how much does a big manufacture sell carbon frame to bike company

Discuss light weight issues concerning road bikes & parts.

audiojan
Posts: 772
Joined: Fri Jan 27, 2006 1:38 pm
Location: New Hampshire

by audiojan

Cost has nothing to do with the selling price of the frame... Any manufacturer (that wants to stay in business...) will price the frame in relationship to positioning on the market and the prevailing market price.
"Suddenly the thought struck me; my floor is someone elses ceiling" - Nils Ferlin

by Weenie


User avatar
53x12
Posts: 3762
Joined: Fri Sep 15, 2006 6:02 am
Location: On the bike

by 53x12

audiojan wrote:Cost has nothing to do with the selling price of the frame... Any manufacturer (that wants to stay in business...) will price the frame in relationship to positioning on the market and the prevailing market price.


Cost has nothing to do with it? You obviously don't work in manufacturing or sales. There is a reason why companies like Felt and Canyon are able to offer comparable offerings to the big names at cheaper prices. There is a reason why Hyundai and Kia are able to offer comparable offerings to he big names at a cheaper price in the automotive world. If you have cheaper labor costs, less money being spent on PR and marketing, you have a lower cost associated to the item price and are able to pass that price savings on to the consumer. Cost has a big portion to play with selling price of the frame.
"Marginal gains are the only gains when all that's left to gain is in the margins."

audiojan
Posts: 772
Joined: Fri Jan 27, 2006 1:38 pm
Location: New Hampshire

by audiojan

53x12 wrote:
audiojan wrote:Cost has nothing to do with the selling price of the frame... Any manufacturer (that wants to stay in business...) will price the frame in relationship to positioning on the market and the prevailing market price.


Cost has nothing to do with it? You obviously don't work in manufacturing or sales. There is a reason why companies like Felt and Canyon are able to offer comparable offerings to the big names at cheaper prices. There is a reason why Hyundai and Kia are able to offer comparable offerings to he big names at a cheaper price in the automotive world. If you have cheaper labor costs, less money being spent on PR and marketing, you have a lower cost associated to the item price and are able to pass that price savings on to the consumer. Cost has a big portion to play with selling price of the frame.


Hmm... I've only been working with pricing for 20+ years, so what do I know?!

No, cost doesn't have anything to do with selling price. It has EVERYTHING to do with margin. Selling price should not be based on your manufacturing cost, it has to be based on market price and product positioning. Think about it this way, as a consumer, do you care what a manufacturers cost is? Probably not... what you care about is the perceived value you get when you purchase a product.
"Suddenly the thought struck me; my floor is someone elses ceiling" - Nils Ferlin

User avatar
53x12
Posts: 3762
Joined: Fri Sep 15, 2006 6:02 am
Location: On the bike

by 53x12

audiojan wrote:
53x12 wrote:
audiojan wrote:Cost has nothing to do with the selling price of the frame... Any manufacturer (that wants to stay in business...) will price the frame in relationship to positioning on the market and the prevailing market price.


Cost has nothing to do with it? You obviously don't work in manufacturing or sales. There is a reason why companies like Felt and Canyon are able to offer comparable offerings to the big names at cheaper prices. There is a reason why Hyundai and Kia are able to offer comparable offerings to he big names at a cheaper price in the automotive world. If you have cheaper labor costs, less money being spent on PR and marketing, you have a lower cost associated to the item price and are able to pass that price savings on to the consumer. Cost has a big portion to play with selling price of the frame.


Hmm... I've only been working with pricing for 20+ years, so what do I know?!

No, cost doesn't have anything to do with selling price. It has EVERYTHING to do with margin. Selling price should not be based on your manufacturing cost, it has to be based on market price and product positioning. Think about it this way, as a consumer, do you care what a manufacturers cost is? Probably not... what you care about is the perceived value you get when you purchase a product.


