Cost of Bike Gear in Australia

On 2007-12-30, jcjordan (aka Bruce)
was almost, but not quite, entirely unlike tea:

Quoted message said:

As I am sure all of you are aware bike gear, such as tires, cassettes,
etc., are all hideously expensive in any bike store in Australia in
comparison to purchases from the UK and US and this is including
postage.

Having spoken to a mate who owns a bike store here in Canberra they
cant even get stuff from the distributors here at the prices that you
get from places like ProBikeKit and Parkers.

My question is why is it so expensive?

The distributers have a legal monopoly.

I've already asked a professional favour of one of my friends who
works in ACCC, so I'm loathe to ask him again, but I'm sure the ACCC
would be interested in finding out why if you prod them. When
they're not too busy helping the government and media understand
supply and demand when it comes to petrol prices.

--
TimC
SIGTHTBABW: a signal sent from Unix to its programmers at random
intervals to make them remember that There Has To Be A Better Way.

TimC said:

On 2007-12-30, jcjordan (aka Bruce)
was almost, but not quite, entirely unlike tea:

Quoted message said:

As I am sure all of you are aware bike gear, such as tires, cassettes,
etc., are all hideously expensive in any bike store in Australia in
comparison to purchases from the UK and US and this is including
postage.

Having spoken to a mate who owns a bike store here in Canberra they
cant even get stuff from the distributors here at the prices that you
get from places like ProBikeKit and Parkers.

My question is why is it so expensive?

The distributers have a legal monopoly.

I've already asked a professional favour of one of my friends who
works in ACCC, so I'm loathe to ask him again, but I'm sure the ACCC
would be interested in finding out why if you prod them. When
they're not too busy helping the government and media understand
supply and demand when it comes to petrol prices.

--
TimC
SIGTHTBABW: a signal sent from Unix to its programmers at random
intervals to make them remember that There Has To Be A Better Way.

With the price comparision its getting to the stage that the friend who owns the shop is considering not even stocking tires anymore. you cant blame him when you can get two tires from the UK (including postage) for less then he can sell one here

jcjordan said:

With the price comparision its getting to the stage that the friend who owns the shop is considering not even stocking tires anymore. you cant blame him when you can get two tires from the UK (including postage) for less then he can sell one here

I've wondered the same thing for a while now. Do the distributors for Shimano, Continental, (etc), make their living from the OEM supply of components to local whole bike distributors? Could it be that the single component and tyre market is really that small? In my bike circles this isn't the case, everyone chews through tyres, chains, cassettes like kids through lollies!!

Anyhow... on a related matter... I looovveee my Dura Ace SPD SL's (PD-7810)... best pedal I've used by far. I'm even planning on kitting out my TT bike and trainer bike with them... price comparisons:

PBK: $169
AU Prices: $240, $295, $299, $320..!!

I'd wear an extra $20-30 locally, but those prices just don't compute. I'm really keen to understand the local industry more... are us racing types such a small market that we don't count? By the sounds of it importing is starting to hurt.

Lama

On 2007-12-30, jcjordan (aka Bruce)
was almost, but not quite, entirely unlike tea:

Quoted message said:

TimC said:

The distributers have a legal monopoly.

I've already asked a professional favour of one of my friends who
works in ACCC, so I'm loathe to ask him again, but I'm sure the ACCC
would be interested in finding out why if you prod them. When
they're not too busy helping the government and media understand
supply and demand when it comes to petrol prices.

With the price comparision its getting to the stage that the friend
who owns the shop is considering not even stocking tires anymore. you
cant blame him when you can get two tires from the UK (including
postage) for less then he can sell one here

Maybe bike shops could get together and contact ACCC.

Bleve (if you're still around) etc, any thoughts?

