Shimano USA - Price Too High?



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[email protected] (Carl Fogel) wrote in message
news:<[email protected]>...

> Years ago, a Honda motorcycle dealer patiently explained to me that yes, the clutch lever was
> expensive, but that it took half a dozen people to get it into my grubby little paws between
> Colorado and Japan, and they all liked to feed their families, so maybe I shouldn't have broken it
> in the first place.

Did he also explain to you the special parts manuals that they had printed that showed the retail
prices 50% higher than list? Retailers were jacking the prices of motorcycle parts outrageously, and
it had nothing to do with the other five people that touched the parts before the retailer got *his*
grubby paws on them.

You could save a lot of money on motorcycle parts just by finding a retailer who sold them at list-
which usually meant mailorder.

JP
 
"Stuart J. Armour" <[email protected]> wrote in message
news:<[email protected]>...
> It's been a while since I've posted but I thought you would find this interesting given Shimano
> USA's decision to only allow 6 mail/web order retailers.
>
> 2003 XTR crank - mail order $450.00 or so, here in Japan list price is 43,000 yen or about $400.00
> (it was on sale this weekend at my LBS for 34,000 yen, about $280.00) 2003 DA crank - mail order
> $200.00 or so, Japan list 36,000 yen or about $300.00
>
> Gives you something to think about. It also is a strong indication of what the discount to the
> inporter is. I really don't mind a company making a profit (that is after all what they are in
> business for) but there seems to be something wrong with this picture. When I get the Japan list
> price for the new DA crank/group I'll post that also given the approximately 500.00 jump in
> price from the current Should be an excellent year for Campy Record!

Just got around to reading this thread. Taken as a whole, looks like a classic dumping scenario to
me. Shimano selling stuff at a significantly lower price than in its home market, driving
competitors out of business, then raising the prices using their near monopoly to control access by
distributors/retailers to product.

JP
 
The dollar has fallen some 25 percent against the major European currencies. Bad for American
tourists. >><BR><BR>

Tell me about it, I just got back from the UK...GWB wants the $ to remain weak, so that US goods are
more attractive to overseas buyers , helping the balance of trade...Makes Euro and Asian stuff
expensive for americans tho...make them but US when they can.

Thank god for this, it means i can buy new parts from big ebay us dealers on buy it now and stil
save 15-20% even after postage when converted to £ and compared to british online shops eg:wiggle,
chain reaction, davehinde etc!!
 
"JP" <[email protected]> wrote in message
news:[email protected]...

> "Stuart J. Armour" <[email protected]> wrote in message
news:<[email protected]>...

> > It's been a while since I've posted but I thought you would find this interesting given Shimano
> > USA's decision to only allow 6 mail/web order retailers.
> >
> > 2003 XTR crank - mail order $450.00 or so, here in Japan list price is 43,000 yen or about
> > $400.00 (it was on sale this weekend at my LBS for 34,000 yen, about $280.00) 2003 DA crank -
> > mail order $200.00 or so, Japan list 36,000 yen or about $300.00
> >
> > Gives you something to think about. It also is a strong indication of what the discount to the
> > inporter is. I really don't mind a company making a profit (that is after all what they are in
> > business for) but there seems to be something wrong with this picture. When I get the Japan
> > list price for the new DA crank/group I'll post that also given the approximately 500.00 jump
> > in price from the current Should be an excellent year for Campy Record!
>
> Just got around to reading this thread. Taken as a whole, looks like a classic dumping scenario to
> me. Shimano selling stuff at a significantly lower price than in its home market, driving
> competitors out of business, then raising the prices using their near monopoly to control access
> by distributors/retailers to product.

JP, *everything* is more expensive in Japan. Their whole economy is inflated compared to ours (US).
The market sets the price. The Japanese will simply pay more to have bicycles than Americans will.

