# Why so Expensive?



## 20mmrain (Sep 18, 2017)

So I recently just got into the Mountain biking hobby. Come to think of it...this is my first post in any bike forum.

My first discussion point is...why are bikes so expensive?

Coming from a computer engineering background... I can't understand for the life of me why mountain bikes (or bikes in general) are so expensive?
At least in the technology world... The high price is explained by heavy R&D costs, mixed with the use of precious metals (silver, gold, man made diamond, etc...) And the cost of power needed to develop such a small computer chip.

But in the world of biking, there isn't a good reason from what I can see, why a high end mountain bike should cost 4K to 10k. (Or even 2k for that matter)

Yes, I understand that materials such as carbon fiber are hard to mass produce, and titanium is expensive. But even then...it pails in comparison to the difficulty of producing a micro circuit board 10nm in measurement.

If you look at it logically, there are probably some R&D costs needed to develop a high-end bike, but once the bike is developed, every part is easily mass produced. Not to mention the fact that every new model isn't designed from the ground up each year. Most times a bike company will just change the color-way of the bike from year to year with minor adjustments. 
In addition to the R&D thought, the design of a bike has not changed that drastically since the creation of bikes. (Back in the day) So in my head, the R&D cost needed to develop a bike should be relatively low to begin with.

Take a second example of a chainring...once the machine die is created... You can produce as many of that chain ring as you want. There isn't a good reason why some of them should cost $50 to $100 dollars a chainring.
The only component on a bike where my opinion above doesn't make sense is forks and rear suspension. But ever then, those companies don't redevelop every part each year. They make small changes in increments.

The only explanation I can see... Is that... Mountain bikes (and bikes in general) are so expensive, because people are willing to pay a insane price the for them, and the prices are souly driven by the market. 

With that said, Bike companies must be making a killing in profits. Especially the big companies.... Trek, giant, Scott, etc.. I wouldn't be surprised that those companies are making 500% to 1000% profit on most high-end bikes.

I am not trying to complain, I really think this would be a good conversation and I only think it will change once the consumer makes a stand.
Yes, I am sure that this topic will generate some comments and opinions that will be in defendable, but if possible let's just try to keep it based in fact.

What do you guys think?

In the meantime... I'll continue to pay the amount I do for bikes and bike components, because I love the sport and I have no other option.


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## *OneSpeed* (Oct 18, 2013)

20mmrain said:


> So I recently just got into the Mountain biking hobby. Come to think of it...this is my first post in any bike forum.
> 
> My first discussion point is...why are bikes so expensive?
> 
> ...


Your right, you should start a bike company. Think how rich you could get. You could charge less than the big companies and still make 400-800% profit.


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## mileslong (Aug 20, 2016)

20mmrain said:


> In the meantime... I'll continue to pay the amount I do for bikes and bike components, because I love the sport and I have no other option.


You answered your own question....


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## 20mmrain (Sep 18, 2017)

*OneSpeed* said:


> Your right, you should start a bike company. Think how rich you could get. You could charge less than the big companies and still make 400-800% profit.


Sounds good to me.... I'll be looking for investors if you want to get in early?


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## 20mmrain (Sep 18, 2017)

mileslong said:


> You answered your own question....


Totally get that... Just wanted to discuss it a little plus I was hoping that there would be something else I was missing.

You know... To make me feel better about spending $300 dollars on a new dropper post or $500 on a new drivetrain... In addition to "I just enjoy the sport"


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## Cotharyus (Jun 21, 2012)

It's mostly a matter of spreading out the cost of R&D. Yes, it probably cost Apple a lot more to develop the iPhone X than it cost Giant to develop their new long travel 29er (hint: Giant has not spent any money developing a long travel 29er, because they don't make one) but Apple will sell a lot more iPhone X's than Giant thinks they'll sell long travel 29ers (who the heck would want one of those?) so they can spread the R&D cost out over more units, hence charge a lower price and still end up making a profit. If you half the number of units, you have to double the amount of R&D you recover on each unit. Half it again, you're at 4 times the R&D cost per unit. Still think your wunderbike won't sell 25% of the number of units as the new iPhone? Cut it again, to 8 times the R&D cost.

Look, I'm not entirely certain that economics of scale explains the whole thing, but I can tell you that buying custom/one-off/prototype electronics isn't cheap either. For instance, a load balancing switch 20 years ago, compared to a cisco router 20 years ago? It will put some perspective on things.


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## 20mmrain (Sep 18, 2017)

Cotharyus said:


> It's mostly a matter of spreading out the cost of R&D. Yes, it probably cost Apple a lot more to develop the iPhone X than it cost Giant to develop their new long travel 29er (hint: Giant has not spent any money developing a long travel 29er, because they don't make one) but Apple will sell a lot more iPhone X's than Giant thinks they'll sell long travel 29ers (who the heck would want one of those?) so they can spread the R&D cost out over more units, hence charge a lower price and still end up making a profit. If you half the number of units, you have to double the amount of R&D you recover on each unit. Half it again, you're at 4 times the R&D cost per unit. Still think your wunderbike won't sell 25% of the number of units as the new iPhone? Cut it again, to 8 times the R&D cost.
> 
> Look, I'm not entirely certain that economics of scale explains the whole thing, but I can tell you that buying custom/one-off/prototype electronics isn't cheap either. For instance, a load balancing switch 20 years ago, compared to a cisco router 20 years ago? It will put some perspective on things.


Great points actually! And it does put some prospective on it.
But, the ultimate goal of any company is to bring their products to as many people as they can in order to make money... Correct?

Well in order to do this they must keep costs down. But in bike business, the major companies almost seem like they are doing everything they can not to do business that way.

For example: years ago the major technology brands (like Intel, AMD, Apple) got together to create standards. Because they realized that the price of technology would continue to sky rocket if they were all creating their own proprietary components. So they created an even playing field with standards such as ATX, Bluetooth, USB etc.. 
This allowed them to all create their own flavor of each of those, with their own features, but it made mass production cheaper and kept costs down for the masses. Ultimately bringing technology to more people and growing their businesses.

It almost feels the bike market is doing everything they can do NOT to do something like that. Look at bottom bracket for example. There are so many proprietary versions, compatibility and long term replacements are almost going to be impossible. Not to mention, so many proprietary types keeps costs high, which means they are more expensive for the consumer.

To me... Their business model don't make sense... If they truly wanted to sell more product.

I guess what I am saying is... If they wanted to make more product and make it more affordable for the average person... They could sure use some standardization. ( Referring to the bike companies)


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## CaptDan (Jun 26, 2013)

Economies of scale would be my guess.


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## Shadow4eva (Jul 11, 2017)

Cotharyus said:


> they'll sell long travel 29ers (who the heck would want one of those?) so they can spread the R&D cost out over more units, hence charge a lower price and still end up making a profit.


They may start producing them for mass production, since they made some for the DH world cup this year. 

Sorry for going off-topic here.

In terms of R&D, I believe that for bike it's an ongoing thing. True, they don't make major changes until at least 2 years, but that could be due to their research not maturing yet, I thinj?


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## 20mmrain (Sep 18, 2017)

CaptDan said:


> Economies of scale would be my guess.


In my post above... in a long-winded way that's kind of what I'm saying... they're not making it easier on themselves...to try and scale their operations larger.


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## 20mmrain (Sep 18, 2017)

Shadow4eva said:


> They may start producing them for mass production, since they made some for the DH world cup this year.
> 
> Sorry for going off-topic here.
> 
> In terms of R&D, I believe that for bike it's an ongoing thing. True, they don't make major changes until at least 2 years, but that could be due to their research not maturing yet, I thinj?


I see your point....

And I'm sorry to keep referencing technology....
But wouldn't the same be true there? And in a much larger scale?
I would argue that doubling the quantity of transistors on Intel's latest CPU every two years, (which is the current cycle) is a much larger undertaking. So I can't imagine bike companies would find it more difficult to do than technology companies. Especially if they're subject matter experts in their fields.

Group:
Im really not trying to be difficult in my responses, I really hope someone can point out something I am not thinking of. Maybe it is just as simple of an answer as "because they can charge that much"


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## Gasp4Air (Jun 5, 2009)

CaptDan said:


> Economies of scale would be my guess.


Don't really know what I'm talking about here (but does that stop anyone?), but I expect this has a lot to do with it. Thousands of units is small potatoes, with far less opportunity to recoup development and production costs than if selling, say, 10,000,000 chainrings.

There's a great deal of competition in the bike world, and I expect if they could gain market share by cutting their huge (so you think) profit margins, some of them would be doing it.


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## Shadow4eva (Jul 11, 2017)

20mmrain said:


> IGroup:
> Im really not trying to be difficult in my responses, I really hope someone can point out something I am not thinking of. Maybe it is just as simple of an answer as "because they can charge that much"


I'm not too sure about other brands, but having been riding 2 bikes with Cannondale Lefty, I think some times the price is justified by the amount of r&d put in, as well as production costs and the technology required for manufacturing.


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## 20mmrain (Sep 18, 2017)

Gasp4Air said:


> Don't really know what I'm talking about here (but does that stop anyone?), but I expect this has a lot to do with it. Thousands of units is small potatoes, with far less opportunity to recoup development and production costs than if selling, say, 10,000,000 chainrings.
> 
> There's a great deal of competition in the bike world, and I expect if they could gain market share by cutting their huge (so you think) profit margins, some of them would be doing it.


I would like to think they would cut prices and gain market share if they could? I find it hard to believe that I would be the only person to ever think of this. And I'm sure I'm not. I guess that's why I am on a quest for answers.

But I would also ask you in most other countries biking is a means for Mass travel not a hobby like it is in the United States. Wouldn't you think if prices were lower that would make the opportunity for sale almost equal to the opportunity of sale for technology? There are 7 billion people in the world and that's a lot of opportunity for sales. A lot of those people can't afford cars too.


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## 20mmrain (Sep 18, 2017)

Shadow4eva said:


> I'm not too sure about other brands, but having been riding 2 bikes with Cannondale Lefty, I think some times the price is justified by the amount of r&d put in, as well as production costs and the technology required for manufacturing.


Maybe... I am making alot of my points based on assumption. I will admit... I've never developed a bike from scratch.


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## COMTBR (Jul 18, 2016)

Imagine how much cash SRAM and all of its child companies make (Rock Shox, for example).
Most of these bike companies are just assembling parts. They have their frame design teams, but a lot of it is:
Specialized purchaser: Hey Rockshox, we need to buy 8,000 Reba RL forks for our worldwide 2018 offering in these different sizes.
Rockshox guy: Ok, btw, your price just went up $7 per unit this year, because, um they're lighter and cooler, and aluminums more expensive.
Specialized purchaser: we also need 20,000 Revelation forks for our global shipment of 2018 Stumpjumpers
We'll also need 35,000 GX Groupsets
and 30,000 sets of Guide Rs
and 20,000 sets of Levels
and 50,000 Truvative parts
and...

And that's just Specialized...


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## 20mmrain (Sep 18, 2017)

COMTBR said:


> Imagine how much cash SRAM and all of its child companies make (Rock Shox, for example).
> Most of these bike companies are just assembling parts. They have their frame design teams, but a lot of it is:
> Specialized purchaser: Hey Rockshox, we need to buy 8,000 Reba RL forks for our worldwide 2018 offering in these different sizes.
> Rockshox guy: Ok, btw, your price just went up $7 per unit this year, because, um they're lighter and cooler, and aluminums more expensive.
> ...


This is an aspect I wasn't even looking at... You make some very very good points. It may not even be the bike companies at all it may be the component companies that are controlling the price. Especially because to brands own 80%or more of the component Market. Either through their parent or child companies.
Your point makes a lot of sense sir!

With that said if I were Giant I would consider making my own component plant. To help Drive competition and keep my suppliers prices down.


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## Shadow4eva (Jul 11, 2017)

20mmrain said:


> But I would also ask you in most other countries biking is a means for Mass travel not a hobby like it is in the United States. Wouldn't you think if prices were lower that would make the opportunity for sale almost equal to the opportunity of sale for technology? There are 7 billion people in the world and that's a lot of opportunity for sales. A lot of those people can't afford cars too.


True, but most commuters wouldn't use full-sus bikes for daily commute too, hahahahaha!
Doesn't have to be full-sus bikes in fact, purpose-built hardtail mountain bikes wouldn't be in their radar either.


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## 20mmrain (Sep 18, 2017)

Shadow4eva said:


> True, but most commuters wouldn't use full-sus bikes for daily commute too, hahahahaha!
> Doesn't have to be full-sus bikes in fact, purpose-built hardtail mountain bikes wouldn't be in their radar either.


LOL touche...

But if it was cheaper would they?


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## COMTBR (Jul 18, 2016)

Specialized already tries to make a LOT of their own parts (saddles, tires.) if they could make groupsets or suspension parts, they would. Way too many patents and Behemoth mainstays to even attempt entering that market. Plus I think Shimano might actually make some or most of their saddles...


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## Millennial29erGuy (Feb 5, 2017)

A pretty good explainer...


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## chazpat (Sep 23, 2006)

20mmrain said:


> Great points actually! And it does put some prospective on it.
> But, the ultimate goal of any company is to bring their products to as many people as they can in order to make money... Correct?


That's not always 100% accurate, if you are saying companies want to make their products as cheap as possible so they can sell more units. Some companies go the sell higher priced items at a greater margin to fewer people route.

If you really want to drive yourself crazy looking at this, look at bike tires vs automobile tires. I'm sure the number produced has a big part in it but compare the amount and number of materials, engineering, and liability between the two. And think if your car tires had the same mileage life as bike tires.


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## Shadow4eva (Jul 11, 2017)

20mmrain said:


> LOL touche...
> 
> But if it was cheaper would they?


I guess they would. I've seen "full-sus" commuter bikes (80mm travel coil fork and some cheap ass coil rear I believe) using 1.5-1.9" "mountain bike tires " over here in Singapore where I live. Probably chosen for the comfort, lol.


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## Engineer90 (Apr 10, 2015)

20mmrain said:


> Coming from a computer engineering background... I can't understand for the life of me why mountain bikes (or bikes in general) are so expensive?


I'm a mechanical engineer and I always design and engineer mechanical components for industrial applications. It doesn't cost us or my metal fabricator that much to make components and parts. Most of the calculations are done on the CAD programs! The only thing that can be expensive is the metals we use, but I usually deal with steel so it's somewhat cheaper than the rest.

But, like you said, I love the sport too and there's nothing we can do about it, so I'll just keep pulling $$$ out of my poop chute and enjoy this addiction :thumbsup:


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## leeboh (Aug 5, 2011)

Just ride a 10 year old steel hardtails with 3 x9 drivetrains, works on my commuters and bikepacking rigs.


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## Legbacon (Jan 20, 2004)

Not again, WTF?

Look at how small the new iPhone is, now look at how big your bike is. Of course the bike is going to cost more🙄


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## armii (Jan 9, 2016)

There has been a lot of talk about technology vs quantity. But what I don't get is that a top of the line motocross racing motorcycle costs about $9,000 to $11,000 and a top of the line mountain bike costs about $8,000 to $10,000? There are a lot more bicycles sold than motorcycles, but motorcycles require much higher technology. Just doesn't make sense to me.


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## Legbacon (Jan 20, 2004)

Try making that motorcycle into a human powered vehicle and see how much that runs you?


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## Crankout (Jun 16, 2010)

They're not expensive if you're just getting into it and purchasing an entry level bike. 

Reckoning back to the days of yore will not yield reliable results. You get much more bang for you buck with bikes now.


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## Silentfoe (May 9, 2008)

Go look at any bike. Pick it up. It's relatively light. Now think about all the things you can do on that bike. How long it's supposed to last. How it's supposed to handle and keep the rider upright and safe. How everything is supposed to function quickly and quietly. Think about that for a minute. How quiet is the bike as you ride it? It doesn't rattle (Or shouldn't) and all of the parts fit together tightly without sloppy machine work. 

All of these things take precise engineering and manufacturing. It's not cheap to do. The more expensive bikes do it better than the cheap bikes. You can pick up a Wal-Mart pos and drop it from 1 foot up and hear the complete **** that it is. Do that to a 3k or 10k bike and you can hear why it's more money. That's quality.

Look closely at a motorcycle. The precision engineering is there but not nearly at the level of a high end bicycle. You can grab parts and shake them. The machining isn't as clean. Parts don't have to be refined for maximum weight and strength, not to the level of a high end bike. If you turn of the engine and still roll on a motorcycle, you can hear things rattling. 

Bicycles take precision manufacturing to a level not seen in any other vehicle. I weigh 220lbs. I would have zero issues hopping on a 20lb 10k XC race bike and flying along a trail at 20 plus mph. Someone had to engineer and build that machine to be that light, strong and smooth. That's amazing. You pay for that level of manufacturing. 

Sent from my SM-G955U using Tapatalk


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## Nat (Dec 30, 2003)

It's expensive because we'll pay. Try not to overthink it. Pay the Man what you can and go shred.

Running, now that's an inexpensive sport. People on running forums complain about buying two pairs of $120 shoes per year though.


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## dir-T (Jan 20, 2004)

armii said:


> There has been a lot of talk about technology vs quantity. But what I don't get is that a top of the line motocross racing motorcycle costs about $9,000 to $11,000 and a top of the line mountain bike costs about $8,000 to $10,000? There are a lot more bicycles sold than motorcycles, but motorcycles require much higher technology. Just doesn't make sense to me.


My MX riding friend, who is also an animal of a MTB rider, and I talk about this quite a bit. It doesn't make any sense to us that bicycles can cost about the same as a MX bike. AND, MX bikes hold their value WAAAAY better than any MTB.


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## dir-T (Jan 20, 2004)

Nat said:


> It's expensive because we'll pay. Try not to overthink it. Pay the Man what you can and go shred.
> 
> Running, now that's an inexpensive sport. People on running forums complain about buying two pairs of $120 shoes per year though.


Oh geeze, I know all about it. My wife is competitive in the regional 1/2 marathon circuit. I wish she only bought 2 pairs of shoes per year - thankfully she gets 40% off. I still bet she spends about $1,000/year on shoes and clothes. And close to that again on entry fees/travel/lodging.


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## sgltrak (Feb 19, 2005)

Part of the cost of bike stuff is the expense of marketing bike stuff to riders to convince them that they need to spend big $ on the newest and greatest bike stuff.


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## Zowie (Aug 3, 2013)

20mmrain said:


> Yes, I am sure that this topic will generate some comments and opinions that will be in defendable, but if possible let's just try to keep it based in fact.


I have nothing to add that I haven't said many times before, but I applaud your effort in the quoted capacity.

Good luck.

(You must spread some Reputation around before giving it to sgltrak again.)


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## mtnbkrmike (Mar 26, 2015)

Silentfoe said:


> Go look at any bike. Pick it up. It's relatively light. Now think about all the things you can do on that bike. How long it's supposed to last. How it's supposed to handle and keep the rider upright and safe. How everything is supposed to function quickly and quietly. Think about that for a minute. How quiet is the bike as you ride it? It doesn't rattle (Or shouldn't) and all of the parts fit together tightly without sloppy machine work.
> 
> All of these things take precise engineering and manufacturing. It's not cheap to do. The more expensive bikes do it better than the cheap bikes. You can pick up a Wal-Mart pos and drop it from 1 foot up and hear the complete **** that it is. Do that to a 3k or 10k bike and you can hear why it's more money. That's quality.
> 
> ...


I was going to post something along these lines.

It blows my mind how I can absolutely beat my bike on the downs, hammer it through mud, and otherwise torque the hell out of it in adverse conditions for hours on end, yet it performs like a champ and keeps coming back for more. It amazes me how much abuse my bike takes, with zero complaints.

My GF picked up my spare SixC 800 mm bar the other day and could not believe how light it was. She did not know something like that was even possible. We are the beneficiaries of some truly high end componentry.

Plus, I do think we are a very small market relatively speaking.

So yes - to reiterate earlier posts, economies of scale in addition to damn good engineering design and ultra precise manufacturing = high cost, but only for the upper end of the spectrum, as also pointed out above. Buy a less blinged out bike in the sweet spot for $2500 or so and it really isn't all that expensive, relative to ski equipment for example, which is MUCH more shocking to me in terms of relative cost. So, again as pointed out above, the demand is obviously there for $8,000 bikes. They sell at that price because people buy them at that price.


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## Nat (Dec 30, 2003)

dir-T said:


> Oh geeze, I know all about it. My wife is competitive in the regional 1/2 marathon circuit. I wish she only bought 2 pairs of shoes per year - thankfully she gets 40% off. I still bet she spends about $1,000/year on shoes and clothes. And close to that again on entry fees/travel/lodging.


A couple of thousand per year is still pretty low for a competitive athlete. Phewww.

Skiing costs me more than all my other sports combined (unless you consider cars a sport). Bottom line: I'm good at spending.


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## Nat (Dec 30, 2003)

Related thread: http://forums.mtbr.com/passion/tell-me-its-ok-spend-8-gs-bike-1056195.html

Note the spirit of "buy, buy, buy!" Why would you NOT offer expensive products if your customers wanted to throw money at you?


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## MozFat (Dec 16, 2016)

Certainly economies of scale at play here. The number of $10k bikes sold must be miniscule. As such the development costs high. I guess they are built for elite athletes, who at the top level will be sponsored (more cost), the rest I guess are bought by next tier athletes looking for the last ounce of advantage, or the hardcore with plenty of disposable income.
Similarly, there is a point of diminishing returns once you go beyond (arguably) say $2-3k for a FS bike. How much to save 4 or 5lbs off a bike at that level? Probably the same cost again.
Mind you I think you get much more bang for buck at that sort of $2k price point than you did 10-15 years ago.


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## Darth Lefty (Sep 29, 2014)

There are certainly some pretty big prices for fancy components. When they add features or make it out of titanium, they really rake you over. But people have gotten wise to this, it's why you can get air forks and NX drivetrains on sub-$1k bikes. All the functions with none of the pork. It's also why mail order bikes have become more palatable, they are pretty conventional and much higher spec per dollar.

There's also a legal form of price fixing in the USA called minimum advertised price. You can buy things for cheaper either on the Europe mail order gray market, or in person at a bike shop if you negotiate (usually for old stock of bikes, not for components).


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## Harold (Dec 23, 2003)

the_joe said:


> A pretty good explainer...


Surprised nobody else commented on that. It's a well done video.

There are so many levels to this, and a similar video could be done for each step in the process. Raw materials extraction. Refining. Manufacturing. Distributors. Shipping. Assembly. People who start these threads think they understand because they have direct experience with some small portion of some other industry. They don't have a bloody clue.

Bikes cost what they cost because they have to.

Sure, you can buy a $100 bike. But it's not even remotely close to what you get on a $10,000 bike. I see casual observers all the time saying that they are almost the same. But the small differences in form make a world of difference in function. The bike industry is the bike industry, and you can't directly compare the production of bicycles to anything else that might remotely resemble bicycles (say, oh, motorcycles). They're different products with different details involved in their manufacturing.