I've been working in manufacturing and sales for +30 years. Cost has a big portion to play in selling price as that is how you get to your margin. Without taking cost into the equation to determine selling price, you end up as an out of business business. The all in cost for a manufacturer has everything to do with where they price their product at to get their profit margin. Keep going on about cost having nothing to do with the selling price of a product.
"Marginal gains are the only gains when all that's left to gain is in the margins."

topflightpro
Posts: 800
Joined: Tue Jan 13, 2009 2:35 am

by topflightpro

53x12, you might want to look at the costs of items from those manufacturers. Hyundais and Kias are now a lot closer to Honda and Toyota than you might imagine. It really surprised me when buying my wife's car how expensive they'd become. And Felt isn't really any cheaper than Specialized or Trek. And as I think about it, I'm not sure I know of another company currently offering a bike for $25k like Felt.

wwnick
Posts: 106
Joined: Wed May 10, 2017 8:49 pm

by wwnick

audiojan wrote:Cost has nothing to do with the selling price of the frame... Any manufacturer (that wants to stay in business...) will price the frame in relationship to positioning on the market and the prevailing market price.


just to get my original post back on track, i have no interest in the selling price of the frame.

wwnick
Posts: 106
Joined: Wed May 10, 2017 8:49 pm

by wwnick

lol. and now to go completely off topic myself :shock:

virenque wrote:https://cyclingtips.com/2017/05/200-bikes-and-a-lot-of-cash-what-it-costs-a-bike-brand-to-sponsor-a-worldtour-team/


i read that article and to me it sounded complete gibberish.

he says the prices for sponsorship went up when all the big companies left cycling forever? wtf?
other points were valid but writing style, wtf? cyclingtips has turned into a hipster site. as much as everyone hates cyclingnews there is a reason it is #1

wwnick
Posts: 106
Joined: Wed May 10, 2017 8:49 pm

by wwnick

wwnick wrote:
audiojan wrote:Cost has nothing to do with the selling price of the frame... Any manufacturer (that wants to stay in business...) will price the frame in relationship to positioning on the market and the prevailing market price.


just to get my original post back on track, i have no interest in the selling price of the frame.

oops, i really need to read my subject post again... apologies

but the selling price to bike company, rrp is not so hard to find

User avatar
53x12
Posts: 3762
Joined: Fri Sep 15, 2006 6:02 am
Location: On the bike

by 53x12

topflightpro wrote:53x12, you might want to look at the costs of items from those manufacturers. Hyundais and Kias are now a lot closer to Honda and Toyota than you might imagine. It really surprised me when buying my wife's car how expensive they'd become. And Felt isn't really any cheaper than Specialized or Trek. And as I think about it, I'm not sure I know of another company currently offering a bike for $25k like Felt.



The Hyundai and Kia vehicles provides more standard features for their price compared to their rivals that have those as additional options.

Felt FR FRD @ 685 grams for $3500 vs.

heavier Specialized S-Works Tarmac for $3800
heavier Trek Emonda SLR for $4000
heavier Cannondale SuperSix Evo Hi-Mod for $3500
heavier Cervelo R5 for $4500

or

Felt FR F1 @ 765 grams for $2000 vs.

heavier Specialized Tarmac Pro for $3000
heavier Cervelo R3 for $2000....etc.

So yes, the Felt is significant cheaper than the competition, especially when you look at what you get for your money.

When you talk about a $25k Felt bike, you also need to reference that with a limited made and track specific frame. That TA FRD isn't made for us Joe Blows. It is designed for Olympic teams and Olympic hopefuls. Even their $12k AR FRD comes with a full set of Zipp race wheels, power meter...etc. So that is why using frame sets is the best way to compare pricing as a frameset is a frameset when compared against each other and you don't need to control for how the bike is spec'd out.
"Marginal gains are the only gains when all that's left to gain is in the margins."

Post Reply
  • Similar Topics
    Replies
    Views
    Last post