Shimano is a tough competitor for sure. But they've left plenty of opportunities for competitors
over the years. Half the battle is just showing up, and when Shimano leaves the door wide open,
no one does.

Matt O.
 
On 10/27/2003 11:35 AM, in article
[email protected], "JP" <[email protected]> wrote:

> Just got around to reading this thread. Taken as a whole, looks like a classic dumping scenario to
> me. Shimano selling stuff at a significantly lower price than in its home market, driving
> competitors out of business, then raising the prices using their near monopoly to control access
> by distributors/retailers to product.

"Dumping" is selling at or near (below) manufacturer's cost to drive competitor's out of
business ...

--
Steven L. Sheffield stevens at veloworks dot com veloworks at worldnet dot ay tea tee dot net bellum
pax est libertas servitus est ignoratio vis est ess ay ell tea ell ay kay ee sea aye tee why you ti
ay aitch aitch tee tea pea colon [for word] slash [four ward] slash double-you double-yew double-ewe
dot veloworks dot com [four word] slash
 
"Matt O'Toole" <[email protected]> wrote in message
news:<[email protected]>...
> "JP" <[email protected]> wrote in message
> news:[email protected]...
>
> > "Stuart J. Armour" <[email protected]> wrote in message
> news:<[email protected]>...
>
> > > It's been a while since I've posted but I thought you would find this interesting given
> > > Shimano USA's decision to only allow 6 mail/web order retailers.
> > >
> > > 2003 XTR crank - mail order $450.00 or so, here in Japan list price is 43,000 yen or about
> > > $400.00 (it was on sale this weekend at my LBS for 34,000 yen, about $280.00) 2003 DA crank -
> > > mail order $200.00 or so, Japan list 36,000 yen or about $300.00
> > >
> > > Gives you something to think about. It also is a strong indication of what the discount to
> > > the inporter is. I really don't mind a company making a profit (that is after all what they
> > > are in business for) but there seems to be something wrong with this picture. When I get the
> > > Japan list price for the new DA crank/group I'll post that also given the approximately
> > > 500.00 jump in price from the current Should be an excellent year for Campy Record!
> >
> > Just got around to reading this thread. Taken as a whole, looks like a classic dumping scenario
> > to me. Shimano selling stuff at a significantly lower price than in its home market, driving
> > competitors out of business, then raising the prices using their near monopoly to control access
> > by distributors/retailers to product.
>
> JP, *everything* is more expensive in Japan. Their whole economy is inflated compared to ours
> (US). The market sets the price. The Japanese will simply pay more to have bicycles than
> Americans will.

That is an argument that almost everything the Japanese sell here is dumped, an argument that might
have some merit. Their system of distribution, with its multitude of middlemen, is a serious
structural barrier to market penetration by foreigners. If the Japanese cut their distribution
costs, they would stimulate demand and allow foreign companies to compete on a more equal footing,
offsetting to some degree the effect of their low priced goods in foreign markets (which they could
no longer be accused of dumping.)

> Shimano is a tough competitor for sure. But they've left plenty of opportunities for competitors
> over the years.

Shimano now meets the definition of a monopoly, and has for probably two decades.

> Half the battle is just showing up, and when Shimano leaves the door wide open, no one does.

When does Shimano leave the door wide open? IMO, their market share has allowed them to foist on us
a system of bicycle components that with every passing year allows for less interoperability with
other manufacturers, and leaves competitors playing a constant game of catchup in trying to maintain
compatibility.

JP
 
> What about France's La Pierre ("The Peter")? I've always heard that this
was an
> *excellent* MTB manufacturer.

Never heard of and can´t find any sign of La Pierre on the web. Each European nation has some makes
that are haussed up to the point that they are almost part of the national identity, most often it
is and old label that nowadays has all their frames made in Taiwan. There are also some frame
welders that manufacture really handcrafted frames. Most of them are into road racing bikes, some
are into chromoly hardtails (e.g., in the UK) or aluminium hardtails (e.g., Principia in Denmark
that produces a frame of a quality Klein had when they were made in Chebalis), but none of them are
into the fullsuspension MTB market. A qualified guess is that US companies take some 80 or 90
percent of what is spent in that market.

