Polygon Factory Racing Looks to be Shutting Down for 2024

 Rumor is Polygon might try to save money by cutting a few corners...after which they’ll be known as Line.

 @WRCDH: they'll still be polygon if they cut a few corners

 A good woody sort of word!

 @WRCDH: underrated comment

 Dude. Pinkbike Collective bow.

 @WRCDH: my father always told me to quit while I was ahead.

 @itslightoutandawaywego: quit while you're ahead

 @WRCDH: I think you mean "...after which they will be known as Cube"

 @powderhoundbrr: Doneygone

 @WRCDH: this is genius

 @deepcovedave: Apologies for the pedantry but as polygons lie in a single plane, they can never become a cube. A cube is a polyhedron, also known as a three-dimensional shape with flat polygonal faces.

 @mi-bike: Deepcovedave is now thinking, “Doh!-decahedron I should’ve paid attention during geometry lessons!”

 poly gone :p

 @mi-bike: fellow mathematics major represent!

 @leelau: Fellow? Who's the other?

 @mi-bike: ‍♂️ had a good laugh that started with the pedantry and ended with a good nerd-laugh at myself.

 @mi-bike: poor assumption on me.

 The bike industry is weird compared to others because of the relatively low barrier to entry.

Case in point - Neko, DH racer develops and releases his own DH frame, now imagine a racing driver developing their own car or a moto gp rider developing a bike - point being its not that hard compared to lots of other products to form a 'bike company'.

You want cheaper bikes? - then we need 3-4 big brands to make everything for us like they do in the moto world, but at the same time we don't want that, we want to be individual, have a fancy toy other people don't, 'steel is real', support the small brand etc etc

I think you really need to understand is that profit margin in the bike industry genuinely isn't as high as people think - sure some prices rose above that witch was required due to inflationary pressure in covid but think about this:

- If a brand could make a range of fantastic bikes at a much lower price than the competition while still turning a great profit, why wouldn't someone have done it? Why wouldn't a big investor had set this up and destroyed the competition and forced lower pricing into the industry?

Truth is - YT etc are those people, they are cheap because they direct sell and don't give margin to distributors / shops - why do people still buy other, more expensive bikes then? are they not cheap enough?

 @lkubica: The 'industry' isnt a singular thing, you do know that don't you?

Do you think a the 'industry' got round a table during covid and cooked up a plan to squeeze all the profit possible out of everyone, or do you perhaps think a once in a generation situation came up in covid causing an increased in demand, restriction of supply and increase in costs never seen before and as a result prices rose and we are left with a surplus as brands got things wrong?

Should you give a shit? - not at all, personally I don't like to hear people I like losing their jobs though.

 I think the industry is in a downturn and the switch from EWS to EDR has been really poorly managed so there's very little return on investment for the teams. I think Polygon and others are just jumping off a sinking ship. The real blame I believe lies with UCI

 @briain: this - so hard to connect a financial return to racing that barely gets any coverage.

 Polygon was a real serious player with a WC overall win with Tracey Hannah in 2019. The bikes were still ugly Although I would have liked to have ridden the Square DH.

 @justanotherusername: Having raced for a team that was also a distributor, what you have written does not align with the price lists we used to get at team riders!
Lapierre back in the day.... tiny margin
Commencal.... huge margin
Maxxis... huge margin

 @justanotherusername: Thats a really point about the low barrier to entry. Means lots of new companies when times are good for selling bikes but then when things go to normal or are in a dip it looks like a ton of bike companies are shutting down.

Since bikes the last 4 years and even more so the last year or two are pretty much perfect the only thing people are asking for is more durability and better cost. Gone are the days where a new bike every two years was a huge jump in performance.

 @justanotherusername: this is true in some aspects. Look at specialized which I’m not hating on I own one. Bought an evo comp during covid. $5,500 a year later it’s on sale 25% off. They price high with good margin and discount to sell remaining stock at still a profitable level.
I think specialized has a good margin in there bikes. Literally you can buy their frame and parts for cheaper than what they have priced on some models.
I think it boils down to business model and management. A race team can quickly chew into profits depending on size of company. Multiple reasons why companies don’t make it not simply pricing and margins.

