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dhx42 mikelevy's article
Feb 1, 2019 at 7:27
Feb 1, 2019
Guerrilla Gravity's Less Expensive, US-Made Carbon Frame
@millsr4: I think we're talking different things. If you don't think Carbon bikes are worth it and are disappointed GG is abandoning AL bike that is totally fine, but that doesn't mean that the market for the price for carbon bikes in its entirety is unreasonable, as you mentioned earlier. Most of us in disagreement with you are saying that the market price for carbon bikes is reasonable because the market for this good is very balanced. Whether you think a carbon bike is the right material or not, is a different discussion. If you think Carbon bikes aren't good value, there's an argument for that. However, you are just one plot on the entire demand curve that makes up the whole market. Given that carbon is becoming more popular, the market is disagreeing with you at the moment. Market's are living things, so who knows maybe it will shift more in line with your thinking in the coming years. But if we knew that, no one would be arguing on PB because we could predict the future...
dhx42 mikelevy's article
Feb 1, 2019 at 6:15
Feb 1, 2019
Guerrilla Gravity's Less Expensive, US-Made Carbon Frame
@SlodownU: Operating Margin is the margin for the business; not the margin of the direct costs associated with making each individual frame. The revenue generated by each frame needs to cover all direct supply and labor costs to make the frame plus all of the business costs that go into actually running a business, which people have outlined but this R&D and future resource development. Take the Clarus Corp, which owns Black Diamond and Sierra Bullets where BD makes up a lot of the revenue. Their operating margin is 4.2% or an EBITDA Margin of 8%. The margin on individual products is probably in the 50% range, but there are a bunch of other costs that go into managing a company that brings their products to market.
dhx42 mikelevy's article
Jan 31, 2019 at 18:09
Jan 31, 2019
Guerrilla Gravity's Less Expensive, US-Made Carbon Frame
@Ktron: can’t say it much better than that. Sometimes I feel like pinkbike needs a micro Econ 101 class.
dhx42 mikelevy's article
Jan 31, 2019 at 14:09
Jan 31, 2019
Guerrilla Gravity's Less Expensive, US-Made Carbon Frame
@millsr4: You may think they are but if the prices were actually ridiculous no one would buy the bikes... Since there are a number of bike brands and suppliers, new ones entering the space, and brands willing to invest in the space to make new product, I'd say the current prices aren't symptomatic of a market where they are out of line with demand... Check-out the latest earnings reports on outdoor brands (w/o any military contracts), it's not like the operating margins are 40% or something. They are pretty reasonable...
dhx42 mikelevy's article
Jan 31, 2019 at 13:51
Jan 31, 2019
Guerrilla Gravity's Less Expensive, US-Made Carbon Frame
@yupstate: Why should GG charge any less than anyone else? If they can make the bikes cheaper, they should make more...
dhx42 mikelevy's article
Jan 31, 2019 at 9:53
Jan 31, 2019
Guerrilla Gravity's Less Expensive, US-Made Carbon Frame
@bigwheels87: 100%. The issue for the small brands is less on the supply cost side and more on the ability to leverage overhead. These are significant expenses and these expenses above COG and this is especially true for a small company with an innovative process like GG. Takes some real leadership to do what they are doing. Hats off too them.
dhx42 mikelevy's article
Jan 31, 2019 at 8:36
Jan 31, 2019
Guerrilla Gravity's Less Expensive, US-Made Carbon Frame
This is definitely really cool. Awesome seeing a company really explore the manufacturing options and taking a unique approach. At scale, it will be really interesting to see what they can do if everything really is that robotic. The pricing discussion here is a bit odd. MSRP (or market price) is really not dependent on the cost to make the frame. The price for a carbon frame is set by the market. This is why you see a number of carbon frames all priced roughly the same, about $3.3K. The cost determines company's margin. I'm guessing SC, Trek, Yeti, etc. make a 50% margin (FOB) on their frames at wholesale. If wholesale is 50% off MSRP, a frame costs about 800-900 for a company to make (obviously there are shipping, admin, overhead costs not included). I'd be interested, once the initial investment is discounted, if GG is doing it for 500-600 with shorter lead times and more capacity. Anyway, congrats to GG. Seems like really great innovation for such a small company. Definitely a bike I'll take a look at in the future.
dhx42 sarahmoore's article
Jan 29, 2019 at 6:26
Jan 29, 2019
First Look: Santa Cruz's Chameleon Hardtail Goes Carbon
New hightower is probably coming on 4/1
dhx42 RichardCunningham's article
Jan 24, 2019 at 7:10
Jan 24, 2019
Interview: Aaron Gwin on His Break With YT & Becoming a Team Owner
"I was told by Martin that YT got everything out of me that they had wanted and that they didn’t need me moving forward" - That's the line that makes this tough. I totally get that from a business standpoint from YT - everyone has to make those choices. However, stringing Aaron along while negotiating a new deal until the last day of the season is not the best way to handle it. Plans change and requirements shift that make certain partnerships not feasible in the future. These changes and plans with partners need to be managed well and this doesn't sound like that was the case with YT. People can say there are two sides to the story; but if Aaron is willing to make these type comments with one of the largest publications in MTB, they clearly didn't manage the change well with Aaron. Anyway, looks like an awesome team and stoked to see Intense still going strong at the WC for the next few years
dhx42 jamessmurthwaite's article
Jan 11, 2019 at 9:06
Jan 11, 2019
YT Announces New 2019 Jeffsy
Definitely a solid bike for most people... The GEO numbers are virtually identical to the ripmo...
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