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## kpdemello (May 3, 2010)

There's a lot of bunk here. High end mountain bikes today cost 3X what they did just ten years ago, and 8X what they did 20 years ago. That's not about R&D costs.

What we have here is a luxury item that affords a premium. So a company like Pivot makes a ridiculously overpriced bike because if they tried to sell a cheap bike, people would think it was a cheap bike. But if they make a bike and charge 10 grand for it, well then wow...it must be good. And Pivot makes good bikes so when you ride it, it IS good. 

Economies of scale make things cheaper. Trek, Giant, and Specialized all made cheap bikes because they could make them in BULK. And they are great bikes. But they lost market share to overpriced boutique brands. It seems people would rather spend 10 grand on the boutique models like Ibis and Pivot because these expensive, hand made bikes must be better, right? 

So nobody is trying to make cheap bikes anymore. Instead, they are all competing to make the *best* and *most expensive* bike that people with money will want to buy. Cost is irrelevant. The fact that people are willing to pay 10 grand for a bike is what matters.


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## Le Duke (Mar 23, 2009)

20mmrain said:


> So I recently just got into the Mountain biking hobby. Come to think of it...this is my first post in any bike forum.
> 
> My first discussion point is...why are bikes so expensive?
> 
> ...


Well, first and foremost:

You just said "Machine die" and "chainring", then talked about $50 chainrings.

No one is paying $50-100 for stamped rings. There is a dramatic difference in the quality of a stamped steel chainring and a CNCd aluminum or titanium ring. Same thing with a stamped then press-fitted steel cassette and a one piece steel cassette with one press fit aluminum cog, like an XX1 cassette.

Really, it sounds like you don't understand what it is that you are talking about.


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## Darth Lefty (Sep 29, 2014)

^^^Well on the other hand, when they invent a cassette that is machined from a single forging and charge many times the price of a stack of stamps, one must wonder if they are making it willfully expensive to extract your money from your wallet.


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## kpdemello (May 3, 2010)

Harold said:


> Surprised nobody else commented on that. It's a well done video.


I'll comment on it. The pricing they discussed make perfect sense if you're only manufacturing 100 bikes.

If you're making 100,000 bikes, like Specialized, Trek, or Giant, those prices are total bullshit. Same for insurance costs. $100 per bike? Sure, maybe if you're talking about selling 1,000 bikes a year. But if you sell 100,000 bikes a year, the cost per bike is going to be WAY less.

I'm relatively sure that the boutique brands are not making huge markups. They sell far fewer bikes and can't leverage economies of scale. But the big guys? Trek, Specialized, Giant, even Santa Cruz? They must be making **** loads.


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## 127.0.0.1 (Nov 19, 2013)

If you want wally world bikes that ride like a dead camel, yes they can be cheap and mass produced.

But bikes that make you want to ride them a second time, are finely tuned instruments.

ask why the virtuoso has to pay $100,000 for their Viola when you can get one at target for 100 bucks. they are the same thing, right ?


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## Engineer90 (Apr 10, 2015)

Harold said:


> Surprised nobody else commented on that. It's a well done video.


Just saw that video, very informational. For smaller guys, this might not be good at all. I feel like one would have better chances building the frames here and staying small... like buying a small warehouse and doing the metal fabrication and welding here locally.

But to reach the Taiwan levels, you gotta be a bigger company, or at least have investors to have some good $$$ seems like. Because it is true, importing products into this country can be a hassle.

Good video though, it interested me a lot because I do have a dream of designing my own frames and build them from scratch, maybe sell them. Who knows? :idea:


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## Harold (Dec 23, 2003)

kpdemello said:


> I'll comment on it. The pricing they discussed make perfect sense if you're only manufacturing 100 bikes.
> 
> If you're making 100,000 bikes, like Specialized, Trek, or Giant, those prices are total bullshit. Same for insurance costs. $100 per bike? Sure, maybe if you're talking about selling 1,000 bikes a year. But if you sell 100,000 bikes a year, the cost per bike is going to be WAY less.
> 
> I'm relatively sure that the boutique brands are not making huge markups. They sell far fewer bikes and can't leverage economies of scale. But the big guys? Trek, Specialized, Giant, even Santa Cruz? They must be making **** loads.


They weren't trying to calculate the actual cost of having a bike produced like one of the "big 3". They wanted to know what it would cost for any yahoo with a briefcase of cash to start a bike brand. Of course the more you make, the more certain costs drop. The bigger you are, though, you're going to add other costs elsewhere. More in-house R&D, more in-house QC, more bodies to handle higher volumes of product.

We're seeing it now, that the biggest drops in costs to consumers come from eliminating steps where markups are added. Going direct-to-consumer is the biggest one. Cutting out the dealer eliminates a level of markups.


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## ljsmith (Oct 26, 2007)

The answer to your question is basic economics. The two main things are:

1. Supply and Demand
2. Economies of Scale (this is why bikes and parts cost more than much more complicated automotive and motorcycle parts)


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## Harold (Dec 23, 2003)

ljsmith said:


> The answer to your question is basic economics. The two main things are:
> 
> 1. Supply and Demand
> 2. Economies of Scale (this is why bikes and parts cost more than much more complicated automotive and motorcycle parts)


You forgot miniaturization


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## Silentfoe (May 9, 2008)

kpdemello said:


> There's a lot of bunk here. High end mountain bikes today cost 3X what they did just ten years ago, and 8X what they did 20 years ago. That's not about R&D costs.


This is a fallacy spread by people who don't know better.

I was there. Bikes were still super expensive back in the day. Adjust for inflation and they are similar to high end costs today.

You also got a flimsier product with weird FS designs and very little carbon. Much less bang for your buck as far as the product goes.

Sent from my SM-G955U using Tapatalk


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## SMR (Apr 20, 2004)

I took this from the Chris Cocalis interview on this site. I think it come down to tolerances required to make a bike perform the way a manufacturer wants it to. 

Mtbr: Riders complain about $6000 being the new normal for bike pricing. What’s your take? 
CC: I’m always worried about cost. I think about it all the time, it just drives me crazy.

Mtbr: That’s reassuring…
CC: You can build a $3500 bike today that’s way better than a $5000 bike was a few years ago. But riders still want carbon frames and wheels and lighter weights and higher performance. At $6000, for the people in the game at that level, price doesn’t seem to be a barrier. Nobody’s making a killing selling bikes at the $6000 to $10,000 level. People look at your $10,000 bike and think you can buy a limited edition KTM 450 for that. But it’s still just like a really nice Toyota. The best stuff that comes off a motorcycle showroom floor isn’t even close suspension-wise, tolerance-wise, to a Fox shock or Pike fork or bike frame tolerances. A mountain bike has to be able to jump buildings with a three-pound fork with no stiction or seal leakage. I get into taking motorcycle components apart, and you see how the upper stanchions and lower tubes fit, and how crappy the castings are, one leg is tight and the other has play. Because everything vibrates on a motorcycle and there’s all this horsepower, you don’t notice it. If that noise showed up on a bicycle, it would just be unacceptable. The bang for buck in bicycling is insanely good.


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## sfgiantsfan (Dec 20, 2010)

20mmrain said:


> So I recently just got into the Mountain biking hobby. Come to think of it...this is my first post in any bike forum.
> 
> My first discussion point is...why are bikes so expensive?
> 
> ...


Doesn't the new Iphone cost 1k-1400? The people that make them are jumping out the windows of the factory because they a make about 23 cents a day. Tech is not worth it either.


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## mtnbkrmike (Mar 26, 2015)

SMR said:


> I took this from the Chris Cocalis interview on this site. I think it come down to tolerances required to make a bike perform the way a manufacturer wants it to.
> 
> Mtbr: Riders complain about $6000 being the new normal for bike pricing. What's your take?
> CC: I'm always worried about cost. I think about it all the time, it just drives me crazy.
> ...


I actually agree with all of that.


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## Gasp4Air (Jun 5, 2009)

Here's my suggestion to OP - take a stand, as you suggest, and don't buy a bike you think costs too much. Comparison shop to find the best value you can get for what you're willing to spend, and leave it at that. I don't preach the "invisible hand of the market" as the answer to everything, but in the case of luxury items like fancy mountain bikes, the marketplace can rule. We vote with our wallets.


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## kpdemello (May 3, 2010)

Silentfoe said:


> This is a fallacy spread by people who don't know better.


You're wrong. I was there too.

Here's an apples to apples comparison: My 2007 Stumpjumper Expert FSR retailed for $3,500. Adjusting for inflation, that's $4245 in today's dollars. Today's Stumpjumper Expert retails for $5,900, which is $1,700 or 40% more.


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## mtnbkrmike (Mar 26, 2015)

kpdemello said:


> You're wrong. I was there too.
> 
> Here's an apples to apples comparison: My 2007 Stumpjumper Expert FSR retailed for $3,500. Adjusting for inflation, that's $4245 in today's dollars. Today's Stumpjumper Expert retails for $5,900, which is $1,700 or 40% more.


Perhaps a different point than what you are making, but I would happily pay quadruple what I paid for my old POS FSR for what I am riding today. Among other things, I am lucky I didn't die on that death trap.


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## DIRTJUNKIE (Oct 18, 2000)

sgltrak said:


> Part of the cost of bike stuff is the expense of marketing bike stuff to riders to convince them that they need to spend big $ on the newest and greatest bike stuff.


Beat me to it.

Hype up the next big improvement, slap on an outrageous price on it. There will be lines of people that will pay the price just to keep up with the Joneses.

I feel the computer age and social media has hyped up every new improvement which in turn jacks the prices up.


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## nauc (Sep 9, 2009)

how much do iPhones sell for, how much they cost to make

/thread


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## DIRTJUNKIE (Oct 18, 2000)

nauc said:


> how much do iPhones sell for, how much they cost to make
> 
> /thread


I'll decide when it's "thread".

/thread


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## Silentfoe (May 9, 2008)

kpdemello said:


> You're wrong. I was there too.
> 
> Here's an apples to apples comparison: My 2007 Stumpjumper Expert FSR retailed for $3,500. Adjusting for inflation, that's $4245 in today's dollars. Today's Stumpjumper Expert retails for $5,900, which is $1,700 or 40% more.


You were not there too if your example is 2007. That was like yesterday.

I had a $3500 bike in 1992. There were even more expensive bikes then. That bike couldn't hold a candle to bikes today. Your argument is a red herring and is easily debunked.

Sent from my SM-G955U using Tapatalk


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## mtnbkrmike (Mar 26, 2015)

Silentfoe said:


> You were not there too if your example is 2007. That was like yesterday.
> 
> I had a $3500 bike in 1992. There were even more expensive bikes then. That bike couldn't hold a candle to bikes today. Your argument is a red herring and is easily debunked.
> 
> Sent from my SM-G955U using Tapatalk


I too am an early 90s rider. All of this is consistent with my recollection.

Bikes today kick ass. You can get a solidly speced one for $3500. Less perhaps. Nobody is forcing anyone to buy an $8k bike, and you certainly don't have to from a performance perspective. Bike companies sell bikes for $8k because they can.


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## Silentfoe (May 9, 2008)

mtnbkrmike said:


> I too am an early 90s rider. All of this is consistent with my recollection.
> 
> Bikes today kick ass. You can get a solidly speced one for $3500. Less perhaps. Nobody is forcing anyone to buy an $8k bike, and you certainly don't have to from a performance perspective. Bike companies sell bikes for $8k because they can.


And an 8k bike is infinitely better than a 3k bike.

Sent from my SM-G955U using Tapatalk


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## mtnbkrmike (Mar 26, 2015)

Silentfoe said:


> And an 8k bike is infinitely better than a 3k bike.
> 
> Sent from my SM-G955U using Tapatalk


To a point. Arguably, diminishing rates of return above the sweet point.

That said, I haven't bought a bike for under $5k since 1996. In 1996 I bought my carbon Ransom LTD. MSRP...$9999. Killer bike. Worth. Every. Penny. Industrial art on wheels.

But one need not shell out $8k to get in the game with a decent bike. I can, I do, and I will continue to. But that's my choice. Nobody is going hungry in my household.

Bikes today are incredible and not a bad deal, especially if you steer clear of the unnecessary bling.


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## DirtyHun (Jan 9, 2011)

An interesting read (at least watch the video clip):

https://www.wsj.com/articles/rise-of-the-five-figure-bicycle-1408489679


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## Silentfoe (May 9, 2008)

mtnbkrmike said:


> To a point. Arguably, diminishing rates of return above the sweet point.
> 
> That said, I haven't bought a bike for under $5k since 1996. In 1996 I bought my carbon Ransom LTD. MSRP...$9999. Killer bike. Worth. Every. Penny. Industrial art on wheels.
> 
> ...


An 8k bike almost invariably has carbon wheels. Those alone are worth the premium. Then you get into the guts and adjustments that an 8k bikes suspension has which makes a much better ride. That doesn't even get into the lighter weight and better functioning components. I'm a big believer in you her what you pay for. I would bet that nearly every person who buys a 3k bike immediately begins planning upgrades.

None of this applies to the OP though.

Sent from my SM-G955U using Tapatalk


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## mtnbkrmike (Mar 26, 2015)

Silentfoe said:


> An 8k bike almost invariably has carbon wheels. Those alone are worth the premium. Then you get into the guts and adjustments that an 8k bikes suspension has which makes a much better ride. That doesn't even get into the lighter weight and better functioning components. I'm a big believer in you her what you pay for. I would bet that nearly every person who buys a 3k bike immediately begins planning upgrades.
> 
> None of this applies to the OP though.
> 
> Sent from my SM-G955U using Tapatalk


Trust me. You're preaching to the converted. That said, and to play devil's advocate, I am convinced my Enve rims are partly responsible for my suspension harshness issues. I question whether I would be much better off with a good set of less expensive alloy hoops. As for components, I have never said to myself "Wow - these lowly Deore compnents on my 2007 Kona hardtail dedicated winter commuter really do suck." Do my Next cranks really feel that much better than XT cranks? Are the 2 pounds I shaved off really the money it took to do that? And on and on.

Like I said, I think it's a case of diminishing marginal returns once you start moving higher and higher above the sweet point for pricing.

But no problem with me. I do it every time I buy a bike. Knowingly. Happily.


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## Nat (Dec 30, 2003)

How much you get out of a more expensive bike also depends on how much you're into biking. I guarantee you that my indoorsy neighbor wouldn't be able to tell the difference between a $3000 mountain bike and an $8000 mountain bike. We, however will detect a bump in performance with upgrades however slight or imaginary.


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## kpdemello (May 3, 2010)

Silentfoe said:


> You were not there too if your example is 2007. That was like yesterday.
> 
> I had a $3500 bike in 1992. There were even more expensive bikes then. That bike couldn't hold a candle to bikes today. Your argument is a red herring and is easily debunked.


Sure and if you hired a company to make a one-off prototype you could pay $100,000 for a bike.

Just because you can find one example of a bike costing a ton back then doesn't mean that generally speaking, bikes haven't gotten more expensive on average. Sure, there were expensive bikes back then. There are stupid expensive bikes now.

But on average, if you look at the mid-range MTB stuff, it's gotten more expensive than 10 to 20 years ago. Hell my 1997 stumpy retailed for $1300, which is like $2k in today's money. Back then it was state of the art. Something similar today is like $3k.

Mountain biking is more popular and it's a rich man's sport. That has driven prices higher, despite increasing competition. That seems like a pretty straightforward fact to me. I'm not saying it's good or bad, I'm just saying it's a fact.


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## kpdemello (May 3, 2010)

mtnbkrmike said:


> Perhaps a different point than what you are making, but I would happily pay quadruple what I paid for my old POS FSR for what I am riding today. Among other things, I am lucky I didn't die on that death trap.


This is actually precisely the point I am making. Mountain bikes are more expensive because people are willing to pay it. Full stop, end of story. The talk about costs is the real red herring.


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## Millennial29erGuy (Feb 5, 2017)

Silentfoe said:


> You were not there too if your example is 2007. That was like yesterday.
> 
> I had a $3500 bike in 1992. There were even more expensive bikes then. That bike couldn't hold a candle to bikes today. Your argument is a red herring and is easily debunked.
> 
> Sent from my SM-G955U using Tapatalk


Word! It is amazing howmuch better a bike we can get today with a couple thousand bucks. The technology on bikes that cost thousands in the 90s are now available at the entry level.

I was reminded of the kitty...


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## Zowie (Aug 3, 2013)

Early nineties?
I had a pretty nice sub thirty pound bike that retailed for like 250 bucks.

But I really should have spent three grand.


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## chazpat (Sep 23, 2006)

kpdemello said:


> Mountain biking is more popular and it's a rich man's sport.


Unless you are racing, it doesn't have to be. Sure, expensive bikes are better. Sure, newer bikes are better. But are we having more fun on newer, more expensive bikes than we did years ago on older tech and lower priced bikes? Do we have to have the latest technology to mountain bike? Is going as fast as possible, cost be damned what we have to do? Is there something wrong with feeling the rocks and roots because our suspension isn't the smoothest? Why do some people ride rigid single speeds when they could be spending more money on suspension and high end drivetrains?

Nothing wrong with all this if it's what you want, some people 100% want to maximize their rides. But you don't have to. When I ride my 12 year old hardtail 26er, I don't think, gee, this isn't as fun as my 29er full suspension. I've at times thought about buying a more expensive bike, but then I ask myself, will my enjoyment level increase greatly to be worth the money? And the answer for me is "no". YMMV.


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## Clayncedar (Aug 25, 2016)

What's the saying regarding shopping for an actual non-Wallyworld mountain bike?

"Strong, Light, Inexpensive - Pick Two."

So most serious dudes are going to go with strong and light which means the wallet's going to take a hit.


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## DirtyHun (Jan 9, 2011)

Mountain biking sure as hell is not a rich man's sport. It's well and good if people feel the need to spend $8K on a bicycle, but that doesn't mean those cats are having more fun than those who ride $500 bikes. I hate that BS snobbery, and bicycles-especially mountain bikes-have grassroots beginnings.


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## Guest (Sep 21, 2017)

Since you can't buy technical skill or fitness, unless you're riding some really difficult terrain I'm not sure why you'd spend a ton on a bike. On the other hand, I save about $2k a year on driving by commuting to work (another $700-1200 if you count the Gym membership I don't have). That means the Fargo I bought in 2014 and sold this year, made me about $4k. You can still buy an old Schwinn frame and add a cruiser fork, drive train out of an old Varsity, set of rims and tires and a BMX handlebar/stem and have the exact amount of fun we had in 1979 when we did that. (Hey, that's not a bad idea. Might have to do that).


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## DirtyHun (Jan 9, 2011)

Forster said:


> Since you can't buy technical skill or fitness, unless you're riding some really difficult terrain I'm not sure why you'd spend a ton on a bike. On the other hand, I save about $2k a year on driving by commuting to work (another $700-1200 if you count the Gym membership I don't have). That means the Fargo I bought in 2014 and sold this year, made me about $4k. You can still buy an old Schwinn frame and add a cruiser fork, drive train out of an old Varsity, set of rims and tires and a BMX handlebar/stem and have the exact amount of fun we had in 1979 when we did that. (Hey, that's not a bad idea. Might have to do that).


Hear, hear!!! That's the truth!


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## TwoTone (Jul 5, 2011)

armii said:


> There has been a lot of talk about technology vs quantity. But what I don't get is that a top of the line motocross racing motorcycle costs about $9,000 to $11,000 and a top of the line mountain bike costs about $8,000 to $10,000? There are a lot more bicycles sold than motorcycles, but motorcycles require much higher technology. Just doesn't make sense to me.


This has been beaten to death, as has been said in here economy of scale.

Also, 10k is top of the line racing bike, 9k-11k is not a top of the line motocross race bike.

Apples to apple -- bike $300-$500 to 9k dirt bike or 10k race bike to 80k supercross bike.


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## TwoTone (Jul 5, 2011)

kpdemello said:


> You're wrong. I was there too.
> 
> Here's an apples to apples comparison: My 2007 Stumpjumper Expert FSR retailed for $3,500. Adjusting for inflation, that's $4245 in today's dollars. Today's Stumpjumper Expert retails for $5,900, which is $1,700 or 40% more.


Yea and that new SJ is carbon. You can't just adjust for inflation and ignore all the other changes as well.


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## TwoTone (Jul 5, 2011)

To the OP you can't seriouly be comparing tech to bikes.

Please find me a bike manufacturer making almost 300% on the bikes they sell. 

I read an article on the IPhone 7, $219 to make, sells for $649 290 percent margin with 78.8 million sold.

Do you know a mold for a carbon frame costs around 60k or more to make and you need one for each size you're going to offer?


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## singletrackmack (Oct 18, 2012)

20mmrain said:


> Bikes are expensive and I don't think they should be that expensive...
> 
> What do you guys think?
> 
> In the meantime... I'll continue to pay the amount I do for bikes and bike components, because I love the sport and I have no other option.


You need a better perspective because you are not looking at the entire picture. Mtbs are not expensive. Walmart sells mountain bike at great prices. And while we look down on those mtbs here, they serve the average person perfectly fine, just like my $350 laptop I just bought serves me just fine. But if your serious about computing power, then my $350 laptop looks just like one of those Walmart bikes. Just took a quick look on google and the HPZ840 Workstation retails for over 9k and it doesn't even come with a keyboard or mouse. 
https://www.google.com/shopping/pro...&ved=0ahUKEwi16_7Cq7XWAhVn7oMKHRG6CbQQsIwCCAU

Same thing with cars. I can go buy a car for X amount and it will work fine for mostly all people, but if your serious about performance then be prepared to pay 5 to 10 times the amount of what the average person needs. This is how it works for most retail items. Welcome to the world of retail, I mean mountain biking.


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## knutso (Oct 8, 2008)

No way you can go on Craigslist and find a full computer system for $100 that can keep up with your friend's that cost 10k. You can certainly do that with road, cx and gravel bikes and stay within a minute per hour. For full suspension mountain bikes you may have to bump that up to $500-$600, but you can certainly do it. Bikes are astronomically cheaper in terms of relative function per dollar.

Heck with computers you can just keep chaining boards together, and get faster and faster all the way up to $100million super computers with 10million dollar electrical bills. When you get past a couple grand on a bike you are chasing a few seconds per hour. Look at the guys riding freestyle bmx, their bikes are cheap as heck yet being ridden at the highest level.

There are boutique bikes and parts, but there are also boutique iphone cases. If you ask me, Apple itself is a boutique brand and receives not only an initial premium for their branding, but the apple store eco system generates huge revenue with ridiculous mark-up. Compare the production/shipping cost of a bike part to the marginal cost of pushing an mp3 to your phone.


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## singletrackmack (Oct 18, 2012)

I don't think computer technology is a good analogy. We are no where near the limits, if there are any of computer technology, but we are maxing out the limits of bike tech. 

