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Bike Shops vs Internet
It's a fact bike shops are losing business to the internet. Many of us on this site use the internet to buy cheap parts. If you read the local bike magazines the topic rears its head occasionally. If you talk to bike shop owners, the topic rears its head often. Can the 2 (internet and shops) coexist?
So here's the dilemma. I need to buy more energy gels. Do I purchase cheaply from overseas where the only downside is I have to wait a couple of weeks or do I order locally where I pay more but get them quickly? In this recent case I decided to pay more to get them locally as I had a soft moment - the brand I use sponsors an elite team and has obvious marketing costs so if I support them they will continue to pump money into our sport. If all of us buy from overseas they will not be able to exist and our sport will not have sponsors. Dilemma!!!
Local businesses are always going to be more expensive than the internet (under current laws) as they pay import duties, GST, must make a margin and recover advertising expenses to name a few. Should we support them to the detriment of our wallets?
How do the rest of you feel about buying overseas and watching our local businesses disappear?
In my case, I will buy locally and spend more if I see value. In the absence of value, I buy where it costs less. Simple!
For example, if I go into a shop looking for a new XTR Derailleur and they have all of the variations there to demonstrate (cage length, normal/reverse rise etc) then I'll see the value in buying from them. If they carry no stock and simply say they can order one in then why the hell wouldn't I go home, get on the internet and order one from overseas for 2/3 or 1/2 the price? I'm amazed at how many shop owners will gripe about how the internet is killing their business yet they miss the point with their one differentiating factor - SERVICE!!! So my tip for shop owners is - carry less bikes in your store, especially the 27 varieties of kids bikes, and stock more consumables (eg, cassettes, derailleure's, wheels) which take up less space but give us, the buyers, more things to look at and we may buy from you rather than a store in England.
Enough of my rant...
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What a great topic Fatboy.
Last year when I bought my new Marin, I spent hours researching on the web, pouring over specs etc. Then i visited local shops that could stocked the bikes i was after, got it down to three brands. There was an option of buying my bike from O/S although what got me was the service factor. I live in Manly although work in Kingsgrove, not far from TBSM...who are one of the rare shops in Sydney that stock Marin. They lent me a freeride Marin for the weekend, gave me heaps of support and facts, let me test other bikes and I purchased with them. Now, when ever I am looking to buy any new kit, I buy from TBSM as I have built a relationship with the guys over there and I'm loyal to them for the service and experience. Never do I walk out without spending a minimum of $100 and at least 30 mins.
Service is the key, there are some good shops locally here on the northern beaches that have all the time in the world for you and there are also one or two that have no idea and are arrogant.
Where ever possible, I'll pay premium for service, bike shops, resturants, food etc. Hopefully the local bike shop never goes under. If they could put beer taps in the middle of the shop, extend their hours and place a few lounges around so we could watch bike porn, they might attract more passing clientele and introduce a whole new range of people to our sport and even make some extra $$$. Any thoughts ???
some of the shops are just caving in, giving less service & product range-whilst the smart ones are actually getting some balls & doing there bit for us bike snobs-they are the stores we need to support!!!
I agree with much of what is said especially on the part that retail stores need to offer SERVICE but i do have to say a couple of things:
1. If you plan to buy online do your research there...not in a retail store
2. Dont waste shop staff time if your sole intention is to buy from an overseas website
Shops find it difficult enough to make ends meet, the last thing they need is an online buyer picking their brains, using their resources and know how while someones sold intention is to go back to their computer and order if from OS.
If you need some service, fitting etc then a retail store is always going to be a better option especially when you dont know what your doing or if you ever have trouble with an item delivered.
It's everyones right to spend money where they want. For me if i pay a little more or if i need the service i'll go for the local retailer all the time. You cant beat having a local face to come back to if you have any issues.
I do spend a fair amount of money in LBS on Gels, tubes etc and I always tend to buy from LBS for that. Infact CBD have done alright out of me recently. I think for big purchases its hard to go past the net, no amount of service in the world could male up the 3k saving I made from buying my Yeti online.
Um bugger them.... if they cant adapt to survive then their time has come.. yes it sucks and I feel bad for them..(boo hoo lets have a cry) sorry its business 101.
Ever been to a bike store in US? they seem to survive just fine.. why?? is it the bike distributors giving them a super awesome wholesale deal? I can't see that happening because you can still buy online very cheap and the actual bikes in the stores are soooo cheap anyhow.. I think its called customer service, my experience with visiting US bike stores (in fact most stores i have been to in the US) leave our AUS stores for dead when it comes to customer service.
