Gray Market Bicycle Parts

[Bustedknuckle]

really, that is so overpriced via the skill it takes...no offence...and your 30 day 5 minute touch up is kinda silly via prices...there is no way that is worth what you charge...

Then do it yourself. I'm sure you can do things like OVH ERGO levers, have the tools to pull and install bearings off Campag UT and PT cranks, can swap springs on calipers, press in headsets, build wheels, overhaul king hubs.

Don't forget $300 cutting tools(6 of them) and a couple of truing stands(decent ones, not an old fork with pipecleaners zipp tied on it) and a tension meter and presses and pullers(4 of them), the last PT bearing puller I got cost $275.
I'm sure you don't use a piece of wood and a hammer to install cart bearings into $400 hubs or a $150 headset. That bearing press I have was $400. I'm sure you know all frames are not prepped when you get them new(or old) and can properly prep the whole thing, have a full set of sharp taps.

Start a service bike shop, charge what you think is 'fair', but be sure you have a store front, and insurance, and utilities and a phone and don't forget the variable expenses like the 2% for CC fees and all the other 'costs of doing business'. . You 'may' want to pay yourself the below minimum wage per hour rate also that most bike shop owners pay themselves.

And taxes, yes, you pay lots of taxes. Like SS tax, workman's comp if you have an employee, and sales tax. Nothing more fun than a big month followed by a slow month, still gotta pay state and local sales tax(8.31% here).

have fun.

 

[elapid]

I would say I'm pretty close to your average cyclist. I earn a decent living and have a modicum of mechanical skills. I have a few bikes all of which have different functions. I can do most of the simple stuff on my bikes (what I call simple), but for most things I will get my LBS to do the job because they do it better and quicker than I could. I would rather be riding my bike than learning how to do the more intricate mechanical fixes on my bike (and as Bustedknuckle pointed out, buy and own all the equipment required for those fixes) that I may do once or twice in a lifetime. I am a specialist in my field and I value the experience and expertise of others. I charge more for the same surgeries that non-specialists can do, but I do that because I am better trained and provide better service and facilities and aftercare than non-specialists. I look for the same in other professions, whether it be bike mechanic, car mechanic, doctor, lawyer, etc. Why should I struggle with something when someone can do it better and quicker than I can? I would rather pay for that service because I value the limited amount of free time I have to enjoy riding.

 

[biker77]

I see all types of strange things on this very simple machine, that were done by DIY wrenches in their garage. Yep, it's pretty simple but do a survey in your area of which shops OVH ERGO levers, or can install Di2(and EPS) or build a wheel or press in a HS, or OVH a King hub or....

A gent brings in a $5000 frame and $3000 group. He doesn't whine about $225.

Most shops near me don`t do any of those things. The guy with the $5k frame may not mind, but I am alienated from the LBS by the high labour rates and large markups which is the real problem to me.

Maybe if rates were a bit more reasonable LBS's would have a few more customers. If you think you are justified charging $100 an hour then that is your right. Things are worth what people are willing to pay,right?

 

[Race Radio]

Then do it yourself. I'm sure you can do things like OVH ERGO levers, have the tools to pull and install bearings off Campag UT and PT cranks, can swap springs on calipers, press in headsets, build wheels, overhaul king hubs.

Don't forget $300 cutting tools(6 of them) and a couple of truing stands(decent ones, not an old fork with pipecleaners zipp tied on it) and a tension meter and presses and pullers(4 of them), the last PT bearing puller I got cost $275.
I'm sure you don't use a piece of wood and a hammer to install cart bearings into $400 hubs or a $150 headset. That bearing press I have was $400. I'm sure you know all frames are not prepped when you get them new(or old) and can properly prep the whole thing, have a full set of sharp taps.

Start a service bike shop, charge what you think is 'fair', but be sure you have a store front, and insurance, and utilities and a phone and don't forget the variable expenses like the 2% for CC fees and all the other 'costs of doing business'. . You 'may' want to pay yourself the below minimum wage per hour rate also that most bike shop owners pay themselves.

And taxes, yes, you pay lots of taxes. Like SS tax, workman's comp if you have an employee, and sales tax. Nothing more fun than a big month followed by a slow month, still gotta pay state and local sales tax(8.31% here).

have fun.

Wait, what? You mean I can't build up that new Dogma with Super Record 11 using just the multi-tool in my seat bag?

