At seven o'clock Monday morning the average MSRP of every new bike that Intense sells will drop 25 percent. That means a $7000 Pro-Build Tracer will cost $5000. Customers in the USA will have the option of either buying their Intense directly from the factory, or from their local Intense dealers for the same money. Intense will support direct-sales customers from its headquarters in Temecula, California, and also support its existing dealers by linking on-line buyers to them with a prepaid service contract.
With a few exceptions, outside the US, Intense will sell direct to customers only. Intense has been busy setting up warehouses and customer support centers in the regions where it sells abroad to ensure prompt delivery, as well as warranty and setup-assistance in a familiar language and time zone.
Introducing Rider Direct Intense calls it Rider Direct, and it's a big change in the brand's business model, which has been staunchly devoted to bike-shop sales since its inception. There are a number of factors which motivated Intense to make that decision, but they all boil down to one simple message: Intense just made it much simpler and less expensive to buy one of their bikes.
No secret that Canyon, YT, and Commencal have demonstrated that consumer direct is a powerful tool for mid-sized brands in Europe. Their success has forced every player, large or small, to consider adopting some sort of internet-based sales strategy.
The obvious motivation is a chance to "cut out the middle man" and pocket two slices of the pie that would normally go to their distributor and retailer, but if consumer direct were that simple, everyone would already be on the program. As intense discovered, there's more to the picture than meets the eye.
Well before the decision was made to adopt Rider Direct, Intense scrutinized the best and worst of YT and Canyon. They also experimented with Intense's key markets outside the USA (the UK, Europe, Australia, and Canada), instigating test programs to compare the conventional distributor/dealer/customer supply chain with dealer-direct and customer-direct alternatives. What they concluded was that internet sales have permanently altered customer buying habits. And, perhaps more important, that the distributor/dealer supply chain was broken.
Fixing What's Broken Mountain biking is a fair weather sport (except in the UK), so our buy/sell season is a short one. Currently, bike distributors and retail shops must purchase and warehouse a substantial inventory to ensure they will have the correct size, color and model for a customer who may never walk into the store. The situation is made worse as bike brands release next-season models in the early summer months, which blunts the value of inventory as retail sales peak.
Savvy bike buyers (and sellers) know this cycle well, so they lay in wait for wholesalers and retailers to close out their stock around August at embarrassingly low prices. It's a vicious cycle that devalues the MSRP of a bicycle (and profit margins) before the first one reaches the dealer's floor.
Bike brands like Intense already own and warehouse their bikes in every size and color. Why waste the time and expense to warehouse them twice more when they could ship them directly to their customer's doorstep? In the USA, where Intense will introduce a hybrid model, dealers can minimize their investment by displaying a small number of showroom models and depend upon Intense to restock them in short notice. Intense says they anticipate shipping orders in two to four days.
Intense says their pilot programs indicated that they could use the savings generated by the Rider Direct Hybrid model to substantially lower their MSRPs and still maintain a fair profit for themselves and for their dealers. For customers, it's a form of free-market price protection. Whether you buy from an Intense dealer, or factory direct, you'll pay a price that reflects the average between the old-school inflated MSRP that high-end brands ask for (but rarely get), and the end-of-season close-out prices that the vultures offer when next year's models arrive. With far less inventory in the supply chain, the close-out situation should be minimized.
| The future of retail bicycle dealers will shift towards customer support, and aftermarket sales. When we sell direct to a customer, we link them to the shop with a service contract. So either way, they have an opportunity to establish a long-term relationship.—Andrew Herrick, Intense CEO |
Will Intense Dealers Accept the Changes? Intense CEO Andrew Herrick was realistic about the switch to Rider Direct in the USA. He admits that Intense stands to lose a number of retailers, but he believes that dealers who do give it a chance will benefit financially. He says that the sport is maturing and when that happens in a technical, high-end market, profit margins begin to drop. Comparing mountain bikes to the motorcycle industry, Herrick states that the margins on new motorcycles are between 20 and 15 percent - which is where he expects enthusiast-level mountain bikes to level off:
"That doesn't necessarily mean that bike dealers can't make a profit," says Herrick. "If they are careful with inventory, they will. The future of retail bicycle dealers will shift towards customer support and aftermarket sales. When we sell direct to a customer, we link them to the shop with a service contract. So either way, they have an opportunity to establish a long-term relationship"
| There are people who don't even grocery shop. My wife goes on Amazon, places the order and they bring it over to our house.—Jason Guthrie, Intense Dealer |
Jason Guthrie - Chainline Bikes: I had the opportunity to speak frankly with Intense dealer Jason Guthrie, owner of
Chainline Bikes in San Diego, California. He thought Rider Direct was going to be helpful:
"I’m pretty sure this will help the shops a ton," says Guthrie. "It gives us another tool to be competitive. It’s one thing to have a high-end bike, but to have one that is more attainable is something special. With on-line stores buying close outs and selling them for less than I could buy one, we can now sell an Intense for a realistic price and not be affected by end-of-year discounts."