So, first, compare new only, as there are a lot of things you can buy used for cheap, but people still buy new for many reasons. And then try just about any other retail item. Shoes, Tv's, cars, canoes, binoculars, whatever and chances are you can get a version that will suit the average person just fine and ones that are 5 to 20 times or more expensive for the "serious enthusiast". Mountain bikes are no different.


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## mattwsurfer (Aug 24, 2017)

kpdemello said:


> There's a lot of bunk here. High end mountain bikes today cost 3X what they did just ten years ago, and 8X what they did 20 years ago. That's not about R&D costs.
> 
> What we have here is a luxury item that affords a premium. So a company like Pivot makes a ridiculously overpriced bike because if they tried to sell a cheap bike, people would think it was a cheap bike. But if they make a bike and charge 10 grand for it, well then wow...it must be good. And Pivot makes good bikes so when you ride it, it IS good.
> 
> ...


There's a lot of truth here. Bike companies are very good at marketing. The main reason they make a $10,000 bike is so that a $6,000 bike seem like a good deal and that a $2500 bike must be a POS by comparison.


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## Jayem (Jul 16, 2005)

Tantrum has done a pretty good job at documenting his process of starting a bike company. Lots of good info there: Making a mountain bike, new pics | Ridemonkey Forums

I know a couple bike company owners here, pretty popular bikes. They aren't driving Lamborghini or anything because they are living some insane lavish lifestyle. For the most part they aren't much more than a shop-owner, the "perception" of their brand exceeds the reality of how much time and effort it actually takes to make it all work, as in they can't hire all sorts of engineers, marketing and other persons. The "perception" is sometimes that these brands/companies can do just about anything at any time, redesign a bike, come out with more bikes, jump through hoops and on top of tall buildings. If you are lucky to build your company up bigger, you might be able to hire some of these people and have more than just a couple guys working on things. It's an uphill battle to grow a bike company. Business is not easy when you have to build it, it doesn't matter how much you want to be in business, you have to constantly come up with new things, new ways to do things, reach out to new markets, create new markets, and so on. When you sit back, someone will come along that can do what you do better than you can do it.


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## DIRTJUNKIE (Oct 18, 2000)

DirtyHun said:


> Hear, hear!!! That's the truth!


Hey, there's only room for one judge here.


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## Jayem (Jul 16, 2005)

The other thing too is that bikes in shops from major manufacturers are for people with the money to buy them. If I'm going to dump a significant amount of money into a bike, I'm going to put on the parts that I want and build the wheelset that I want. I'll most likely do it all for several grand less than an equivalent new bike would cost. I'll do it with a few of last years parts that are still available and I'll likely go the custom-suspension route. If you can't be bothered to learn how to do some of this stuff or don't have the time, the 8-10 grand bikes exist for you. In our instant-gratification society where "ain't nobody got time for that!", you can be your own worst enemy.

There's probably a large number of bikes sold, at all pricepoints, that hang inside the garage most of the time. 

If I put together a bike, I'm going to ride the **** out of it and get my money's worth.


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## Mudguard (Apr 14, 2009)

Jayem said:


> There's probably a large number of bikes sold, at all pricepoints, that hang inside the garage most of the time.


These are often the best bikes to buy. Last years latest and greatest at a great price.


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## Picard (Apr 5, 2005)

A gf cost more money 

Sent from my F3213 using Tapatalk


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## cjsb (Mar 4, 2009)

20mmrain said:


> So I recently just got into the Mountain biking hobby. Come to think of it...this is my first post in any bike forum.
> 
> My first discussion point is...why are bikes so expensive?
> 
> ...


Not sure if you are trolling but give benefit of the doubt and keep reply short.

Your main theme--it is super easy and mass produced so cost should be very low, there can be no reason why it costs so much.

You must be wrong here on at least a couple of fronts because of the following:

It is very easy to enter the bike mfg. business, there are low barriers to entry. There isn't an OPEC cartel or a Trade Union restricting output/inputs, etc.

Mixing retail price with mfg. cost. It is all throughout your post. We are also seeing the cost of retailing come down dramatically due to internet retailers who sell directly to customer.

Customer preference and price discrimination based on such, i.e., a wise seller will price retail much higher to those who have a very high demand or the latest and greatest.

There are many other variables, but to me these are the 3 main mistakes in your reasoning.

Sent from my iPad using Tapatalk


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## TwoTone (Jul 5, 2011)

knutso said:


> No way you can go on Craigslist and find a full computer system for $100 that can keep up with your friend's that cost 10k. .


Maybe you can, I can guarantee you that $100 PC can't play the latest games.


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## chazpat (Sep 23, 2006)

cjsb said:


> It is very easy to enter the bike mfg. business, there are low barriers to entry. There isn't an OPEC cartel or a Trade Union restricting output/inputs, etc.
> 
> Sent from my iPad using Tapatalk


I'm assuming you are talking about forming a bike brand, not the actual manufacturing business. Not easy to become a bike manufacturer at all.


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## Nat (Dec 30, 2003)

During undergrad two roommates and I formed a mountain bike manufacturing company. We never got further than purchasing a bottom bracket shell and getting a first-gen Grip Shift. Ha, that went well!


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## Darth Lefty (Sep 29, 2014)

Nat said:


> During undergrad two roommates and I formed a mountain bike manufacturing company. We never got further than purchasing a bottom bracket shell and getting a first-gen Grip Shift. Ha, that went well!


This is about how I go whenever I get a Big Idea. I work on it until I'm satisfied it _could _be done, then lose interest. That's why I'm an employee


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## jestep (Jul 23, 2004)

Darth Lefty said:


> ^^^Well on the other hand, when they invent a cassette that is machined from a single forging and charge many times the price of a stack of stamps, one must wonder if they are making it willfully expensive to extract your money from your wallet.


They're saving you 100g or so to produce a consumable product at 3x the cost of a stacked one.


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## cjsb (Mar 4, 2009)

chazpat said:


> I'm assuming you are talking about forming a bike brand, not the actual manufacturing business. Not easy to become a bike manufacturer at all.


i am talking about both.

Sent from my iPhone using Tapatalk


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## chazpat (Sep 23, 2006)

cjsb said:


> i am talking about both.
> 
> Sent from my iPhone using Tapatalk


Ok, if you're just talking about becoming a custom builder, maybe not. But trying to become a mass manufacturer of bikes is not easy. There's reasons why so many bike brands don't manufacture their own product.


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## bamwa (Mar 15, 2010)

What LaDuke said......No stamping, there's cnc up in this beyoch!

And also........thats the reason craigslist is alive.


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## JackWare (Aug 8, 2016)

I think the OP is looking at the wrong profit/cost area, the development costs of a product are not the best way to look at the final price. Maybe a better comparison of a bike shop would be to a jewelers shop that also keeps a lot of stock at all price points including a few high end pieces of jewelry and watches that won't sell as often but there is a market for. 
For a bike shop to afford to keep enough stock of bikes and parts and pay wages of their staff to ensure you can walk in and get what you need including advice will mean there is a mark up on the bikes, and there would also be a mark up added by the importer because they need to make money as well on supplying a wide range of products.

In the industry I work in (UK automotive aftermarket) the final price of parts that manufacturers can charge is now strongly dictated by the power of buying groups that most distributors are part of, but I don't know if this is a factor in the cycle industry?


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## injected59 (Aug 14, 2016)

Great first post. I'm also curious what the MAP (minimum advertised price) pricing markup is from most bike companies. The major bike companies need to keep the LBS alive so they probably set that profit margin pretty high 


Sent from my iPhone using Tapatalk


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## mack_turtle (Jan 6, 2009)

I would love to hear perspective from a bicycle manufacturer. This topic hass been discussed TO DEATH in dozens of MTBR threads over the years and the same arguments are rehashed every time.


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## COMTBR (Jul 18, 2016)

I know the MAP for most Specialized bikes past the entry level is $1 lower than retail. A base to mid Rockhopper has more margin in it and the LBS are allowed to come off retail a bit. I think this is to hook that low end target audience. To get them into the sport and walk out with a bike instead of going to Walmart. Once you’re past that, most LBSs will be charging at or close to retail. Sure if you have a good LBS relationship you can get deals on current model year bikes, but they try not to price-dilute the mid-upper end bikes. You’ve got to wait a season for that.


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## *OneSpeed* (Oct 18, 2013)

injected59 said:


> Great first post. I'm also curious what the MAP (minimum advertised price) pricing markup is from most bike companies. *The major bike companies need to keep the LBS alive so they probably set that profit margin pretty high *


Is that why most bike companies are shifting their business models and selling bikes directly to consumers, cutting the LBS out of the equation?


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## injected59 (Aug 14, 2016)

*OneSpeed* said:


> Is that why most bike companies are shifting their business models and selling bikes directly to consumers, cutting the LBS out of the equation?


Can you provide examples of "most"?

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## Engineer90 (Apr 10, 2015)

injected59 said:


> Can you provide examples of "most"?


Only company I can think of doing this is Framed. They sell through their own website, but sell very limited thru LBS. I got my fatty from their website.


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## Silentfoe (May 9, 2008)

I know Trek and Giant are both selling online. You must still use your LBS for local pick up and service. I don't see this as cutting out the LBS, it's just a new way of selling to a modern crowd.

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## injected59 (Aug 14, 2016)

Engineer90 said:


> Only company I can think of doing this is Framed. They sell through their own website, but sell very limited thru LBS. I got my fatty from their website.


Okay, do you blame smaller less established companies going Direct to consumer to compete in today's marketplace when they don't need local shops to reach the end-user? Once they commit to selling through distributors easily marks up another 30 to 40%. I manage a Wholesale automotive parts company. We've had the same distributors for 30 years and we struggle with the fact that we can go direct in today's economy through eBay and Amazon and our own e-commerce site and gain 30-40% more in profits, but we don't. Fortunately we have a niche product with little competition. In turn the end user pays for it in spades. I've seen our products get marked up two hundred percent by some catalog companies is that distribute it.

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## *OneSpeed* (Oct 18, 2013)

injected59 said:


> Can you provide examples of "most"?


What you describe as "major bike companies" are offering bikes directly through their websites. It's not that they're pulling the bikes out of retail stores, just killing them slowly.

Trek, Giant, Kona, Raleigh, Diamondback, and many others, all offer bikes directly to consumers. I'm sure someone else can add to that list. The point is that your statement is extremely inaccurate.

Can YOU provide examples of companies that "set the profit margin high"? You know, like 500-1000% like the OP stated and you praised as "great first post".


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## *OneSpeed* (Oct 18, 2013)

Silentfoe said:


> I know Trek and Giant are both selling online. You must still use your LBS for local pick up and service. I don't see this as cutting out the LBS, it's just a new way of selling to a modern crowd.


Well, instead of the LBS getting any profit from the sale of the bike, they get a minimal assembly fee. $40-60? I would call that cutting them out of profit.


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## Silentfoe (May 9, 2008)

*OneSpeed* said:


> Well, instead of the LBS getting any profit from the sale of the bike, they get a minimal assembly fee. $40-60? I would call that cutting them out of profit.


You're focused on only a small part. It's debatable if they would have had a sale at all without the direct sale. At least this way they got something. Bit the bigger picture is now they have a customer. That person needs accessories and a lifetime of service. It's a general win for the LBS.

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## *OneSpeed* (Oct 18, 2013)

I don't disagree, but instead of making a decent margin on a big ticket item (think $5k bike @30% margin) a LBS gets pennies from the sale of accessories and labor. Your also assuming the customer needs accessories and a lifetime of service. LBS might never see that person again.


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## Silentfoe (May 9, 2008)

*OneSpeed* said:


> I don't disagree, but instead of making a decent margin on a big ticket item (think $5k bike @30% margin) a LBS gets pennies from the sale of accessories and labor. Your also assuming the customer needs accessories and a lifetime of service. LBS might never see that person again.


They might not but again, better than nothing. Also the bigger margins are on accessories and service. It's not pennies.

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## 127.0.0.1 (Nov 19, 2013)

oh yeah...sure

bikes and components are just simple pieces of stamped tin. should be cheap


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## Engineer90 (Apr 10, 2015)

injected59 said:


> Okay, do you blame smaller less established companies going Direct to consumer to compete in today's marketplace when they don't need local shops to reach the end-user? Once they commit to selling through distributors easily marks up another 30 to 40%. I manage a Wholesale automotive parts company. We've had the same distributors for 30 years and we struggle with the fact that we can go direct in today's economy through eBay and Amazon and our own e-commerce site and gain 30-40% more in profits, but we don't. Fortunately we have a niche product with little competition. In turn the end user pays for it in spades. I've seen our products get marked up two hundred percent by some catalog companies is that distribute it


What Framed is doing is great actually. I got my bike like 99% assembled in a big box. All I had to do was put the seat, pedals, and front wheel.

But just like you, I have seen e-commerce pick up like crazy. I work in the warehousing/factory industry and our customers always tells us their e-commerce is booming. Just to give you an example, I finished a multi-million $$$ project, their system was more towards e-commerce rather than them supplying retailers.

A lot of us bikers, we know how to use tools and we have the YouTube and Google for DIYs, so why not sell bikes in their websites?


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## injected59 (Aug 14, 2016)

*OneSpeed* said:


> What you describe as "major bike companies" are offering bikes directly through their websites. It's not that they're pulling the bikes out of retail stores, just killing them slowly.
> 
> Trek, Giant, Kona, Raleigh, Diamondback, and many others, all offer bikes directly to consumers. I'm sure someone else can add to that list. The point is that your statement is extremely inaccurate.
> 
> Can YOU provide examples of companies that "set the profit margin high"? You know, like 500-1000% like the OP stated and you praised as "great first post".


No I can't provide examples. I don't have access to their accounting dept. I started with "I'd be curious to know" because I didn't know.

You seem to be just looking at this through the eyes of the consumer. It will always be the same, companies want to grow and to grow they need money and money these days is easily obtained going direct to consumer.

It's also curious that you brought up Kona because I shopped for 3 to 4 weeks for my big honzo, and could not find one through any lbs in northern Illinois or lower Wisconsin, so I was going to have to buy direct from Kona, luckily in the end I found one used.

I couldn't begin to predict trek and Giants future if they lose LBS as distributors and support, perhaps they're not looking at the endgame and simply looking at tomorrow's profits.

I can tell you that I have had wonderful support from my local LBS Who is primarily a specialized distributor, and people seem to rip the **** out of specialized on these forums for some reason.

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## R_Pierce (May 31, 2017)

You can add Canyon and YT to the "direct to consumer" list as well.


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## Engineer90 (Apr 10, 2015)

127.0.0.1 said:


> oh yeah...sure
> 
> bikes and components are just simple pieces of stamped tin. should be cheap


I agree, a lot of engineering went into this. But us engineers use CAD programs (Solidworks, CREO, AutoCAD, etc). These programs do all of the math for us. So back in the 70s designing a part would take weeks, months. Now, it takes us about a day to design mechanical parts and then testing which depends on the application. Whole point being, engineering wise, it doesn't cost that much as it used to. Also, most parts are made using CNC machines that are programmed. Again, not too much money there either.


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## Silentfoe (May 9, 2008)

Engineer90 said:


> I agree, a lot of engineering went into this. But us engineers use CAD programs (Solidworks, CREO, AutoCAD, etc). These programs do all of the math for us. So back in the 70s designing a part would take weeks, months. Now, it takes us about a day to design mechanical parts and then testing which depends on the application. Whole point being, engineering wise, it doesn't cost that much as it used to. Also, most parts are made using CNC machines that are programmed. Again, not too much money there either.


Are you cheap? Are your skills and expertise cheap? How about the computer you do the designing on? How about the CAD machine? Is it cheap to buy/run?

As you say, it may take less time but I doubt it's cheap.

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## jochribs (Nov 12, 2009)

mack_turtle said:


> I would love to hear perspective from a bicycle manufacturer.


I wouldn't believe it as gospel, unless I was privy to their books, frankly.


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## slapheadmofo (Jun 9, 2006)

kpdemello said:


> You're wrong. I was there too.
> 
> Here's an apples to apples comparison: My 2007 Stumpjumper Expert FSR retailed for $3,500. Adjusting for inflation, that's $4245 in today's dollars. Today's Stumpjumper Expert retails for $5,900, which is $1,700 or 40% more.


My 1998 hardtail cost over $5k. I can bet a better one for half that now, easily.
My 2001 FS cost over $6k. I can get a WAAAYYYY better one for half that now.
I could've easily spent quite a bit more on those things too.


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## Engineer90 (Apr 10, 2015)

Silentfoe said:


> Are you cheap? Are your skills and expertise cheap? How about the computer you do the designing on? How about the CAD machine? Is it cheap to buy/run?
> 
> As you say, it may take less time but I doubt it's cheap.


Of course not. But, should maybe cost about 50-60% of what stuff is sold for IMHO. In my industry we make 30% profit. The bike manufacturers must make way more than we do.


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## Silentfoe (May 9, 2008)

Engineer90 said:


> Of course not. But, should maybe cost about 50-60% of what stuff is sold for IMHO. In my industry we make 30% profit. The bike manufacturers must make way more than we do.


I doubt that. I know most bikes sell for 30-35% profit. I'd bet that stays true throughout the sales pipeline.

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## Engineer90 (Apr 10, 2015)

Silentfoe said:


> I doubt that. I know most bikes sell for 30-35% profit. I'd bet that stays true throughout the sales pipeline.


Is that LBS profit or manufacturer profit?


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## Silentfoe (May 9, 2008)

Engineer90 said:


> Is that LBS profit or manufacturer profit?


Reread my post

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## Ailuropoda (Dec 15, 2010)

Mountain biking is not expensive. You can get a decent bike for $500. You can get a used bike on EBay for steep discounts of the original price. 

I have $6000 in my Expedition Bike....but that's a personal choice. I could ride a $1000 bike or build one from parts for less than that. 

And you can always get a decent Costco bike or even a Wal Mart bike just to get started.


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## Silentfoe (May 9, 2008)

Ailuropoda said:


> you can always get a decent Costco bike or even a Wal Mart bike


These don't exist

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## jestep (Jul 23, 2004)

Silentfoe said:


> Are you cheap? Are your skills and expertise cheap? How about the computer you do the designing on? How about the CAD machine? Is it cheap to buy/run?
> 
> As you say, it may take less time but I doubt it's cheap.
> 
> Sent from my SM-G955U using Tapatalk


There are a number of tech shops around here that anyone somewhat qualified can join and use their CAD and CNC and other expensive equipment for a very nominal monthly fee, at least nominal compared to purchasing any equipment at all. Not saying someone could easily start a bike business out of that, but a lot of prototyping could be accomplished for pennies compared to what it would cost to setup a full blown production facility. I think a lot of the newer brands are probably modeling like this where they initially prototype out of budget facilities and outsource actual production to shops overseas, and then final assembly is done back in the states. I don't know enough personally to have an opinion on margins, but I can buy a car for cheaper than some of the high end bikes coming out.


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## Silentfoe (May 9, 2008)

You can buy a lot of things cheaper than a high end bike. There's a reason it's high end. 

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## Engineer90 (Apr 10, 2015)

Silentfoe said:


> Reread my post


30-35% I believe for LBS, but for the manufacturer must be higher than that.

BTW, going back to the whole engineering thing. SRAM had a recall for their Guide line up of brakes. Turns out the O-ring and other internals expanded during high heat, happened to me. Not gonna say I'm an expert at brakes, but the engineering could have been better. And yet, with crappy engineering, the brakes cost a lot of $$$ and SRAM claims they are the best brakes out there. Maybe it wasn't the engineers, maybe the upper management made them cut corners to save money, who knows what truly happened. It's happened to me where upper management has made me cut corners and things went south.


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## J.B. Weld (Aug 13, 2012)

singletrackmack said:


> Mtbs are not expensive. Walmart sells mountain bike at great prices. And while we look down on those mtbs here, they serve the average person perfectly fine


That's because the average person rides them 2 or 3 times before parking them permanently in their garage, the marketers know this and spec them accordingly. If someone actually tries to ride one on a regular basis they'll soon discover it's just a BSO (bicycle shaped object).


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## Engineer90 (Apr 10, 2015)

Ailuropoda said:


> Mountain biking is not expensive. You can get a decent bike for $500. You can get a used bike on EBay for steep discounts of the original price.
> 
> I have $6000 in my Expedition Bike....but that's a personal choice. I could ride a $1000 bike or build one from parts for less than that.
> 
> And you can always get a decent Costco bike or even a Wal Mart bike just to get started.


The whole eBay, Costco, Walmart comment... are you on drugs bro? :eekster:

At least in my experience, I got a $200 "decent" bike at Walmart, but it broke after like 2 uses and had to rebuild the whole thing... at least it did get me into real MTB. But in no way are these bikes decent.


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## injected59 (Aug 14, 2016)

Engineer90 said:


> 30-35% I believe for LBS, but for the manufacturer must be higher than that.
> 
> BTW, going back to the whole engineering thing. SRAM had a recall for their Guide line up of brakes. Turns out the O-ring and other internals expanded during high heat, happened to me. Not gonna say I'm an expert at brakes, but the engineering could have been better. And yet, with crappy engineering, the brakes cost a lot of $$$ and SRAM claims they are the best brakes out there. Maybe it wasn't the engineers, maybe the upper management made them cut corners to save money, who knows what truly happened. It's happened to me where upper management has made me cut corners and things went south.


From my experience, a lot of these problems come from inconsistencies and poor quality control from overseas tooling and manufacturing. We've ok'd a sample only to see the second run of the product completely off spec.

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## Silentfoe (May 9, 2008)

Engineer90 said:


> 30-35% I believe for LBS, but for the manufacturer must be higher than that.
> 
> BTW, going back to the whole engineering thing. SRAM had a recall for their Guide line up of brakes. Turns out the O-ring and other internals expanded during high heat, happened to me. Not gonna say I'm an expert at brakes, but the engineering could have been better. And yet, with crappy engineering, the brakes cost a lot of $$$ and SRAM claims they are the best brakes out there. Maybe it wasn't the engineers, maybe the upper management made them cut corners to save money, who knows what truly happened. It's happened to me where upper management has made me cut corners and things went south.


I doubt it's higher. You can go backwards from the final retail price of a bike. If an LBS takes 35%. The shipper/handler takes a fee and the manufacturer takes 30%, that doesn't leave much for the original cost of making the bike. If we take that final number, that's what people are bitching about here and you are saying should be lower. I doubt it could be lower for all of the work and expertise that goes into it.

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## jestep (Jul 23, 2004)

Engineer90 said:


> The whole eBay, Costco, Walmart comment... are you on drugs bro? :eekster:
> 
> At least in my experience, I got a $200 "decent" bike at Walmart, but it broke after like 2 uses and had to rebuild the whole thing... at least it did get me into real MTB. But in no way are these bikes decent.


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## schnellmann (Oct 24, 2008)

I've wondered the same thing myself many, many times.