 

[ultimobici]

Most shops near me don`t do any of those things. The guy with the $5k frame may not mind, but I am alienated from the LBS by the high labour rates and large markups which is the real problem to me.

Maybe if rates were a bit more reasonable LBS's would have a few more customers. If you think you are justified charging $100 an hour then that is your right. Things are worth what people are willing to pay,right?

What is it with this idea that bike shops are taking the Mickey with their pricing? Giant markups, expensive labour rates etc? How on earth do you think a business can afford to exist? Stock on the shop floor has to be paid for sometimes months before it's sold, wages paid even when virtually no money has come through the till for days in the dead of winter.

Run the numbers for setting up and running a small shop. You'll soon see that no one in an LBS is getting rich as a result. Most employees are there, not because it's all they can do nor because it pays megabucks, but because they have a passion for bikes. Indeed the wages are far below the average and that includes the owner's cut, if they actually make a decent profit.

In London the average LBS charges £60 per hour to the customer. Out of that wages account for barely a fifth. The rest covers rent, rates, tool upkeep etc. If you're working on 10+ bikes a day it's alarming how quickly you need to replace stuff. Then you have stuff like 11 speed chain tools, Powertorque & Ultratorque tools, Di2 diagnostic kit to buy & maintain. It all costs money and it all contributes to that labour rate. Don't forget the cost of liability insurance too, in this day and age you can't afford to do business without it. If your lawyer who charges $500/hr makes a mistake you may loose a few bucks, if I make a mistake you may die. Which is the more "justifiable"?

 

[biker77]

What is it with this idea that bike shops are taking the Mickey with their pricing? Giant markups, expensive labour rates etc? How on earth do you think a business can afford to exist? Stock on the shop floor has to be paid for sometimes months before it's sold, wages paid even when virtually no money has come through the till for days in the dead of winter.

Run the numbers for setting up and running a small shop. You'll soon see that no one in an LBS is getting rich as a result. Most employees are there, not because it's all they can do nor because it pays megabucks, but because they have a passion for bikes. Indeed the wages are far below the average and that includes the owner's cut, if they actually make a decent profit.

In London the average LBS charges £60 per hour to the customer. Out of that wages account for barely a fifth. The rest covers rent, rates, tool upkeep etc. If you're working on 10+ bikes a day it's alarming how quickly you need to replace stuff. Then you have stuff like 11 speed chain tools, Powertorque & Ultratorque tools, Di2 diagnostic kit to buy & maintain. It all costs money and it all contributes to that labour rate. Don't forget the cost of liability insurance too, in this day and age you can't afford to do business without it. If your lawyer who charges $500/hr makes a mistake you may loose a few bucks, if I make a mistake you may die. Which is the more "justifiable"?

I don`t have a problem with whatever the LBS might charge nor the owners trying to make a living. For me it is an overpriced unjustified model that is made irrelevant as I can do all the work myself.

So a question to all the bike shop owners, how can a customer like myself interact with a shop to the benefit of both? I don`t want to pay $60-100 an hour in labour and a 20-50% markup on internet pricing. Am I better just to stay away?

 

[RDV4ROUBAIX]

I don`t have a problem with whatever the LBS might charge nor the owners trying to make a living. For me it is an overpriced unjustified model that is made irrelevant as I can do all the work myself.

That part of this argument is irrelevant. If you do all your own work what do you care about labor rates for? You are a minority being able to wrench your own bike, majority of people out there aren't and are willing to pay for a service.

So a question to all the bike shop owners, how can a customer like myself interact with a shop to the benefit of both? I don`t want to pay $60-100 an hour in labour and a 20-50% markup on internet pricing. Am I better just to stay away?

You're caught between worlds, you want to support your local LBS, but do all the work and source gear cheaper. So do something else to help out your shop and cycling community like organize a ride or something along those lines. I don't know, just seems kind of pointless to complain about pricing when you DIY everything, anyway.

 

[Parera]

You're caught between worlds, you want to support your local LBS, but do all the work and source gear cheaper.

Tools are spendy, that's part of DIY that is major stumbling block for most people. That's why people who DIY are WAY in the minority.

I have enough tools/know how to do most of the labor on my bikes, but some things I'm just lazy about and would rather pay my mechanic to deal with (disc brakes come to mind). He never makes a stink about gray market parts either, but I really don't buy gray market TBH. Kind of have a loose rule of 10-15% within my LBS price I favor buying from my shop, just because it always includes shipping (even on large items) and I get better service with my purchase.