 STOP BUY NEW BIKES --> prices down --> simple

 @justanotherusername: you made a great point

Also an other issue with bike world is the sponsors ship is mainly coming from the inside. have you ever seen a car race sponsored only by the car brand and the tires brand? Golf too. all tournament have major sponsor with a lot of dough coming along. Right now a bike brand need to support their team and get ask to sponsor local and provincial event... how much money can you really spend on racing...because how many rider here bought a bike because a ride is winning a race? not that many...i Bet

 @justanotherusername: I'm a bit confused as you are giving clear examples of how the margins are inflated, yet claiming the margins are not so high. The question is whether you look at it from the consumer's point of view or the industry insider.

YT/canyon can sell you a carbon bike with good equipment for 3.5k, whereas most store bought brands will sell you the same bike for 5-6k. Or even worse, YT will sell you a dream build for 5k, where others will try to sell it for 10-12k.

Some napkin, made up, math would make me guess a YT comes out of the factory for around 1k, you have some overheads related to design, marketing, race teams, other staffing, hard to average per bike but let's say another 1k, and then you have shipping/storing/delivery/assembly costs which again lets inaccurately call 500. so YT have a 1000e or 30% margin per bike, it doesn't even matter if these numbers are wrong, maybe the YT actually costs 2k out the factory, it is the comparison below that matters.

Now we all know and understand that for the store bought bike: the distributor and the store need to be compensated for storing and shipping the bike, final assembly and selling the bike. And that no one in that chain is particularly rolling in it. But at the end of the day, your 5k carbon bike still probably costs 1k out of the factory like the YT, and your 12k dream build was probably worth closer to 3k out of the factory.

One of the main things that I have seen change over the last 15 years is the marketing budget for bikes, the videos YT and Commencal make are bonkers and must cost a fortune. Hate to say it, but Commencal and Canyon also sponsor multiple teams in the same championships, not sure how much sense that makes. Would like to see those overheads get under control if it means more affordable bikes.

As a broke student in 2008 I owned and rode 3 bikes (HT, EN and DH), as an adult with a good job, I only really have one (that is worth more than the price of the 3 from 2008 combined).

 @RedBurn:

You’re welcome everybody. It’s been 10 years since I bought a new bike and these low prices are my doing.

Plastic Capra Uncaged $2400?

 It's a shame to see so many talented riders and great guys/gals without a worldcup level ride next season(s). Not surprising really, but still sad.

 @justanotherusername: Exactly. Lots of people knock the influencer types but they can pretty easily show return on investment to the brands. Racers and teams can't but Discovery/ UCI has screwed the EDR with the crap coverage and calendar you'd swear their actually trying to run it into the ground

 @Mugen: I am a little confused now too so sorry about that.

So your model where the dealer / shop must take a margin explains exactly why some bikes cost much more than others, the network must make its margin and the more people you add the more margin from the initial factory price is required.

Trust me though, nobody is making the profits in the bike industry that other industries enjoy.

So YT have spent a significant amount of money on advertisements, the exact same way brands in other industries do and for exactly the same reasons - the advert drives sales and thus pays for the advert.

When you state 'you would like to see these overheads get under control' you say so with absolutely zero info about the cost of overheads or return on investment of such an advertisement.

This scrutiny of profit and spending seems to be fairly unique to the bike industry - Profit is a dirty word for many on here when a bike company is involved, bike companies should work as non-profits and provide us with all of the fantastic bikes we want for bargain prices, sound right?

 It’s all positive news. The MTB industry will be in a much healthier place after the crash and all the parasites and vultures gone somewhere else. Just look at BMX who went through this in the early 2000’s. Only quality rider owned companies left, no investment companies and all other spam.

