Road Bike, Cycling Forums banner
1 - 20 of 26 Posts

·
Registered
Joined
·
270 Posts
Discussion Starter · #1 ·
Big Three brands duke it out with March discounts | Bicycle Retailer and Industry News

"...A variety of factors point to lower bike prices for the 2017 model year — including the collapse of the Chinese economy, which decimated its once-promising domestic consumer market for higher end bikes, but opened up bike production capacity for other markets. Lower fuel costs cut material and shipping costs for bike and parts makers, and currency exchange rates are trending favorably for the U.S. and Europe. Shimano’s recent wholesale and retail price cuts on aftermarket parts may reflect some of those factors, although Shimano pushed discounts out to OEM bike makers late last year..."

Your comments!
 

·
Banned
Joined
·
2,075 Posts
companies have sales all the time, if they can make the discounts seem better than they really are by blowing smoke up our collective arses, so be it.
 

·
Registered
Joined
·
3,695 Posts
there's so much upheaval in the bike industry. disc brakes, sram etap move to larger tires such as 28mm, to name a few developments. most of the hydro bikes out are not outfitted with thru-axles and sram just literally came out with etap. would not surprise me if some customers are taking a hold approach to bicycle buying. Seems the new bike becomes obsolete the moment you take delivery.
 

·
Adorable Furry Hombre
Joined
·
30,949 Posts
Big Three brands duke it out with March discounts | Bicycle Retailer and Industry News

"...A variety of factors point to lower bike prices for the 2017 model year — including the collapse of the Chinese economy, which decimated its once-promising domestic consumer market for higher end bikes, but opened up bike production capacity for other markets. Lower fuel costs cut material and shipping costs for bike and parts makers, and currency exchange rates are trending favorably for the U.S. and Europe. Shimano’s recent wholesale and retail price cuts on aftermarket parts may reflect some of those factors, although Shimano pushed discounts out to OEM bike makers late last year..."

Your comments!
Yea...it has NOTHING whatsoever to do with lower fuel and shipping costs. The fact that any analyst or writer would throw that in there proves the writer/analyst has no f*cking clue why anything is going on...they're just throwing darts at the wall and hoping something sticks. Seriously, fuel prices had dropped 50% from peak several times in the last 5-7 years and bike parts/bicycle pricing only went up. As such using shipping costs as a causative factor for price drops is to be completely blind and ignorant to history.

Probably more to do with bicycles and parts have been climbing ridiculously in price for over a decade, and had reached "that is *&^% STUPID" pricing levels years back. It simply wasn't sustainable, and now they priced themselves out of the stagnant consumer wages, so they are correcting.
 

·
Registered
Joined
·
3,695 Posts
I agree. Costs don't directly translate into the end price. Costs just factor into profit or loss. Companies lower prices when they're stuck with inventory, not because shipping costs declined. If business was good, they would have kept the price high and made more profit.
 

·
Banned Sock Puppet
Joined
·
14,411 Posts
It simply wasn't sustainable, and now they priced themselves out of the stagnant consumer wages, so they are correcting.
Exactly. Case in point is when fuel prices shot up, food prices went with it. Now fuel prices are lower than they have been in two decades. Have you seen food prices or prices on other staples drop? Of course not, because these are items people NEED in order to survive.

Unless you rely on a bike for point A to point B transportation, it is a hobby, which is something you don't need to survive. And even if you do need it to survive, if like many people, you are working at a job paying less than half of the one you lost back in the Great Recession, you are most likely not upgrading your commuter steed.
 

·
Registered
Joined
·
6,833 Posts
Specialized's promotion involves about 45 bike models and gear including helmets, shoes and wheels. Bike retail prices are discounted 9 to 23 percent off MSRP, with discounts at retail from $150 to $801.
really? 9 to 23%? Take it easy there Specialized. You don't want to drive the mass into a heart attack with such massive discount of MSRP.

Get real! Online sellers regularly give 25% - 50% off frames at year end sales.

Just a week ago, a friend got a Trek Madone 9 (H1) with a 17% discount off MSRP. And this is the latest frame from Trek in size 52, which the seller told us that only 19 existed in stock in Cali, and 26 in stock for the whole USA. Frame had to be shipped from Wisconsin warehouse. Yet my friend was able to get a 17% discount with some bargaining with the LBS.

So anything less than a 40% off MSRP is a yawner to me. It's like those fake furniture liquidation sales you see.
 

