Amazon, eBay and... QBP? Those are three nouns I never thought I'd see in the same sentence. Quality Bicycle Products
is one of North America's largest cycling wholesalers, and arguably, the most influential when it comes to making money and setting trends. The Midwestern mega business prefers to operate quietly behind its widespread base of brick-and-mortar retailers, and a surprisingly diverse group of bike builders and custom fitters. QBP's portfolio includes an in-house wheel-building factory, at least four bike brands, a clothing and gear brand, and two component ranges. Until now, the only way ordinary folks could buy those things was through a QBP-certified retailer's own store or website - until now.
|If Amazon is the first stop for shoppers, then a QBP brand like Whisky has to be there.—John Sandberg, QBP|
John Sandberg, Marketing and Communications Manager at QBP, says that well over 50 percent of all product searches begin on Amazon. And, while less than half of those who make a purchase will do so on Amazon, the site has become the universal go-to for price and feature comparisons. Sandberg put it simply: "If Amazon is the first stop for shoppers, then a QBP brand like Whisky has to be there."
QBP chose its Whisky Co
component brand to launch the program, which is called "3P Select." Whisky produces things like carbon wheelsets, handlebars, carbon forks, and a variety of specialty items for elite mountain, gravel and fat bike enthusiasts - all of which are a good fit for on-line shoppers. Sandberg says the two key aspects to 3P Select is that QBP maintains control of the product's presentation on Amazon and eBay by curating the photos, graphics, and product information in order to present the most accurate and useful customer interface possible.
"We curate the products and ensure that all pricing is MAP (minimum advertised price)," says Sandberg. "But, the retailers make the sale and ship the items from their inventory."
How would a Whisky purchase on Amazon would transpire? Say you searched for a Whisky Number 9 Carbon Fat fork.
It would come up on Amazon with Whisky branding, along with specs and an MSRP of $540. Only qualified retailers who stock a full range of Whisky products and have a well-proven on-line presence will be approved for the 3P Select program. Amazon's algorithms would arrange and display a Number 9 fork from each of those shops. You select which retailer you want to buy from and a few days later, your fat bike fork arrives at your doorstep.
Sandberg admits that QBP expects some pushback from traditional store owners who vehemently oppose any form of on-line sales, many of whom view Amazon and eBay as the great Satans of retail. QPB's 3P Select system, however ensures that all their retailers will benefit in some way, whether they choose to sell online or not. According to QBP's most recent press release, "there are 310 million people who use Amazon and 177 million on eBay, many of whom are there to purchase bicycle products." If you divided that sum evenly between QBP's 5000 retailers, that works out to 97 thousand more opportunities to sell Whisky components. Reason enough for both QBP and its retailers to adapt to Amazon and eBay's third-party sales models.
At present, a number of bike stores also host sister outlets on eBay, so QBP's move to standardize the pricing and presentation of their products in that market may be more contentious. Consistent pricing will be paramount to keeping QBP's core retailers on board, and it also takes some of the stress out of the purchase process.
|QBP's move to Amazon is a pilot program intended to offer the wholesale giant a chance to learn as much as possible before they consider expanding the program beyond their Whisky Co component range. I believe it will be successful. 3P Select doesn't employ unproven technology or ideologies. It offers cycling customers convenient online access to QPB's products, it locks in the retailer, and fulfillment is channeled through two proven entities. The entire bike industry will be watching this one.—RC|
But for real, you're publishing a story and the IMAGES are the only spots with correct spelling. You wonder what the effects of Canada legalizing the devil's lettuce are.
Disclaimer, I am a previous bike shop employee with the same small shop for 10 years. As much as I don't like seeing the little guys go under, this is the environment we live in. As the article states, the sales will be channeled thru their current bike ship client base. I am sure if QBP mishandles this too much, many of their brick-and-mortar clients will drop them as tough as that would be to get products.
I will await my downvotes
"These dag nabbed internets are ruining things! I can't change!"
Shops get f*cked by the distributors´ unwillingness to match the speed and convenience at which online sales operate.
I go to my local store and need a SRAM X01DH derailleur. Naturally, that is something most shops won´t have in stock.
I am then asked whether i want to order the product (at full price of course) with an added shipping fee of a measley 10 bucks or so and an estimated delivery time of at least 2 weeks.
I then continue to leave the shop without doing business and order online for half the price and next day delivery.