--
TimC
"This thesis brought to you by the letter tau" -- TimC

On 2007-12-30, gplama (aka Bruce)
was almost, but not quite, entirely unlike tea:

Quoted message said:

jcjordan said:

With the price comparision its getting to the stage that the friend who
owns the shop is considering not even stocking tires anymore. you cant
blame him when you can get two tires from the UK (including postage) for
less then he can sell one here

I've wondered the same thing for a while now. Do the distributors for
Shimano, Continental, (etc), make their living from the OEM supply of
components to local whole bike distributors? Could it be that the
single component and tyre market is really that small? In my bike
circles this isn't the case, everyone chews through tyres, chains,
cassettes like kids through lollies!!

I think they're doing it quite deliberately. Goto PBK, and try to buy
a polar HRM. They won't sell it to you, because they have been banned
by the distributer.

--
TimC
[advice on riding in traffic:] make eye contact with drivers at every
possible opportunity. If they make eye contact, they'll feel worse
about running over you. -- Davidm in aus.bicycle

jcjordan said:

My question is why is it so expensive?

In many cases you'll find the Au distributer is paying as much or not much less than the OS shops. Add their 20 to 30% margin on + another 30 to 50% for the shop and 10% GST, it inflates the prices pretty quickly without anyone making a lot of money.

Parbs

"gplama" <[email hidden]> wrote in message
news:[email hidden]...

Quoted message said:

jcjordan said:

With the price comparision its getting to the stage that the friend who
owns the shop is considering not even stocking tires anymore. you cant
blame him when you can get two tires from the UK (including postage) for
less then he can sell one here

I've wondered the same thing for a while now. Do the distributors for
Shimano, Continental, (etc), make their living from the OEM supply of
components to local whole bike distributors? Could it be that the
single component and tyre market is really that small? In my bike
circles this isn't the case, everyone chews through tyres, chains,
cassettes like kids through lollies!!

Anyhow... on a related matter... I looovveee my Dura Ace SPD SL's
(PD-7810)... best pedal I've used by far. I'm even planning on kitting
out my TT bike and trainer bike with them... price comparisons:

PBK: $169
AU Prices: $240, $295, $299, $320..!!

I'd wear an extra $20-30 locally, but those prices just don't compute.
I'm really keen to understand the local industry more... are us racing
types such a small market that we don't count? By the sounds of it
importing is starting to hurt.

Lama

--
gplama

It would be good to find out why the prices are so high here. The $169 you
can import pedals for is less than the Aus wholesale, without GST! It is
surelybiting into the viablity of stocking parts in my bike shop. Sad,
really. Shimano offers a small discount for bulk buys and full groupsets but
even with the discount I'd make a significant loss at $169.

I'd love to be able to stock a much bigger range but even at break-even
prices it is often a waste of time. We have to rely largely on the lower
priced stuff that people won't bother shopping around for. The upshot is
that the retailer is deprived of business, the shoppers are deprived of
browsing for choice and someone out there (distributors, imporers, who??) is
raking it in.

I've noted of late that it's not just my shop (which I've only had for a
year) has dropped the range in stock. It seems to be a common thing around
the traps. The start of the decline of your LBS...

Cheers,

Frank

kanangara said:

In many cases you'll find the Au distributer is paying as much or not much less than the OS shops. Add their 20 to 30% margin on + another 30 to 50% for the shop and 10% GST, it inflates the prices pretty quickly without anyone making a lot of money.

Parbs

That's it pretty much. Actually the online wholesalers are contributing to the problem, how can the LBS feasibly order, hold stock, rent premises, pay staff and keep prices at a minimum compared to online distributors would have vastly more purchasing power and less overheads?

Australia has always been a small market by comparison to o/s. Part of a possible solution would be the manufacturers to stop online wholesalers undercutting local retailers. The recent ACCC ruling on Netti will have repercussions in the long term, but probably not for consumers:

http://www.accc.gov.au/content/index.phtml/itemId/802223/fromItemId/776481

Plodder said:

I've noted of late that it's not just my shop (which I've only had for a
year) has dropped the range in stock. It seems to be a common thing around
the traps. The start of the decline of your LBS...