Chainline Bikes caters almost exclusively to high-end buyers, who often pay a premium for customized paint and accessories. When asked whether dropping prices and going customer direct would adversely affect Intense, Guthrie was also positive:
"There are people who don't even grocery shop. My wife goes on Amazon, places the order and they bring it over to our house," laughed Guthrie. "The service contract, that's a great option. It covers things, like converting to tubeless, and offers a chance to introduce on-line customers to our shop. I don’t think that Intense’s reputation for being a boutique brand will go away, because of the passion they have for their brand and their core following. As long as they keep their shops involved, as long as price is not the main force driving them."
Team mechanic and test rider Chappy Feine. When on-line buyers seek advice, they'll be speaking with the people who build and ride Intense.
| With high-end boutique bikes, you don't see them selling as much. People are looking for value builds. I think the industry has pushed a little too hard.—James Matty, Intense Dealer |
James Matty - Squatch Bikes and Brews: Across the country in Brevard, North Carolina, I also spoke with James Matty, owner of
Squatch Bikes and Brews. I asked Matty if and how Intense's direct sales hybrid was going to affect the way his shop does business in the future. Matty seemed positive about the change, but he takes a wait-and-see attitude:
"For us, I think that having better inventory control and product readily available for customers is going to be better for overall volume of sales," says Matty. "I see it being better for local bike shops. People who bought on line before will continue to do so, but now Intense will be directing them to us. As far as the price of the bikes? People are looking for bang for their buck. With high-end boutique bikes, you don't see them selling as much. People are looking for value builds. I think the industry has pushed a little too hard."
To reduce its MSRPs, Intense is lowering its own profit margins, as well as the margins it offers to dealers that elect to stay on the program. Matty seemed okay with that. Intense's Andrew Herrick calls the concept of lowering profit margins, while increasing the volume of sales "the modern, transactional model." It's one of the pillars supporting the brand's move to direct sales. Matty maintains, however, that the transactional model was developed for much larger companies that primarily sell widgets at low price tags and at volumes that dwarf the cycling industry's.
"With this model [Rider Direct hybrid], I see it somewhere in between." predicts Matty. "As long as a bike shop does a little homework and watches their dollars, they will see their profits go up. Ratios will balance out, we will see more people mountain biking, and an increase in sales of smaller items and service. Low margins are like so many industries today. You have to look at your ratios and percentages. If I can sell three instead of one. If at the end of the year, my profits are higher. Why wouldn't I like that?"
Matty views initial success of Rider Direct with positive skepticism. I asked him about that, and how the changes were going to affect Intense's relationship with its core customers:
"I think, out of the gate, they are going to suffer internally." says Matty. "They are going to have a learning curve to figure out what the inventory should be like. When you are running a boutique manufacturing plant like they are, as long as they are maintaining quality and servicing their customers well - as long as they have that human touch like the bike shops - and they're hitting on price - I think those things are hard to beat. All that the on-line shops have to offer is low numbers."
| Retail pricing at the boutique level is totally fictitious. Dropping the MSRP 20 percent just brings the prices to a realistic level - what customers are really paying for them.—Doug Wolkon, Intense Dealer |
Doug Wolkon - North of the Border Bikes: Back to Southern California. Doug Wolkon, owner of
North of the Border Bike Shop, has a different take on Rider Direct. Doug's shop sits at the trailhead of one of San Diego's most popular trail networks, so his sales are split almost evenly between high-end bikes like Intense, and entry-level models purchased by newbies. Wolkon believes that there are other compelling reasons that Intense is reducing its pricing:
"Retail pricing at the boutique level is totally fictitious," says Wolkon. "Dropping the MSRP 20 percent just brings the prices to a realistic level - what customers are really paying for them. I'd rather sell less bikes at a higher margin. When things are hard to get, everyone wants one. After everyone has one, nobody wants one anymore. There's too many brands out there, and everyone is trying to grasp so much of the market. I think that there's just not enough market."
| ...We have never been afraid of doing things differently. This time, instead of bringing out a new bike, we are bringing out a better way to do business.—Jeff Steber, Intense Founder |
What Rider Direct Means for Intense Buyers When we met to discuss the big changes in store, Intense founder Jeff Steber said: "We have always been a rider-driven company, and we have never been afraid of doing things differently. This time, instead of bringing out a new bike, we are bringing out a better way to do business. It's still about the rider. Prices of high end bikes have gotten out of hand. We've found a way to drop our prices, so now people who maybe could never dream of owning a high-end bike can afford something like our new Tracer."