At least that´s how my past 5 or so visits in local stores went down.
Now there´s absolutely nothing a shop can do about this and i feel really sorry for those trying real hard to satisfy customers needs but are then hindered by the distributors inability to get them any parts in reasonable time without huge costs involved.
The fact that the industry leaders (those that actually utilize brick and mortar stores) like Trek are pushing dumb standards and by this make the situation even harder for the shops, doesn´t help either.
My personal conclusion:
The industry is killing off brick and mortar stores more than anyone else, simply by putting huge strain on their ability to satisfy customer needs. Manufacturers and distributors need to reevaluate the way they cooperate with local shops in order to keep them competitive.
There´s a reason i wrote "greed".
I see it the same way you do as far as shops unwillingness to adapt is concerned, however i do also see those who do still struggle to compete, essentially being forced to cut their own bottom line in order to compensate for shortcomings on the suppliers side.
I do fully realize that some businesses may need to operate the way they do, however, if you´re dependant on a local dealer network you need to go with the times as a distributor and enable your local shops to be competitive in an ever more challenging market.
It cannot only be the shops responsibility to match online pricing, hence why for example Shimano is protecting US based shops through shipping limitations on european online sales. This is one way to protect them. Another would be to offer more flexible pricing and delivery options for shops based on general sales volume and not only on volume per one specific article. There are options, but as of now, they chose to just let the shops deal with the problem they created in order to protect their own bottom line.
That is of course a legitimate practice but i don´t see how it´ll benefit them long term if customer frequency in shops declines and more and more people drift off to online competitors. Somebody has to visit those shops to actually buy those Treks off the showroom floor. So i can´t really see this strategy of protecting their own bottom line work forever because local shops can´t shoulder all the responsibilities forever.
Of course many shops are simply unable or unwilling to adapt, but that´s always been the case. Bad businesses will eventually die off, that´s nothing new. The new thing is one market evolving (online) while their competitors (brick and mortar shops) are held back by dated structures on the side of their supplier chain even if they do try to go with the times.
I dunno. Maybe that´s a local thing around my part of the world where parts go through many hands before they arrive at the customer, but i have experienced it often enough that the LBS wasn´t even able to give an estimated delivery date as they were at the mercy of the suppliers good will to ship them the stuff they ordered, which would only happen if a certain number of orders was hit.
It sounds like you run a shop. If supplier A charges you 30% more and takes longer to deliver than supplier B who are you going to order from? Its pretty obvious and bike shops would jump on any chnace they have to dave money too so why would consumers act different? Thats what bike shops need to grasp, they get so bent out of shape at the online world when they would do exactly the same of they could.
Here's a tip: learn about a business model canvas. Create one for your business and use it to evolve. We are in an evolutionary period for most marketplaces. You can evolve, or shrivel up and post on pinkbike about how modernization killed your business.
Face it - there is very little market space or economic reason for LBS to continue to exist.
- has very little storage space and therefore can only hold small amounts of stock
- a shop in a high-density retail precinct has high rental costs which must be absorbed into the price of product
- serves a very small footprint of customers - ie locals - so there is a tiny customer base
- is reliant on physical walk-in customers. Consumers are increasingly time-poor. Getting to stores is often a pain-in-the-@$$
- the probability of having the right product, for the right customer at the right time is low and getting lower
It is totally uneconomic for a LBS to hold sufficient supply of the enormous range of parts, accessories and clothing available today, to sell to the limited footprint of customers it serves.
- Can operate out a giant warehouse in a low rental area. Can therefore hold a truly massive range of stock
- Has a GLOBAL customer footprint - justifying massive stock holdings
- Benefits of large economies of scale, lower overheads and can therefore offer lower pricing to consumers
- Offers anytime, anywhere, anyhow service to its customers and can have product to their door in days.
The fact that a giant warehouse in the UK via a website offers better stock selection, pricing and can have products to my door in Sydney in a couple of days after taking a moment of my time whilst sitting on the bus on my way to work, vs an LBS which takes hours out of my day, doesn't have what I want, and can only get it at a much higher price point is basic evidence of the point.
Think of it like an investor - WHY would you invest your money in an LBS? The LBS business model is mostly broken and works in a very limited and narrow market space which is not economically sustainable.
You make comments about distributors not backing LBS enough. Why should they? Distributors exist to move large amounts of stock. Who is selling more and more stock? Their online retailer customers who buy XO1DH derailluers in bulk - not 1 pissant unit per your example.