 @criscoe: the future is Rockrider Ford Racing

 @lkubica: no we shouldn’t care about companies going under. There are lots of reasons companies tank and ultimately it boils down to mismanagement. That is not an insult to the executives at these companies but if you build something that won’t sell at your price you have made an error, and that’s that you can’t force the consumer to buy what you’re selling and it isn’t a big conspiracy against companies going under. It’s nature

 @blueH2Oj: Easy to have the big man attitude when it isn't you losing your job - it isn't usually the 'executives' that are for the chop either, its the staff that had no role to play in any mis-management.

 @briain: I came down here to say the exact same. These companies are going to survive - for the most part, they're just not investing in a marketing channel that no one watches. if you look at the stats. Youtubers/content creators are getting more views on their weekly videos than the EDR replay. Where would you spend you money given the same situation?

 @justanotherusername: there is definitely some bandwagoning going on with your viewpoint which I feel tries to inappropriately discredit other ideas. I personally would love a generic aluminum bike with some good suspension and an slx-ish drivetrain, some decent DT or similar wheels, and house components. I'm pretty sure someone could set up a direct to consumer, no frills company with generic but updated geometry that operates at like 20% profits and make super reasonably priced bikes. Why isn't anyone doing that? Probably because they can make more money NOT doing that.

 @justanotherusername: I agree however, I have been on the chopping block. I completely empathize with staff losing their jobs when companies go under. However what are we to do? Should we buy products we don’t want in an effort to save jobs? Also I wasn’t aware that pointing out mismanagement was an insulting or “big man attitude”. But companies go under all the time and everyone can eventually point to why. So no as consumers we shouldn’t care we are after the best product at the best price in our own opinion. As far as executives not paying the price I agree they should we need like a corporate death sentence where if you’ve f*cked a company into the ground your contract is voided the companies assets are sold off and those at the helm get nothing. But that’s another conversation.

 @justanotherusername: Why do people pay for bottled water when you can get it from the tap for free? A business has the job of extracting the most money from us they reasonably can and not to get us the lowest price possible.

 @The-Wheel: because a company makin a 20% profit margin on a product would go bankrupt in absolutely no time at all?

 @blueH2Oj: We all seem to care so much about what bike companies are charging, how they spend their money, who they sponsor, what they do, why shouldn't we care if staff lose their jobs too?

 @lkubica: You do understand that a lot of the 'bike industry' is made up of companies that can and do make almost anything. Their production time has to be worth it for them to make bike components (stems for example), which some people in the world might want, when that production time could otherwise be used to make other things (medical devices for example), which many people in the world actually need.

Take Shimano as a 'big player': their bike division represents approximately 10% of their production effort. They could actually make as much, if not more money, if they re-directed half of that effort back into their fishing division.

Mountain bikes are never going to be a need to have item so we are bidding for production time against 'need to have' items and thus, for anything above commuter city bike level, that is going to cost.

 @pink505: Many business supply product at the lowest price possible and fail, why? - Because you don't want the no frills product at the lowest price possible, you want the shiny and to create the shiny you need branding, advertising etc etc.

Of course a business exists to make a profit, but competition keeps that honest and there is plenty of that in the bike industry.

 @The-Wheel: www.bird.bike/product/aeris-9-shimano-12-speed/#configuration

 @justanotherusername: not sure that's how profit works

 There's a lot of people here attacking high margins. If the margins were that high, companies would be able to continue what they were doing at today's reduced prices. They can't.
People seem to forget that a lot of the increase in cost is for raw materials, shipping, etc., through and post Covid. This has massively impacts prices and is nothing to do with bike manufacturers.
Yes, leaner businesses are better set up to cope with this (particularly DTC), but to say that all other businesses are mismanaged is a bit unfair - should we be saying that nobody should invest in a race team unless they are going to win? Where would that leave the sport?

 @slimboyjim: seems like the way people are investing I race teams at the moment isn't the best tbh

 @watchmen: those looks pretty sweet!

 @justanotherusername: we should sure. But at what cost? Do we buy as many bikes as possible even ones we don’t want or need to keep jobs? The unfortunate reality is that mismanagement cause job loss. And there is a trickle down effect. Of course as consumers we care about price.