Perhaps I should have mentioned Scott USA too. It is a company with American connotations in their
ads that is pretty big in Europe, makes some decent hardtails and crappys FS bikes.

Per http://www.lowdin.nu
 
"Steven L. Sheffield" <[email protected]> wrote in message
news:<BBC3B931.14170%[email protected]>...
> On 10/27/2003 11:35 AM, in article
> [email protected], "JP" <[email protected]> wrote:
>
> > Just got around to reading this thread. Taken as a whole, looks like a classic dumping scenario
> > to me. Shimano selling stuff at a significantly lower price than in its home market, driving
> > competitors out of business, then raising the prices using their near monopoly to control access
> > by distributors/retailers to product.
>
>
> "Dumping" is selling at or near (below) manufacturer's cost to drive competitor's out of
> business ...

No, it's not. "Dumping" is selling goods in a foreign market for below what they are sold in the
domestic market where they are produced. They may or may not be sold below cost. This kind of
dumping violates national laws and the provisions of the WTO. It shouldn't be hard to see how this
creates an unfair international trade advantage for the business with the protected, high priced
home market who competes against businesses whose home markets are not protected.

The popular notion of dumping you describe is not generally against the law, except where it is a
part of other violations, such as monopolistic price manipulation, dumping as described above, or
price fixing.

JP
 
In article <[email protected]>, [email protected] says...
> "Steven L. Sheffield" <[email protected]> wrote in message
> news:<BBC3B931.14170%[email protected]>...
> > On 10/27/2003 11:35 AM, in article
> > [email protected], "JP" <[email protected]> wrote:
> >
> > > Just got around to reading this thread. Taken as a whole, looks like a classic dumping
> > > scenario to me. Shimano selling stuff at a significantly lower price than in its home market,
> > > driving competitors out of business, then raising the prices using their near monopoly to
> > > control access by distributors/retailers to product.
> >
> >
> > "Dumping" is selling at or near (below) manufacturer's cost to drive competitor's out of
> > business ...
>
> No, it's not. "Dumping" is selling goods in a foreign market for below what they are sold in the
> domestic market where they are produced. They may or may not be sold below cost. This kind of
> dumping violates national laws and the provisions of the WTO. It shouldn't be hard to see how this
> creates an unfair international trade advantage for the business with the protected, high priced
> home market who competes against businesses whose home markets are not protected.
>
> The popular notion of dumping you describe is not generally against the law, except where it is a
> part of other violations, such as monopolistic price manipulation, dumping as described above, or
> price fixing.

According to the definition I just dug up, there are elements of both of your descriptions:

"Selling goods at less than the normal price, usually as exports in international trade. It may be
done by a producer, a group of producers, or a nation. Dumping is usually done to drive competitors
off the market and secure a monopoly, or to hinder foreign competition. To counterbalance
international dumping, nations often resort to flexible tariffs. In international trade, acute
competition from foreign producers often leads to charges of dumping. A policy of dumping depends
for its effectiveness on the possibility of maintaining separate domestic and foreign markets, on
monopolistic influences maintaining a high price in the home market, on export bounties, or on low
import duties in the foreign market. Dumping disturbs those markets that receive dumped goods, and
it may drive local producers out of business. Governments may condone, or even sponsor, dumping in
other markets for either political reasons or to achieve a more favorable balance of payments. In
the late 19th cent., dumping became part of the trade policy of great European cartels, especially
German cartels. Britain, France, Japan, and the United States also have practiced dumping.
Antidumping legislation was first passed (1904) by Canada. In the United States various tariff acts
have been passed to deal with different types of dumping; in particular the 1921 Emergency Tariff
Act imposed special duties on goods imported for sale at less than their fair value or cost of
production. It was amended by the Customs Simplification Act of 1954. The General Agreement on
Tariffs and Trade (GATT) prohibits dumping and provides for increased import duties to combat the
practice."

