultant. Part of my job is going to small companies, doing network audits, and writing up a proposal for that company to address the issues we found in the course of the audit. Sometimes we get the work, sometimes we don't, and sometimes they use our quote to price shop and play other company's quotes trying to get what they need for the best price. We understand we need to provide the most compelling proposal based on thoroughness, service, and, yes, cost. Sometimes we get the work at a higher cost because the company determines we're a better fit for them than another provider. Do we get bent out of shape when we lose a proposal or know that folks use us to price shop? Well, it's not fun and yes we "waste" time when that happens but it's an essential part of our business or any other business.
Face it, if nobody walks though the bike shop door for a test ride they aren't going to sell a lot of bikes. The goal then should be to convince the customer when you have them there that the only logical decision is to buy from you. But referring to people as jack@sses because they might not buy from you because you couldn't (or wouldn't) provide them a compelling reason to do so may be the reason you're not selling them in the first place. From your description it sounds as you're describing a very confrontational selling style, "Test ride this bike ONLY if you intend on buying it from us." That's not going to get anybody anywhere.
I don't know if you work at an LBS, but it sounded like you did...
I'm a network consultant. Part of my job is going to small companies, doing network audits, and writing up a proposal for that company to address the issues we found in the course of the audit. Sometimes we get the work, sometimes we don't, and sometimes they use our quote to price shop and play other company's quotes trying to get what they need for the best price. We understand we need to provide the most compelling proposal based on thoroughness, service, and, yes, cost. Sometimes we get the work at a higher cost because the company determines we're a better fit for them than another provider. Do we get bent out of shape when we lose a proposal or know that folks use us to price shop? Well, it's not fun and yes we "waste" time when that happens but it's an essential part of our business or any other business.
Face it, if nobody walks though the bike shop door for a test ride they aren't going to sell a lot of bikes. The goal then should be to convince the customer when you have them there that the only logical decision is to buy from you. But referring to people as jack@sses because they might not buy from you because you couldn't (or wouldn't) provide them a compelling reason to do so may be the reason you're not selling them in the first place. From your description it sounds as you're describing a very confrontational selling style, "Test ride this bike ONLY if you intend on buying it from us." That's not going to get anybody anywhere.
I don't know if you work at an LBS, but it sounded like you did...
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Sean Kelly is a god, sure a god that I can't understand a word he is saying, but a god nonetheless.
#39
Thread Starter
Senior Member
Joined: Sep 2008
Posts: 118
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This has turned into an interesting discussion. What surprises me most is the anger shop owners/workers seem to have toward customer (assuming the posters on this board are somewhat representative of the industry).
#40
Thanks. I'm no Marketing guru but 12 years of doing this job has taught me a lot. It's the intangibles that generally get you or lose you business. Everyone in a certain industry offers pretty much the same "stuff" (be that services or products)...how they deliver, support, and service it/them is the big differentiator.
#41
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Joined: Aug 2005
Posts: 12,769
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From: Rocket City, No'ala
Bikes: 2014 Trek Domane 5.2, 1985 Pinarello Treviso, 1990 Gardin Shred, 2006 Bianchi San Jose
It's not price fixing. That's when competing companies get together and set prices. MAP is when the manufacturer(Trek, Specialized, Cervelo, Cannondale, etc.) tell their dealers what the prices are. They can and do make deals so the pricing isn't written in stone.
You missed my point entirely and went off on a rant about your job instead.
A brick and mortar bike shop can't compete on price with somebody selling bikes over the internet. The shop could have the best mechanics and sales staff that knows just how to set up a bike and make sure it fits you perfectly and then let you test ride it for an hour. They then show you how to adjust the gears, brakes, etc. and spend a great deal of time educating you on that bike. Then you say "Thanks" and walk out to go buy the same bike off that internet site.
Just as your company can't charge for audits and quotes, the bike shop can't charge for that test ride service, even though it takes time and effort. The customer just used the bike shop; acted like a jack@ss.
You missed my point entirely and went off on a rant about your job instead.
A brick and mortar bike shop can't compete on price with somebody selling bikes over the internet. The shop could have the best mechanics and sales staff that knows just how to set up a bike and make sure it fits you perfectly and then let you test ride it for an hour. They then show you how to adjust the gears, brakes, etc. and spend a great deal of time educating you on that bike. Then you say "Thanks" and walk out to go buy the same bike off that internet site.