Where is the incentive for the distributor? Not to mention distributors are getting squeezed by online retailers going direct to manufacturers - why pay margin to a distributor when your volumes are large enough to just go direct to manufacturer?
Online is winning because the basic economics of the business model makes vastly more sense than bricks-and-mortar retail.
Online has its challenges, but its market space justifies investment being made to improve the model.
The LBS model is old, dead and uneconomic. There is no point in anyone throwing any more money at it. You will never generate the returns and will only lose money in the long run.
Online DIY videos are brilliant. Most bike mechanics is simple stuff and easily learned.
For really difficult stuff, you can hire a self-employed wrench operating out of a van who comes to your door and costs less than a bike shop. So now I don't have to take time out of my day to bring my bike into town, leave it for a couple days, then waste more of my time going back to get it.
Yeah, cos only the big guys are in it for greed - only the little guy just does it for the passion...
Everyone is in it to make money, no one is in it for charity and everyone is trying to capture as much of the value chain as possible.
LBS are not entitled to special protection.
Trek/Specialized/Giant can for the moment justify having shops given their sheer scale provides economies of scale that allow them to price bikes similarly to lower volume, online competitors.
BUT - that equation is changing. As online brands sell larger volumes, improve their business models and become more competitive it will over time challenge the big 3's model and their strategy people will be closely monitoring it. And when one of the big 3 changes, you can watch the other 2 jump ship very quickly as well.
If I pay cash things are cheaper. He has even sold me some used tools and parts for a couple bucks so I didn’t have to pay the retail price of new ones. If I need an odd ball screw, he will dig one out of his parts bin and give it to me.
I use his bike stands and tools to work on my bike all the time. He has taught me the majority of what I know about building bikes. He never ask, but I usually just give him $20 or so to say thank you for using his stuff for an hour. Or bring him beer. Beer goes a long way in his bike shop.
There is always a customer hanging out for no reason in this shop. Just drinking a beer or coffee.
Hold on while I get a 2nd mortgage on my house, pull out my life savings and open an LBS in your neighbourhood!
People pay huge price increases on booze in bars because of the scenery, conversation, entertainment etc.
Bike shops sell bikes and bike accessories. Read any article on this website. People don't like paying anything extra for anything bike related.
The world evolves. As the saying goes, evolve or die.
Business has to adapt to change. Most online stores started as shops and evolved. If you chose to not evolve, then dont whine at those that did and succeeded. That makes you a bad losser. Business is competition regardless of anyones passion. Anyone doing it for a passion needs to understand that.
Anyone that works is ‘in business’ (of paying mortgages, bills, etc) and needs to invest their assets (time/money) wisely hence moving to online purchases.
There is a place for LBS but dont be so preachy about it.
(I have to admit for my SingleSpeed/Gravel-needs there is a local dealer in town with a superb shop who is small but great and as a result I always buy anything of that category from them. But it is one shop in twenty in town and doesn't do mountain bikes :-()
everything can be bought online for cheap and conveniently dropped at your doorstep. You can make one trip to the shop to have it installed instead of multiple trips. For most people, TIME and Money are their most valuable commodities. Online handles both of these. Shops must adapt or die. Service oriented shops will be the only ones that survive.
If a shop denies filing a warranty for someone simply because they didn't buy the part from there, that shop deserves to fail. That's about as idiotic as a shop refusing to work on someone's bike because they didn't purchase the bike from them.
Have you done any research on conversion rates? Online, conversion rates are generally 3%. That means 97 people out of 100 people never buy anything. Browsing is just a part of business. And done right, conversation and hospitality are true incentives to create loyal followers.
We aim for on-the-spot repairs or same day if it’s takes longer than 20 minutes. A lot of times the customer will shop and pick up a few parts while waiting for the repair.
If it’s not possible for same day, most are done in 24 hours unless parts are ordered. Less time in the shop= more time riding = more worn parts and repairs in the future. Winning!
2) don’t see bike shops lining up to stockpile a full range of extra carbon parts in the off chance they could fulfill some amazon orders for QBP
Trying to read between the lines this looks like:
1. These will be sales through authorized QBP resellers on the Amazon/Ebay marketplace and NOT direct sales from QBP to Amazon/Ebay.