But yeah, I don't think anyone here is saying if you don't buy from a LBS you're a pedophile or rapist or something. I don't know why people get so defensive about not buying local; I refuse to buy from like 60% of the shops in my area because I hate their owners. I don't lose any sleep over it.

 

[RDV4ROUBAIX]

Tools are spendy, that's part of DIY that is major stumbling block for most people. That's why people who DIY are WAY in the minority.

I have enough tools/know how to do most of the labor on my bikes, but some things I'm just lazy about and would rather pay my mechanic to deal with (disc brakes come to mind). He never makes a stink about gray market parts either, but I really don't buy gray market TBH. Kind of have a loose rule of 10-15% within my LBS price I favor buying from my shop, just because it always includes shipping (even on large items) and I get better service with my purchase.

But yeah, I don't think anyone here is saying if you don't buy from a LBS you're a pedophile or rapist or something. I don't know why people get so defensive about not buying local; I refuse to buy from like 60% of the shops in my area because I hate their owners. I don't lose any sleep over it.

I don't think it's so much the price of tools, if you DIY you've basically been around bikes long enough that you've accumulated most of the necessary tools at home by now, complaining about shop labor rates is a mute point if you DIY. Same as if I went on general contractors forums and complained about labor rates for remodeling my mom's house when I did all the work myself, probably saved $10k+ in labor over a span of 3 years because I was either taught by someone or taught myself and have all the tools, plumbing and HVAC being the exception, I was happy to pay.

 

[briztoon]

I know the point has been made already, but I don't think those complaining about LBS charges really understand all the costs associated with running a small business. You are not just paying for the work done on your bike, you're helping to pay the wage of each employee, for rates, power, insurance, rent, etc. If you are employed, ask your boss or employer if you can see one months profit and loss statement, then you might have a small understanding where all the money goes.

Just a question to those that do their own wrench work. If you crack your bike frame while doing some work on it, is it covered under warranty? What if you're doing work on your freinds Dogma and crack the frame?

I'm not mechanically inclined or trained, so I take my Tarmac in to my Specialized LBS for servicing, etc. I know that if my bike is accidently damaged while being worked on, it's going to be replaced.

 

[ultimobici]

I know the point has been made already, but I don't think those complaining about LBS charges really understand all the costs associated with running a small business. You are not just paying for the work done on your bike, you're helping to pay the wage of each employee, for rates, power, insurance, rent, etc. If you are employed, ask your boss or employer if you can see one months profit and loss statement, then you might have a small understanding where all the money goes.

Just a question to those that do their own wrench work. If you crack your bike frame while doing some work on it, is it covered under warranty? What if you're doing work on your freinds Dogma and crack the frame?

I'm not mechanically inclined or trained, so I take my Tarmac in to my Specialized LBS for servicing, etc. I know that if my bike is accidently damaged while being worked on, it's going to be replaced.

Exactly. It's like complaining about the cost of a meal in a restaurant. The ingredients may be cheaper when you buy them at the store and cook it at home. You also have to serve it, not to mention washing up afterwards.

You might like to check your warranty information. Most bike manufacturers explicitly exclude parts not installed by a properly qualified mechanic. So unless you're Cytech 2 qualified in the UK you void the warranty as soon as you start installing it yourself, no matter how good you are. The qualification can be obtained by attending a two week course costing £2000 if you want.

 

[LugHugger]

Exactly. It's like complaining about the cost of a meal in a restaurant. The ingredients may be cheaper when you buy them at the store and cook it at home. You also have to serve it, not to mention washing up afterwards.

You might like to check your warranty information. Most bike manufacturers explicitly exclude parts not installed by a properly qualified mechanic. So unless you're Cytech 2 qualified in the UK you void the warranty as soon as you start installing it yourself, no matter how good you are. The qualification can be obtained by attending a two week course costing £2000 if you want.

To be accurate, Cytec 2 costs from £1250. It's well worth the investment of time and intellect if you're committed to the sport.

 

[ultimobici]

To be accurate, Cytec 2 costs from £1250. It's well worth the investment of time and intellect if you're committed to the sport.

Price appears to have dropped since I left ATG. At £1500 inc VAT it's still a worthwhile investment especially as it includes a DT Wheelbuilding qualification.

But I have to say I find the attitude of some posters that it's just simple work so any fool could do it and by extension it should cost peanuts, insulting and ignorant. A high proportion of home mechanics won't take a couple of hours to build a bike from scratch. They'll take several hours, perhaps finding issues with comparability that put the job on hold until the correct part arrives etc etc.

