Shimano restricting online UK sales to the US & Canada.

Questions about bike hire abroad and everything light bike related. No off-topic chat please

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TonyM
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by TonyM

raisinberry777 wrote:I'm always amused when corporations shop around to find the cheapest country to build their product, and then get annoyed when customers do the same.
+1!!

by Weenie


MichaelB
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by MichaelB

For Aus residents, Shimano have now blocked the sale of gear from German websites as well.

Wouldn't be sop bad if the full range was available in Aus (at reasonable prices), but often it's not available nor a reasonable price ....

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ultimobici
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by ultimobici

What most of you are missing is that the “corporations” you are slating are not making any more money by restricting inter regional sales. Far from it. They are protecting small businesses, the LBS, from the likes of PBK, Wiggle & Ribble. These companies sell product so cheap that no LBS can compete leading to fewer & fewer outlets that actually invest in brands & support consumers.

The majority of consumers are not the type who post on here & other boards. They do not necessarily have the nous to buy the right parts for a job, let alone put it all together. As more and more regular LBSs disappear due to insane pricing online the sport dies. It’s now gotten to the point where the price for some parts has been normalised to such a low level it isn’t worth stocking at all as no amount of added customer service can make up for the pricing difference.




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TonyM
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by TonyM

I am used to deal with such pricing issues in my job...

-> Don’t look at the last step before the consumer (online shop or lbs)!

But look at the distribution chain, the added value of each step (if any) and the pricing...Manufacturer-importer-distributor-wholesaler(s)-retailer/online shop

ooo
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by ooo

2 big shimano sellers from asia examples (there are more): 007bike and 8081bike
if shimano can do anything about them, there will be other sellers 008bike and 8082bike open next day
the only problem they only sell popular parts/groupsets,
smaller parts available on ebay from asian/european sellers, but price is not as nice as in germany shops
'

TheRich
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by TheRich

ultimobici wrote:
Tue Jun 04, 2019 7:53 am
What most of you are missing is that the “corporations” you are slating are not making any more money by restricting inter regional sales. Far from it. They are protecting small businesses, the LBS, from the likes of PBK, Wiggle & Ribble. These companies sell product so cheap that no LBS can compete leading to fewer & fewer outlets that actually invest in brands & support consumers.
Their pricing was competative with employee VIP pricing from Shimano.

It simply isn't sustainable.

Berzin1
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by Berzin1

ultimobici wrote:
Tue Jun 04, 2019 7:53 am
What most of you are missing is that the “corporations” you are slating are not making any more money by restricting inter regional sales. Far from it. They are protecting small businesses, the LBS, from the likes of PBK, Wiggle & Ribble. These companies sell product so cheap that no LBS can compete leading to fewer & fewer outlets that actually invest in brands & support consumers.

The majority of consumers are not the type who post on here & other boards. They do not necessarily have the nous to buy the right parts for a job, let alone put it all together. As more and more regular LBSs disappear due to insane pricing online the sport dies.

The whole notion of capitalism flies against the very notion of protectionist policies on the retail side for the benefit of a stagnant business model. Part of the fault lays squarely on the shoulders of distributors for giving larger retailers better pricing, allowing them to offer better pricing to their customers.

Brick and mortar stores need to change their business practices if they want to stay in business. No one owes owners of bike shops a living, and it's not up to the rest of the industry to ensure their survival if their business model is not self-sufficient.

The sport is never going to die as long as people enjoy riding. What needs to be put in order is more realistic price points for all retailers, instead of restricting sales country to country and offering better deals to larger retailers.

ultimobici wrote:
Tue Jun 04, 2019 7:53 am
It’s now gotten to the point where the price for some parts has been normalised to such a low level it isn’t worth stocking at all as no amount of added customer service can make up for the pricing difference.
You are being overly dramatic. Price margins are the biggest secret in the industry, worse than any omerta practiced by cyclists who dope, and it's like that for a reason. And the expenses, at least on the higher end where most of us swim, are egregious and are set in conjunction with whatever the industry deems "competetive pricing".