The way I read it is that the main item in defining "dumping" is its purpose (i.e. to hinder or
drive out competitors). The most commonly used legal U.S. definition appears to be based on
production cost, not on what they are selling it for in foreign markets compared to the
domestic market.

--
Dave Kerber Fight spam: remove the ns_ from the return address before replying!

REAL programmers write self-modifying code.
 
[email protected] (JP) wrote in message
news:<[email protected]>...
> [email protected] (Carl Fogel) wrote in message
> news:<[email protected]>...
>
> > Years ago, a Honda motorcycle dealer patiently explained to me that yes, the clutch lever was
> > expensive, but that it took half a dozen people to get it into my grubby little paws between
> > Colorado and Japan, and they all liked to feed their families, so maybe I shouldn't have broken
> > it in the first place.
>
> Did he also explain to you the special parts manuals that they had printed that showed the retail
> prices 50% higher than list? Retailers were jacking the prices of motorcycle parts outrageously,
> and it had nothing to do with the other five people that touched the parts before the retailer got
> *his* grubby paws on them.
>
> You could save a lot of money on motorcycle parts just by finding a retailer who sold them at
> list- which usually meant mailorder.
>
> JP

Dear JP,

Alas, in 1972 mail order houses selling a full line of Honda parts were a trifle thin on the ground.
Nowadays, people are able to purchase all sorts of parts over the telephone, although the shipping
and handling often eat up a good deal of the savings on small orders. When they need a local bike or
motorcycle shop, they're usually astonished that the mechanics, countermen, and salesmen still like
to feed their families and will not fix things for free or provide parts five minutes before closing
at "list" prices.

The same Honda dealer who explained the facts of life to me from his side of the counter later had
to remind me that he had to make a living, so he wasn't able to stock a full line of Montesa trials
bike parts for the two machines that he'd sold the previous year.

Spare parts are rarely highly profitable if you have to stock a wide variety. The investment tends
to sit idle, requires extensive shelving and indexing, is returned far more often by dissatisfied
customers, takes a surprising amount of labor to sell, and ends up competing more and more with
salvaged parts from the local junkyard.

Anyone who thinks that they can make a living selling the same service and parts cheaper is always
welcome to try. The established dealers with higher prices often pick over their carcasses at
bankruptcy sales.

All I want is cheap parts, free installation, loaned tools, a wide selection, ample parking,
convenient location, and someone who can answer all my questions 24/7. Otherwise, I'll take my
business elsewhere and buy that inner tube from someone who values me as a customer!

Carl Fogel
 
David Kerber <ns_dkerber@ns_ids.net> wrote in message
news:<[email protected]>...

> The most commonly used legal U.S. definition appears to be based on production cost, not on what
> they are selling it for in foreign markets compared to the domestic market.

The passage you quoted certainly does not support this conclusion. In fact, it notes the necessity
for using monopolistic influences to maintain high prices in the domestic market.

I stand by my definition: dumping is the practice of selling a product in a foreign market at a
price below which it sells in the domestic market.

If you stop and think about it, if you base it on the production cost, every single business that is
losing money would be "dumping" its product or service. It is the disparity between the protected
domestic market and the unprotected foreign market that makes dumping a predatory practice. The
production cost is practically incidental. And the whole concept is meaningless when applied merely
to a domestic market.