No cheap bikes: First and foremost, Intense is well aware that performance and pride of ownership are inseparable among its core customers. They will offer their entire 2018 range as advertised and without downgrading anything to reach their new set pricing. Andrew Herrick states that soon, every high-end bike maker will have to make a similar adjustment in their prices.
| Every customer who purchases an Intense will be contacted in person, walked through their service contracts and introduced to a local dealer, whether that dealer sells Intense or not.—Andrew Herrick, Intense CEO |
To maintain its core customers and rider-driven mission statement, Intense plans to wow them with personalized service. A completely
reconstructed website directs customer requests to real Intense employees who speak their language in their time zones.
Ready to ride - almost: Bikes will be shipped to the customer 90-percent assembled, along with a gift box packed with instructions, user manuals, accessories, and a high-quality tool set that includes everything the owner needs to finish, adjust and tune the bike. Most riders will be able to get their bikes up and running in a half hour. If the new owner doesn't feel up to the task, Intense's free service contract should cover the cost to have it done by his or her local bike shop.
Get the bike you want: Regardless of whether you are an on-line shopper or you choose to buy from a retailer, you won't have to search around for your dream bike. Intense will be shipping your bike directly from its warehouse, so you'll be able get the size, model, and color you want, instead of settling for the closest match that your retailer has in stock - or being diverted to another brand of bike altogether. If intense is sold out, you'll be communicating with the factory, so you'll get the straight story the first time around.
Join the family: Perhaps the best aspect of Rider Direct is that owners and potential customers will be interacting with the people who make, design, assemble, ship and ride Intense bicycles. Who could better answer your questions? The power of internet sales is that, for the first time in the mass market, an individual who is making a purchase can communicate directly with a person who helped make the product. It seems that Intense is prepared to take full advantage of that opportunity and hopefully customers will too. The bicycle industry will surely be watching.
NorthAmerica and europe where the market is not as big in terms of $$ however important, and direct sales its not going to happen (putting inventory in the country wont make sense) ...listen up intense, YT , canyon, you need to drop your final price to a few key independent distributors to maintain presence in some countries.....cheers
i am having a hard time selling my one or two year old bikes for 20% of the original price...
I count myself fortunate that I know an outstanding life-long mechanic in the Seattle area. I admit I haven't bought much product save for Clif Bars and Dirt Rag magazine from the shop - but I only trust him to service my suspension.
@michibretz: If you actually want to sell your used bikes you should be pricing at 50% of MSRP as a starting point. 20% off new is laughable, you can buy a new bike for 20-30% off at the end of the season and that comes with a full warranty.
Who would pay 20% off new price for used? Even if it is mint condition that is absurd.
for example i am currently trying to sell a 2016 Yeti Sb6. It's a custom xtr build with Industry nine carbon wheels and a lot of other high end parts. At full retail this bike would have been around 14K in 2016 and i'm trying without much success selling it for 2500...
Its sad but i am used to it as I am switching bikes almost every year and it has been like this for a while.
Bike industry: if you want to make more money, look after your core customer base and it will look after you and even grow. Result...higher gross and net profit!
Canyon Australia has been very helpful and forthcoming in sorting issues with some warrantied parts on my Strive. My only criticism of them is that they are a bit tardy in responding to emails, otherwise all good.
For me it is a mix of location and love. My go to shop is within 2 miles from where I work. There are 3 other shops within a half of a mile of it. They treat me like I’m part of the crew. I occasionally drop off beverages and donuts to bribe them but at the end of the day they take care of me. They have a great selection of parts on hand and go out of the way to make sure I am taken care of. They have provided me with loaner wheels when my Enve’s were out for warranty repair. They have offered to loan me a bike while mine was in the shop. They treat every interaction like they are still trying to earn my business and rarely disappoint.