 @andrewbikeguide: Shimanos bike division does and always has dwarfed their fishing side. I have no idea where you pulled 10% from. Between 70 and 80% of their revenue comes from bike components and they'd been making bike parts for near on 50 years before entering the fishing market.

 @andrewbikeguide: 75% of Shimano’s revenue comes from just regular old bicycles. That’s why they’ve kind of given sram the high end mountain bike market. It’s so tiny they don’t even care. They could compete if they wanted to, they could undercut sram in the oem market, they’re worth like 6 times as much. They’re just not interested, they make so much more money making cheaper parts that it’s not really worth it for them anymore. Think how many bikes Walmart sells and they all have Shimano parts and that’s just out of one store in the US.

 @briain: I would agree 100%

 @justanotherusername: No but Im sure plenty of companies individually got round their own tables and did increase prices where they could

 @Mugen: When I was closer to anther outdoor sector prices roughly double each time a product changes hands along the supply chain. So for a bike its factory price, importer price, retail price. So your bike that leaves a factory having at $1k ends up as $4k retail

 @briain: True. Influencers are alot cheaper too. I dont suppose many get more than a free product

 @justanotherusername: Of course bike companies should be profitable. If there is not profit and no ROI then there is no future and no business. Equally plenty of importers/distributers are making big margins. The vulture capitalist and conglomerates that have bought brands are only doing so because they see good ROI for the risk

 @justanotherusername: Whilst sad and very true blue H20j is still correct.

 Their riders are not exactly household names, to put it mildly.

 @justanotherusername: All good points. It’s a complex industry but there are a few things that are set. Most bikes get manufactured in the same factories in Taiwan (not because of cost only, they are also specialists), yet the variation in price can be enormous depending on the model and brand. The current environment also shows that bikes can be sold cheaper when push comes to shove because inventory is stacking up.

YT, Commencal etc. are great and their success shows it can be done. Thing is, many brands now employ a hybrid model whereby they sell direct and through shops. But why not price your bikes, frames, components correctly from the go rather than having to cut aggressively when things pile up and as this year has shown, start going sideways?

 @justanotherusername: the motor is the big barrier. There are people who build frames around a good motor.

 @vp27: I agree with almost everything you said but there is one bit you *may* have got wrong. Bikes may be sold at a loss as otherwise they just sit there depreciating. It's better to sell at a slight loss now, rather than have it sit somewhere taking up space (which costs money) and depreciating further. Plus the competition out there right now is crazy with the overstock AND lack of disposable cash people have, which kind of forces the hands of sellers - if you don't compete with a DTC brand you are likely to struggle to clear your stock...
Just because bikes are being sold cheap doesn't necessarily mean that the bike companies and shops involved had big margins...

 @The-Wheel: lol 20% profit. Bike industry would love a 20%. If you sell a bike at full price off the shop floor you’re lucky to make a 30% margin. Lots of shops operate in the 3-5% net margin at the end of the year.

Rather own a bar, than a bike shop.

Consumer direct stuff is still not any better of a value proposition. In traditional bike brands, they would sell their bikes to the local distributor and then to a bike shop and then to you. Well with direct, you’re cutting out at least two channels of 30% mark up and yet their bikes are 10% cheaper than a normal bike.

But you guys forget how little money is actually moving here. 30% margin on a $5k stumpy doesn’t cover the payroll for a day and if you work that backwards, the likely landed cost of $1,200 and the margin forwards, Specialized is making a couple hundred bucks. Think how many people they employ at Morgan Hill and Switzerland, who aren’t directly generating cash. It doesn’t take much for a brand to have a major cash flow issue.

A 20% margin on a bike wouldn’t pay for the cost to hold the spare parts inventory.

Sucks for the riders, the mechanics, the team manager, the support staff, the marketing team who does the media for the team, to all lose their jobs. That’s a rough time.