I try and do the right thing by buying as much as I can from my LBS mainly because of the advice that I get, something that you don't get from a online store.

Plus you don't get a usable warranty from a O/S purchase. Take for the example that I have seen recently. Two friends purchased full group-sets, one online and one at a local store. The one that bought online had to send a part back to the UK and wait for a return, 2 weeks later. The other wanted to swap the cranks after realising that he had ordered the wrong size. One call to the local distributor and the swap was made from shop stock and the distributor and LBS figured out the difference, 15 minutes.

I do agree with the lack of range in most LBS these days as a lot of products are just not worth stocking when competing against the online stores, like tires.

I think in the future though you will see Australian distributors putting pressure on manufacturers to not allow online sales out of zone, like what has happened on ProBikeKit with Polar and Zipp. Not sure who the winner is though as the prices in Australia will most likely stay high.

On 2007-12-31, jcjordan (aka Bruce)
was almost, but not quite, entirely unlike tea:

Quoted message said:

I think in the future though you will see Australian distributors
putting pressure on manufacturers to not allow online sales out of zone,
like what has happened on ProBikeKit with Polar and Zipp. Not sure who
the winner is though as the prices in Australia will most likely stay
high.

Does anyone have idea whether what Polar have done is legal?

I don't recall what the latest status of parallel importatation is.
Then of course, if it were against the TPA, the deed would have been
done overseas, and so can't necessarily be punished under an
Australian Trade Practices Act.

--
TimC
"It took people a long time to figure out which machine was [mooing],
and even longer to figure out how. But for some reason it didn't take
them any time at all to figure that I'd done it." -- Paul Tomblin on ASR

TimC said:

On 2007-12-31, jcjordan (aka Bruce)
was almost, but not quite, entirely unlike tea:

Quoted message said:

I think in the future though you will see Australian distributors
putting pressure on manufacturers to not allow online sales out of zone,
like what has happened on ProBikeKit with Polar and Zipp. Not sure who
the winner is though as the prices in Australia will most likely stay
high.

Does anyone have idea whether what Polar have done is legal?

I don't recall what the latest status of parallel importatation is.
Then of course, if it were against the TPA, the deed would have been
done overseas, and so can't necessarily be punished under an
Australian Trade Practices Act.

What they have done is very similar to the selling of a franchise zone. The other franchises agree not to step on each others toes.

On Dec 31, 9:40 am, cfsmtb <cfsmtb.32f...@no-

mx.forums.cyclingforums.com said:

kanangara said:

In many cases you'll find the Au distributer is paying as much or not
much less than the OS shops.  Add their 20 to 30% margin on + another 30
to 50% for the shop and 10% GST, it inflates the prices pretty quickly
without anyone making a lot of money.

Quoted message said:

Parbs

That's it pretty much. Actually the online wholesalers are contributing
to the problem, how can the LBS feasibly order, hold stock, rent
premises, pay staff and keep prices at a minimum compared to online
distributors would have vastly more purchasing power and less overheads?

Australia has always been a small market by comparison to o/s. Part of
a possible solution would be the manufacturers to stop online
wholesalers undercutting local retailers. The recent ACCC ruling on
Netti will have repercussions in the long term, but probably not for
consumers:

http://tinyurl.com/2yssp9

Mmm, interesting. I met a guy on a ride who owned a LBS that stocked
Learsport/Azzuri and he told me Learsport do not allow selling at less
then RRP or they take distribution rights away ?! Anyone else heard
this ?

It's not just bike parts. My Koss headphones needed a new pair of foam
earpads. I bought three pairs of the pads from an Internet site, and the
cost, plus postage, was less than the price a local audio store wanted for a
single pair...

"jcjordan" <[email hidden]> wrote in message
news:[email hidden]...

Quoted message said:

As I am sure all of you are aware bike gear, such as tires, cassettes,
etc., are all hideously expensive in any bike store in Australia in
comparison to purchases from the UK and US and this is including
postage.