Just as your company can't charge for audits and quotes, the bike shop can't charge for that test ride service, even though it takes time and effort. The customer just used the bike shop; acted like a jack@ss.
#42
#43
Senior Member
Joined: Aug 2007
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As other posters have indicated, you are not only buying a bike from a shop, you are buying the service as well. For example: At the shop where I work, we offer free on-bike adjustments($40) (braking, shifting, minor wheel true, etc) for as long as the customer owns the bike, as well as a free fitting($60/hr). Now that it is spring, as you can immagine-people are pulling their Huffys out of the garage, so we are super backed up on repairs (2.5 weeks or so). If you bought a bike from us, however, We generally do any minor repairs within a day or two, then you get your bike back. It doesn't matter how nice your bike is, if you didn't get it from us, the work gets put on the board for the next open day.
I can't decide for anyone else, but being able to get repairs done quickly forever is worth paying a few hundred dollars more initally. And depending on your situation, that money would be spent on repairs and fitting for your internet-bought (nothing wrong with it if you're happy) bike anyway.
#44
.


Joined: Aug 2005
Posts: 12,769
Likes: 38
From: Rocket City, No'ala
Bikes: 2014 Trek Domane 5.2, 1985 Pinarello Treviso, 1990 Gardin Shred, 2006 Bianchi San Jose
I think most people do appreciate the extra service that a good bike provides and will do their shopping there even if it means paying a bit more.
The guys that throw out low ball quotes just to get the job usually don't last too long, either.
Except in government work.
The guys that throw out low ball quotes just to get the job usually don't last too long, either.
Except in government work.
#45
#46
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Joined: Sep 2007
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From: Looking for my right leg muscles.
Bikes: 2000 Cannondale CAAD3 Triple 105/Ultegra
A lot of the times prices aren't written in stone. You just have to give the LBS a reason to give you a deal. If they know that you aren't loyal, why give you a deal? But if you are the person that come in, knows every person in the shop by their first name, bring in beer occasionally, buy all your stuff from there, you may just get that deal you are looking for without even asking. To stock Specialized for example, the shop has to move $xx,000 worth of bikes a year. The shop may give you a deal on a new bike on the floor so they can be a large part of the way to that number without having that bike stay in inventory for a long time. Be nice to your LBS and they will be nice to you. Expect a deal while shopping for everything else online, well, you saved your money on your online purchases--you may have to pay full, or near full price on your bike.
#48
personally I bought a cervelo S1, I tried to beat them up on the price, they did however have a 2008 model and I could have saved 300 bucks on it but the size was wrong, I ended up getting the 09, they did throw in pedals and bottle cages and cut me a deal on a computer. before I committed to the S1 I test rode a carbon specialized tarmac, he came off 500 bucks on that bike so it was a tough choice. buy the specialized and save some money or pay what seemed like full price for a cervelo. after riding the cervelo I couldnt even go to the specialized, it was day and night difference in bikes. I really wanted to get carbon too, or at least I thought. I am way happy about my choice. I think they are committed to the price on the bike but if you beat them up they will probably hook you up on shoes pedals etc.
#49
If you are dead set on trying to get a discount on a bike I would walk in with CASH. Credit Card company's take a percentage of every sale so if you can save the LBS that cost he may be more willing to work with you.
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#50
Senior Member
Joined: Mar 2007
Posts: 190
Likes: 1
find out if the city you live in has a bike coaltion. I joined my citys bike coalition for 30 dollars and you get 10% of bikes & accesories with alot of participating shops.
I just purchased a CAAD9 5, around here they are popular and selling out fast. I was able to get 10% and saved 130 dollars even though the employess didnt know about the program and they got on the phone with the owner or someone, to approve 10% one of thier best selling bikes. The shop also sells Cervelos which i could of saved alot more on.
for the record, I dont recommend joining a bike coalition solely for a discount, Ive meet some awesome people and have done some really cool volunteer work. I never knew outreach would be something i really enjoyed doing.
I just purchased a CAAD9 5, around here they are popular and selling out fast. I was able to get 10% and saved 130 dollars even though the employess didnt know about the program and they got on the phone with the owner or someone, to approve 10% one of thier best selling bikes. The shop also sells Cervelos which i could of saved alot more on.
for the record, I dont recommend joining a bike coalition solely for a discount, Ive meet some awesome people and have done some really cool volunteer work. I never knew outreach would be something i really enjoyed doing.




