Why are tires so much more expensive in the US

Discuss light weight issues concerning road bikes & parts.
ryker
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Joined: Sun May 19, 2013 1:01 am

by ryker

I think retailers can sell for whatever they want but, by some agreements, cannot /advertise/ lower prices.

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WMW
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by WMW

martinSL wrote:The monopoly survives only because people are willing to support it.


They have no choice if they want service or to purchase at a local shop. I wouldn't call that "willing". And the shop owners *really* don't have a choice... they are the ones being screwed the hardest by this.

Yes of course, since the monopoly only covers the US market and sophisticated consumers have the option of buying overseas, the monopoly may collapse. But another thing that could happen is collusion among distributors all over the world, so that EU prices rise.
formerly rruff...

by Weenie


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WMW
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by WMW

User Name wrote:I figure shops should get tyres where ever they can, then sell them for prices that are competitive with online dealers, even if it's just to get people like me going back to bike shops semi-regularly.


The US *wholesale* price is often higher than UK retail. Selling at a "competitve price" means selling at a loss. If you owned a business like a B&M bike shop that services locals you'd know that you need to mark up parts 50% plus just to stay in business. It sucks all around.

Sure you are limiting sales because your prices are high, and you could do more volume if you cut the markup in half... but then you'd need a bigger building, more stock and more staff, and the math doesn't work out... and you still can't compete with UK prices.
formerly rruff...

Pharmstrong
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Joined: Sun Jul 22, 2012 7:17 pm

by Pharmstrong

WMW wrote:But another thing that could happen is collusion among distributors all over the world, so that EU prices rise.


You all appear to be forgetting that in the EU we pay another 20% on these prices you lot find so attractive. Thankfully we have real competition laws in the EU that would not allow such price fixing.

jmpsmash
Posts: 2
Joined: Wed Nov 21, 2012 11:01 am

by jmpsmash

US distributors practice what is called the MAP price, Minimum Advertised Price. basically they tell the retailers they are not allowed to advertise under the specified price. it is supposed to keep the pricing premium to protect the brand and retailers are happy to oblige as it preserve their fat margins. this is why we often see retailers listing items at very similar prices.

as for the legality of it. no idea.

Zigmeister
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by Zigmeister

Yes, and that is the problem, they can't advertise a lower price. Even if they can sell it lower...but that means you still need to get customers to come to your site and somehow skirt around that pricing...like Add to Cart to see pricing etc...you see often.

But, most people searching wouldn't go to that extent to find the best price, they see the Web listed price when they search, and boom, they are on Wiggle/PBK etc...and get the best price, even with shipping, instead of having to play the game of trying to find somebody who will sell it lower, even online, in the US.

I mean, can you really get a GP4000S tire in the US for $39 to your door bought from the US??? PBK can do it, and that is where I get my stuff often, like tires.

So....sadly for US retailers/Online sellers here. Nature of the beast, all brought on by the manufacturers and legal threats.

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mellowJohnny
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by mellowJohnny

Try buying Assos kit from Wiggle or PBK with a Canadian shipping destination - all products are hidden. Switch to a EU country and voila! Perfect example of Assos protecting their retailers from geographic price discrepancies available via the magic of online shopping.

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AGW
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Location: Tucson, AZ

by AGW

Pharmstrong wrote:
WMW wrote:But another thing that could happen is collusion among distributors all over the world, so that EU prices rise.


You all appear to be forgetting that in the EU we pay another 20% on these prices you lot find so attractive. Thankfully we have real competition laws in the EU that would not allow such price fixing.


I don't like US prices in the cycling market either, but calling it price fixing is naive. Manufacturers are free to dictate their minimum prices and retailers are free to carry another product if they don't wish to uphold that agreement. More laws to "protect" the consumer market from basic economics don't help.

sawyer
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by sawyer

AGW wrote:
I don't like US prices in the cycling market either, but calling it price fixing is naive. Manufacturers are free to dictate their minimum prices and retailers are free to carry another product if they don't wish to uphold that agreement. More laws to "protect" the consumer market from basic economics don't help.


In Manufacturers are "free to dictate ... prices" by definition you do not have a competitive market
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Stiff, Light, Aero - Pick Three!! :thumbup:

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