Example:

Santa Cruz V10 X01 $$8699
KTM 250 XCF-W $8599
















Both of these machines are precision beasts which will take the wildest of beatings and last for years. The fit and finish on both is top-notch. Machining is precise,though the KTM suspension is at a much higher scale, and I bet there's 50 V10s sold in North America for every KTM 250 XCF. Yet the KTM takes an order of magnitude more R+D, machining, shipping costs, factory warranty support, etc. Yet the KTM is cheaper by $100.

It's pretty clear (to me at least) there's hefty margins on these MTBs and there are $ flowing to the dealer network too. Bike stores around me stock next to no parts now (they're making money on shop services and new bikes), and companies like Canyon and YT are making fantastic bikes and selling them direct for much better prices than the big guys. The recent proliferation of boutique brands is also testament to the margins available IMO if you can gain even a small market foothold.

Sooner or later market forces will catch up to the pricing. The best cure for high prices is high prices. Until then, we bleed out the wallet, but have fun while we're doing it.


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## Silentfoe (May 9, 2008)

schnellmann said:


> I've wondered the same thing myself many, many times.
> 
> Example:
> 
> ...


This old comparison has been debunked many times. Read the rest of the thread.

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## schnellmann (Oct 24, 2008)

I saw zero debunking in the thread, I only saw your rationale, frankly, which holds little water.


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## injected59 (Aug 14, 2016)

This is America, the land of consumption, people will always pay for what they want. Hi prices will not "heal" anything. The buyer must simply stop buying the product. If I may use an example from the automotive market Chevrolet and Chrysler have pretty poor reviews on consumer reports and other reviews, but buyers purchase with their emotions instead of rationale. They think, this is what my daddy always bought, or i'm buying American to support Americans when in the end they're only prolonging A needed change in quality.


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## schnellmann (Oct 24, 2008)

What I mean by high prices cure high prices is that if there are "excess" margins to be had anywhere in the production, distribution or retail sales chain, other players will enter this market with equal quality and lower prices. This is how all markets work. If you want to know where the profit is in any market/product is, look at the changes in various parts of the design-to-retail chain over time. There's a continual hunt for margins at every step, and the inefficient steps get tuned for maximum effect.

A data point of one, granted, but I got a YT Tues recently (direct), and it's fantastic. I mean fantastic. This same bike would have been 25-50% more expensive had I bought a similar one from one of the big guys. I've had lots of bikes from the big guys too (specialized, giant, trek, santa cruz). Is see this model as the dominant future for bikes... if only because bikes can be easily shipped direct to consumer (unlike motorcycles, cars, etc).

Just my 2c.

EDIT: forgot to add I think the future of LBSs is probably mostly low-end bikes and shop services, small parts. Or they act as a showroom for higher end bikes which can be ordered from the factory direct. Sorry to any bike shop owners, if you're out there.


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## mtnbkrmike (Mar 26, 2015)

injected59 said:


> This is America, the land of consumption, people will always pay for what they want. Hi prices will not "heal" anything. The buyer must simply stop buying the product. If I may use an example from the automotive market Chevrolet and Chrysler have pretty poor reviews on consumer reports and other reviews, but buyers purchase with their emotions instead of rationale. They think, this is what my daddy always bought, or i'm buying American to support Americans when in the end they're only prolonging A needed change in quality.
> 
> Sent from my iPhone using Tapatalk


My Ram truck (third in a row) conquers all. Not one problem with any of the 3.

The end.


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## MikeDee (Nov 17, 2004)

Not only are mountain bikes getting more expensive, they are more complex as well (high tech suspension, dropper posts, disc brakes, lots of carbon fiber). I personally think that the amount of maintenance required is a headache. Changing standards don't help either. Simpler = less expensive and more reliable.


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## Engineer90 (Apr 10, 2015)

mtnbkrmike said:


> My Ram truck (third in a row) conquers all. Not one problem with any of the 3.
> 
> The end.


I think FCA puts more RD and engineering into Rams and Wranglers more than any other car they offer. I always hear good things about Rams and Wranglers, but always hear nothing but complaints about their other cars/xuvs.


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## Silentfoe (May 9, 2008)

schnellmann said:


> I saw zero debunking in the thread, I only saw your rationale, frankly, which holds little water.


It explains it all but you refuse to see it.

Show us the carbon and/or titanium in that moto.

Show us the carbon wheels that weigh a ridiculous amount yet can hold a 250lb rider and not break.

Show us the tiny yet robust suspension components.

Show us the tight tolerances in fitment.

Show us the tubeless tires

Do you see it yet.

Just because it's big and has an engine doesn't make it better or more economical.

What people get hung up on with motos is the fact that it propels you and somehow that justifies it as a better machine. It's different is all.

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## injected59 (Aug 14, 2016)

Engineer90 said:


> I think FCA puts more RD and engineering into Rams and Wranglers more than any other car they offer. I always hear good things about Rams and Wranglers, but always hear nothing but complaints about their other cars/xuvs.


This is true.


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## injected59 (Aug 14, 2016)

mtnbkrmike said:


> My Ram truck (third in a row) conquers all. Not one problem with any of the 3.
> 
> The end.


You must have been one of the lucky ones.


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## Engineer90 (Apr 10, 2015)

schnellmann said:


> I saw zero debunking in the thread, I only saw your rationale, frankly, which holds little water.


I gotta give it to Silentfoe on this one. MTB's are super light and strong AF for what they do. That takes more engineering and more expensive metals and carbon fibers than motorcycles. Motorcycles are heavy and nearly all components are dense heavy steel which is way cheaper than AL/CF. And the engines are usually already made from years ago just rebadged. I bet KTM didn't engineer most parts from scratch.


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## slapheadmofo (Jun 9, 2006)

mtnbkrmike said:


> My Ram truck (third in a row) conquers all. Not one problem with any of the 3.
> 
> The end.


MY wife's `10 Ram 1500 was rusting to the point of needing a new bed within 5 years, and required more service in that time than any other vehicle I've owned, including ones I paid under $500 for. Seriously shitty vehicle, specially for the price and lack of manufacturer support.

The end is right.


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## Terp (Jul 25, 2013)

Silentfoe said:


> I doubt that. I know most bikes sell for 30-35% profit. I'd bet that stays true throughout the sales pipeline.


Without data (which I know will never be available) I'm pretty sure you're confusing profit and revenue. I'd believe that a manufacturer buys a bike for $2000 from the factory and sells it for $2600 but that ignores all of the costs of running a business. To get a decent *profit* you need more like a 40-50% margin between what it cost to build and what you sell it for.

I know this to be true because if ANYBODY was seeing a true 35% profit, wallstreet and silicon valley would go to war over who can put up the most $Billions to buy it. Or we'd endup with "Carbon Hills" as the new rich buzzword. But we don't see that. The only recent outside money I've heard of in MTB is Pon Holdings buying Santa Cruz...but even they already invested in other bike companies and probably see some opportunity for consolidation and volume cost downs. If not they'll dump SC within a year.

Also bikes cost as much as they do because thats as cheap as they can be. Consider an unbranded FS carbon frame off ali-baba. Probably around $1k - $1.5k. Crappy shock (if any) and who knows about geo or quality control. Then theres the consumer direct category. Good QC, good design, good shock and you're paying closer to $2-$2.5k for it (if you can even find a frame only). There is another level of overhead in designing, marketing, and distributing it which easily eats up a few $Hundo. So, no real gain. Then you get to boutique brands. Volumes are much lower, quality is top notch and now your struggling LBS needs something too to stay alive. Thus they are usually all around $3k - $3.5k frames.

No magic here!


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## Silentfoe (May 9, 2008)

Terp said:


> Without data (which I know will never be available) I'm pretty sure you're confusing profit and revenue. I'd believe that a manufacturer buys a bike for $2000 from the factory and sells it for $2600 but that ignores all of the costs of running a business. To get a decent *profit* you need more like a 40-50% margin between what it cost to build and what you sell it for.
> 
> I know this to be true because if ANYBODY was seeing a true 35% profit, wallstreet and silicon valley would go to war over who can put up the most $Billions to buy it. Or we'd endup with "Carbon Hills" as the new rich buzzword. But we don't see that. The only recent outside money I've heard of in MTB is Pon Holdings buying Santa Cruz...but even they already invested in other bike companies and probably see some opportunity for consolidation and volume cost downs. If not they'll dump SC within a year.
> 
> ...


Profit was a simplified word. Sorry you didn't follow.

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## Steve71 (Mar 15, 2004)

armii said:


> There has been a lot of talk about technology vs quantity. But what I don't get is that a top of the line motocross racing motorcycle costs about $9,000 to $11,000 and a top of the line mountain bike costs about $8,000 to $10,000? There are a lot more bicycles sold than motorcycles, but motorcycles require much higher technology. Just doesn't make sense to me.


Dirt bikes are pretty low tech, especially two strokes. They could also drop 15-20% of their weight with exotic materials. But they would cost 5-10 times as much, so nobody would buy them. There's not much wrong with a 215lb moto with 50+ hp.

MTB's on the other hand need all the help they can get, since humans only have a few hundred watts of power output. Road bikes make a lot of sense in that rearguard, since they don't need suspension, dropper posts and knobby tires etc. You can get a nice light road bike for $1000-$1500.

Motorbikes are just about the best fun per dollar to be had in this world IME. Nothing beats backing it into a corner, drifting the rear on exit and accelerating so hard your front wheel comes up even though your standing up, leaning over your front axle.


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## mtnbkrmike (Mar 26, 2015)

slapheadmofo said:


> MY wife's `10 Ram 1500 was rusting to the point of needing a new bed within 5 years, and required more service in that time than any other vehicle I've owned, including ones I paid under $500 for. Seriously shitty vehicle, specially for the price and lack of manufacturer support.
> 
> The end is right.


I have never seen a rusting out 2010 Ram in my life. And I live in a city where pick ups are by far the most predominate vehicle on the road. I hope your luck is not as shitty with other products. Especially anything mountain bike-related.

Carry on.


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## slapheadmofo (Jun 9, 2006)

mtnbkrmike said:


> I have never seen a rusting out 2010 Ram in my life.


There are probably more rusty Dodges than non-rusty ones in New England. Dunno why, and it's a bummer, cuz they sure are sharp, but man they don't hold up for **** around here.


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## Steve71 (Mar 15, 2004)

Engineer90 said:


> Motorcycles are heavy and nearly all components are dense heavy steel which is way cheaper than AL/CF.


That's simply not true. The only steel on my KTM's is the frame and it's chromoly steel. Lighter than the Japanese Alu frame in all/most cases. It also has the advantage giving a better ride quality and makes the bikes easier to work on (more space/thinner tubes).

Just about everything else is Alu. Carbon fiber and Ti is available aftermarket.

I can call KTM and order up OEM carbon wheels and full titanium exhaust for my street bike. But at 180hp and 415lbs it's mostly just eye candy, unless you're racing competitively. The previous owner already dropped 14lb's with just a carbon/ti slip on.

Same with the dirt bike. Almost everything except the frame is Alu. It's got a CF pipe guard. That's told me everything I need to know about CF and dirt bikes. Great for armor, but NO-THANKS to anything structural - ever. I've cracked and dented so many Alu rims, I would not want CF on a dirt bike.


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## jestep (Jul 23, 2004)

slapheadmofo said:


> There are probably more rusty Dodges than non-rusty ones in New England. Dunno why, and it's a bummer, cuz they sure are sharp, but man they don't hold up for **** around here.


Do they salt the roads in the winter? I've noticed that cars/trucks last a lot longer (corrosion wise) in places where they just use gravel if anything. Salted roads really accelerate rust and corrosion.


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## chazpat (Sep 23, 2006)

I imagine bikes are like cars, very little profit margin on the low end, high profit margin on the upper end. I was reading another thread earlier where a guy was looking for a 7-speed rear derailleur, the Acera and Altus are available for $15 and $20, seems pretty cheap to me considering all the parts, etc. But of course, an XTR is way more expensive and I'm sure Shimano makes a higher margin on them.

And bike companies have to walk a thin line between lightweight and durability, just look at how many frames get broken around here and replaced under warrantee; that has to be factored into the cost and again, that is going to affect the more expensive bikes. And I'm sure there is a good bit of liability in a bike, more than a computer (as long as it doesn't burst into flames).

I think we might see more bikes sold online and maybe then a model like Apple where the manufacturers open their own stores so that people can still test ride but the manufacturers still sell direct.


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## jochribs (Nov 12, 2009)

^^Not to get into this debate...I just want to add something here. 

In my time working in shops it was always the lower ticket items that had the greatest mark-up. We referred to that as 'keystoning'. Basically doubling the cost price of the item. Tubes were even worse. Cost a dollar or less at the time, and were sold for $5 or $6. And that was a standard tube.

And Acera derailleur, if retailing for 15 or 20 would in my mind have cost the shop 7 or 10 dollars. 

Not sure if this still holds true, but I have no reason to believe it doesn't.


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## slapheadmofo (Jun 9, 2006)

jestep said:


> Do they salt the roads in the winter? I've noticed that cars/trucks last a lot longer (corrosion wise) in places where they just use gravel if anything. Salted roads really accelerate rust and corrosion.


Yeah, they salt the **** out of them. 
Never ate up any of our other vehicles in that sort of timeframe though.


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## kpdemello (May 3, 2010)

One of the issues that no one seems to be mentioning is that the component makers are likely the ones with the highest margins. There are lots of bicycle manufacturers out there nowadays, and I'm not sure they are the ones making the highest profits. It seems like there are only a handful of component makers (usually 2 major ones for each category). 

This is where that Pivot guy's comments on keeping an eye on his margins makes the most sense. For that $8k bike he's selling, his margin is probably almost the same as a $3k bike because the rest of the money is going toward the components.

All this is kind of besides the point. Are bikes more expensive than they were years ago? I think it's silly to argue that they aren't. However, what does it matter? If you're willing to pay it, and you enjoy the product, what's the problem? Sure it's expensive, but there are less expensive alternatives. Personally, I always try to avoid paying full retail, and buy on closeouts or second hand.


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## life behind bars (May 24, 2014)

Engineer90 said:


> I agree, a lot of engineering went into this. But us engineers use CAD programs (Solidworks, CREO, AutoCAD, etc). These programs do all of the math for us. So back in the 70s designing a part would take weeks, months. Now, it takes us about a day to design mechanical parts and then testing which depends on the application. Whole point being, engineering wise, it doesn't cost that much as it used to. Also, most parts are made using CNC machines that are programmed. Again, not too much money there either.


When you get outsourced you might have a different tune to sing.


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## slapheadmofo (Jun 9, 2006)

kpdemello said:


> Are bikes more expensive than they were years ago? I think it's silly to argue that they aren't. However, what does it matter? If you're willing to pay it, and you enjoy the product, what's the problem? Sure it's expensive, but there are less expensive alternatives. The expensive ones happen to be better.


They're really not more expensive, there are just a lot more people willing to buy higher end ones now, since you get so much more for your money.

5k for a flexy hardtail with canti brakes and a 2" travel fork that would barely last a couple seasons under hard riding made for a much tougher sell than what you get today for that kind of money.


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## Engineer90 (Apr 10, 2015)

life behind bars said:


> When you get outsourced you might have a different tune to sing.


I got plan B and C, I am fully aware of this.


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## kpdemello (May 3, 2010)

Engineer90 said:


> I got plan B and C, I am fully aware of this.


Just so you know, selling your body and playing the lottery are not solid plans B and C.


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## jestep (Jul 23, 2004)

My Bontrager Privateer which I purchased in 1997 and was considered a good but low to middle range bike, and is still going strong, was outfitted with a horrible Indy shock, and mixed LX/XT components, and the retail was right around $1200 in '96. Top end bikes of that era were running $3500+ or so for a Moots or other high end Ti or Steel hardtails, ironically with the same front shock. But, that's 20+ years ago, I'm not sure what inflation would say exactly, but it seems like prices are still within some similar range.


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## Engineer90 (Apr 10, 2015)

kpdemello said:


> Just so you know, selling your body and playing the lottery are not solid plans B and C.


With my killer bod? Psh, I'll be richer than the Kardashians :winker:


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## Zowie (Aug 3, 2013)

Silentfoe said:


> Profit was a simplified word. Sorry you didn't follow.
> 
> Sent from my SM-G955U using Tapatalk


Out of curiosity, how exactly did you 'simplify' it, and why didn't you use a proper term like margin instead if that's what you actually meant?

Kinda sounds like you're just posting bull in a misguided attempt to confuse people at this point.


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## Silentfoe (May 9, 2008)

Zowie said:


> Out of curiosity, how exactly did you 'simplify' it, and why didn't you use a proper term like margin instead if that's what you actually meant?
> 
> Kinda sounds like you're just posting bull in a misguided attempt to confuse people at this point.


Now you're asking for an argument? Why?

Sent from my SM-G955U using Tapatalk


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## Zowie (Aug 3, 2013)

Silentfoe said:


> Now you're asking for an argument? Why?
> Sent from my SM-G955U using Tapatalk


Arguments are down the hall, asking for a clarification.


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## Silentfoe (May 9, 2008)

Zowie said:


> Arguments are down the hall, asking for a clarification.


Sorry. I can't fix obtuse.

Sent from my SM-G955U using Tapatalk


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## Zowie (Aug 3, 2013)

Silentfoe said:


> Sorry. I can't fix obtuse.
> 
> Sent from my SM-G955U using Tapatalk


I guess neither can I.

Thanks for your time.


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## honkinunit (Aug 6, 2004)

You can get a pretty nice entry-level hardtail MTB for under $400. I'm not kidding. They have a 10% off code for that website. RANDOM.

https://www.randombikeparts.com/col...-bike-avid-hydro-disc-shimano-slx-3-x-10s-new

Except, OMG, it has 26" wheels. How could anyone ride it?


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## richj8990 (Apr 4, 2017)

Clayncedar said:


> What's the saying regarding shopping for an actual non-Wallyworld mountain bike?
> 
> "Strong, Light, Inexpensive - Pick Two."
> 
> So most serious dudes are going to go with strong and light which means the wallet's going to take a hit.


It's the (lack of) weight and the forks that make most bikes expensive. You can get a 3x10 speed aluminum bike with hydraulic brakes for under $800. But it's not going to have an all-mountain front fork and it will weigh over 25 lbs. So it's not XC or all-mountain. This is what is very frustrating for beginners like me to hear, it's almost like a fraternity saying "You don't belong in any of our subgroups so you and your bicycle-shaped object can wash dishes while we party".

Here is the frustration: XC must be under 25 lbs, so that's $1000+ or more for that weight of bike. All-mountain must be 140mm+ fork and those are at least $500 alone without the rest of the bike. Downhill same or even more money for the front fork. I think there needs to be a "Trail Bike" forum with 80-120mm forks, and ANY weight allowed. So heavier than XC, not has much fork as all-mountain. There are a zillion people on here with 80-120mm forks looking around to see where they fit in. Beginners section or passion section? How about a real, defined section for these $300-1000 bikes. And not marketing brainwash about what bike you need to fit in with the fraternity.


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## Gasp4Air (Jun 5, 2009)

Ther's probably a theoretical law about capacity and demand. I know in IT, as processing speed increases and storage cheapens, the demands for both will rise as systems developers try to capitalize on the increased ability to do more stuff faster. And complexity is a steady byproduct. As materials technology grows, designers and builders will continue to try to capitalize on it to increase performance and riding pleasure. As long as there's a market for more and better, this will continue. And the bleeding edge of development will always command a premium.


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## slapheadmofo (Jun 9, 2006)

jestep said:


> Top end bikes of that era were running $3500+ or so for a Moots or other high end Ti or Steel hardtails,


Depends on the build I guess.
My Ti frame alone was about $2k. CK wheels, BB, White Bros fork, Speed Dial Ultimate brakes, XTR shifty bits, etc etc...**** added up just as fast then as now.


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## honkinunit (Aug 6, 2004)

richj8990 said:


> It's the (lack of) weight and the forks that make most bikes expensive. You can get a 3x10 speed aluminum bike with hydraulic brakes for under $800. But it's not going to have an all-mountain front fork and it will weigh over 25 lbs. So it's not XC or all-mountain. This is what is very frustrating for beginners like me to hear, it's almost like a fraternity saying "You don't belong in any of our subgroups so you and your bicycle-shaped object can wash dishes while we party".
> 
> Here is the frustration: XC must be under 25 lbs, so that's $1000+ or more for that weight of bike. All-mountain must be 140mm+ fork and those are at least $500 alone without the rest of the bike. Downhill same or even more money for the front fork. I think there needs to be a "Trail Bike" forum with 80-120mm forks, and ANY weight allowed. So heavier than XC, not has much fork as all-mountain. There are a zillion people on here with 80-120mm forks looking around to see where they fit in. Beginners section or passion section? How about a real, defined section for these $300-1000 bikes. And not marketing brainwash about what bike you need to fit in with the fraternity.


Who says a bike has to have an "all mountain" fork and weigh under 25 pounds? I used to race a hardtail what weighed 26lb. The fork had 80mm of really crappy travel and the cantilever brakes sucked. It was a blast.

Is someone is really strapped for cash, used is the only way to go. New high end bikes lose value like mad, they are one of the most depreciating items you can buy.

Here's one: Ventana El Rey 29" full suspension - $750
https://denver.craigslist.org/bik/d/ventana-el-rey-29er-full/6299425438.html


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## mtnbkrmike (Mar 26, 2015)

slapheadmofo said:


> Yeah, they salt the **** out of them.
> Never ate up any of our other vehicles in that sort of timeframe though.


I thought more about what you said and decided that maybe I shouldn't feel so much like a hurt little puss.

I'm not so naive as to think that my Rams, as well as other domestic vehicles, don't have a limited shelf life. I always get rid of them in year 3 or 4 so I don't really get to the stage where **** starts going sideways on me.

So yeah. I appreciate these are not a vehicle one wants to keep for 15 years. Or even 5.

But ho-lee **** do I love those brawny, full load basturds for the 3 or 4 years I have each. And every one is even better than the last one.

All this talk has prompted me to call my dealership. I may spring for a fourth and get rid of my 2015.

I don't think Calgary uses as much salt as other areas but maybe I just get rid of them before they **** the bed.


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## chazpat (Sep 23, 2006)

jochribs said:


> ^^Not to get into this debate...I just want to add something here.
> 
> In my time working in shops it was always the lower ticket items that had the greatest mark-up. We referred to that as 'keystoning'. Basically doubling the cost price of the item. Tubes were even worse. Cost a dollar or less at the time, and were sold for $5 or $6. And that was a standard tube.
> 
> ...


I would imagine that is true for the really cheap items like tubes and cables, but I doubt it for derailleurs. An XTR is $150, I doubt it costs 10x in material/labor than the $15 Acera.


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## jochribs (Nov 12, 2009)

chazpat said:


> I would imagine that is true for the really cheap items like tubes and cables, but I doubt it for derailleurs. An XTR is $150, I doubt it costs 10x in material/labor than the $15 Acera.


