Re: Dear LBS-longish with a history

Hello again Andy,

I think you make some very good points. On my previous post I was  
relating some disappointing moments to illustrate and try to  
encourage people not to abuse your local LBS.  Honestly they can be  
trained to do your bidding with care.  Everyone probably thinks they  
shouldn't bother or have to but it could be mutually beneficial.


Time spent with customers is always a sticky subject. Some customers  
that come in always buy something, some never do and some  
occasionally do.  When I ran a big deal bike shop we ran the National  
Bicycle Dealer's Association cost formulas and we found that our over  
paid $6.00 per hour (years ago this was a legal wage) employees cost  
us after rent, taxes and other overhead (we paid their health  
insurance 100% like Canada ) cost us $30.00 hour! Amazingly this was  
about the average cost of a $6.00 guy after the other non inventory  
costs. We charging $20.00 an hour in the repair shop for said  
overpaid mechanic were losing money each and every minute when  we  
open or closed! Often we never billed even this amount though we  
worked like crazy without breaks in the summer. It was the old we are  
losing money so we will make it in volume!

We calculated that each of our managers and employees needed to  
generate at least $100.00 an hour in sales so we could just sustain  
our business. No we didn't suddenly make $70.00 per hour over that $6/ 
$30 overpaid employee; we found that all those bikes, parts,  
clothing, shoe and accessory suppliers charged big bucks for their  
stuff; oh and interest too! With 8-10 full and part timers this was  
not easy.  Some people did and some didn't produce but the averages  
starting coming out OK when we fired.........................not the  
employees but some of the customers.  The non-buyers.  It sounds  
terrible but we had to label some customers as "the ones we would  
rather not talk to."  At the time costs were rising fast and the  
business and our jobs ( of several stores) were in jeopardy but it  
worked.  The amazing thing is sales increased; a lot, profits which  
we seemed to not have in the beginning rose an awful lot.  We were  
able to spend lots of our income of events which over time helped  
some more.

As a teenager in the early 1970s bicycles had a huge markup compared  
to nowadays.  The were cheap to ship, service and assemble.  Wages  
were low low low; a small part of the cost. Also demand was  
astronomical; 10 speeds were the Ipod/Iphone and Ipad of the day. Hot  
stuff indeed and few people had bikes and everybody wanted one.   
Early into the "gas" crisis sales were very frantic. People would  
walk into our store and grab bikes and dare anyone to tough them;  
they had to get to work and no body was going to stop that! That all  
changed after the Arab Oil embargo "Energy Crisis", gas lines, wage  
price freeze, limited retail hours, recession etc.  We even had a war  
in there somewhere. At least 1/2 the bikes shops in the USA closed  
their doors. I worked in a shop in the mid 1970s that would have no  
one walk in at all some weeks. They survived but I think they were  
selling contraband out the back.


Nowadays wages, while modest are much higher in dollars per hour but  
the other costs are much higher than that proportionally in most  
businesses and markups are generally far lower as are the numbers of  
bike shops. As I noted before bike shops build cycling. Shopping on  
line is convenient no matter what the industry.  Nothing wrong with  
that.  Many local brick and mortar bike shops offer mail order/ on  
line shopping but you might be surprised that often local bike shops  
are forbidden to even advertise or sell common items by  
manufacturers.  Store pickup only is the rule on these items while  
the item can be found easily on line and apparently without  
restriction. Weird world.

One thing on pricing, if some current item is 75% higher at a bike  
shop something is wrong. I'd tell the shop where you found it and at  
what price and ask why the difference. With this information and s a  
little time they might be able to bridge the gap.  Don't send them  
through a meat grinder over a small difference, just ask.  There are  
relatively few suppliers of most bicycle products to shops.  If you  
are a shopper you can always find a "BETTER PRICE" on the internet  
someplace as there are often five sellers for every customer of some  
items.  Items are not always cheaper, offer reliable or fast  
delivery, have warranties,offer tech support, returns, available or  
exist on earth but you can always find a better price on a webpage.   
Often webpages are not updated  ( often for years) and old pricing  
just sits in cyberspace forever. I recently was asked to meet a price  
of an item listed at a store that has been closed for over five years  
but I guess they paid there domain server well in advance! Now  
closeout items of one of a kind things are almost always available at  
a discount but some classic things cost more because they have become  
collectable.  Try and buy an new Ideal 90 saddle and you will see.

I think if what you want a good deal and a good relationship with a  
bike shop you should try and build a relationship. Try and bundle  
your needs and send or bring by a list of equipment you would like to  
purchase and ask for a bundle price. If you have price shopped it  
send that along with details. Sometimes the shop can do much better  
on a list of multiple items (particularly bulk-think supplies,  
spokes, tires, tubes, handlebar tape ) than you can manage on your  
own after shipping things in from all over.  Give them time so they  
can check multiple suppliers.  If it doesn't work out, no harm no  
fowl; try again next time.  You know people seem to really value the  
shop that waits after closing while the supper gets cold for you to  
pickup a tire for your group ride or works into the night to solve  
your shifting problem or crazy noise for the big ride that weekend  
but if you only open your wallet when there is a crisis there may not  
be a shop there when you really need them. Remember most stores work  
in the background to support cycling, better road conditions, better  
facilities and safety for you whether you shop there or not.  Often  
there is a lot of time and often cash money invested on your behalf  
and supporting them helps offset the free ride many of the big online  
stores enjoy at the local guys expense.

75% higher sounds way outta line!


<<Message: 6
Date: Fri, 18 Feb 2011 16:07:31 -0500
From: Andy Goodell <[email protected]>
Subject: Re: Dear LBS

One of the shops did recommend that, and gave me a catalog to see if  
I could
find what I wanted. Though they said it would likely be about 2 weeks  
to get
the part. Two weeks and a 75% higher price means I just bought it online
instead.

This is what I mean by chicken and egg. I know they can't stock  
everything,
but how many times do they expect someone to get turned down and  
still be
willing to come back the next time? I like supporting my local  
economy, so I
do keep coming back just to see if they have the parts I'd like before
looking elsewhere. They've lost hundreds of $ now in potential sales  
because
I too often look online to buy the things they don't stock.
 >>

Yours in Cycling,

Gilbert Anderson

North Road Bicycle Imports
PO Box 840
166 Court Square
Yanceyville, NC 27379
USA

Our newest direct local Yanceyville Area phone is 336-421-4054
Toll Free Research Triangle Area, NC area 919-828-8999
Toll free Nationwide 800-321-5511

email: [email protected]

www.northroadbicycle.com