ShopMechanic

@toast2266: The margins are actually quite a bit lower. More like 20-30%.

“Been an eternity since I’ve been here.” LOL how do you feel now that the eternity of the Sea Otter grind is over!?

I do want to add that the current dealer model is definitely not sustainable at these margins, at least not in smaller markets. So, I expect some significant disruptions to the market as we currently know it over the next 5 years.

@GTscoob: fair points. Although I will say that most bikes these days have a very small margin around 25% at the dealer level. That is of course a gross margin and doesn’t take into account the labor required to build the bike. Most bikes above the $4k price point have little assembly done from the factory these days. So, it’s true that dealers are definitely being squeezed, hard. It appears from my perspective to be an effort to cut out the middleman by bike companies that are now selling customer direct as well and this allows customers to “showroom” a product at a dealer and then buy directly from the manufacturer and probably get it a little faster, but at the same price. I do want to note here that my above comments aren’t intended to make an ethical argument for how the market should work. Just hoping to shed some light on how it does work to combat all the rumors, emotionally charged rhetoric, and misinformation out there about how the bike business works.

It’s a Taiwanese factory

@vinay: Whether they start at the top or the bottom (frame design will dictate which one) it still saves a good amount of time pushing all of it through a big hole in the head tube.

@vinay: The liner’s I am referring to are the fully lined frames that allow you to push the hose or cable in one end and it comes straight out the other end effectively sealing and separating the cables from the larger voids inside frame tubes. Yes, this type of liner is optional for manufacturers, but no one expects it on a headset routed setup because it is literally impossible. Additionally, the headset routing is far faster from a factory assembly standpoint. All the hoses and cables get inserted into the headset at the same time and then all of them get pushed together into the frame at once and pulled out of a large port at the other end. Much easier than doing them one at a time with small individual ports for each hose or cable.

@Wannabet: have you considered that the focus on developing first and foremost for OE might be coming back after 20 years? Additionally, price point doesn’t have much to do with whether it’s aimed at OE or not outside of the clear examples of low end OE components that can’t be purchased aftermarket.