Having spoken to a mate who owns a bike store here in Canberra they
cant even get stuff from the distributors here at the prices that you
get from places like ProBikeKit and Parkers.

My question is why is it so expensive?

rmr said:

Mmm, interesting. I met a guy on a ride who owned a LBS that
stocked Learsport/Azzuri and he told me Learsport do not allow
selling at less then RRP or they take distribution rights away
?! Anyone else heard this ?

Such behaviour (retail price maintenance) has been illegal since
the days of Gough Whitlam.

John

So does anyone know how Apple gets away with it for Ipods? There are the
same price everywhere - no discounting.

"John Henderson" <[email hidden]> wrote in message
news:[email hidden]...

Quoted message said:

rmr said:

Mmm, interesting. I met a guy on a ride who owned a LBS that
stocked Learsport/Azzuri and he told me Learsport do not allow
selling at less then RRP or they take distribution rights away
?! Anyone else heard this ?

Such behaviour (retail price maintenance) has been illegal since
the days of Gough Whitlam.

John

Rex said:

So does anyone know how Apple gets away with it for Ipods? There are the same price everywhere - no discounting.

Different issue - www.streetwise.com.au always have a few $ off RRP on Apple goods.

(now throw me a bone for the free plug streetwise!!!) 🙂

Lama

Rex said:

So does anyone know how Apple gets away with it for Ipods?
There are the same price everywhere - no discounting.

Resellers are all allowed to ask whatever price they like. RRP
is just that - a recommended retail price. There're obvious
advantages to retailers if they all stick to RRP (voluntarily,
of course) and nobody breaks ranks with a lower price.

John

"John Henderson" <[email hidden]> wrote in message
news:[email hidden]...

Quoted message said:

Rex said:

So does anyone know how Apple gets away with it for Ipods?
There are the same price everywhere - no discounting.

Resellers are all allowed to ask whatever price they like. RRP
is just that - a recommended retail price. There're obvious
advantages to retailers if they all stick to RRP (voluntarily,
of course) and nobody breaks ranks with a lower price.

John

There seems to be an unofficial code regarding prices. Although I can charge
what I please in my shop, when I recently advertised a bike at a substantial
discount I had a call from the distributor asking me to withdraw the
advertised price. The reasoning was that it put other retailers under
pressure to offer the same price. I thought that was what was meant by
'marketplace competition'!

I didn't take it further and I did withdraw the ad. My first year in the
game and I didn't want to make waves. Leaves a bit of a bad taste in my
mouth, though. It has made me look to stock alternative brands, though...

Cheers,

Frank

"Plodder" <[email hidden]> wrote in message news:[email hidden]...

Quoted message said:

"John Henderson" <[email hidden]> wrote in message
news:[email hidden]...

Quoted message said:

Rex said:

So does anyone know how Apple gets away with it for Ipods?
There are the same price everywhere - no discounting.

Resellers are all allowed to ask whatever price they like. RRP
is just that - a recommended retail price. There're obvious
advantages to retailers if they all stick to RRP (voluntarily,
of course) and nobody breaks ranks with a lower price.

John

There seems to be an unofficial code regarding prices. Although I can charge
what I please in my shop, when I recently advertised a bike at a substantial
discount I had a call from the distributor asking me to withdraw the
advertised price. The reasoning was that it put other retailers under
pressure to offer the same price. I thought that was what was meant by
'marketplace competition'!

I didn't take it further and I did withdraw the ad. My first year in the
game and I didn't want to make waves. Leaves a bit of a bad taste in my
mouth, though. It has made me look to stock alternative brands, though...

Retail price maintenance is against the law. Have a look at:

http://www.ami.org.au/amimu/0703March/0703_law_resale-price.html

I'm expecting Apple to get whacked before too long. Shimano may be on
the ACCC's list, but I don't think they'd be near the front.

Tom.

Quoted message said:

Cheers,

Frank