Reading the other day that i could get a porsche 911 in the states for 74k here it would cost 200. I wonder about how stupid we are accepting all the govt taxes, income, gst, sales tax, luxury tax, means testing etc etc and we have crap public services and our small business guys suffer under an avalanche of red tape and taxes.
I agree bike shops have got to find that niche to survive - locally cell bikes is giving it a good go there is another post about them but most local bike websites are rubbish. They need to have both online prices and full retail prices if you wish to visit the store.
Look at local bookstores - same price online and offline - online you also pay delivery and wait 10 days and they wonder why people go to amazon
I think eventually the two will work together in a way. Customer service is the key to any successful business but shops that don't have online accessibility will eventually have to incorporate it. Personally I try to support Australian retailers as much as possible.
Obmal, you are entitled to your opinion. However, it seems like a very narrow minded one.
Most small businesses, struggle from time to time. Whether it's fluctuations in their market, or their market taking a different direction. It is up to a business to try and keep up with the latest happenings, or be left behind.
However, it's pretty hard to adapt to import duty, GST, wholesalers markups. When you buy overseas, you are avoiding these taxes that the local shops have to pay for. How do you expect them to compete? The Wholesalers are doing the best they can, they've got to make a dollar too, after all it's not a charity here.
I think it's pretty unfair to think that local businesses should cut their prices or go out of business. I don't think there's enough margin in it. Do you expect them to lose money, just so you can save a few bucks? What happens, when you need some repairs done to your bike, there's no LBS, as they've all gone out of business. Are you going to call CRC to fix it? What about warranty claims? Say you buy a bike online from overseas. It breaks, are you going to expect your LBS to do the warranty claim for you? Are you going to expect the Aust. wholesaler to cover the warranty? Both of these businesses haven't made a cent out of your purchase, to cover the paperwork, let alone the other things involved in processing your claim.
I, like most of us am on a pretty tight budget. Battling the usual crap of day to day living. However, I refuse to buy stuff from over-seas. I've built quite a good relationship with my LBS and the service and knowledge learnt is worth 1000 times more than any saving made by purchasing products over seas. A lot of the stuff I buy is second hand, simply because I can't afford new. So the LBS also gets the service costs of adjusting or fixing what ever I've put on. Every little bit helps out LBS'. Do your bit to help them stay in business, or there won't be any left.
I do my research online, look around and see parts etc you like. Read the forums etc. Then when I've narrowed things down, I head down and get advise from the LBS. Where I purchase/order said part. If anything is wrong (broken in packaging, doesn't fit what ever), I simply drive down and make the change/arrange for warranty etc.
Sorry for the rant, but it I get a bit annoyed when I see this sort of thing.
My point was that even in the US where consumers can still buy parts online and the bike stores have to compete, its perhaps stellar service and other marketing/business innovations that continue to ensure their survival.
I never mentioned that they should cut their prices, that's not really a sustainable business model and its not akin to providing great service. (hard to employ great talent when you cant pay them with your dwindling margin)
For what its worth, I support my favorite LBS, I've bought bikes and bike bits there (as well as from OS/internet), they are great and worth the premium.
Don't apologize.. A rant? not at all. Your proving my point when you mention the service you get is why you go back to the bike store, but I maintain that there are shops that will go bust and its not "the internet shopping market" that's the problem here....
I'm siding with obmal on this debate. I take the point about import duties and GST, but that accounts for about 30% of the markup, not the frequently 100%+ markup you pay to buy from your LBS compared to offshore in most cases.
Whinging about rent and employment costs doesn't wash - CRC for example employs 420 people. Neither does whining about freight costs. Most bike companies have their manufacturing operations in Taiwan, and ship direct from there to national distributors so if anything, the freight component inbound to Oz should be less. Yet we still pay through the nose.
Now I don;t have a problem paying more if the quality of service matches. Unfortunately that is uncommon. In a lot of cases we're being expected to pay the premium without getting the service. That's not sustainable, and the pressure local bike shops and distributors are feeling is a natural consequence. Something's gotta change. Personally I reckon the bike industry is long overdue for a major consolidation.
So that means there's an opportunity for someone to do very well for themselves indeed, by distinguishing themselves on an outstanding service culture. Will be interesting to see what Super Cheap Auto group does with its acquisition of the Goldcross chain once they're confident they've learned the industry.