 @Douglas4130: With sale 25% off they may not necessary be at profitable level. The reason for that high price reductions is often cashflow. At today high "cost of money" (interests rates) company often needs to reduce their working capital and thus also inventories. In bad times positive cashflow often becomes priority to short-term profitability. I am not saying that S is losing money with 25% sale but they may not by far from zero profit, especially after allocating of all indirect and fixed costs to those sales.

 @slimboyjim: what people fail to realize is that the high margin is needed to profitable. Also high margin doesn’t mean overall GP is healthy. Usually does not always the case.

 @bonfire: just want to point out your taking about the bike shop. I’m talking about the company. You don’t think specialized sells to the shops for profit?

 @northboy: I agree with you on the cash flow aspect. It would be hard to say for sure without seeing numbers.
The discount affects the shop more unless specialized pays them the difference. I could ask and find out.
My point was to complain about prices but to highlight what’s necessary to stay competitive and relevant in the industry. They sell a lot of bikes at good margin, when they don’t sell they discount and maintain cash flow and a little margin. Specialized hate it or love it has a winning formula. I don’t see them shutting down their race teams just sayin!

 @justanotherusername: I don’t know you, but i like you…

 @pargolf8: thanks - not many people that know me like me so you get a special poopy fist bump

 @justanotherusername: I just want to say I'm sorry my comment was so long

 The only thing that gave Polygon any MTB credibility was their race team. Without it they are simply the 'cheapest' bike you can buy.

 @professed: I don't see hows that a bad thing. Cheap companies keep other established brands in check to an extent by capping how much they charge. I know it's not always true but the first comment on any review here about a Transition, Yeti etc is how crap the spec is for the price compared to the cheaper brands

 This is true! Talking with a pro who had multiple high end sponsors. He flat out said his sponsors care more about video content than race results!

 What wins on Sunday sells on Monday! Really depends on what kind of Youtuber as well. Lots of youtubers out there who have millions of followers and can't ride a bike at all, not gonna be influenced by that kind of brand ambassador personally.

 Not sure why you're getting downvotes because it's true. Insta and youtube will sell more bikes rather than racing. Just look at what Orbea wanted from the last pink bike academy. And some anecdotal of that is that I know no one that watched enduro and only a few people that watch downhill. You can't sell many bikes if people don't watch or your just a midfield team. It sucks though because i want to see more factory backed teams. And with everyone wanting cheaper bikes, the only way i see that happening is through scale and that means a few companies will have to fold.

 @az-shredder3 is spot on. The old days of wearing a jersey on Sunday are long gone by way of algorithms and short attention spans. Why pay someone to race if they don't add content to a hashtag silo on autoplay?

 Probably depends on the racer. Greg Minaar has probably sold some bikes in his day. Some racer who's never won a world cup and struggles to make it to finals, not so much.

 @jeremy3220: yep. Back when you could sell bikes by having photos in magazines

 I can honestly say I have never bought a bike because of a racer or race team. The first 10-12 years I rode, I never even really watched a race. I had a vague awareness of some names. The closest I ever came was Gwin and YT. They went from some questionable, fringe, direct-to-consumer brand in my eyes to something a little more legit. (Easy YT dudes — that was my perception, not necessarily reality). But still, I never bought a YT.

That said, I can’t think of any bike I’ve bought because of a specific influencer. But I will say influencers have made me aware of a bike’s existence more than any racer. I thought about GG because of Remy, but never bought one (and won’t now). He’s on Devinci now, and I’m not too excited about their bikes, but I did take a closer look because of Remy. I thought about Revel because I saw the one Seth was riding — and it wasn’t because Seth was riding it, but because he put it in front of my face and made me aware of it. Still didn’t get one, though. But I would say the influencer have done more to make me aware of the products.

 @TheR: your actually proving your point of not been influenced. Remy is on propain your thinking Yoann berilei who was. GG and moved to Devinci

 @TheR: I check out propane bikes any time kid sends me a link to his latest video. If I thought it would make me ride even close to that level I’d buy at least two of them. Lol

 @briain: Yeah, my bad. I got my French guys’ names confused. I pay more attention to Yoann than Remy. And I pay way more attention to both of them than, say, Loic Bruni. I wonder if that would be flipped around if I actually raced. Also, I’d say as far as Yoann’s sponsors are concerned, they’re just happy I’m looking at the bikes.