I feel for people who bought an intense this year at the full price , big drop in resale price !
i was just commenting on the fact that someone stated there is a healthy market for used bikes which i don't think there is. especially with brands dumping new bikes in teh market at the end of the year...
Every body wats for teh deal an bikes in shops don't move for the suggested price any more either. thats a problem for teh industry and not only teh reason you cant sell a used bike anymore but also causing financial problems for teh whole industry. just read teh chapter 11 article on Niner...
@robw515 Yes I like bikes. when did this become a surprising thing on pinkbike?
Mountain bikes that are a year old (and are the most abused category of bicycle) are worth maybe 60% of their RRP.
For example, the used market for Santa Cruz is much, much better because they’re don’t often break and even when they do, SC helps out.
i own and owned many yetis over the years and never had any bad or even troublesome experience with the bikes or the support.
I crashed an sb66 3 or 4 years back and banged it really hard against a rock and it had a tiny little crack by the front derailleur mount. in less the two weeks i had a new frame and the bike was ready to roll again. it took me way longer to heal up again.
@CosmicCarbon I try to sell a bike that was 10k+ for 2k and change. I started at 3 but came down quite a bit already. Yes it has bin ridden hard but everything works the way it is supposed to.
The offer i get are so low it makes more sense to part it out and keep the pieces around as spares. for example it on one of my other bikes a wheel would break and i have to buy a new one i would be quickly up to what people are offering for the bike right now.
anyway, I did not make that statement because of my bike in particular, i just used it as an example because someone stated there is a good market for used bikes which at least in Socal is definitely not true.
@CosmicCarbon - good market for second hand parts, save those stories to your GF when you want to convince her you need a new bike Like @michibretz says, selling a complete is a terrible idea if you want at least 40% of original value of a 2-3 year old bike. You can get 50-60 if you are willing to go through the mess of selling the bike in parts. And completes of absolute high end bikes lose value like hell. While frame and fork keep some value, the XX1/XTR and Enve jewelry is often worthless when sold as complete. And all those fkrs who will bitch on boost are the first to use lack of it as an argument against your bidding price
1) No bikes on the sales floor, just a fleet of demo's which will let a potential buyer actually swing a leg over a bike. Charge em $50 for the rental and refund it if the place the order. Acknowledge the reality that consumers have a strong incentive to shop around online when it comes to big ticket items so steer clear of them in general. Maybe get a few for the pigs in the window effect but know up front that it was a marketing trick and don't expect that Fox 40 in the window to actually sell.
2) Robust small parts inventories. Leverage the fact that the consumer has less of an incentive to shop around on small parts. i.e. i'm not going to waste my time looking for the best deal on a seal kits, bearings, brake pads, etc at the $50 price point. I want to walk into a shop and buy it now and am happy to pay the LBS premium for the convenience. In fact a lot of the time its cheaper to get those small parts from an LBS as you'd have to pay shipping on the small parts. Also this is where you are providing real value added as an LBS. I need new brake pads for my shimano brakes but can't figure out which pads as there are several generations of pad being sold and i don't know if i should get resin or metallic. This is where the bike shop steps in and creates some value added by steering you to the right product with staff knowledge/wisdom. Also, if you are a good LBS you should be curating your parts selection to fit with the local riding and preferences that you observe. Put some thought into the parts your stock and you won't be left with 20 of those studded 26in tires in your AZ shop.
3) Service and repairs. That guy that bought the DTC bike after you sheparded them through demoing bikes to choose the right one will first think of you when they need service and repairs to be prepared to capitalized on that be actually being able to perform said service or repair. Fire your bloated army of pimply faced teen know nothings on the sales floor and hire a small core of seasoned wrenches. Note, you'll need to pay better than min wage to acquire said core of seasoned wrenches but you'll still make out like a bandit in savings on payroll from your reduced number of employees. I'm always disappointed when i walk into a shop needing something more in depth than der adjustment (like a damper service) and find out "oh you need to take it to a specialty shop for that". FFS, I walked into this shop that supposedly specializes in bikes via the big sign that said "Bicycles" on the front of your shop. YOU, were supposed to be the specialty shop.
Who will go this way next - Santa Cruz would be a prime suspect.
Shops are reluctant to pay more because there isn't a good way to quantify skills right now short of demonstrated ability, and it doesn't take long to train someone who's never held a wrench before how to be "good enough." Which sucks, because "good enough" means that they still screw up a lot, which cuts into margins and takes extra time spent fixing mistakes.