Yeah, I have no idea what the cost would be to build the XTR, or the Acera for that matter, but that is something to look deeper into.


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## jochribs (Nov 12, 2009)

Let's think about that though. Acera is mostly steel and plastic. XTR is either machined or forged and polished aluminum with much tighter and longer lasting pivots. The pulley wheels are sealed, and relieved as well (cutouts). The hanger is carbon. It's clutched. Etc. etc. etc. 

I'm not trying to argue that there isn't a significant markup for the XTR, but it certainly is more expensive to produce in materials alone. 

I do fall to the camp side of this debate that things are a lot of times the prices that they are, because they can command those prices. We will pay them.


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## Clayncedar (Aug 25, 2016)

slapheadmofo said:


> MY wife's `10 Ram 1500 was rusting to the point of needing a new bed within 5 years, and required more service in that time than any other vehicle I've owned, including ones I paid under $500 for. Seriously shitty vehicle, specially for the price and lack of manufacturer support.
> 
> The end is right.


Ram pickups always seem to reach rustbucket status faster than any other vehicle here in PA where the roads get salted til they're white in the winter.


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## chazpat (Sep 23, 2006)

jochribs said:


> Let's think about that though. Acera is mostly steel and plastic. XTR is either machined or forged and polished aluminum with much tighter and longer lasting pivots. The pulley wheels are sealed, and relieved as well (cutouts). The hanger is carbon. It's clutched. Etc. etc. etc.
> 
> I'm not trying to argue that there isn't a significant markup for the XTR, but it certainly is more expensive to produce in materials alone.
> 
> I do fall to the camp side of this debate that things are a lot of times the prices that they are, because they can command those prices. We will pay them.


Oh yeah, no doubt it costs more to produce, but even comparing the price to XT, XTR has higher margin because some people are willing to buy at the top end and will pay a premium above and beyond to get it.


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## jochribs (Nov 12, 2009)

chazpat said:


> Oh yeah, no doubt it costs more to produce, but even comparing the price to XT, XTR has higher margin because some people are willing to buy at the top end and will pay a premium above and beyond to get it.


Agreed


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## slapheadmofo (Jun 9, 2006)

mtnbkrmike said:


> So yeah. I appreciate these are not a vehicle one wants to keep for 15 years. Or even 5.
> 
> But ho-lee **** do I love those brawny, full load basturds for the 3 or 4 years I have each. And every one is even better than the last one.


Dude, my wife misses that thing big time. Crew cab silver Sport version, real tires on it, super sharp. Got up and went too. Needing a new bed at 70k. Mad bummer, but it was something I was already concerned about when we bought it. New England is tough on those things IME. I'm sure there's a lot of luck of the draw involved too.


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## Jayem (Jul 16, 2005)

jochribs said:


> ^^Not to get into this debate...I just want to add something here.
> 
> In my time working in shops it was always the lower ticket items that had the greatest mark-up. We referred to that as 'keystoning'. Basically doubling the cost price of the item. Tubes were even worse. Cost a dollar or less at the time, and were sold for $5 or $6. And that was a standard tube.
> 
> ...


It never applied to bikes, it applied to things like tubes and tire levers. With components, you are correct, but with bikes the margin was a % and fairly constant.


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## Jayem (Jul 16, 2005)

chazpat said:


> Oh yeah, no doubt it costs more to produce, but even comparing the price to XT, XTR has higher margin because some people are willing to buy at the top end and will pay a premium above and beyond to get it.


XTR has a higher margin? Prove it.


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## chazpat (Sep 23, 2006)

Jayem said:


> XTR has a higher margin? Prove it.


Do you know something we don't know?


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## Ailuropoda (Dec 15, 2010)

richj8990 said:


> It's the (lack of) weight and the forks that make most bikes expensive. You can get a 3x10 speed aluminum bike with hydraulic brakes for under $800. But it's not going to have an all-mountain front fork and it will weigh over 25 lbs. So it's not XC or all-mountain. This is what is very frustrating for beginners like me to hear, it's almost like a fraternity saying "You don't belong in any of our subgroups so you and your bicycle-shaped object can wash dishes while we party".
> 
> Here is the frustration: XC must be under 25 lbs, so that's $1000+ or more for that weight of bike. All-mountain must be 140mm+ fork and those are at least $500 alone without the rest of the bike. Downhill same or even more money for the front fork. I think there needs to be a "Trail Bike" forum with 80-120mm forks, and ANY weight allowed. So heavier than XC, not has much fork as all-mountain. There are a zillion people on here with 80-120mm forks looking around to see where they fit in. Beginners section or passion section? How about a real, defined section for these $300-1000 bikes. And not marketing brainwash about what bike you need to fit in with the fraternity.


You have to ride what you can afford. I'm not sure why 25 pounds is your magic number. My $6000 Rohloff-equipped, titanium frame, carbon fork etc. expedition bike weighs 26 pounds. Clearly weight is not that important in the 19-30 pound range where most decent bikes live. A reasonably priced hardtail or rigid mountain bike is not a "bicycle-shaped object."

Set a realistic budget and start looking for a bike in your price range. If you want one that is more expensive either make some cuts somewhere else or get a better job. But bikes are not expensive. High end bikes are expensive. I rode a $400 Gary Fisher Wahoo for three or four years and it was plenty rugged enough for the trails.

There is no fraternity. I probably see another mountain biker once a month. I don't hang out with other riders. This advice has been repeated on MTBR so often that it is becoming pendantic...but don't worry about what other people are riding. Likewise, anybody who looks down on your bike because it's all you can afford is not someone you want to hang with anyway.


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## EricTheDood (Sep 22, 2017)

schnellmann said:


> I bet there's 50 V10s sold in North America for every KTM 250 XCF.


It's the other way around. There is absolutely no comparison between MTB and MX in terms of nationwide popularity.

Just look at the income of top MX riders compared to MTB. Aaron Gwin is the only American rider to have ever dominated WC DH racing in the history of the sport. He recently revealed that his current annual income is around $1 million, which includes endorsements. That's very high for MTB.

Compare that to the $10 million James Stewart was raking in over six years ago.

Then there's signficant consolidation in dirtbike brands. You have six brands - Yahama, Kawasaki, Honda, Suzuki, Husqvarna, and KTM - taking in 99% of sales. How many bike brands offer a DH bike? 30+?


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## richj8990 (Apr 4, 2017)

jochribs said:


> ^^Not to get into this debate...I just want to add something here.
> 
> In my time working in shops it was always the lower ticket items that had the greatest mark-up. We referred to that as 'keystoning'. Basically doubling the cost price of the item. Tubes were even worse. Cost a dollar or less at the time, and were sold for $5 or $6. And that was a standard tube.
> 
> ...


Isn't that because lower ticket items can be mass produced in places like China and then the bike shop gets a huge discount buying in volume? The other issue is that if you tried to build your own bike, and then looked at the exact same manufactured bike with the same parts, it would be cheaper than you could get for exactly the reason above: volume and distributor discounts. Those happen more at the lower level simply because more $500 bikes are sold with cheap components than $5000 bikes with expensive components. As for profit margin, if you looked at total revenue and profit the figures may be the same, but the % profit cannot be as high on a cheap bike as on an expensive bike. Even cheap foreign labor and import fees have a certain base cost. I have to side with Chazpat on this one.


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## Jayem (Jul 16, 2005)

chazpat said:


> Do you know something we don't know?


I have seen the QBP/BTI pricing schedules. Granted, it was years back, but I doubt it's changed much.


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## cjsb (Mar 4, 2009)

chazpat said:


> Ok, if you're just talking about becoming a custom builder, maybe not. But trying to become a mass manufacturer of bikes is not easy. There's reasons why so many bike brands don't manufacture their own product.


I agree with you that for a small operation to become a mass mfger it's going to be nearly impossible. But when I am referencing barriers to entry I mean the legal, political, institutional barriers that are erected to keep new entrants out. Arguably there is some of that in the USA with respect to government requirements, legal costs and they are real costs but they seem indirect with respect to a barrier. It has been a long and winding road for the end of mfg. in the USA, but I thought that in the bike industry there was a relevant discussion of the death blow the past few years when Turner started with Zen, then ended and then I think Zen ended themselves.

For mfg. in general, it is a global market and it is highly competitive. But the scale and scope keeps small players out of that arena. Although, I at least suspect that in China, given how flexible it can be to set up shop, there is even a highly contested mfg. market that goes smaller in scale than one would see in the U.S.

Personally, I was hoping 3D printing and low natural gas prices would bring some bike mfg. back to the USA but that has not happened.

Sent from my iPad using Tapatalk


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## cjsb (Mar 4, 2009)

jochribs said:


> ^^Not to get into this debate...I just want to add something here.
> 
> In my time working in shops it was always the lower ticket items that had the greatest mark-up. We referred to that as 'keystoning'. Basically doubling the cost price of the item. Tubes were even worse. Cost a dollar or less at the time, and were sold for $5 or $6. And that was a standard tube.
> 
> ...


This is more of a question of what customers will pay, covering your retail overhead, and How much of a hassle the retailer will have to go through if consumables and accessories are subject to Gladiator competition on cost--last man standing.

A shop will say it isn't worth their time to sell a tube that cost them $1 wholesale at $1.20 retail and it does not cover their overhead. If a customer will pay $8 for the tube because they need it ow, then fine, it contributes to shop overhead but hardly gross-margins unless you are blowing out a huge volume.

My first job as a teenager in highschool was fast-food. It cost us 2 cents, excluding overhead, for a large coke. They sold for over $1. They also gave employees free coke when on break. These are just some things you need to sell, you cover your expenses, and hope they contribute to overhead, but you aint making t on these items--they don't keep the shop lights on.

Sent from my iPad using Tapatalk


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## chazpat (Sep 23, 2006)

Jayem said:


> I have seen the QBP/BTI pricing schedules. Granted, it was years back, but I doubt it's changed much.


I really doubt Shimano reveals their margins on a pricing schedule. I think you are talking about the LBS's margin, much different thing.


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## jochribs (Nov 12, 2009)

Jayem said:


> It never applied to bikes, it applied to things like tubes and tire levers. With components, you are correct, but with bikes the margin was a % and fairly constant.


I figured that my saying 'low ticket item's' made that fairly clear. The statement of mine was in response to it being inferred that there were high margins on high prices items and low margins on low items...of which in my shop time experience, was the opposite.

The higher the ticket, the lower the margin. I am sure in some cases that is variable, and advantages will be taken where they can be for as long as they can be, but I generally believe that to be the rule.


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## jochribs (Nov 12, 2009)

cjsb said:


> This is more of a question of what customers will pay, covering your retail overhead, and How much of a hassle the retailer will have to go through if consumables and accessories are subject to Gladiator competition on cost--last man standing.
> 
> A shop will say it isn't worth their time to sell a tube that cost them $1 wholesale at $1.20 retail and it does not cover their overhead. If a customer will pay $8 for the tube because they need it ow, then fine, it contributes to shop overhead but hardly gross-margins unless you are blowing out a huge volume.


Have you worked at a bike shop? The amount of tubes bike shop sell is (or at least was) astronomical. We'd go through cases of tubes. 50 to a case. Serious margin was made on tubes alone. Factor in the 10 labor on top of that, and you can do the math. Took about a minute to change a tube. Good money being made there.

With a good percentage of people running tubeless now, I'm sure that's changed to some degree, but you still have commuters, students in university areas, roadies etc. and shops are probably doing pretty good on that still.


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## DirtyHun (Jan 9, 2011)

jestep said:


>


This made me laugh out loud. Awesome!


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## cjsb (Mar 4, 2009)

jochribs said:


> Have you worked at a bike shop? The amount of tubes bike shop sell is (or at least was) astronomical. We'd go through cases of tubes. 50 to a case. Serious margin was made on tubes alone. Factor in the 10 labor on top of that, and you can do the math. Took about a minute to change a tube. Good money being made there.
> 
> With a good percentage of people running tubeless now, I'm sure that's changed to some degree, but you still have commuters, students in university areas, roadies etc. and shops are probably doing pretty good on that still.


No I have not, but if you read in my post I said just that--you need to do large volumes to make a difference. Despite your experience, and even if it is replicated across the industry it isn't saving the LBS because it is an easy item to sell closer to cost and for even larger volume over internet. It is a convenience purchase at the LBS.

Sent from my iPhone using Tapatalk


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## COMTBR (Jul 18, 2016)

jochribs said:


> I figured that my saying 'low ticket item's' made that fairly clear. The statement of mine was in response to it being inferred that there were high margins on high prices items and low margins on low items...of which in my shop time experience, was the opposite.
> 
> The higher the ticket, the lower the margin. I am sure in some cases that is variable, and advantages will be taken where they can be for as long as they can be, but I generally believe that to be the rule.


The margin percentage goes down, the higher the price. Specialized LBS probably make 20%-40% profit on a low-end Rockhopper, vs 10%-15% on an S-WORKS, but that actual profit amount might be the same or higher from the SWORKS.

Whereas a bottle of Orange Seal, LBSs are making 100%-200% profit, at least.
One LBS sells it for $16.99; another for $19.99. Same exact bottle.
With tubeless, they all had to think of a way to recoup that lost revenue and paying $17+tax for a bottle of freakin liquid is it. More expensive than tubes!


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## jochribs (Nov 12, 2009)

richj8990 said:


> Isn't that because lower ticket items can be mass produced in places like China and then the bike shop gets a huge discount buying in volume? The other issue is that if you tried to build your own bike, and then looked at the exact same manufactured bike with the same parts, it would be cheaper than you could get for exactly the reason above: volume and distributor discounts. Those happen more at the lower level simply because more $500 bikes are sold with cheap components than $5000 bikes with expensive components. As for profit margin, if you looked at total revenue and profit the figures may be the same, but the % profit cannot be as high on a cheap bike as on an expensive bike. Even cheap foreign labor and import fees have a certain base cost. I have to side with Chazpat on this one.


Wrong. Wrong on the profit margin cannot be as high on lower ticker items as on higher ticket items.

When you work at a shop you are privy to what the bike shop is paying for the item, and it only takes remedial math to see that the percentage of profit is smaller the higher you go. This is inarguable.

Often times, my pro-deal from a manufacturer was less than the cost price on the item, of which the shop was paying. Any shop employee can vouch for this. Its the reason so many keep working at shops even though the pay sucks.

As to the first part of your post. The shop isn't getting product direct from China if that's what you're inferring. There are distributors...one of which is QBP, as Jayem has brought up. Bulk orders do have an effect on pricing and terms.


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## COMTBR (Jul 18, 2016)

injected59 said:


> You must have been one of the lucky ones.
> 
> View attachment 1159034


While I don't disagree Chrysler products are crap, along with GM, it's generally understood CR is worthless when it comes to reliability studies/stats. Audi and Buick at the top? LOL. Honda way down mid-pack? LOL. So much wrong with that chart and CRs methods.


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## EricTheDood (Sep 22, 2017)

COMTBR said:


> The margin percentage goes down, the higher the price. Specialized LBS probably make 20%-40% profit on a low-end Rockhopper, vs 10%-15% on an S-WORKS, but that actual profit amount might be the same or higher from the SWORKS.


If that were true, it would be backwards from every other industry. I don't think it's true.

If the margins weren't there, no way could an LBS can afford to stock $10-15K S-works bikes and blow them out at the end of the season for 25% off. Your LBS may not do it, but many do.

Bike component and frame manufacturers use their top shelf models to recoup their R&D costs and hopefully make a few bucks on the side. It's gravy. Rockhoppers are their bread and butter and cater to a much more price-conscious customer base.

The average buyer of a $15K road bike or MTB can afford to buy three of them. There's no reason for a manufacturer to shoot themselves in the foot and reduce the price of a flagship product for a customer base that doesn't care about the price to begin with, especially when less-wealthy folks come in at the end of the year to scoop up the leftovers at-cost.


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## jochribs (Nov 12, 2009)

COMTBR said:


> The margin percentage goes down, the higher the price. Specialized LBS probably make 20%-40% profit on a low-end Rockhopper, vs 10%-15% on an S-WORKS, but that actual profit amount might be the same or higher from the SWORKS.
> 
> Whereas a bottle of Orange Seal, LBSs are making 100%-200% profit, at least.
> One LBS sells it for $16.99; another for $19.99. Same exact bottle.
> With tubeless, they all had to think of a way to recoup that lost revenue and paying $17+tax for a bottle of freakin liquid is it. More expensive than tubes!


We're saying the same thing.


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## COMTBR (Jul 18, 2016)

The percentages I listed are not actual, obviously, it’s only been explained to me, on numerous occasions by LBS owners while I’m staring at retail, MAP and cost pricing on their screens with them. But the general rule applies.
Yes, the SWORKS getting blown out 2-3 seasons old for low prices, LBSs are usually breaking even or taking a loss on those. Cost of doing business. And they’ll think real hard the next purchase season which high-end bikes they’re willing to put on the floor vs special order. 
I live in CO, MTB Mecca, and I had an impossible time finding an Epic HT to demo. No LBS wanted to stock them as they have had new SJ HTs 2-3 years old sitting on the floor, cut by 40% off retail. EHTs are pretty much special order only around here.


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## jochribs (Nov 12, 2009)

cjsb said:


> No I have not, but if you read in my post I said just that--you need to do large volumes to make a difference. Despite your experience, and even if it is replicated across the industry it isn't saving the LBS because it is an easy item to sell closer to cost and for even larger volume over internet. It is a convenience purchase at the LBS.
> 
> Sent from my iPhone using Tapatalk


You're making assumptions on this, rather than having first hand experience.

In curious how many people are buying tubes online? Some probably are. But I would bet that a good deal are probably sold at any shop. Some locations, it's probably better than others. (As I said, university areas, high commuter populations etc.)

The cost of a tube and labor is probably around 20 these days. ( Shop guys, correct me if I'm wrong.) With a shop that has guys that are worth their salt, money is being made in that regard. Money that helps to even out other areas. This is how it was at least. If things have changed on this, I'll definitely accept my being wrong, but I have no reason to believe otherwise at this point.


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## jochribs (Nov 12, 2009)

COMTBR said:


> The percentages I listed are not actual, obviously, it's only been explained to me, on numerous occasions by LBS owners while I'm staring at retail, MAP and cost pricing on their screens with them. But the general rule applies.
> Yes, the SWORKS getting blown out 2-3 seasons old for low prices, LBSs are usually breaking even or taking a loss on those. Cost of doing business. And they'll think real hard the next purchase season which high-end bikes they're willing to put on the floor vs special order.
> I live in CO, MTB Mecca, and I had an impossible time finding an Epic HT to demo. No LBS wanted to stock them as they have had new SJ HTs 2-3 years old sitting on the floor, cut by 40% off retail. EHTs are pretty much special order only around here.


Are you telling me this, or someone else?


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## EricTheDood (Sep 22, 2017)

cjsb said:


> Personally, I was hoping 3D printing and low natural gas prices would bring some bike mfg. back to the USA but that has not happened.


It can eventually come back because overseas OEM/ODM contract manufacturing is a dead-end road for "luxury" products like high end MTBs.

Manufacturing prices overseas will keep going up while quality stays stagnant. The current state of manufacturing quality in counties like Taiwan has peaked. It will not get significantly better and it will not get cheaper, because their methods involve a certain amount of brute-force, which frankly is yesterday's methodology. Today and tomorrow is all about automation/semi automation with more efficient use of labor.

I work in an unrelated manufacturing industry and our company competes with products made in Taiwan. I'm familiar with how OEM/ODM manufacturing works in Taichung and wrote it off years ago. We've been steamrolling our importing competitors because our quality is a night and day improvement, even though our end-user pricing is comparable and our margins are higher.


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## cjsb (Mar 4, 2009)

jochribs said:


> You're making assumptions on this, rather than having first hand experience.
> 
> In curious how many people are buying tubes online? Some probably are. But I would bet that a good deal are probably sold at any shop. Some locations, it's probably better than others. (As I said, university areas, high commuter populations etc.)
> 
> The cost of a tube and labor is probably around 20 these days. ( Shop guys, correct me if I'm wrong.) With a shop that has guys that are worth their salt, money is being made in that regard. Money that helps to even out other areas. This is how it was at least. If things have changed on this, I'll definitely accept my being wrong, but I have no reason to believe otherwise at this point.


i don't think you are wrong and I am not arguing with you. If anything you may be leaving out overhead, but that's okay.

The key is that there needs to be high volume and it is one part of the service. If a shop is staying in business on tube sales and flat repairs alone then awesome. But now take a step back: can a shop owner clear $50k per year for himself on tubes and flats? if he can then that is what I am doing when I retire.

Sent from my iPhone using Tapatalk


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## jochribs (Nov 12, 2009)

No not on that alone. But it is most likely helping to keep the doors open and the lights on.


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## richj8990 (Apr 4, 2017)

jochribs said:


> Wrong. Wrong on the profit margin cannot be as high on lower ticker items as on higher ticket items.
> 
> When you work at a shop you are privy to what the bike shop is paying for the item, and it only takes remedial math to see that the percentage of profit is smaller the higher you go. This is inarguable.
> 
> ...


"Often times, my pro-deal from a manufacturer was less than the cost price on the item, of which the shop was paying." So why do LBS have contracts with distributors if they are getting screwed? Isn't that just plain dumb for them to enter into a contract and not even get the best price?

I'm not talking about buying a tube for $1 and selling it for $8, I'm talking about buying an entire new bike and then selling it retail. One of the problems with proving this is that LBS stores generally don't sell sub $500 bikes like Walmart does, so it's hard to extrapolate down to the percent profit of a cheap bike that could be sold at an LBS and not Walmart.

If you look at a $150 bike, there is no way Walmart is making a huge profit percentage on that retail price. It's going to cost at least $120 for the parts, assembly, and shipping to the US. Compare that with a $5000 custom bike whose parts with a distributor discount cost around $2500, and then the labor for assembly. High volume cheap bikes = stay in business with low profit margin due to world/national/regional competition. Custom expensive bike shop = low volume = must charge extra for the bike to stay in business locally. This is economics 101. Cheap volume products (whole bike products, not tubes) with competition do not make high profit margins.


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## richj8990 (Apr 4, 2017)

Originally Posted by cjsb View Post
No I have not, but if you read in my post I said just that--you need to do large volumes to make a difference. Despite your experience, and even if it is replicated across the industry it isn't saving the LBS because it is an easy item to sell closer to cost and for even larger volume over internet. It is a convenience purchase at the LBS.

Exactly. The LBS sells bikes because of convenience, not because they are the cheapest out there. Their main selling point is free maintenance for...1 yr, 2 yrs, the life of the bike, etc. depending on the contract. But you can still buy the same bike on Amazon and even if you take it to the LBS 3 times a year for paid maintenance it still ends up a cheaper purchase on Amazon. Which brings me to the point of the thread --- why so expensive? Because aspiring riders get sucked into a bike people tell them they need instead of a $500 hardtail that they can learn on for 1-2 years until they really know what type of more expensive and purpose-made bike fits their riding style. I've seen guys out there with $2000 bikes that can barely even stay on the bike without falling down on a flat surface. The $2000 bike isn't helping them stay on the bike, experience will. Just like how people buy a car for $10-20K more than they need on the dealership lot because the salesperson talked them into it.