Anyone have an idea what bike shops get their Pinarello F10's for or any other type of frame/equipment? The profit margins would make for interesting reading.

TheRich
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by TheRich

Berzin1 wrote:
Tue Jun 04, 2019 11:00 pm
The whole notion of capitalism flies against the very notion of protectionist policies on the retail side for the benefit of a stagnant business model. Part of the fault lays squarely on the shoulders of distributors for giving larger retailers better pricing, allowing them to offer better pricing to their customers.

Brick and mortar stores need to change their business practices if they want to stay in business. No one owes owners of bike shops a living, and it's not up to the rest of the industry to ensure their survival if their business model is not self-sufficient.
Their practice in the face of prices that they simply cannot compete with is to close down. Unbridled capitalism leads to a hellscape.
Berzin1 wrote:
Tue Jun 04, 2019 11:00 pm
The sport is never going to die as long as people enjoy riding. What needs to be put in order is more realistic price points for all retailers, instead of restricting sales country to country and offering better deals to larger retailers.
How much will you enjoy riding when there's nobody around to fix your bike and you can't actually see and sit on a bike you're consiering purchasing?
Berzin1 wrote:
Tue Jun 04, 2019 11:00 pm
You are being overly dramatic. Price margins are the biggest secret in the industry, worse than any omerta practiced by cyclists who dope. And the expenses, at least on the higher end where most of us swim, are egregious and are set in conjunction with whatever the industry deems as "competetive pricing".
No, he's not. They were selling for less than what bike shops paid, some shops were ordering FROM those online retailers because Shimano couldn't compete. You may choose to not believe that, but it doesn't change reality.

What happened was that those parts were supposed to be used on bike builds, which is why complete bikes are significanly cheaper than building one, they then sold those heavily discounted parts individually. Shimano could either stop giving OEMs that discount, raising the prices of bicycles, or protect brick and mortar retailers by restricting online retailers.

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ultimobici
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by ultimobici

Berzin1 wrote:
ultimobici wrote:
Tue Jun 04, 2019 7:53 am
What most of you are missing is that the “corporations” you are slating are not making any more money by restricting inter regional sales. Far from it. They are protecting small businesses, the LBS, from the likes of PBK, Wiggle & Ribble. These companies sell product so cheap that no LBS can compete leading to fewer & fewer outlets that actually invest in brands & support consumers.

The majority of consumers are not the type who post on here & other boards. They do not necessarily have the nous to buy the right parts for a job, let alone put it all together. As more and more regular LBSs disappear due to insane pricing online the sport dies.

The whole notion of capitalism flies against the very notion of protectionist policies on the retail side for the benefit of a stagnant business model. Part of the fault lays squarely on the shoulders of distributors for giving larger retailers better pricing, allowing them to offer better pricing to their customers.

Brick and mortar stores need to change their business practices if they want to stay in business. No one owes owners of bike shops a living, and it's not up to the rest of the industry to ensure their survival if their business model is not self-sufficient.

The sport is never going to die as long as people enjoy riding. What needs to be put in order is more realistic price points for all retailers, instead of restricting sales country to country and offering better deals to larger retailers.