Its going to get difficult for the shops out there if they keep trying to make money selling full bikes, custom builds and service are about the only way I can see things being profitable in the future if we keep going direct sale on bikes and the online shops keep component prices to a minimum - not to mention the guys selling parts direct.
2) Small parts are our bread and butter. When looking at numbers and seeing if we can afford peanut butter sandwiches or an actual meals, (generally I pick PB sandwiches anyways haha) the small parts are what actually have margins. Its what people need most often. I don't stock things that I think will sit on a shelf for more than 3 months. I also offer free delivery to your door if you live in Bellingham. Customers can call me or come to the shop, order a part, and I will deliver it to their door the next day. I see this as the convenience to order online but you're able to actually support a local rider that owns and operates a shop and is there to help you out on the drop of a dime.
3) This is all true. I've been around the block for years and have worked with/visited other shops with some mechanics that A) don't know what they're talking about, and B) are arrogant about their opinion. Honestly, hiring undereducated mechanics is just part of any service business. The main difference is how willing they are to learn. Those who are, learn REALLY fast and can be a decent mechanic for most basic service rather quickly. Having a certificate generally doesn't help, and man, I've met some "certified mechanics" that make me scratch my head on that whole subject. I'm not saying I am the best mechanic on Earth, but I'm more than willing to admit if I don't know something off the top of my head. There's no need to completely stop hiring younger kids, because they need to start somewhere. Luckily when I was 16, my LBS hired me, and 11 years later I own and operate my own successful business because they saw me as a local bike lover rather than a little bmx punk. Also, 100% of shops can't service many types of suspension. Some brands, as you know, will not sell service tools to LBS's so you have to send them in to the manufacturer for service. This would be another industry change, but manufacturers would need to be willing to lose out on service income. This may or may not be something that happens.
All in all, its very easy to think about how a bike shop should be ran, and how one would own and operate their own shop if they decided to. In the end, its WAY HARDER to implement said plan once you actually start to do it and make a living from it. Long hours and little to no pay makes the LBS business as something that is either for a investor trying to make a buck from an income business, or from a cyclist who LOVES what they do. There is no in-between. I really do this strictly because I enjoy it and I love helping people with their bike. Going for a ride on the local mountain and seeing a smiling customer that I helped with their skipping drivetrain and contaminated brakes is a great feeling, which is the driving force behind all of my hard work.
And as for stocking small parts - that's a pipe dream IMO.
But in all seriousness my proscriptions on how to run a bike shop probably should be directed at bike shops that cater to the enthusiast rather than the average Joe. I can't see many avg Joe's willing to wait 1 week while their bike is shipped to the store. They'll expect to walk out with a bike under $500 with lots of assurances that this bike is "sick" from a sales rep. But still a shop that caters to the average joe is going to face the same pressures from DTC. Not sure what path forward they have.
I miss the last decade when it was cool to fill a shop with awesome stuff and people came in because your store js known to be full of awesome stuff. These last couple years we are seeing less people hanging around and drooling about bikes/shiny bits. Those people are droolig at home. whenever people come in the sale is already done. All we have to do is (1) have the item the customer came in for (2) not charge too much more than the cheapest online source they saw and (3) not screw up the sale.
we've had Cytech and City & Guilds here in the UK for some years
Cytech 1 is bike building, Cytech 2 is service mechanic, Cytech 3 for workshop manager (4 & 5 for frame building?)
as with anything, a certificate means nothing without aptitude, open mind and further education. "Everyday you learn something new is a good day"
I've interviewed two "mechanics" recently for our workshop, and despite both being certificated (I won't say which scheme), they couldn't present a competent PDI (pre delivery inspection) on a boxed road bike, and boxed hybrid.
An foreign intern working at our store this summer paid for his own certification in September and came back 2 weeks later all fully certified. We let him loose in the workshop starting with building himself some wheels, and it was a total disaster, they had "taught" him some weird ideas and practises
I had to reteach him how to lace and build wheels as the method they taught him didn't work!
Blaming internet sales is a copp out. Good business finds ways and the real riders know deep down supporting local shops is a win/win in the long run. But if the parts you want can't be found or take 2 weeks to show up (or more likely, can't show up until you place a minimum order) no wonder most go online. Sadly, components are components, and a derailleur is a derailleur. In the end, all that matters to the buyer is that he got it and at the best price. Bonus if he didn't have to wait a month for the order.