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## jochribs (Nov 12, 2009)

richj8990 said:


> "Often times, my pro-deal from a manufacturer was less than the cost price on the item, of which the shop was paying." So why do LBS have contracts with distributors if they are getting screwed? Isn't that just plain dumb for them to enter into a contract and not even get the best price?
> 
> I'm not talking about buying a tube for $1 and selling it for $8, I'm talking about buying an entire new bike and then selling it retail. One of the problems with proving this is that LBS stores generally don't sell sub $500 bikes like Walmart does, so it's hard to extrapolate down to the percent profit of a cheap bike that could be sold at an LBS and not Walmart.
> 
> If you look at a $150 bike, there is no way Walmart is making a huge profit percentage on that retail price. It's going to cost at least $120 for the parts, assembly, and shipping to the US. Compare that with a $5000 custom bike whose parts with a distributor discount cost around $2500, and then the labor for assembly. High volume cheap bikes = stay in business with low profit margin due to world/national/regional competition. Custom expensive bike shop = low volume = must charge extra for the bike to stay in business locally. This is economics 101. Cheap volume products (whole bike products, not tubes) with competition do not make high profit margins.


Sigh. When I was selling 250 to 300 dollar trek 820's, the cost price was approximately half that. This was a number of years ago, but I am SURE this still holds true. The higher ticket bikes we sold were a much smaller mark up.

I don't know if you are disputing this, but it sounds like you are. I don't know where a person that hasn't been in a first hand knowledge situation of what they are arguing against, gets the gumption to debate something simply based on what they 'think' and not what they know.

Quite interesting.


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## bronxbomber252 (Mar 27, 2017)

EricTheDood said:


> If that were true, it would be backwards from every other industry. I don't think it's true.


Definitely not confined to the bike industry. For example, a typical inexpensive digital watch sells for about 5000% (yes, three zeros) over what it costs to make it. However a high end Swiss mechanical watch (all springs and gears) typically sells for about 500% what it costs to make. Margin is of course higher on the expensive watch.

Sent from my iPad using Tapatalk


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## jochribs (Nov 12, 2009)

bronxbomber252 said:


> Definitely not confined to the bike industry. For example, a typical inexpensive digital watch sells for about 5000% (yes, three zeros) over what it costs to make it. However a high end Swiss mechanical watch (all springs and gears) typically sells for about 500% what it costs to make. Margin is of course higher on the expensive watch.
> 
> Sent from my iPad using Tapatalk


I might be understanding the terminology incorrectly, but wouldn't the margin on the more expensive watch be 'smaller' or 'lower'?

Maybe I'm flipping the meaning. Is it described in a similar sense as a fly hook in a higher number, say a size 20, is smaller than a size 8, for instance?


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## Zowie (Aug 3, 2013)

jochribs said:


> I might be understanding the terminology incorrectly, but wouldn't the margin on the more expensive watch be 'smaller' or 'lower'?
> 
> Maybe I'm flipping the meaning. Is it described in a similar sense as a fly hook in a higher number, say a size 20, is smaller than a size 8, for instance?


Say you sell your Acera mech that cost seven dollars for fifteen. Then let's say an XTR costs a hundred and fifty, and you sell it for two hundred.

Covers your time either way, Acera is twice as much margin in percentage, XTR is seven plus times as much margin in dollars. 
Which would you rather sell?


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## *OneSpeed* (Oct 18, 2013)

Zowie said:


> Say you sell your Acera mech that cost seven dollars for fifteen. Then let's say an XTR costs a hundred and fifty, and you sell it for two hundred.
> 
> Covers your time either way, Acera is twice as much margin in percentage, XTR is seven plus times as much margin in dollars.
> Which would you rather sell?


I tried explaining this to someone earlier in this thread but he was convinced 100% margin was more important on a $3 item than selling a $5k bike with a 30% margin.


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## DeadGrandpa (Aug 17, 2016)

20mmrain said:


> Great points actually! And it does put some prospective on it.
> But, the ultimate goal of any company is to bring their products to as many people as they can in order to make money... Correct?


I believe the ultimate goal of any company is to make as much profit as possible. Business models vary from a high profit margin on relatively few numbers sold, such as Rolls Royce Phantom, to a much smaller profit margin on a Ford Fiesta, which would sell many more units. In each case, the seller charges what the market will bear, along a sliding scale of supply/demand which, in the most successful companies, maximizes total profit. 'Twas ever thus. Uh-huh, that's right, I've been to college.


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## jochribs (Nov 12, 2009)

Zowie said:


> Say you sell your Acera mech that cost seven dollars for fifteen. Then let's say an XTR costs a hundred and fifty, and you sell it for two hundred.
> 
> Covers your time either way, Acera is twice as much margin in percentage, XTR is seven plus times as much margin in dollars.
> Which would you rather sell?


My dollars are going farther with less 'buy in' so to speak, with the Acera. And I'm selling more of the Acera.


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## jochribs (Nov 12, 2009)

*OneSpeed* said:


> I tried explaining this to someone earlier in this thread but he was convinced 100% margin was more important on a $3 item than selling a $5k bike with a 30% margin.


I personally wouldn't say it's more important, but it's the reality at a bike shop for the most part. You're selling way more of the lower ticket item, and your dollars are going further. Sure, you want to sell the high ticket item too, and your making more in 'one' sale...but your sure as **** had to have a whole lot more hanging out there (money) to get it. And that money that was hanging out there on it could be spent on other things.

But as my old boss used to say....CODB, cost of doing business.

Every shop guy wants to be fondling the best, newest stuff everyday, but it's the boring, mundane stuff that keeps the money flowing.


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## paulmich (Jul 6, 2015)

Every hobby is expensive. From guitars to metal detectors to cameras.You can find budget bikes at Dunhams or Dicks sporting goods. Mountain bikes range from $100 to $8,000. You can pick your own price point just like any other hobby. As a kid I rode the $100 bikes and I was lucky if it lasted a year or two. Nowadays I ride a $2,000 carbon hardtail. There are more expensive hardtails but I would not pay much more than $4,000 for a hardtail. I am not interested in full suspension but a quality FS bike will start around $1,500. It all boils down to your wants and needs.


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## chazpat (Sep 23, 2006)

jochribs said:


> My dollars are going farther with less 'buy in' so to speak, with the Acera. And I'm selling more of the Acera.


But he just said "which would you rather sell", as in a customer will buy this product or that product; you're going to make a lot more money off of the XTR for the same amount of effort. Yes, inventory wise you need to be carrying more of the lower price/lower profit item as you will sell greater quantities. But this thread is about why bicycles are so expensive, as perceived by the OP.

As I said earlier and DeadGrandpa above said, some manufacturers go the "sell a lot of cheap (lower margin) product" route and some go the "sell fewer higher margin product" route. This is going to be reflected on the retail level as well.


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## armii (Jan 9, 2016)

Travis Bickle said:


> Try making that motorcycle into a human powered vehicle and see how much that runs you?


Try making that human powered vehicle in to a motorcycle and see how much that costs. And neither have anything to do with the conversation going on here. GEEESSSZZZ.


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## armii (Jan 9, 2016)

Silentfoe said:


> Look closely at a motorcycle. The precision engineering is there but not nearly at the level of a high end bicycle. You can grab parts and shake them. The machining isn't as clean. Parts don't have to be refined for maximum weight and strength, not to the level of a high end bike. If you turn of the engine and still roll on a motorcycle, you can hear things rattling.
> 
> Sent from my SM-G955U using Tapatalk


As someone who raced motocross and hare scrambles, both on motorcycles and ATVs, and who was a licensed master motorcycle mechanic, I say your statement about motorcycle levels of technology and quality are totally incorrect.


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## armii (Jan 9, 2016)

schnellmann said:


> I saw zero debunking in the thread, I only saw your rationale, frankly, which holds little water.


+ a bunch on that!!!


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## Silentfoe (May 9, 2008)

armii said:


> As someone who raced motocross and hare scrambles, both on motorcycles and ATVs, and who was a licensed master motorcycle mechanic, I say your statement about motorcycle levels of technology and quality are totally incorrect.


Really? You raced motox on an 8k motorcycle with zero mods?

Doubtful.

So then why did you modify it? Better parts? Of course. We're not idiots. Don't assume we are.

An 8k mtb is pretty much top of the line and requires zero mods to race or ride hard. A top of the line motox bike is 10's of thousands. Yes, 10's. You and I both know it.

Sent from my SM-G955U using Tapatalk


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## jochribs (Nov 12, 2009)

chazpat said:


> But he just said "which would you rather sell", as in a customer will buy this product or that product; you're going to make a lot more money off of the XTR for the same amount of effort. Yes, inventory wise you need to be carrying more of the lower price/lower profit item as you will sell greater quantities. But this thread is about why bicycles are so expensive, as perceived by the OP.
> 
> As I said earlier and DeadGrandpa above said, some manufacturers go the "sell a lot of cheap (lower margin) product" route and some go the "sell fewer higher margin product" route. This is going to be reflected on the retail level as well.


Who cares 'exactly how he asked the question'? I still answered the general idea of what he was inquiring. I think we're all a bit more intelligent in here than to start splicing pubic hairs based on semantics.

And to disagree with your simplifying of the high-end, low-end 'getting to the same place', proposition....yes the XTR (etc) is going to bring in more in one sale. Absolutely. But how many shops do you know that have the capital to just sell high-end? It takes a lot more money to even have that stuff, in order to sell it. Are you gonna stock it? Are you gonna just order it when a person comes on for it? Are they gonna wait? Are they gonna pay shipping? Or are they just gonna but it from Jenson etc? What are you gonna charge?

Your dollars are going further with less commitment with lower end.

Listen, I'm tiring of this pissing match. I only got into it to correct someone who said something blatantly wrong, and that's evolved now into a discussion that isn't really on topic, but to a degree parallels it. Anyhow, (I think, lol) I'm done here .


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## mtnbkrmike (Mar 26, 2015)

Not to add fuel the fire, but to those making the motorcycle analogy in support of an argument to **** all over bike pricing...

I take it that none of you own a Harley.


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## richj8990 (Apr 4, 2017)

Quote Originally Posted by Travis Bickle View Post
Try making that motorcycle into a human powered vehicle and see how much that runs you?

Isn't that called an e-bike?


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## richj8990 (Apr 4, 2017)

jochribs said:


> Sigh. When I was selling 250 to 300 dollar trek 820's, the cost price was approximately half that. This was a number of years ago, but I am SURE this still holds true. The higher ticket bikes we sold were a much smaller mark up.
> 
> I don't know if you are disputing this, but it sounds like you are. I don't know where a person that hasn't been in a first hand knowledge situation of what they are arguing against, gets the gumption to debate something simply based on what they 'think' and not what they know.
> 
> Quite interesting.


OK let me clarify, low end first high end second. I was not clear about who exactly is selling the bikes, I made a mistake by mixing in a volume LBS store with Walmart and high-end custom bike shops.

Bike Forums › ... › > Road Cycling › Are Trek bikes made in Taiwan / China ?
Apr 22, 2006 - 22 posts - ‎21 authors
It mentioned that most of Trek bikes except their super high-end model are made in Taiwan and China. ... The Madone SSLX is built at Trek's world headquarters in Waterloo, Wisconsin, while the price-competitive models are manufactured in Taiwan or China.

So again back to importing a cheap bike for $120+ and then selling it in the US. LBS sells it for $250-300, Walmart sells it for $150-200. I'm happy that the run of the mill LBS can make that profit margin.

High-end, make in America, costs a lot to by pre-made, lower profit margin, I totally get that for a run of the mill LBS. I was talking about a custom-made bike with discounted parts and cheap labor, not just selling a brand-name higher-end bike that comes mostly assembled, my apologies.


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## richj8990 (Apr 4, 2017)

*OneSpeed* said:


> I tried explaining this to someone earlier in this thread but he was convinced 100% margin was more important on a $3 item than selling a $5k bike with a 30% margin.


Well strictly from a numbers standpoint, if you sold 2000 items for $3 each and made a total of $1500 profit, it would be the same as selling one $5000 bike for $1500 profit.


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## chazpat (Sep 23, 2006)

jochribs said:


> Who cares 'exactly how he asked the question'? I still answered the general idea of what he was inquiring. I think we're all a bit more intelligent in here than to start splicing pubic hairs based on semantics.
> 
> And to disagree with your simplifying of the high-end, low-end 'getting to the same place', proposition....yes the XTR (etc) is going to bring in more in one sale. Absolutely. But how many shops do you know that have the capital to just sell high-end? It takes a lot more money to even have that stuff, in order to sell it. Are you gonna stock it? Are you gonna just order it when a person comes on for it? Are they gonna wait? Are they gonna pay shipping? Or are they just gonna but it from Jenson etc? What are you gonna charge?
> .


This isn't even what this thread is about. The fact that an LBS needs to sell lower end product for the volume isn't what makes bikes expensive as perceived by the OP. And I've not said that is not accurate, I was just trying to stay on topic (for once). I don't think the OP was discussing low-end bikes as being expensive.


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## Zowie (Aug 3, 2013)

chazpat said:


> But he just said "which would you rather sell", as in a customer will buy this product or that product; you're going to make a lot more money off of the XTR for the same amount of effort. Yes, inventory wise you need to be carrying more of the lower price/lower profit item as you will sell greater quantities. But this thread is about why bicycles are so expensive, as perceived by the OP.
> 
> As I said earlier and DeadGrandpa above said, some manufacturers go the "sell a lot of cheap (lower margin) product" route and some go the "sell fewer higher margin product" route. This is going to be reflected on the retail level as well.


My point was really to the OP. To be honest, I like to see more reasonably priced stuff out there, it's easier for an LBS to stock a little bit of everything that way. This is also the reason I'm not the biggest fan of continually changing standards, since there is only so much room you can have to stock different permutations of the same component.

By the same token, I can't really slight the high end shops for trying to sell silly expensive stuff, as mentioned, they can make good money if they can keep stuff moving, and you can certainly get at least a slightly nicer bike if you want to drop a bunch of cash as opposed to a moderate amount. I can't help but think the internet is destroying that market faster than the reasonably priced one, since those high dollar margins are easier to cut online, but we're all watching that play out as we argue.


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## bronxbomber252 (Mar 27, 2017)

More margin = more dollars in pocket of seller

More profit = higher proportion of retail price goes to seller


Both are after covering cost/overhead


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## jochribs (Nov 12, 2009)

chazpat said:


> This isn't even what this thread is about. The fact that an LBS needs to sell lower end product for the volume isn't what makes bikes expensive as perceived by the OP. And I've not said that is not accurate, I was just trying to stay on topic (for once). I don't think the OP was discussing low-end bikes as being expensive.


"Everytime I think I'm out...they pull me back in..." 

Ugh Chazpat. I am aware that that isn't what the thread is about. In the portion of my comment that you are quouting (but decidedly chose to not include in your quoting me) I fully acknowledge that, and explain what brought me into this discussion in the first place.

And no, you are correct. We weren't discussing low-end bikes as being expensive or inexpensive for that matter, but rather the changing margins of bikes as they get more expensive. And really, that isn't that far off-topic, and relates rather well. Hence why I said in my section of the quote that you snipped...

" and that's evolved now into a discussion that isn't really on topic, but to a degree parallels it. Anyhow, (I think, lol) I'm done here ."

Now, go piss up a rope.

(And don't take that so seriously. It's a quote of my grandma's, and meant to be funny)


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## jochribs (Nov 12, 2009)

Zowie said:


> My point was really to the OP. To be honest, I like to see more reasonably priced stuff out there, it's easier for an LBS to stock a little bit of everything that way. This is also the reason I'm not the biggest fan of continually changing standards, since there is only so much room you can have to stock different permutations of the same component.
> 
> By the same token, I can't really slight the high end shops for trying to sell silly expensive stuff, as mentioned, they can make good money if they can keep stuff moving, and you can certainly get at least a slightly nicer bike if you want to drop a bunch of cash as opposed to a moderate amount. I can't help but think the internet is destroying that market faster than the reasonably priced one, since those high dollar margins are easier to cut online, but we're all watching that play out as we argue.


Precisely Zowie, hit on the head.


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## chazpat (Sep 23, 2006)

Zowie said:


> My point was really to the OP. To be honest, I like to see more reasonably priced stuff out there, it's easier for an LBS to stock a little bit of everything that way. This is also the reason I'm not the biggest fan of continually changing standards, since there is only so much room you can have to stock different permutations of the same component.
> 
> By the same token, I can't really slight the high end shops for trying to sell silly expensive stuff, as mentioned, they can make good money if they can keep stuff moving, and you can certainly get at least a slightly nicer bike if you want to drop a bunch of cash as opposed to a moderate amount. I can't help but think the internet is destroying that market faster than the reasonably priced one, since those high dollar margins are easier to cut online, but we're all watching that play out as we argue.


Yep, that's what I was saying, addressing the OP.

Yeah, I miss the old days when it was a lot easier to piece a bike together without having to worry about all the different standards.


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## chazpat (Sep 23, 2006)

jochribs said:


> "Everytime I think I'm out...they pull me back in..."
> 
> Ugh Chazpat. I am aware that that isn't what the thread is about. In the portion of my comment that you are quouting (but decidedly chose to not include in your quoting me) I fully acknowledge that, and explain what brought me into this discussion in the first place.
> 
> ...


I hope you don't think I snipped your quote to be misleading in anyway, it was just a long quote and I wasn't addressing all of it so I thought it would be clearer.

Now I'm going to go piss up a rope, if I can figure that out.


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## jochribs (Nov 12, 2009)

Hahaha! All good Chazpat! I also hope I wasn't coming off as combative. I should have never posted in this debate, lol!! Got sucked in.


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## neblewis (Jun 29, 2009)

Since I have a background in selling IT hardware, I know the markup on H/W is insane and for that matter S/W. Flip your perspective, HP, NetApp, EMC, Dell, bla bla bla, once they create the S/W there is no gizmo to sell, it is vapor, they are protecting their IP. I have sold H/W at 90% off list (in a heavy competition) and I still made margin as an OEM reseller, so it goes both ways. I have often wondered why bikes cost so much, but I also wonder why an access layer 3 switch would be $15K does that make sense either? The answer to both is - because there is either a perceived or actual value to the customer. I do not need a $5,000 carbon fiber bike, but damn it sure is nice. Is it 2K nicer than my old aluminum ride . . . the world will never know.


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## gshocksv (Jun 21, 2015)

The high end bikes are expensive yes, but bike companies actually don't make that much money. I happen to be a financial analyst, and Giant's net income as a % of total revenue in 2016 was only 5.4%. Merida was a little better at 8.4%. The parts manufacturers actually make a lot more money, Fox was 8.9%, and Shimano 15.8% in 2016.

At the end of the day, the supply is driven by demand. I also think some bikes are getting too ridiculously expensive, but they sure don't have the kind of net margins that Apple has (21.2% in 2016).


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## RAKC Ind (Jan 27, 2017)

Those margins are biased though. The execs of those companies make a boat load.

So the net for Giant brand itself was 5.4%. What about all the money their factories make producing frames and other products for the other brands?

The band themselves may have a low net, thats after paying everyone that is making the money off the brand. That amount is basically what's left over.

I know the margins on bikes between list and cost for a couple brands. Giant is one. What they charge an lbs on a normal and what they can clearance out bikes for, still making a profit, the difference is insane.

Lbs get a nice starting margin (can easily be pushing 1/3 of list price). But after getting haggled down and paying the bills, they arent left with much. 

Sent from my SM-G950U using Tapatalk


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## 274898 (Nov 29, 2005)

Yeah, I don't get some of the high costs of stuff. Especially mountain bike specific clothing is so expensive. I think a lot of the cost models have been trickled down from road biking prices. Road biking clientele is more affluent buyer so I think the road biking industry prices up the costs. 

Also, there is demand for purchasing the products at higher prices so it keeps the prices up. The industry may change if the demand slows.


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## n8_ (May 20, 2013)

Despite the large number of brands, you've got oligopolies with drivetrains, brakes, and forks. Even though all the frames have different names of them, we know that most of them come from a only a few places - aka oligopolies.

From a price and probably innovation perspective, you'd want a handful of brands that make every piece of the bike. You don't have the drivetrain manufacturer and fork manufacturer getting their pound of flesh out of each bike. 

Also Cocialis is full of it when he says a mountain bike is a more precision thing that a motorcycle. Has he ever taken apart a motor? What about fuel injection (nevermind the ecu to run it).


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## gshocksv (Jun 21, 2015)

RAKC Ind said:


> Those margins are biased though. The execs of those companies make a boat load.
> 
> So the net for Giant brand itself was 5.4%. What about all the money their factories make producing frames and other products for the other brands?
> 
> ...


Apparently executive compensation of a public company is not necessarily disclosed in Taiwan, so I don't know how much they pay their executives. Chances are they are paid a fair salary because as a reasonably sized public company, shareholders are not going to let the executives get away with fat packages. I do know that Giant's cost of good sold (all materials, factory labor), represents 80% of total revenue. So for every 100 dollars of revenue they bring in, 80% goes out right away. Then you factor in selling and marketing expenses, R&D, depreciation, interest expenses, tax, they only make about $5.4 dollars (that's the total profit they make, including the money they make from other brands). Trust me, they are not taking you out for a ride.

Separately, the CEO of Fox (a public company in the US by the way), makes about $1.5 million a year. Great money sure, but compare to other Wall Street fat cats, I think it's reasonable.


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## Mergetrio (Jul 16, 2012)

Many have answered OP’s question of cost. In fact, that question may apply to my other expensive passion and hobby, namely the (electric) guitar. My solution to the market situation is to buy close outs at 35% discount and buy used guitars. It works for me.


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## Squashman (Jul 7, 2013)

And then you have organizations like NICA who are trying to bring the sport to all children across the country but they are no better then the bike industry when it comes to charging kids to race in their league. I paid over double for my son to race in NICA then I had to for his USA Cycling races.

This is an organization that should be asking the industry to produce a good quality inexpensive bike to make it feasible to put more kids on bikes. Yet they are just as guilty as the rest of the industry.


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## chazpat (Sep 23, 2006)

Mergetrio said:


> Many have answered OP's question of cost. In fact, that question may apply to my other expensive passion and hobby, namely the (electric) guitar. My solution to the market situation is to buy close outs at 35% discount and buy used guitars. It works for me.