ultimobici wrote:
Tue Jun 04, 2019 7:53 am
It’s now gotten to the point where the price for some parts has been normalised to such a low level it isn’t worth stocking at all as no amount of added customer service can make up for the pricing difference.
You are being overly dramatic. Price margins are the biggest secret in the industry, worse than any omerta practiced by cyclists who dope, and it's like that for a reason. And the expenses, at least on the higher end where most of us swim, are egregious and are set in conjunction with whatever the industry deems "competetive pricing".
In the 26 years I’ve worked in this industry I have always been able to buy at cost from my employers. That was one of the perks of the trade. Only now it is very often as cheap it even cheaper to buy parts from the likes of CRC or PBK. That cannot be a healthy or sustainable business model. Ultimately choice is removed because, instead of multiple outlets actually competing for business in a fair way, the large online retailers are bit by bit killing off any competition. Eventually they’ll have the whole market to themselves and then they’ll be able to charge whatever they like. Good luck getting those last minute bits you weren’t told you’d need to complete your build because there isn’t a friendly LBS for 100 miles. Goodbye to the young kid starting out in the sport looking for local sponsorship. Who gave the likes of Wiggins a helping hand at the start of their career? Sure as hell wasn’t a mail order company.
Anyone have an idea what bike shops get their Pinarello F10's for or any other type of frame/equipment? The profit margins would make for interesting reading.
Margin on high end items is the lowest of the lot. Think half the margin, two thirds if you’re lucky. And you work twice as hard for it.


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TonyM
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by TonyM

We are not anymore post WWII where the retail just put the products on shelves with a margin of 50%+ and was just waiting for the consumer to buy the product.

Adapt or get outdated.


TobinHatesYou
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by TobinHatesYou

ultimobici wrote:
Wed Jun 05, 2019 12:28 am
Margin on high end items is the lowest of the lot. Think half the margin, two thirds if you’re lucky. And you work twice as hard for it.
I don't know about your region, but that's not true here. Expensive items sell for roughly the same margins, sometimes a little less...sometimes a little more.

I can tell you a bike shop would much rather sell one $10K bike vs eleven $1K bikes, even if the margin on the bike itself is 33% vs 37%. The sale of one $1K bike subtracts the same static costs in assembly, inventory, salesperson hours, rent, insurance, utilities, training, etc as one $10K bike. The sale of eleven $1K bikes means more of those static costs lost contributing to lowering gross margins.

TheRich
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by TheRich

TonyM wrote:
Wed Jun 05, 2019 12:35 am
We are not anymore post WWII where the retail just put the products on shelves with a margin of 50%+ and was just waiting for the consumer to buy the product.

Adapt or get outdated.
You don't seem to understand that the adaptation is the elimination of the LBS.

Is that what you want?

TheRich
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by TheRich

TobinHatesYou wrote:
Wed Jun 05, 2019 12:53 am
ultimobici wrote:
Wed Jun 05, 2019 12:28 am
Margin on high end items is the lowest of the lot. Think half the margin, two thirds if you’re lucky. And you work twice as hard for it.
I don't know about your region, but that's not true here. Expensive items sell for roughly the same margins, sometimes a little less...sometimes a little more.

I can tell you a bike shop would much rather sell one $10K bike vs eleven $1K bikes, even if the margin on the bike itself is 33% vs 37%. The sale of one $1K bike subtracts the same static costs in assembly, inventory, salesperson hours, rent, insurance, utilities, training, etc as one $10K bike. The sale of eleven $1K bikes means more of those static costs lost contributing to lowering gross margins.
I think he's talking about tubes vs. bicycles, not a hybrid vs. carbon superbike.

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TonyM
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by TonyM

TheRich wrote:
TonyM wrote:
Wed Jun 05, 2019 12:35 am
We are not anymore post WWII where the retail just put the products on shelves with a margin of 50%+ and was just waiting for the consumer to buy the product.

Adapt or get outdated.
You don't seem to understand that the adaptation is the elimination of the LBS.

Is that what you want?
Yes if the LBS keep that business model they will disappear.
At least the way they are now...

by Weenie


TobinHatesYou
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by TobinHatesYou

TheRich wrote:
Wed Jun 05, 2019 2:15 am

I think he's talking about tubes vs. bicycles, not a hybrid vs. carbon superbike.

I can name pretty much any high end accessory and the margin will be ridiculous. The new $425 Giro Imperial shoe? $150 cost. The problem for bike shops however is the churn of selling low-end bicycles at almost loss-leader prices in hopes of attachments like helmets, clothing, flat kits, pumps, lights, cages, a bell, etc.

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