2. QBP is a distributor and the nature of their business model means they have limited control and visibility on what their current resellers do with pricing and distribution. They have guidelines and requirements, but these get violated.
3. Price protection, brand presentation standardization, Minimum Advertised Price Policy are all likely goals here.
4. Cracking down on and eliminating unauthorized online sellers is likely also a goal
5. There are currently 2 main ways to sell on Amazon. One is for a company to sell directly to Amazon who then resells it. The other is for authorized resellers of a brand's product to utilize Amazon as a marketplace where they list their product for sale. This Article reads like QBP is going with the second scenario.
6. You will be seeing more and more retailers offering up their online scale as a marketplace to 3rd party retailers. Walmart, Target are some examples.
7. Maybe PB can educate the masses on 1P vs 3P sales on Amazon and what that could mean for bike shops(many of who rely on their Amazon storefronts in addition to relying on QBP)and vendors seeking to protect pricing and make sure business is transacted through authorized resellers?
QBP clearly has good intentions, but the reality is the Buy Box. No one searches through a list for their favorite
vendor, they just click Buy it Now. Amazon just cycles through the list of 3Ps, so if there are a dozen authorized vendors, you will get a 1 in 12 chance of selling your item. If Amazon gets in the listing, no one will sell anything.. meaning they have to sit on their inventory until Amazon sells out, then the 1 in 12 starts up again.
Now if you are a vendor with inventory you have to sell, the best option is to violate MAP by a penny or create your own listing. QBP might fight you, but that is easily mitigated because of the First Sale doctrine. That screws the other 11 vendors trying to sell their items too, but who cares, right? Not QBP.
The other HUGE issue is that demand on Amazon is static - meaning if an item only sells one per day, you cant change that. QBP sells to 12 vendors, that means you get one sale per 12 days (due to Amazon cycling through vendors). QBP now has a large amount of inventory they sold through to 12 vendors in Q1, but they wonder why no one is buying anymore inventory in Q2, Q3, Q4, etc.
So to mitigate the lack of orders from 3Ps, they sell a whole bunch to Amazon hoping to generate more sales, but now they have screwed the 3Ps they said they were trying to help. Due to the static demand, there hasn't been an increase in sales.. just orders, and now Amazon demands they buy back their unsold inventory. Since no 3Ps were able to sell due to Amazon being in the BB, QBP has no more cash to buy it back and has to file bankruptcy.
Wash, rinse, repeat. It happens to thousands of Amazon resellers every year. Short Sell your QBP stock now.
Edit: I just saw that Salsa and Surly are both owned by them too. Rip.
worked for a company who got shut off by QBP for selling product via amazon. now they do it too. hahahahahaha what a crock of shit
ORDER BTI / HAWLEY / ANYBODY BUT Q
Plus, Amazon and Ebay are the primary platforms for counterfeit products, and carbon bike components are an easy target for that (E.g. the proliferation of counterfeit Race Face Next handlebars). This practice is so widespread that i generally avoid buying brand-name stuff on either platform.
Why not just sell directly to the shop, and or to me. Lower price to consumer, and at no loss to the bike company. Why so many middle men.
2008 happened and I just didn't sell as much with the retail store Pedal Shop....I moved the store to a business condo (shared space), started doing some "mobile" again but without warning, QBP closed our account... one day I couldn't log-in to QBP's site. they gave me some song and dance, told me to re-apply .. ehh, no thanks, treat a customer like that? I had been dealing with QBP for almost 15 years didn't count for anything? They do carry a lot of cool stuff but, I never got around to sending in a new dealer app.. just felt back-stabbed too much.
You’re math is “fake news”
A. You didn’t account for people with accounts on each site.
B. Not every user on these sites is there for bike parts. Let’s be generous and say 10% for easy math. (Probably closer to 1% in reality). So 9.7k potential new customers.
C. But how many of those people are looking for Whisky specifically? Let’s say 1%?
So now we’ve got AT MOST 970 potential new customers per shop. And that’s probably still 10x to high. So more realistically, 100 people. Huge step down from 97k!
If you want to see what people buy on amazon? Google, “shit people buy on amazon.” *warning. You’ll hate people for the shit they spend money on....
Shops are better off running a radio ad to get 10 more customers....
To believe they contribute "Zero to society" is naive and childish".
- I worked for qbp and they had hitler type rules with their employees and customers. Not selling on eBay, Amazon etc was very high on the list.. I understand why but thier reasoning is for the exact reason bike shops need to. The industry f’s over bike shops.