I was a guitar player but then pretty much got out of it, though I have a Les Paul sitting next to me as I type (trying to get back into it). My daughter wanted an acoustic guitar one Christmas and I was shocked at how nice a guitar you can get for around $100 now-a-days. Sure, it's not the greatest but it plays well and sounds good; when I was a kid $100 got you a guitar with such bad action your fingers just about bled trying to hit the fret board, if you were able to push then down that far. I'm sure really nice guitars are still expensive.


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## Metamorphic (Apr 29, 2011)

Couple of ideas the OP might want to consider....

-The kind of bikes you're talking about are RACE machine. These are not duffer rigs. They're designed to win pro races. The last little bit of speed is always extraordinarily expensive. 

-Unlike a computer chip, the warranty returns can be huge. These bikes have design margins that will allow a Pro to ride for full season, but justbbarely. Guys that are short of pro but still hard-core will warranty their frames and other parts pretty regularly. 

-This race machine designed for a 165 pound guy needs to be up to the task of a 280 pound clyde or fat uncle lou who wants to take it for a spin around the block. Its an amazing task for such a light carbon sculpture. Guaranteed you'll go "wow" the first time you pick up a bare frame. When I got my first frame in the mail I thought the box was empty. 

If you go out and look at bikes that old designs, that are made for long term general, non race use, bikes are actually pretty affordable.


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## J. Random Psycho (Apr 20, 2008)

richj8990 said:


> Well strictly from a numbers standpoint, if you sold 2000 items for $3 each and made a total of $1500 profit, it would be the same as selling one $5000 bike for $1500 profit.


But sales operations themselves take time and money, and this expense is much greater in the former case.


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## mb2112 (Mar 5, 2013)

Agree with everything you said, but in a nutshell your answer is: everything is worth what someone will pay for it.


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## richj8990 (Apr 4, 2017)

No offense but I think we need to get back to the original question and provide a real example of direct-sourced parts that we could build a 'high-end' or at least mid-range bike from:

Titanium frame $550
10-12 speed rear derailleur $150, 1-2 chainring front derailleur $50
Wheels $300, cassette $50, shifters $70
140mm air fork $700 (120mm air forks can be as cheap as $190 but that's blasphemy)
Hydraulic Brakes $200
Misc parts (kickstand, seat, etc.) $50
Total cost around $2120 in parts with no labor and that's without any LBS discount for them purchasing the parts.

Now some on here will blow a brain artery on some of the pricing and say certain parts "should be" much more expensive than listed. That is THEIR opinion. There are decent parts above for a pretty cool bike. This is MY opinion but anything above this for pricing is just for bragging rights if they are not racing or doing some other competitive event. Law of diminishing returns. Just like a Porsche owner 'needs' $1500 signature floor mats in their car, or 'needs' a $2500 racing yellow paint job.


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## chazpat (Sep 23, 2006)

^ Needs a carbon fiber kickstand, much more expensive.

Titanium frames are not so common now-a-days and will run you a lot more.
If you're buying a titanium frame, you're going to spend more than $300 in wheels.
Misc is real short, stem, cranks, pedals, handlebar, seat post, grips, tires (tires alone will be over $50)


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## Aging Wannabee (Oct 22, 2004)

leeboh said:


> Just ride a 10 year old steel hardtails with 3 x9 drivetrains, works on my commuters and bikepacking rigs.


wtf. as soon as I read this I thought: this is one of my fellow Massholes. Lee you are SO obvious!


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## Brodino (Sep 15, 2008)

richj8990 said:


> No offense but I think we need to get back to the original question and provide a real example of direct-sourced parts that we could build a 'high-end' or at least mid-range bike from:
> 
> Titanium frame $550
> 10-12 speed rear derailleur $150, 1-2 chainring front derailleur $50
> ...


I like your list but I think we need to bump wheels to at least $600. I have ridden the lower tier wheels and that was an exercise in frustration and more money spent to fix.


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## Aging Wannabee (Oct 22, 2004)

sgltrak said:


> Part of the cost of bike stuff is the expense of marketing bike stuff to riders to convince them that they need to spend big $ on the newest and greatest bike stuff.


^ this


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## J. Random Psycho (Apr 20, 2008)

chazpat said:


> Titanium frames are not so common now-a-days and will run you a lot more.
> If you're buying a titanium frame, you're going to spend more than $300 in wheels.


I've just checked on aliexpress; there are indeed $550-650-ish hardtail Ti frames being sold. Not sure about their quality though.


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## richde (Jun 8, 2004)

n8_ said:


> Also Cocialis is full of it when he says a mountain bike is a more precision thing that a motorcycle. Has he ever taken apart a motor? What about fuel injection (nevermind the ecu to run it).


Yeah, what does that guy know about bikes.

The engine (and suspension, in some cases) is the ONLY part of a motorcycle that even comes close to the same levels of materials and fit and finish on a bicycle. Oh, and bicycle suspension, and the associated linkages, have to have tighter tolerances and less stiction because of the lower weight and smaller forces acting on it.

What keeps motorcycles DOWN is that street bikes are generally seen as transportation so when they cost more than a car, people balk at the idea, and weight limits on dirt bikes have remained stable, allowing stagnation and cost savings to take place. If we still thought that 40+lb DH bikes and 23lb XC bikes, with metal frames, could be the leading edge, they'd be significantly cheaper. But instead we have sub 35lb WC DH capable bikes and sub 20lb XC bikes that can be ridden and abused daily, so naturally they cost a lot of money.

Drop the weight of a motorcycle by 20% and see how much it increases the cost...and that's not addressing the hidden point that the motorcycles that pros race cost several times the base cost of the model they're allegedly riding. A KTM Dakkar bike costs over $50K, and that's not even close to being race ready. But I can order a Phoenix from Pivot and be good to go at the highest levels of competition other than personal preferences for bars, pedals and saddle.


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## Le Duke (Mar 23, 2009)

richde said:


> Yeah, what does that guy know about bikes.
> 
> The engine (and suspension, in some cases) is the ONLY part of a motorcycle that even comes close to the same levels of materials and fit and finish on a bicycle. Oh, and bicycle suspension, and the associated linkages, have to have tighter tolerances and less stiction because of the lower weight and smaller forces acting on it.
> 
> ...


Tried to pos rep you, but couldn't. Well said.


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## slapheadmofo (Jun 9, 2006)

richj8990 said:


> No offense but I think we need to get back to the original question and provide a real example of direct-sourced parts that we could build a 'high-end' or at least mid-range bike from:
> 
> Titanium frame $550
> 10-12 speed rear derailleur $150, 1-2 chainring front derailleur $50
> ...


 :skep:

"Better to remain silent and be thought a fool than to speak and to remove all doubt"


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## Aging Wannabee (Oct 22, 2004)

A lot of good points here. I would summarize what (IMHO)are the correct ones as: Precision costs money, companies want to differentiate themselves, not mass-market cheapify themselves so are always looking for the competitive edge, we want to keep up with the Joneses so are willing to pay for that edge. The cycle continues. Let's hear it for Capitalism!


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## kpdemello (May 3, 2010)

Mergetrio said:


> Many have answered OP's question of cost. In fact, that question may apply to my other expensive passion and hobby, namely the (electric) guitar. My solution to the market situation is to buy close outs at 35% discount and buy used guitars. It works for me.


This is what I try to do with bikes (did it this year with a new Santa Cruz, and my last bike was bought used). It works for me, too, but I am thankful for those who make the sacrifice and pay full retail so there are lots of bike companies that keep making better stuff that I can buy second hand or at closeout pricing. :-D


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## Silentfoe (May 9, 2008)

slapheadmofo said:


> :skep:
> 
> "Better to remain silent and be thought a fool than to speak and to remove all doubt"


Exactly. That was the most hilarious parts list/costs for a "high end" or even mid range bike.

Sent from my SM-G955U using Tapatalk


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## gshocksv (Jun 21, 2015)

*Giant's Income Statements*

Since this has generated so much interest, I've included a snapshot of Giant's key income statement stats. Keep in mind these are in Taiwanese currency, so to get to USD you have to divide it by 30.

As you can see, their net margin for 2017 is actually expected to be about 4.68% (a decrease from 2016). They'll make about $87 million USD in 2017. Not bad but in the world of corporate finance, it really is just pocket change.

Shimano in comparison is doing a lot better. Net margin for 2017 is 13.66%, and they'll make about $400 million a year.

So- bikes are expensive for sure, but they're not taking you out for a ride (pun intended).

The parts manufacturers on the other hand, is really where all the money is.


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## 127.0.0.1 (Nov 19, 2013)

...


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## Darth Lefty (Sep 29, 2014)

gshocksv said:


> The parts manufacturers on the other hand, is really where all the money is.


No doubt! You know that the dealer and the manufacturer and the distributor are all still making some money on the $2000-on-clearance frame that is the same as the one in last year's $9000 complete top-end bike


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## cjsb (Mar 4, 2009)

gshocksv said:


> Since this has generated so much interest, I've included a snapshot of Giant's key income statement stats. Keep in mind these are in Taiwanese currency, so to get to USD you have to divide it by 30.
> 
> As you can see, their net margin for 2017 is actually expected to be about 4.68% (a decrease from 2016). They'll make about $87 million USD in 2017. Not bad but in the world of corporate finance, it really is just pocket change.
> 
> ...


i am not supporting just a look at a couple of income statements but I agree with the point you are making.

If bikes cost too much because price far exceeds cost then returns will be higher than a competitive level and will attract new entrants, for comparable risk.

if costs are excessive and people still buy such outrageously price equipment, then there is room for huge cost cutting.

a huge part of bike expense is retail/distributor mark up. not complaining about latter, but noting that the industry is on a path to substantially eliminate the inefficient in thatline of business as we have known it, and it has been underway for a while.

to make bikes more affordable the LBS independent network is being highly refined.

Sent from my iPhone using Tapatalk


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## kpdemello (May 3, 2010)

It seems to me that a corporate income statement from a huge company like Giant is going to tell us very little about the margin on each individual bike. For all we know, Giant could be overspending on all kinds of nonsense completely unrelated to bike manufacturing.

That said, I do suspect the component makers like Shimano, SRAM and Fox make a lot more than the frame makers do. There's just a lot less competition there.


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## ezweave (Jul 9, 2004)

chazpat said:


> ^ Needs a carbon fiber kickstand, much more expensive.
> 
> Titanium frames are not so common now-a-days and will run you a lot more.
> If you're buying a titanium frame, you're going to spend more than $300 in wheels.
> Misc is real short, stem, cranks, pedals, handlebar, seat post, grips, tires (tires alone will be over $50)


To your point: Ti tubesets run about $1000 for the tubes alone. You can price it out yourself here. (4 stays, seat tube, head tube, bb shell, down tube, top tube.) Then you need a good rig to set it up. Some machining tools to do things like bend tubes, which you might need to do in some fashion that isn't available from someone like Nova directly. Then you need a proper welding set up. Then you might have to spend some time training yourself to weld... and you'll make a few that don't work. Oh and stuff from someone like Paragon for your bosses, brakemounts, dropouts.

A modern bike is a symphony of precisely machined parts, gobs of R&D, lots of equipment. The bikes built when I first got into MTBs (20 years ago) were very primitive in comparison. Ad hominem: but I know lots of industry folks, including a few manufacturers, and have been part of prototyping new stuff before... seeing how the sausage is made, and all that, I can tell you that the margins on high end bikes/parts/what-have-you are not that great. The price points have gone up, even accounting for inflation, but the stuff being sold today is getting better every year. You don't have to buy a new bike every year, I don't (well not for the same purpose, per se).

FWIW, the average bloke/blokette doesn't need more than a $4k bike max. The best values on the market are in that $3-4k range.


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## gshocksv (Jun 21, 2015)

Except that Giant is a public company, they are indeed just a bike manufacturer (they have to report their expenses) and they don't venture into other nonsense products (I included a snapshot of the key stats, if you really are curious, you can find their entire set of financial statements online with all the details). Not to mention, the executives are paid based on the stock performance. Their incentive is to boost profitability as much as possible, there's absolutely no reason for them to overspend on fun pet projects. I am not sure if that's the case for Trek because it's a private company and I have no idea how they spend their money.

The average gross margin on each bike is 20% (as shown in their financial statement. This means material, labor for the employees, the rent, electricity, whatever direct costs). Obviously for the high end bikes gross profit is going to be a lot higher, but what I am talking about here is average (you can argue that it's the high end bikes that drive profitability sure). Then you still have to pay the salaries of the people in selling & marketing, the sponsorship, the HR lady, shipping, the bean counter like me, auditors, compliance, insurance. Again, the bike manufacturers are really not that profitable compare to other industries.

There's a very interesting Youtube video from Pinkbike on this topic. They went to Taiwan to try to start a bike company. Their conclusion? It's not as easy as it looks:






If anything I would rather go into parts. Shimano does make a killing compared to the bike manufacturers.


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## *OneSpeed* (Oct 18, 2013)

cjsb said:


> to make bikes more affordable the LBS independent network is being highly refined.


Well, uh, that's one way to put it. :skep:


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## TwoTone (Jul 5, 2011)

richj8990 said:


> No offense but I think we need to get back to the original question and provide a real example of direct-sourced parts that we could build a 'high-end' or at least mid-range bike from:
> 
> Titanium frame $550
> 10-12 speed rear derailleur $150, 1-2 chainring front derailleur $50
> ...


Link to the $550 TI frame. Link the Seat, Seat post, Stem, Handlebars, BB, HS and grips that come in under $50


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## J.B. Weld (Aug 13, 2012)

Is the kickstand titanium?


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## chazpat (Sep 23, 2006)

richj8990 said:


> No offense but I think we need to get back to the original question and provide a real example of direct-sourced parts that we could build a 'high-end' or at least mid-range bike from:
> 
> Titanium frame $550
> 10-12 speed rear derailleur $150, 1-2 chainring front derailleur $50


I have got the most awesome 1 chainring front derailleur ever. It functions perfectly and literally weighs nothing. And you can have it for that $50.


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## cjsb (Mar 4, 2009)

*OneSpeed* said:


> Well, uh, that's one way to put it. :skep:


or, thinned out

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## cjsb (Mar 4, 2009)

gshocksv said:


> Except that Giant is a public company, they are indeed just a bike manufacturer (they have to report their expenses) and they don't venture into other nonsense products (I included a snapshot of the key stats, if you really are curious, you can find their entire set of financial statements online with all the details). Not to mention, the executives are paid based on the stock performance. Their incentive is to boost profitability as much as possible, there's absolutely no reason for them to overspend on fun pet projects. I am not sure if that's the case for Trek because it's a private company and I have no idea how they spend their money.
> 
> The average gross margin on each bike is 20% (as shown in their financial statement. This means material, labor for the employees, the rent, electricity, whatever direct costs). Obviously for the high end bikes gross profit is going to be a lot higher, but what I am talking about here is average (you can argue that it's the high end bikes that drive profitability sure). Then you still have to pay the salaries of the people in selling & marketing, the sponsorship, the HR lady, shipping, the bean counter like me, auditors, compliance, insurance. Again, the bike manufacturers are really not that profitable compare to other industries.
> 
> ...


 great video, shows how competitive the manufacturing side of the business is, and also why some brand's probably struggle with quality.

Sent from my iPhone using Tapatalk


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## DaveRider (Jul 14, 2014)

Because the companies know that people will spend the money on their passions. They've already got us at the gas pump, market, & medical. The economy of the last fifty years is designed to drain you of every penny & keep you barely scraping by, but not quite in the poor house.


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## dubdryver (Mar 20, 2006)

Honestly, I believe this debate is moot because you're not presenting accurate facts for both sides to even have a fair comparison...you know apples to apples? So far you've introduced one side of the argument that only observed costs of bicycles and theoretical market against a static price of a motorcycle, but we all know...even if we know nothing about motorcycles...that they don't all cost the same.

If you're talking pro model vs pro model....apples to apples...you're dead wrong. Check the price of a factory MX...what the pros ride....$100k or more. That's more than 10 times the cost of a performance production model. What is the cost of a pro bicyclist? $7-10k.....where the nominal production model is $2k-$3500. its not even close. The amount of high end materials and technologies far exceed that of the MX. The difference is that the MX has many many more parts. If you started putting high end parts all over the MX...carbon bars, machined not cased stem, carbon wheels, highend shocks etc....you would turn a $9k MX into a $20k bike very very quickly.

This doesn't even take into account the amount of precision that bicycles have over motorcycles. A MX with Brembo brakes and the Brembo name doesn't mean it has CNC machined calipers. No they're casted and machine faced. Shimano XTR are machined with ceramic, carbon and titanium bits all throughout. I could go on and on piece by piece comparison on how they're different and the use of higher quality parts, but in that its still not a comparison.


Yes MX provides much more value for the dollar, but that doesn't mean its a better value compared to a high end bicycle.


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## kpdemello (May 3, 2010)

gshocksv said:


> Except that Giant is a public company, they are indeed just a bike manufacturer (they have to report their expenses) and they don't venture into other nonsense products


Sure but don't they make all kinds of bikes, not just high end mountain bikes? Because I'm not sure it makes sense to include kids bikes, beach cruisers, road bikes, hybrids, e-bikes, etc in this discussion. Does it? Not to mention what about other things like failed new products in different markets and other expensive endeavors that really don't relate to mountain bike margins?


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## cjsb (Mar 4, 2009)

kpdemello said:


> Sure but don't they make all kinds of bikes, not just high end mountain bikes? Because I'm not sure it makes sense to include kids bikes, beach cruisers, road bikes, hybrids, e-bikes, etc in this discussion. Does it? Not to mention what about other things like failed new products in different markets and other expensive endeavors that really don't relate to mountain bike margins?


The more they can utilize their factories the cheaper they can make everything.

Sent from my iPad using Tapatalk


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## gshocksv (Jun 21, 2015)

kpdemello said:


> Sure but don't they make all kinds of bikes, not just high end mountain bikes? Because I'm not sure it makes sense to include kids bikes, beach cruisers, road bikes, hybrids, e-bikes, etc in this discussion. Does it? Not to mention what about other things like failed new products in different markets and other expensive endeavors that really don't relate to mountain bike margins?


The more bikes they build the greater the economies of scale. You pay the same rent, depreciation, and property tax whether you operate the factory 12 hours a day or 24 hrs a day. Also, you get greater discounts the more raw materials you buy. As long as they can cover the variable cost (labor and raw materials), it'll make sense for them to build as many bikes as possible. So in reality, the low end bikes help spread the costs (especially the fixed costs).

Failed products are part of the costs of doing business. Every company, not just bike manufacturers, will have some failures. You still remember the Macintosh TV? I didn't think so.


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## Yardstick (Jan 10, 2007)

It was funny to run across this thread after independently thinking about the tech to bike comparison recently. I have been thinking about a new bike, but the prices are high and my "outdated" 26-inch wheeled, 10-speed bikes from 2012 that were ~$5k new aren't worth much on the used market. That's where I made the connection to tech. We pay high amounts up front for computers or phones, they are outdated very quickly, and the resale sucks after a relatively short time. Since I ride dirtbikes a lot I'm tempted to make that comparison too. I ended up reading this whole thread and it actually changed my mind a bit. It wasn't necessarily the arguments made here, though. Some of the arguments in this thread are so full of false equivalencies that they are just absurd. But on a whole, they did made me think about the real reasons for bike prices. By the end I started thinking that bike prices might be more reasonable than I initially thought. I still think bike prices could be lower if they modeled their businesses after tech or motorcycles, but I think the choices would look significantly different.

I think the comparison to tech breaks down with the volumes involved. Talk about economy of scale. In the tech industry saving tenths of pennies ($0.001) on components is significant. I've seen purchase orders for millions of components per year for multiple years of a production run. They create a lot of supply in the tech world. Mountain bikes are a niche industry by comparison. There are certainly a lot of bikes and components out there, but they come from so many sources that there really isn't a good comparison there. If you could consolidate bicycle and bike parts manufacturers, create some common standards and narrow the choices, the prices would go down.

Comparing mountain bikes to dirtbikes is so tempting because they both have wheels, knobby tires, handlebars and are a lot of fun in the dirt! There might be some validity to the comparison, but there are also a lot of poor arguments too. Comparing based on part fit, like the case Chris Cocalis attempts to make in that interview, isn't valid. There are a lot of extremely tight tolerances in both cases. There are also a lot more parts with tight tolerances on a dirtbike -just think of an engine alone. If there's a rattle or loose fit, it's either something wrong or it is meant to be that way. In either case (MTB or moto) the parts have to be made to a high tolerance, but they also must be made interchangeable. These are mass produced things, not something like accurized gun parts that are hand fit and lapped together for an absolute minimum tolerance. I recall that he also pointed out something about the weight of a component and having to be strong enough to take some big hit. While that's true, the dirtbike also has to deal with some extreme forces due to engine torque, speed and the kind of hits they can take. Dirtbike parts really are pretty light for their capability. 

Basing a comparison on premier racing is another one that breaks down pretty quick. Supercross/Motocross and Dakar Rally racing are certainly high profile extreme ends of dirtbike racing. In both of those disciplines the factory machines are effectively test beds. In the case of Dakar, they are very low production machines. In either case, they are expensive to acquire or replicate. Numbers like $20k-100k for a bike might also be based on the level of engineering and labor in low-production parts being tested. If you tried to replicate the bike, maybe you'd spend that much on development and one-time setup for some limited production run of sample parts to be used and evaluated for one race or one season. I wouldn't be too surprised to hear that similar things happen at WC DH levels or other premier MTB race classes. On the other hand, there are examples like Extreme Enduro events where guys like Graham Jarvis go out and win on well prepped production bikes. I read that he tends to take a production bike, make some adjustments, adds his own tires and mousses and goes racing. That's probably similar to a Pro MTB racer who preps, or has the bike prepped by a mechanic to a high level. They might change their stem, bars, saddle, pedals and other parts from the production bike. I bet that most change from production tubes to their preferred tires and tubeless system too. So some comparisons could be made with a narrow focus, but comparing extreme ends of racing is a false equivalence.

If you compare the number of models of MTB and motorcycles and look at how they break down, it's easier to see why MTB's are so expensive. Just looking at Specialized and KTM, since that's what's in my garage, there are currently 24 models of Specialized mountain bikes (using the Mountain Bike category on their website) and 19 models of full-sized KTM dirtbikes. That's combining MX and Enduro but subtracting kids models. That also includes at least one KTM model that just adds different graphics and a few accessories to another model. Each mountain bike on the Specialized website breaks down to multiple build levels (Comp, Elite, Pro, S-Works, etc...), several with different wheel size options and even color options and then they each come in multiple sizes. Holy crap! Their supply chain management must be a nightmare! Compare that to KTM where most of the wheels are interchangeable. Six of the MX models get 19" rear wheels. The enduro models have 18" rear wheels. I think they both use the same hubs. All but the three kid sized MX models are using 21" front wheels. I think there are only two versions of forks on the big bikes. There is no S, M, L, XL sizing with dirtbikes and their graphics are pretty consistent. Even plastic is interchangeable between a lot of the models. Imagine if Specialized just cut down to a handful of models with consistent graphics and one fairly high end build spec, maybe equivalent to their Pro spec. Even with different sizing, I bet the price of that build spec would be significantly lower. 