But yeah — I’ll admit I’m not all that influenceable. At least not consciously. But I have become aware of the bikes I’ve owned somehow. I just don’t know why. I’d say more the guys in the videos than the races.

 @NicoOfner: "What wins in Sunday sells on Monday" is really only valid for participants of racing.

The truth is the % of MTBers who race today is a much smaller percentage of what it was 25 years ago. MTBs explosion in popularity has mostly come toward the recreationalist who does not care about racing at all. Participation in sanctioned events has mostly stagnated over the last 20 years despite how many new riders the sport has gained. No UCI rule change in the world or improved TV coverage will ever interest today's median demographic of rider.

 Unfortunately, this is now completely true. I have been told essentially the same thing while recently seeking sponsorship for a junior racer. Every prospective sponsor asked for social media info. Not one asked for race results. Not one.

Back in the Olden Times (i.e. before youtube) when I raced, sponsors wouldn't give me the time of day until I had a history of results as a privateer. Now likes and hits are measurable and more valued metrics than podium stands.

 @jbuzzinco: that’s a failure of the racing series. If the series was highly coveted and made for extreme exposure. Companies would care

 @TheR: True, since civid there's way less demo days which is a shame I used to demo everything to get an idea of what I wanted in a new bike rather than just demo bikes I was interested in

 Watch me ride dis special line in da berm peak with seth! Durrrrr

 I agree but the media format isnt the issue. the old DH broadcast showed the same number of riders as the current set up.

 That's what happens when a road club takes over a mountain bike club!! Should be split like rugby union and league.

 Do you just copy and paste the same line on all the articles?

 @warmerdamj: Nuh uh. I personally do it with nothing wasted other than a 10 seconds, which is negligible

 @tobyhann: Remember, the pinnacle of DH (1990's) was still under UCI rule, so that's a bit of a stretch. TV coverage is also much higher and more accessible today.

The reality is most MTBers now don't care about racing, either participation or spectating. The sport has exploded to the common man that just wants to take his bike out to their local trails every weekend. If you asked every person that walked into a bike shop who won the world cup from previous weekend, a fraction would probably know the answer.

 Sophocles, Euripides, Bophades

 Exactly

Its by design

They want it to be the pinnacle of the sport

If you listen to a vital podcast from about a month ago, bruni said he agrees. To paraphrase, he said riders are ignoring their regional races to come to world cups and trying to skip the hard graft to reach the top and they are no where near the required level whereas he had to race the little races to earn his place. There is also a massive complaint by bros on the volume of riders hitting the track.

Others want the little man to have his day at the top level. In reality no major sport works like this. Ok you have great fa cup matches for little teams but in football you really do earn your premier league status. Less than 1% of academy players make it professional. Yes there is a massive pool but we need a better pyramid in our sport through the governing bodies

 @Lorieng: you still have to race regional races to get enough points to race. The fact that UCI change the rules when they want CX guys on the front row of an XC world cup is bloody disrespectful to the other racers. The number of racers is much lower in general so less competition on the way up. UCI need to get their act together and actually promote all of cycling not just the bits they like. I'd say over 70% of bikes on my trails are enduro/ Trail bikes. Yet enduro is really poorly supported by the UCI

 More likely a buy off where investment firms try and wring out every single penny as they drive the brand into the ground and it disappears. The era of true consolidation (a la Trek acquiring Klein, Fisher, LeMond, etc) is mostly dead due to intrabrand competition. It also doesn't help barriers to entry are so low in the bicycle industry that anyone with capital can start their own venture.

 @Jamminator: good point

 I always see EDER. This is why it is a bit fucked up, because Pumuckl keeps doing his things.

 EWS without any fun

 who?

 Sucks for you lol