I think in the end the shops either evolve or die out. My other hobby, among others, is high end audio, and the brick and mortar stores are suffering for the same reason as bike shops. But both seem to do little to adapt, find new ways or give incentives to keep a customer base. Again, I can get a Chris King headset anywhere........
Your suggestion to prosper as a good bike shop - do some marketing and 'Spend more money - DUH!' - well thats very insightful of you, isnt it?
Just take somet time to think about what you are saying, you want small (focus on that word) shops to carry enough stock to have the parts people always need on the shelf, dispite an ever diversifying industry, so not only do you want them to have bottomless pockets, they also need a warehouse now to store it all in.
You also want the small shop to 'do some marketing' - does everybody think all businesses have endless resources? How on earth is a small shop meant to obtain this kind of information so that it is actually usefull?
With the above business model, your local, small shop will be gone, replaced either by a chain shop or much larger business, a small shop can only do so much, people expect big business service and abilites everywhere now, even the 2 man bike shop.
I own a bike shop and that's exactly how we function. Custom wheels, suspension work, brake overhauls, high end hub rebuilds, and normal repairs is our focus. I can't afford to have a fleet of bikes on the floor only to have them be blown out by the suppliers and crush any margin I may have had. When sales reps come in looking to get their bikes represented in the store and I have to turn them away because it's a bad investment in my local market. People come to us because we stock what we know is durable, what works in our area and what has good company backings and we try to bring in as many USA made options as well.
There are only 2 of us at the shop. Both UBI and DT Swiss certified. My mechanic makes $3.50 an hour more than I make because I know that the wages in a bike shop don't compare to working in a mill and I want my employees to strive to pick up every bit of feedback we get from our experiences riding trails, parts and from our customers.
I looked at the way the industry has been moving over the last 15 years that I've been wrenching professionally and structured my shop to take up the slack from online direct sales and poor LBS experiences.
It's really the only way I can be competitive on my prices and keep the doors open.
What I think most of these companies aren't seeing is that when bike shops quit recommending or pushing brands of bikes because the brand, model and are irrelevant to the shop (pick what makes you happy and click order on your smart phone) combined with the perpetual need to one-up the next guy with a new "industry standard" that is actually more proprietary than standard; I imagine we will see a heavy stagnation of bikes in an oversaturated and under supported market. Try calling the big companies that do online direct sales and getting good customer support. They say take it to you LBS and have them contact us. That's terrible in the eyes of the customer especially when the LBS is a dying breed and not everyone has access to a shop.
Remember the base of Maslow's hierarchy of needs; the basic human need to eat, sleep and complain. If Intense or anyone else ever truly addressed everything PBers were complaining about, they'd start complaining that they have nothing to complain about.
Here's what shocks I can for my frame. Fox X2, Ohlins STX/TTX, Dvo Topaz, Monarch Plus.
Storm in a teacup and some real world advantages.
Eesh. Plenty of opinions on S and YT.
My Stumpjumper is awesome but of course I didn’t pay near msrp for it (but new). Their prices are fair and for example their $3k models (Stumpy Comp) can go head to head performance, spec, and price wise with any other non D2C brand.
Hahaha! No geo on the Capra is outdated IMO. I will agree tho that the Jeffsy’s could go a little longer and slacker. The XL Jeffsy 29 is actually too short for my preferences and I’m only 6’1”.
J-Dubb -> I run a DVO Topaz on my Stumpy and it’s an awesome shock upgrade that’s available with the proprietary mount. So are Monarch Pluses. Unfortunately most high end Fox shocks aren’t and if you use a bike yoke link the air cans still don’t always clear the (carbon) frame. I tried a DPX2 and it wouldn’t fit
They are right about how the single biggest thing against Santa Cruz, Ibis, Specialized, Trek, etc is that when you by a new one, even if you got a "deal" from the shop, deep down you know you got hosed. That's why the direct models are growing so fast.
No, shops aren't paid for that either. Another reason for shops to carry good brands with good quality control.
In Europe they're gonna get their arses kicked trying to compete with the efficient german brands (Radon, YT, Canyon)
I'd never buy a new bike without demoing, but I have bought used bikes without demoing, knowing I could re-sell it for the same price. I've bought at least 3 used bikes that I did not like at all and had to re-sell them. Lessons learned I guess.
£8k instead of £10k for a factory model.
But YT equivalent spec is £4k (ok £5 if you add on a grand to upgrade the ethirteen wheels to enve)
I could put a factory model together myself for £8k and the distributers are still making money this way.