When we are engaged to build a bike up the deal is, if we're supplying the parts, we get it done on time no matter what. That's the deal, you're paying so you have your bike built right, on time, within the agreed budget. That means you can enjoy your Saturday with family or whoever, pick up the bike later on, and then ride first thing Sunday.

 

[Bustedknuckle]

Then do it yourself. I'm sure you can do things like OVH ERGO levers, have the tools to pull and install bearings off Campag UT and PT cranks, can swap springs on calipers, press in headsets, build wheels, overhaul king hubs.

Don't forget $300 cutting tools(6 of them) and a couple of truing stands(decent ones, not an old fork with pipecleaners zipp tied on it) and a tension meter and presses and pullers(4 of them), the last PT bearing puller I got cost $275.
I'm sure you don't use a piece of wood and a hammer to install cart bearings into $400 hubs or a $150 headset. That bearing press I have was $400. I'm sure you know all frames are not prepped when you get them new(or old) and can properly prep the whole thing, have a full set of sharp taps.

Start a service bike shop, charge what you think is 'fair', but be sure you have a store front, and insurance, and utilities and a phone and don't forget the variable expenses like the 2% for CC fees and all the other 'costs of doing business'. . You 'may' want to pay yourself the below minimum wage per hour rate also that most bike shop owners pay themselves.

And taxes, yes, you pay lots of taxes. Like SS tax, workman's comp if you have an employee, and sales tax. Nothing more fun than a big month followed by a slow month, still gotta pay state and local sales tax(8.31% here).

have fun.

I guess I should add since I implied this $100 per hour rate.

ProBuilds w/o us building wheels, stuff brought to us is $225, takes about 2-3 hours. If the stuff is bought from us-$175.

Complete overhaul, take the bike completely apart, hubs apart, BB, HS, pulleys out, etc, is also $225 and takes about 4 hours. That's $56 per hour or so.

If you go to a car dealer for repairs, his 'book' says new front brakes are say 2 hours, $200, even if the wrench does it in 1 hour-charge for 2. If the car wrench has a problem and it takes 3 hours-$300 total.

For just, 'find this noise'-$60 per hour. Takes 1 hour? $60.

So it depends. For the Gnome, if you have the proper tools, can do it yourself, fine and dandy but customers come in 3 flavors.

Those that let us 'do it'
Those that do it all theirselves.
Those that think they can do it all and we make it right after they goon it up.

Smallest group is #2 above.

 

[Moose McKnuckles]

Good post, bustedknuckle. I think your rates are completely fair.

I place myself in the first category. I readily admit I can't wrench at all, so I bring my bike to the shop whenever I need anything done.

I'm better off since I can spend the time doing something else like playing with my kid, riding, or working.

They're better off because they get the work. Win-win.

 

[chasbo]

I guess I should add since I implied this $100 per hour rate.

ProBuilds w/o us building wheels, stuff brought to us is $225, takes about 2-3 hours. If the stuff is bought from us-$175.

Complete overhaul, take the bike completely apart, hubs apart, BB, HS, pulleys out, etc, is also $225 and takes about 4 hours. That's $56 per hour or so.

If you go to a car dealer for repairs, his 'book' says new front brakes are say 2 hours, $200, even if the wrench does it in 1 hour-charge for 2. If the car wrench has a problem and it takes 3 hours-$300 total.

For just, 'find this noise'-$60 per hour. Takes 1 hour? $60.

So it depends. For the Gnome, if you have the proper tools, can do it yourself, fine and dandy but customers come in 3 flavors.

Those that let us 'do it'
Those that do it all theirselves.
Those that think they can do it all and we make it right after they goon it up.

Smallest group is #2 above.

Very close to the same rates we charge in my shop. Our complete overhaul is 200 though.

 

[Moose McKnuckles]

I would expect bike shop repair rates will differ across the country according to cost of living. I don't expect a sandwich will cost the same in NYC as in Duluth, MN.

 

[Bustedknuckle]

Very close to the same rates we charge in my shop. Our complete overhaul is 200 though.

We've been at $200 for 4 years.BUT my rent, utilities, labor, etc all went up so rates did too.