·
Registered
Joined
·
7,332 Posts
I wouldn't be surprise that there is a glut of bikes on the market and at factories, and since the world wide economy is slowing and thus sales will be low and slow, so the manufactures are reducing prices to get people to buy who now have less discretionary income for luxuries like hobbies then they had before.
 

·
Adorable Furry Hombre
Joined
·
30,949 Posts
Exactly. Case in point is when fuel prices shot up, food prices went with it. Now fuel prices are lower than they have been in two decades. Have you seen food prices or prices on other staples drop? Of course not, because these are items people NEED in order to survive.

Unless you rely on a bike for point A to point B transportation, it is a hobby, which is something you don't need to survive. And even if you do need it to survive, if like many people, you are working at a job paying less than half of the one you lost back in the Great Recession, you are most likely not upgrading your commuter steed.
Saying "We're so fat and happy that no one can afford our prices...ooops...we need to lower them to stay fat and happy" sounds much worse...than "oh gas is cheap so our costs went down and we're passing them to you". Fortunately most people lack 5th grade Junior Achievement business sense.
 

·
Banned Sock Puppet
Joined
·
14,411 Posts
Saying "We're so fat and happy that no one can afford our prices...ooops...we need to lower them to stay fat and happy" sounds much worse...than "oh gas is cheap so our costs went down and we're passing them to you". Fortunately most people lack 5th grade Junior Achievement business sense.


Exactly. Companies don't lower prices because they don't need to make sooooo much money. The only reason they will lower prices is when people stop buying their products.

Simple supply and demand.
 

·
Cycling Addict
Joined
·
5,170 Posts
Exactly. Companies don't lower prices because they don't need to make sooooo much money. The only reason they will lower prices is when people stop buying their products.

Simple supply and demand.
Or they projected greater growth than they got, so they have an overstock they want to reduce... That is usually the case.
 

·
Registered
Joined
·
109 Posts
I think there are two main drivers: 1) At least one of these brands has too much inventory and didn’t see sales picking up enough without sale prices. 2) Once one brand goes, the others follow, partially due to pressure from their sales channel, who know that the shop down the street is going to be promoting sales.

Lots of consolidation happening in the bicycle industry of late. Less customers and flat sales in the US means only the strongest survive this part of the cycle (no pun intended.)
 

·
Registered
Joined
·
3,695 Posts
Seems like nobody can afford all those great bikes.
I have this theory that fewer and fewer people are buying more of the bikes.
Anyone have an opinion on this either way?
 

·
Registered
Joined
·
109 Posts
Seems like nobody can afford all those great bikes.
I have this theory that fewer and fewer people are buying more of the bikes.
Anyone have an opinion on this either way?
I think your theory is correct based on research done on IBD sales numbers. Sales are remaining flat while the customer base is shrinking.

If the brands would acknowledge the pie is shrinking and it's critical to grow the pie rather than simply focus on taking bigger pieces of the pie that's left, I think that would be a good approach. For example, why isn't People for Bikes (PFB) doing a campaign for bicycling like "got milk"? PFB argues they're focused on infrastructure advocacy, but I'm pretty sure there are billions of US federal funding available for infrastructure as of last year. There is almost zero going to bicycling advocacy campaigns in the US. The bike brands need to think bigger, which means working together on this. Then again, maybe they're OK conceding their industry to be a niche market?
 

·
Registered
Joined
·
3,695 Posts
problem is each year bikes are becoming more expensive. stuff like electronic shifting, hydro-disc brakes etc cost money, so it seems to me the game is not more sales, but wallet share and making more from the customers out there. At least in the high end. Seems like the Trek's and Giants are moving toward on-line sales and will start to resemble bikes direct more and more.

I think your theory is correct based on research done on IBD sales numbers. Sales are remaining flat while the customer base is shrinking.

If the brands would acknowledge the pie is shrinking and it's critical to grow the pie rather than simply focus on taking bigger pieces of the pie that's left, I think that would be a good approach. For example, why isn't People for Bikes (PFB) doing a campaign for bicycling like "got milk"? PFB argues they're focused on infrastructure advocacy, but I'm pretty sure there are billions of US federal funding available for infrastructure as of last year. There is almost zero going to bicycling advocacy campaigns in the US. The bike brands need to think bigger, which means working together on this. Then again, maybe they're OK conceding their industry to be a niche market?
 
1 - 20 of 26 Posts
Top