Doen’t quite add up...
Albeit I saw it at £4.5K all year...
Just about every manufacturer requires going through a shop for warranty though. In fact, the shop that I went through was one that commented in this article. Sometimes a bike shop with a good relationship with their dealers gets things done quicker. I highly recommend Squatch Bikes and Brews in Brevard, NC (it's also four states away from me). The situation sucks for you, and I hope that you call them freaking out every day until they get you taken care of. Have the shop that you bought it at take care of it, they should ship it to you for free as well, if not, then it's a small price to pay in the situation. Again, I hope you get it resolved!
I keep looking at slightly cheaper bikes than the $3k mark ( $3k is really the max I can't afford, so coming in lower is desirable.). My local builder, Transition, is just up the road and are great guys. Their bikes are heavier than I really want, but that local availability and customer service keep me coming back to them as the next buy. I know that I can always call ahead if needed and get in my car to take care of any issues I might have. Customer service is very important to me. There is plenty of choice in any market these days, so to stand out and earn dollars, you have to have that human element nailed down.
SKILLS REQUIRED
- Work 28 hours a day, 9 days a week dealing with 95% of Intense's inventory being sent back to your department.
- Mediate 95% of Intense' customers as they spend their summer waiting for a replacement part.... or even an email.
- Handle death threats.
- Survive assassination attempts
- Be invincible
Bond, James Bond
I.Q. Double-O, Seveen
So I'm not buying what you're selling buddy..
Intense Tracer Expert , carbon frame, lyrik
$4299
intensecycles.com/collections/tracer/products/2017-tracer-expert-build
vs.
YT Capra CF carbon fram, Lyrik fork
$3,999 (on sale now at $2,999!)
us.yt-industries.com/detail/index/sArticle/1283/sCategory/260
Where did you buy that?
Why did you buy that?
You don't want that.
Are you in our computer system?
All the racers around here use (fill in blank)
I don't think lower prices or inventory management will solve that problem. LBS used to service every bike that rolled in the door, no problem (70s era). Now you have to declare a political party before buying an inner tube or a gear cable.
2018 Reign Advanced 1: $5699, GX eagle, Fox36/DPS float elite, alu rear end, Green
2018 Tracer expert: $5590, GX eagle, Lyrik/Monarch RC3, Full carbon frame, Also green
For instance, YT bikes are very appealing, however, because I can't demo one here in Santa Cruz, they are off my radar.
$4900 and the 2018 is at an even $4000...
Would have sucked for me had I not bought one leftover brand new in the box, in the spring of 2016 for $3000 even.
My friends paid $17000 for 2 Pivots... I'm sorry but THEY ARE F#$%ING BIKES at the end of the day...
Hard spending real money on something I try to break every time on I ride it.. Thank God it takes it.
So will these bikes remain at a premium. Losing the dealer network and saving some money but maintaining their boutiqe price status (I understand they will be cheaper but how much more expensive than competition?)
As for the future of the LBS? On a recent trip to a city they have already evolved. Front of house is a large coffee shop with artfully placed bike parts and candy, a few bike catalogues strewn about and some bikes mounted to the wall. Looking through the door next to the counter you could see bikes and mechanics working away.
Might work well for a city shop but a small town, with limited space, is going to struggle to exist
I can't think you are missing out on the tiny margin they will be offering the 'dealers' in the us anyway, will be essentially a finders fee now as shops won't hold stock.
Then again - how many shops actually held intense frames as stock anyway and just ordered on demand? I imagine they looked at that, why bother allowing shops to order when they get a sale for an easy profit when they can do that themselves.
My point is this may say more about the demise of Boutique Brands rather than the LBS. We will always need the LBS as these bikes get more and more complex.
The intense bikes seem so out of place in MEC in Canada based on their high sticker prices. But that's how many other "high end" boutique brands are. Bring out the "my bike is worth more than my car" bumper stickers!
Sucks to be on of them
A friend had a 275a that the back end was so twisted it ruined opposite bearings - this was 1 month out of warrenty and Intense refused to sort it.
The reason being that the dealerships/Distribution has dealer Information i,e Adress etc for the the part to get sent back. Certain and mostly all distributions do not cater to customer Needs, all has to done by the shop.
Am I wrong on this?
I think the recent business moves (carbon frames only, offshore manufacturing, focusing on complete builds) were necessary to survive and reflect the new reality. Smaller boutique brands must adapt now or they will lose to the YT's and others. Bigger brands with deeper pockets will likely have more of a multi-channel approach.