Honestly I think it would be good for biking & the world in general if some of these companies & customers went the way of the dodo.
First thing that I will address is that LBS that do not evolve. We have some tech savy people, including myself, to run an online business. The problem is manufactures and distributors, such as QBP, do not want/approve internet sales much less selling on eBay or Amazon event though you see it countless times. Hell the new AXS stuff is already all over eBay. So those LBSes that choose to play by the rules are kinda between a rock and a hard spot when trying to compete with online shops. One thing that we do is we will price match almost anyone and if we do not have a product more than likely we can get it faster than you even though you can order it yourself. These are points we make known. Not that it works all the time, as you have those that want to order online and that is fine. However, if it is a part that need to be installed and you have your bike in for service more than likely you are going to pay to have that installed vs it just being thrown in.
Second, LBS stocking clothing. That is a hard one. So many colors and sizes. then the showrooming that consumers do (try it on to see what fits then go buy it online) Who wants that? Then end of the season have to blow it all out. Does not make sense. LBSes stock more niche products that are not widely available online or sold at super discounted prices. We also only carry brands that allow us to trade in our unsold product to go toward the purchase of fresh product.
At the end of the day, yes the LBS need to evolve and yes those that do not will die. We got into vehicle outfitting installing racks, hitches and such because you need to transport that bike right. Yes we sell racks but what shop installs hitches? We created a one stop shop for that. That is evolving and creating a positive customer experience. That is what is strived for...the customer experience. Whether you want a greenway bike or the latest rad ride from brand X. You , as the sales person need to speak the language of the consumer. If you can get these things right you will survive, but some of you need to quit being so hard on the LBS community. We are here for you all and not the other way around. We are here because we are as passionate about the sport as you are. No we are not going to stock every part or have every high end part, that does not make economical sense. However, there are good shops out there that are looking to serve your every need, you as the consumer just need to give them a chance. If you see foul shit then by all means don't make your purchases there but do not group us all together that we are all about ripping people off. Hell, for those that like Starbucks coffee you pay $4-$5 for a beverage that cost less than $1 to make. Nobody screams Starbucks is ripping people off and that is something you can easily do at home.
My shop started as online only, that made the most economical sense. Distributors and manufactures forced brick & mortar or would not sell to me. That's fine we have evolved and are still in business and actually just expanded, while other shops have closed. Sorry for the long rant, but yes some shops suck, does the typical business model suck? yes. But there are some of us out there that are doing things different than the traditional BS. Go out there and find them, they are out there willing to serve you. They probably ride next to you on the trails and you don't even know it.
just hoping what qbp improved their quality control and recycling of “B” grade product before it surfaced on market.
Ordering bikes at the start of the season to build your stock is a complete gamble. How are you, a small business owner, supposed to know if a new hot ticket item is going to sell? Do you risk not having it and turning away customers, or not being able to order it at all as the season progresses? What if you buy it, and it tanks- You're stuck selling it for cost a year and a half later. Now, throw size runs and different standards into the mix, and it's an absolute cluster f*ck. Sure, bike shops get to know their customer base, and their bread and butter, but it still always comes down to a guessing game for some percentage of their inventory. Tell me it's not. I've worked at bike shops and there was always 'that bike' nobody could sell.
The shear amount of product available on the market is truely staggering. Not many industries sell big ticket items through as diverse a network of retailers as the bike industry. No other sells this kind of expensive product without a nation wide marketing plan on a local level, and a corporate support strategy to manage inventory, store by store.
The bike shop as a major sales avenue is dying, and honestly I don't care. Get with the times, focus on service, stock a few basic parts. There will always be some people who buy from stores, but for most, I'm sorry to say, most bike shops don't offer enough to make the increased cost and hassle worth it. Never mind the the people who experience grouchy shop owners, eliteism, and sexism. I know a few women who are legit afraid to step foot in a bike shop, and I don't blame them based on the stories they've told. Now make it cost extra for the same products? Ya f*cking right.
Whisky stuff is not stackable against the competition anyway.
Reactive design to what other people already do better.
Also... Any chance it will be selling on the Amazon Canada store or just USA?
If the brand has assumed the basterdized Scottish spelling "whisky" then ok.
FYI, the Amazon channel is my specialty so if any LBS want to have a conversation around building a successful Amazon business, let me know