 

[Reformed]

chain reaction/pbk etc are not 'gray market' - they are authorized dealers

this guy is just unhappy that someone has better buying power than him and can undercut his prices

there are plenty of brick and mortar bike shops making a lot of money selling high end gear at retail prices

what we have here is someone who has not worked out how to do this so he is just blaming someone else for his own shortcomings as a business owner

Exactly, it is right out of Atlas Shrugged

 

[briztoon]

Exactly. It's like complaining about the cost of a meal in a restaurant. The ingredients may be cheaper when you buy them at the store and cook it at home. You also have to serve it, not to mention washing up afterwards.

Now there is an example I know a little something about. Here in Oz the standard pricing in your average restaurant goes a little something like this, cost of ingrediants = 30% + the cost of labour = 30% + cost of running the business = 30% + 10% gst (goods & services tax) gives you the minimum price of your meal on the plate.

Our "house" wine is bought for about AUS$4.67 per bottle and we sell it for $5 a glass (150ml) or $18 a bottle.

I know a few years ago the wine used as our house wine was bought for $4.89 a bottle and we sold it for $21 a bottle. Versace down the Gold Coast used the same wine as their house wine, but sold it for $32 a bottle.

If you can't afford to eat at Versace down the Coast, come see me, we do some pretty good food for a pub. However I take no responsibilty for our current wine list.

What's this got to do with the current topic? ****** all, but just trying to illustrate that most things in life cost if you can't or won't do it yourself.

Going out for a nice dinner is a luxury. Guess what, so to is owning a nice bike. If you're whinging about some one making a living from the hobby/sport then you've lost sight of why we love this sport.

Just get out and ride.

 

[RDV4ROUBAIX]

I would expect bike shop repair rates will differ across the country according to cost of living. I don't expect a sandwich will cost the same in NYC as in Duluth, MN.

Oddly enough even though rent in NYC is double or triple what it is everywhere else, food is generally cheaper there than most big cities. Bike shop prices for goods and services in NYC are pretty much on par with the rest of the country, the slight price difference is more localized by neighborhood. A shop in Williamsburg Brooklyn is usually more expensive than one in Greenpoint, and they're right next to each other. But everyone wants to live in Williamsburg, higher incomes and rent. I don't know how bike shops survive in NYC, it's beyond me, overhead is through the roof.

 

[BroDeal]

Exactly, it is right out of Atlas Shrugged

Funny. In my copy of Atlas shrugged, amongst the adolescent delusional views of economics and human behavior, I don't remember anything about suppliers obliterating their dealer networks by allowing their goods to be sold at below wholesale to a select few.

 

[Parera]

Funny. In my copy of Atlas shrugged, amongst the adolescent delusional views of economics and human behavior, I don't remember anything about suppliers obliterating their dealer networks by allowing their goods to be sold at below wholesale to a select few.

Funny, I don't remember anything about that book except it being remarkably awful.

 

[ultimobici]

chain reaction/pbk etc are not 'gray market' - they are authorized dealers

this guy is just unhappy that someone has better buying power than him and can undercut his prices

there are plenty of brick and mortar bike shops making a lot of money selling high end gear at retail prices

what we have here is someone who has not worked out how to do this so he is just blaming someone else for his own shortcomings as a business owner

Effectively they are. When there is a warranty issue with an item bought this way there is no obligation to honour the warranty through the local distribution network because it has been imported direct. Your warranty is with PBK/CRC/Ribble, and good luck sorting that out!

The guy mentioned in the OP is not a poor businessman , he is victim of somewhat excessively generous personal import allowances coupled with the ability to avoiding paying any sales tax.

As for the guy in this LBS, he has every right to charge a levy on parts bought from overseas. IMO he would be better served offering a discount to those buying from him.

But that is the way it has been for decades anyhow. If you come into the store and buy kit and want it installed, most shops will cut you a deal on fitting or on the whole package.

Problem is many people who buy online do their research at the LBS. But the one thing they often neglect to do is ask if the LBS is willing to do a deal. They just go home and click. That is one of the most galling things in bike retail. Seeing a guy rock up on a bike that is fitted with the stuff you spoke to him for ages about but he never even asked about a package price or installation at all. then to cap it all he wants his gears dialling on the spot!

The urge to tell him to Foxtrot Oscar is very very strong!

 

[BroDeal]

Funny, I don't remember anything about that book except it being remarkably awful.

That too, but it is remarkably funny encountering anyone over the age of sixteen, maybe eighteen at most, who buys into it. It's like meeting an adult who tells you that Winnie the Pooh is his favorite movie.