Our small local bike shops have pretty much adapted already. Buying a high end bike like an Intense was always been special order. Mobile mechanic models like Velofix will really benefit from this as well as they currently make their money on service and P&A rather than stocking complete bikes.
Intense? It's been over priced for way too long. I considered the 275 but the full build was insulting for the kit they through on the bike
With all these "direct to customer"sales going on and when Intense mentioned the customer will be linked to the shop eith a service contract..when repairs have to be made(when the bike is still under warranty)...will the customer be willing to pay for the repairs? The way I see it,the dealer always has some playing space because of his margin...people who buy bikes from the shop automatically get calculated into that margin. Now,that the bike was sold/sent directly the customer,he will be obligated to pay for repairs because no mechanic in this day and age will work for free. Right?
If the customer get linked to a shop with a service contract...what terms are in those contracts?
My experience is certain things are covered by warranty..and the rest I will have to pay. A good dealer will recognise his customers and give you a good deal...
At any bike shop you can get a 10% discount if you talk for more than 10min. But my guess is the official prices were just 10% higher because they know that everyone gets discounts.
So yeah Intense is trying the premium approach with support, service contract and stuff. Is there a sort of engagement on parts availability, response time... ?
I just wonder how the LBS business model is going to change over time. Maybe it will go back to what I remember as a kid -- the Schwinn shop was also a locksmith -- or something similar, not even sure being a locksmith is a viable option these days. I just fear that if this trend continues, only select few LBS's will have the tools and knowledge to do repairs on high-end bikes, and more service will be mail-order. For suspension components we already see that. I'm lucky enough to be a competent-enough mechanic to do my own stuff, but most people aren't. And for those that aren't, dropping coin on a bike you have to ship in for maintenance sounds like a pain.
With the variety of standards and brands, stocking an assortment of small parts that work with the variety of bikes out there just doesn't seem feasible. It's a guessing game knowing what will actually move, and I would guess that there would be 40% or more that sits in bins for months at a time. Not much money to be made there.
Anyway, prices and margins are a bit crazy, but so is the tech we are getting these days. I love seeing what they will come out with next, and yes, I go buy it (even though I would like them to settle down on some standards). I had a standing deal with my previous LBS of 15% off MSRP, which we both thought was a decent deal for both me and them (but from this article it sounds like I could have negotiated 20%!). I just moved and got told by my new LBS that they would do 10% this time, but that's it. OK, well, guess I will be going somewhere else next time. Maybe just order an Intense.
Sells bikes for $10k or more.
2018 fox factory suspension, sram XX1 Eagle, and enve m70s? Not sure how those are odd, just sounds like best of the best
My guess is many shops will stop carrying Intense, because they can sell you an Intense at 15% margin or a Santa Cruz at 50% margin.
Look at what Competitive Cyclist is selling Santa Cruz's for right now: www.competitivecyclist.com/santa-cruz-bicycles-bronson-carbon-cc-x01-eagle-complete-mountain-bike-2017?skidn=SNZ00GC-MATBLA-M&ti=U2VhcmNoIFJlc3VsdHM6c2FudGFjcnV6OjE6ODpzYW50YWNydXo
They are 30% off, and have been all month, I guarantee you they are not losing money on every SC they sell. If you replace my estimate of 50% margin with 30% the still thing remains true that LBSs aren't going to want to make half the margin on an Intense.
Yeah I was just commenting on SC, whose dealers mark up their bikes at a smaller margin than say the big S. Dealers then have to maintain close to msrp to make a decent margin. SC can do this because they have a strong brand image. I know this as I’m friends with a SC dealer.
An online SC distributor probably gets better pricing from SC but at 30% I doubt CC is making anything, just offloading inventory at the end of the season to free up capital. It’s a standard end of the year sale on 2017s and very normal for all types of businesses to offload at or near cost at the end of the year.
We'll see what happens, I think it's good for the consumer, but will lead to Intense being direct only as I bet they will be passing on those lower margins to LBSs.
Agreed. If I were a dealer I’d sell SC over Intense. Plus IMO they just haven’t dialed in the quality and brand image as well as SC.
But let’s be real now. It’s the paint jobs that are hurting them.
E.g. Why is the linkage used by Giant not a VPP but a Santa Cruz is?
Subtract the marketing from the meaning of the terms
Remember VPP just stands for 'virtual pivot point, man SC have done a number on the industry with that one.