Personally, I have to try really hard to avoid the argument of the amount of fun and satisfaction I get riding dirtbikes vs. mountain bikes. Dirtbikes are subjectively an order of magnitude more fun and satisfying to ride than mountain bikes for me. I tell people that I have to live close to mountain bike trails because I'm far less willing to travel to go ride the pedal bikes. I'm much more willing to drive long distances for a day ride on the dirtbike. I like riding mountain bikes, but if I start thinking about the fun I have on the dirtbike vs. mountain bike, the price, used resale values and changing part standards of mountain bikes gets infuriating.

Just for the fun of it I thought of another funny false equivalence comparison that almost makes sense. Think about the clothing industry compared to mountain bikes. The clothing industry offers a lot of different styles (models) with different colors and sizes and maybe different materials. The $10 t-shirt and $15 pants from Wal-Mart are perfectly adequate for clothing. They might be less stylish and less comfortable than high end clothing from elsewhere and they might not last as long, but they get the job done. What's the limit of high end clothing? Who spends thousands on a single shirt and pair of pants? Probably the same people that see the S-works bikes as disposable toys.


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## Gasp4Air (Jun 5, 2009)

If someone reads all of this, would you give me the condensed version?


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## Silentfoe (May 9, 2008)

Gasp4Air said:


> If someone reads all of this, would you give me the condensed version?


I gave up

Sent from my SM-G955U using Tapatalk


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## jeremy3220 (Jul 5, 2017)

Gasp4Air said:


> If someone reads all of this, would you give me the condensed version?


No two things are not alike.


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## J. Random Psycho (Apr 20, 2008)

Gasp4Air,
the way I read it, the idea is that sports bicycle industry has too low ratio of

V / (N * D)

where
V is total sales volume,
N is the number of suppliers,
D is total product diversity (sum of number of models per supplier for all suppliers).

V is not going to increase because of competition with dirt motorbikes, so the ways to reduce prices are to reduce N and/or D.

Reducing N should improve economies of scale because each supplier would get to produce more bikes. Reducing D should improve logistics and reduce R&D costs.


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## Yardstick (Jan 10, 2007)

J. Random Psycho said:


> Gasp4Air,
> the way I read it, the idea is that sports bicycle industry has too low ratio of
> 
> V / (N * D)
> ...


I assume you're talking about my post. That's an interesting way to think about it. I wouldn't say that," V is not going to increase because of competition with dirt motorbikes", though. I don't think that's a point of competition really. There are plenty of people who do one or the other and lots who do both. It would be interesting to know the real numbers on that. I bet there are even more who do neither. I think the sales volume of bicycles (especially new, high end bicycles) will remain low because cost is the barrier of entry for most people who aren't already in the sport (or hobby, depending on how you define your involvement).


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## J. Random Psycho (Apr 20, 2008)

That's how I compressed your paragraph about dirt motorbikes being more fun than MTBs!


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## Yardstick (Jan 10, 2007)

J. Random Psycho said:


> That's how I compressed your paragraph about dirt motorbikes being more fun than MTBs!


:lol: That's just my own personal barrier and opinion. That might explain why there are more motorcycles in my garage than bicycles.


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## Gasp4Air (Jun 5, 2009)

J. Random Psycho said:


> Gasp4Air,
> the way I read it, the idea is that sports bicycle industry has too low ratio of
> 
> V / (N * D)
> ...


Of course Mr Psycho! It's so simple now that you put it that way!

Actually, I still don't get it. Sorry, I work in IT all day and check my brain at the login screen.


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## Gasp4Air (Jun 5, 2009)

And about that "Low V/(N*D)" thing - isn't there a testosterone supplement for that? I saw one last night at 3AM called Ball Booster for Men. Maybe that would help.


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## J. Random Psycho (Apr 20, 2008)

You're supposed to be sleeping at 3 AM! Preferably next to a woman, too.


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## bachman1961 (Oct 9, 2013)

Gasp4Air said:


> If someone reads all of this, would you give me the condensed version?


It gots words in there like;

Outdated

Tech

Motorcycles

Clothing industry

Also, there's a bit in there about 26" wheels. Apparently at one time, bikes were set up that way.

I knew better than to read it all. He'll reveal we all pay too much for our bicycles, prove it with math, economy and history, then he'll tell our wives.


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## Gasp4Air (Jun 5, 2009)

J. Random Psycho said:


> You're supposed to be sleeping at 3 AM! Preferably next to a woman, too.


I do sleep next to a lovely woman, but my sleep switch sometimes turns off in the middle of the night so I go to the couch and watch Man-Boosting infomercials.


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## richj8990 (Apr 4, 2017)

Yardstick said:


> It was funny to run across this thread after independently thinking about the tech to bike comparison recently. I have been thinking about a new bike, but the prices are high and my "outdated" 26-inch wheeled, 10-speed bikes from 2012 that were ~$5k new aren't worth much on the used market.


26-inch 10-speed bikes were $5000 just 5 years ago??? OMG. Pardon my naivete. The million dollar question is what fork did you have on that $5000 bike?

10-speed 26'ers are currently selling for around $750-1000 brand-new right now; most are 3x10 but some are 2x10 (I found this one on Amazon, it's a fat-bike so not to everyone's taste):

NEW IN BOX Motobecane Boris X9 2x10 26 inch Wheel Bike Disc Brake Fat Bike (Silver, 21in) Price: $799.00 + $55.37 shipping

Have you guys heard of the the infamous 'mountain of evidence' in the OJ Simpson 1994 criminal case? But no indisputable proof of guilt? The mountain of evidence in this thread is that trends = overpricing and milking the profit margin as long as they can. The marketers agree to start a new trend, then bump up the pricing to 200-1000% profit for a while, then several years later things die down and you can get the same bike for a fraction of the cost. The only question is what the next trend is going to be for them to make a huge profit.


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## Yardstick (Jan 10, 2007)

richj8990 said:


> 26-inch 10-speed bikes were $5000 just 5 years ago??? OMG. Pardon my naivete. The million dollar question is what fork did you have on that $5000 bike?


Not sure if that's serious or sarcasm. One has a Fox 36 Vanilla R (tapered steerer, 20mm axle, 170mm travel). The other has a Fox 36 Float RC2 with 160mm travel (switched from a TALAS R that year). They came on 2012 Specialized Enduro Expert Evo and Carbon bikes respectively. I still like riding those bikes but the new standards are getting hard to ignore.


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## Zowie (Aug 3, 2013)

richj8990 said:


> 26-inch 10-speed bikes were $5000 just 5 years ago??? OMG. Pardon my naivete. The million dollar question is what fork did you have on that $5000 bike?
> 
> 10-speed 26'ers are currently selling for around $750-1000 brand-new right now; most are 3x10 but some are 2x10 (I found this one on Amazon, it's a fat-bike so not to everyone's taste):
> 
> NEW IN BOX Motobecane Boris X9 2x10 26 inch Wheel Bike Disc Brake Fat Bike (Silver, 21in) Price: $799.00 + $55.37 shipping


Another data point to make sense of your disconnect, if you so choose.
Fox 36 Float 831 Factory 26 2018 | Jenson USA

The fork on that bike cost more than the complete you linked.


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## 127.0.0.1 (Nov 19, 2013)

Gasp4Air said:


> If someone reads all of this, would you give me the condensed version?


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## car bone (Apr 15, 2011)

20mmrain said:


> So I recently just got into the Mountain biking hobby. Come to think of it...this is my first post in any bike forum.
> 
> My first discussion point is...why are bikes so expensive?
> 
> ...


To be honest a 1k bike is better than 4-5k bike was 10 years ago. and a 2k bike is better than anything you could build like 10 years ago. just sayin.


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## jeremy3220 (Jul 5, 2017)

car bone said:


> To be honest a 1k bike is better than 4-5k bike was 10 years ago. and a 2k bike is better than anything you could build like 10 years ago. just sayin.


It's the same with sports cars. A new Camaro SS is faster around the track than most supercars from 10 years ago.


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## slapheadmofo (Jun 9, 2006)

jeremy3220 said:


> It's the same with sports cars. A new Camaro SS is faster around the track than most supercars from 10 years ago.


Hmmm...funny, since they're only a smidge faster than an old 4th gen F-body.


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## slapheadmofo (Jun 9, 2006)

car bone said:


> To be honest a 1k bike is better than 4-5k bike was 10 years ago. and a 2k bike is better than anything you could build like 10 years ago. just sayin.


Define 'better'.


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## Silentfoe (May 9, 2008)

car bone said:


> To be honest a 1k bike is better than 4-5k bike was 10 years ago. and a 2k bike is better than anything you could build like 10 years ago. just sayin.


No. Not even close.

Sent from my SM-G955U using Tapatalk


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## jeremy3220 (Jul 5, 2017)

slapheadmofo said:


> Hmmm...funny, since they're only a smidge faster than an old 4th gen F-body.


I'm not sure if you're joking or not. They're way faster around a road course and the new V6 runs the same 0-60 as the old 4th gen SS.


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## car bone (Apr 15, 2011)

slapheadmofo said:


> Define 'better'.


If you define "expensive"


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## car bone (Apr 15, 2011)

I just tore apart, lubed and greased then reassembled a 1400€ genesis croix de fer 30 (steel cx/adventure) bike for a coworker. it was a 2017 model. ok its not an mtb but still. Full 105 group, good hydro brakes, reynolds 725 frame, good everything. veery good value there imo. and performance wise compared to cx bikes/road bikes from 10 years ago, well, time goes on.

with mtbs its even more dramatic. just look at suspension forks, brakes, rear squish systems and geometries, actually semi durable carbon frames, through axles for those that like them, lock on grips, wider rims, better tires, high output lights, and on and on and on. I think budget bikes today are really good, compared to old stuff, like 10 years old. its not very good compared to new more expensive stuff though. and it was the same way 10 years ago too.


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## outlaws (Aug 26, 2008)

All in all, I used to think MTB was expensive until I looked at other sports like car racing or 4x4 offroading. MTB is kids toys compared to car racing. Sure there seems like a huge upfront cost of MTB but in the grand scheme of things maintenance and upkeep of MTB is relatively low. There is also no entrance charge to enjoy your mtb trails. The bikes we are all drooling over are race bikes with race components that add up to 5-8k, but if you look at the lower entry ones they are only $2-3k and even those are already insanely good with any of the 120/140/160mm travel options. As with any type of racing that drives cost is the exponential cost factored in by weight reduction. Bikes used to be 35lbs and now they are down to 30lbs thanks to carbon frames, air forks, air shocks and lighter wheelsets. With all this factored in I feel bikes have been cheaper than ever for what you are getting even though I still think they are expensive for what it is just because I don't have a lot of disposable income but it is a niche sport afterall. 

To the guys who say MTB has more tolerance than dirt biking must be joking. Try opening a service manual for a dirt bike and see the tolerances inside an engine. It's in the hundredths and thousandths. Also almost all modern MTB tech was a direct copy from dirt bikes like forks, shocks, and disc brakes. I do like how MTB has advanced in the fork and shock with the air tech to lower weight and carbon parts. Wished dirt bikes could catch on but might just not be feasible with how heavy dirt bikes. MTB is still a lot cheaper than dirt biking though.


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## Nat (Dec 30, 2003)

outlaws said:


> To the guys who say MTB has more tolerance than dirt biking must be joking.


When I first read that sentence I immediately thought you were referring to racial/social/gender type tolerance and thought, this should be interesting. LOL.


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## slapheadmofo (Jun 9, 2006)

car bone said:


> If you define "expensive"


Not sure where you think I used 'expensive' in my posts, so no idea why you'd want me to define it for you.

You made a blanket statement about newer bikes all being 'better' than older ones, regardless of price point. Curious as to what you mean by that. I can think of tons of older high-end bikes that I'd rather have then a new entry level bike.


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## car bone (Apr 15, 2011)

moar better.

just moar


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## xler8 (Oct 22, 2015)

They charge what they do because people pay it. When people stop buying, the prices will be reflected. Until that happens, the prices will keep going up and up. 

Is is sad though that a bike costs more than a used car or motorcycle (new or used).


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## Nat (Dec 30, 2003)

I wouldn't buy a used car that cost $5000-$8000 without planning to spend more money for repairs though, so comparing a nice high-end new bike to a beater car probably isn't a great measuring tool.


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## targnik (Jan 11, 2014)

Bikes aren't expensive...

My wife's walking around w/ my high end bike on her fingers o_0

I'm sure my relatively cheap bike is more fun though...

Sent from my kltedv using Tapatalk


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## leeboh (Aug 5, 2011)

Aging Wannabee said:


> wtf. as soon as I read this I thought: this is one of my fellow Massholes. Lee you are SO obvious!


 I own 3 Surlys, a Burley and 2 steel sort of road bikes. Winning!


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## mrFreelancer (Apr 25, 2017)

Here's my 2 cents... regardless of if a brand new spankin' bike costs 10K or 5K, wait about a year or two, and you can get it for 60 - 75% off it's msrp. Bikes in these price ranges are much like "luxury" cars.... the moment you drive it off the lot, you lose most of it's value.

I've got myself a "cheap" $1400 FS and have absolutely no probs riding next to the guy that's got the 10K. And guess what? I can do everything on my bike he can do on his bike. Here's how I look at things...

- A Lexus is an upper end Toyota + wood trim
- An Acura is a Honda with expensive parts
- A 10K MTB is a 4 - 6K MTB + eye candy & wow factor
- A Weekend Warrior on a 10K MTB is keeping up with the Jones
- A dude on a beat up MTB smashing through the trails is a real MTB'r
- And a real MTB'r don't think about the finer points of pricing a bike


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## car bone (Apr 15, 2011)

mrFreelancer said:


> Here's my 2 cents... regardless of if a brand new spankin' bike costs 10K or 5K, wait about a year or two, and you can get it for 60 - 75% off it's msrp. Bikes in these price ranges are much like "luxury" cars.... the moment you drive it off the lot, you lose most of it's value.
> 
> I've got myself a "cheap" $1400 FS and have absolutely no probs riding next to the guy that's got the 10K. And guess what? I can do everything on my bike he can do on his bike. Here's how I look at things...
> 
> ...


No shizzle!

I just bought a lunskey pro cross with carpet fiber fork for 1300, mrsp was 4500... and this was directly from lynskey.
my last frame was a lynskey cooper cx 1 year old model that i bought for 800€ from chainreaction, it was half price.
and the frame before that was a 2008 chromag sakura that I bought for 700€ since it was last years model, and that retailed for 1700 or so


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## Nat (Dec 30, 2003)

mrFreelancer said:


> - A dude on a beat up MTB smashing through the trails is a real MTB'r
> - And a real MTB'r don't think about the finer points of pricing a bike


In that case I've seen an awful lot of pretend mountain bikers doing some pretty amazing things in some really awesome places over the years. It's a shame their nice bikes negated their existence.


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## mileslong (Aug 20, 2016)

car bone said:


> No shizzle!
> 
> I just bought a lunskey pro cross with carpet fiber fork for 1300, mrsp was 4500...


I had a carpet fiber fork once, got terrible rug burns from it....


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## EricTheDood (Sep 22, 2017)

Silentfoe said:


> No. Not even close.
> 
> Sent from my SM-G955U using Tapatalk


Correct.


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## Yardstick (Jan 10, 2007)

It's probably accurate to say that bikes are better now than they were 10 years ago. Frame geometry, part design, materials and manufacturing refinements have made things better. That's true across the board from entry level mountain bikes to the high end bikes. I'm not sure if that applies to box store bikes, but it might. Interestingly, it seems like bike weights have plateaued or started to go back up in some cases. Entry level or budget bikes still have the same problem they always have. The parts tend to be heavier, less sophisticated and less durable. In my experience those budget/entry level bikes tend to be more expensive over time than the higher end versions. If bike store salespeople were honest they'd tell potential customers who are balking at the $1500-2000 entry level FS bike they're looking at that if they stick with the sport/hobby they will be upgrading the forks, shock, drive train and wheels as they break them or notice their shortcomings. Is an entry level bike with $1500+ in suspension, $1,000+ in wheels and $500+ in drivetrain better than a $4500-5000 bike? Or do you get a better bike, maybe with a lighter frame for that higher up front price?


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## BadgerOne (Jul 17, 2015)

Guy from I think Pivot said something to the effect of, the precision and performance you get from quality bike parts is as high as it gets. He compared it to motorcycle forks and shocks, where things could be much sloppier and do the job just fine, so when looked at that way bikes are a relative bargain.

Everything is expensive. 

I bought a Wrangler Rubicon and performed a mid-grade build on it. When I was done, I had a 40k Jeep that was a blast to wheel and very capable, that I could actually only wheel about 4-5 months out of the year. And I easily could have spent twice that. 

Guns are also expensive. Depending on what you're into, a half dozen 'funs' are expensive enough. Then figure in the price of stocking ammo in those calibers, paying for range time if you don't have outdoor space, buying a robust and secure safe, paying for safe moves....expensive.

Again, everything is expensive.

About the only relatively inexpensive hobby I have is brewing beer, and even then a batch of specialty ingredients can exceed the cost of store-bought beer, luckily the equipment is a one-time expense.

So when I look at my bikes, I have two mtn, one road, and a couple others, all quality stuff, and realize I'm about 10k in for a hobby that I really enjoy and dramatically improves both my mental and physical health....that doesn't seem like such a bad deal at all in my mind.


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## Steve71 (Mar 15, 2004)

BadgerOne said:


> Guy from I think Pivot said something to the effect of, the precision and performance you get from quality bike parts is as high as it gets. He compared it to motorcycle forks and shocks, where things could be much sloppier and do the job just fine, so when looked at that way bikes are a relative bargain.


What a load of BS. High end motorcycles have amazing suspension. I was a little disappointed to find some steering slop in my $13K sled. Not sure if that's normal (don't notice it when riding). Seems to be some play in the pillow block bearing.

IME nothing compares to dirt bike suspension for erasing the bumps. 13" of rear wheel travel, massive tubeless tires at 5-3 psi and best of all a throttle to loft the front wheel in the air and hold it there. Not to mention the magic of massive gyroscopic stabilization. Freaking magic carpet ride over the nastiest of sh!t.


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## Gasp4Air (Jun 5, 2009)

Steve71 said:


> What a load of BS. High end motorcycles have amazing suspension. I was a little disappointed to find some steering slop in my $13K sled. Not sure if that's normal (don't notice it when riding). Seems to be some play in the pillow block bearing.
> 
> IME nothing compares to dirt bike suspension for erasing the bumps. 13" of rear wheel travel, massive tubeless tires at 5-3 psi and best of all a throttle to loft the front wheel in the air and hold it there. Not to mention the magic of massive gyroscopic stabilization. Freaking magic carpet ride over the nastiest of sh!t.


Sounds like a blast, though I've never ridden anything with a motor. Just wish it wasn't so loud.


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## slapheadmofo (Jun 9, 2006)

Steve71 said:


> IME nothing compares to dirt bike suspension for erasing the bumps. 13" of rear wheel travel, massive tubeless tires at 5-3 psi and best of all a throttle to loft the front wheel in the air and hold it there. Not to mention the magic of massive gyroscopic stabilization. Freaking magic carpet ride over the nastiest of sh!t.


 My son rode his first real MX track today on his KX 85. Spent most of the day there; amazing what those bikes (and riders) can do. So much braap.


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## Yardstick (Jan 10, 2007)

Steve71 said:


> ... Freaking magic carpet ride over the nastiest of sh!t.


I have seen/heard a few references to how 29ers "monster truck" over trail obstacles. If they only knew!  I was out on the dirt bike equivalent of a monster truck the other day. The KTM Super Enduro doesn't have 13" of rear wheel travel, but 10" of travel gets it done. That bike is overpowered and heavy but it's just ridiculous fun.



Gasp4Air said:


> Sounds like a blast, though I've never ridden anything with a motor. Just wish it wasn't so loud.


Electric dirt bikes are pretty quiet. KTM makes an electric 'freeride' motorcycle that is about 90% the size of a full-size motorcycle. I saw that they are selling for just under $10k out the door. For comparison, the new Specialized Kenevo E-bike retail price on the website is $7500. Alta Motors has a couple of full-size electric dirt bike models. Alta Motors usually runs one in Red Bull Straight Rythm. I found this video of someone racing a prolog (qualifier for extreme enduro) on the KTM freeride:






*not sure why the video won't embed. Vbulletin tags for video aren't working.


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## Nat (Dec 30, 2003)

Gasp4Air said:


> Sounds like a blast, though I've never ridden anything with a motor. Just wish it wasn't so loud.


Your (our) prayers have been answered. They make electric dirt bikes now:


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## Steve71 (Mar 15, 2004)

Gasp4Air said:


> Sounds like a blast, though I've never ridden anything with a motor. Just wish it wasn't so loud.


There's so much more to the two wheeled experience when you have a motor. It's pretty hard to go back. Ear plugs are good for the noise (assuming you're taking about yourself and not the noise disturbing others).



slapheadmofo said:


> My son rode his first real MX track today on his KX 85. Spent most of the day there; amazing what those bikes (and riders) can do. So much braap.


Lucky boy! My wife has a KTM 105xc (basically a bored out 85) and that thing flat out rips when it's on the pipe.


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## Steve71 (Mar 15, 2004)

Yardstick said:


> I have seen/heard a few references to how 29ers "monster truck" over trail obstacles. If they only knew!  I was out on the dirt bike equivalent of a monster truck the other day. The KTM Super Enduro doesn't have 13" of rear wheel travel, but 10" of travel gets it done. That bike is overpowered and heavy but it's just ridiculous fun.


Looks like a fun machine (gotta love v-twin torque). I'd love to get a bigger bike for ADV/dual sport rides. My 300 has a plate, but it's just not much fun at highway speeds (gearing).

You can never have too many motorcycles!


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## Steve71 (Mar 15, 2004)

Nat said:


> Your (our) prayers have been answered. They make electric dirt bikes now:


It's a good start, but they don't have the range for enduro/trail riding.


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## armii (Jan 9, 2016)

Silentfoe said:


> Really? You raced motox on an 8k motorcycle with zero mods?
> 
> Doubtful.
> 
> ...


wow, it has been awhile since I have been here, but that is a total non sequitur. What I said about the knowledge of motorcycle technology and your misconception of it has nothing to do with what I raced on. But, Yes, I was competitive in ATV AMA amateur hare scrambles (4th in my state 250 class) with a completely stock Suzuki Quad. And not one machine I ever raced had more than minor mods, never more than a thousand dollars. And just a couple years ago, one of the factory KTM riders had his bikes stolen just before a race, he competed in Supercross with a stock machine borrowed from a local dealer, with only his spare shock and fork, and managed a top 10. There may be a massive price difference from a top of the line stock dirt bike to a pro tricked out bike, but it is a quantum step in actual technology.


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