JP
 
[email protected] (Carl Fogel) wrote in message
news:<[email protected]>...
> [email protected] (JP) wrote in message
> news:<[email protected]>...
> > [email protected] (Carl Fogel) wrote in message
> > news:<[email protected]>...
> >
> > > Years ago, a Honda motorcycle dealer patiently explained to me that yes, the clutch lever was
> > > expensive, but that it took half a dozen people to get it into my grubby little paws between
> > > Colorado and Japan, and they all liked to feed their families, so maybe I shouldn't have
> > > broken it in the first place.
> >
> > Did he also explain to you the special parts manuals that they had printed that showed the
> > retail prices 50% higher than list? Retailers were jacking the prices of motorcycle parts
> > outrageously, and it had nothing to do with the other five people that touched the parts before
> > the retailer got *his* grubby paws on them.
> >
> > You could save a lot of money on motorcycle parts just by finding a retailer who sold them at
> > list- which usually meant mailorder.
> >
> > JP
>
> Dear JP,
>
> Alas, in 1972 mail order houses selling a full line of Honda parts were a trifle thin on the
> ground. Nowadays, people are able to purchase all sorts of parts over the telephone, although the
> shipping and handling often eat up a good deal of the savings on small orders. When they need a
> local bike or motorcycle shop, they're usually astonished that the mechanics, countermen, and
> salesmen still like to feed their families and will not fix things for free or provide parts five
> minutes before closing at "list" prices.

Interesting. My 1972 Honda story is taking my CB450 in for an engine rebuild, paying what seemed
like a fortune at the time for the repair, getting the bike back and having a piston hit a valve
after about 100 miles. And they refused to fix it. But for all I know, at that time they may not
have been engaged in the practice of marking up parts above retail, and I also know that in the 80s
the practice was not universal.

I have made an effort at staying out of motorcycle shops since then, and that includes asking them
to borrow tools. Hell, one time I even replaced the recalled slides in a Ninja carb set myself
rather than let them get their hands on my bike (not to mention their policy of letting the bikes
sit in the rain for a week or more until they got to it- they wouldn't let you make an appointment-
you left the bike to get in their queue). They billed Kawasaki for labor they didn't perform, too. I
figure if they're doing it to them, they're probably doing it to their customers as well.

By the mid-80s it was not hard to find mailorder motorcycle parts.

As for stocking parts, well they usually don't unless it is a common part. Otherwise, they want
you to float them the money while they get the part in. And for that privilege you get to pay
retail + 50%.

JP
 
In article <[email protected]>, JP
<[email protected]> wrote:

>I stand by my definition: dumping is the practice of selling a product in a foreign market at a
>price below which it sells in the domestic market.

That's absurd. For one, it makes no allowance for different transport costs, which is one reason a
German beer (or a Japanese one, for that matter) costs more here than it does in the old country.

For another, even if a Japanese bicycle parts company were to set U.S. and domestic prices at
parity, the slightest devaluation of the dollar (not hard to imagine) would make them a
dumper--which is, of course, absurd.

>If you stop and think about it, if you base it on the production cost, every single business that
>is losing money would be "dumping" its product or service. It is the disparity between the
>protected domestic market and the unprotected foreign market that makes dumping a predatory
>practice.

I suppose this is as good a time as any to point out that plenty of Shimano parts that are sold in
the U.S. likely come from China and Taiwan, and that many of the OEM parts probably never go any
where near Japan.

>The production cost is practically incidental. And the whole concept is meaningless when applied
>merely to a domestic market.

It's pretty meaningless all around. The U.S. bike parts market probably gasped its last breath when
Bendix stopped making coaster brakes here. Oh, wait, there were GripShifts, which may or may not
still be made here.
--
---
Eric Holeman Chicago Illinois USA
 
In article <[email protected]>, [email protected] (Eric Holeman) wrote:

> In article <[email protected]>, JP
> <[email protected]> wrote:
>
> >I stand by my definition: dumping is the practice of selling a product in a foreign market at a
> >price below which it sells in the domestic market.
>
> That's absurd. For one, it makes no allowance for different transport costs, which is one reason a
> German beer (or a Japanese one, for that matter) costs more here than it does in the old country.
>
> For another, even if a Japanese bicycle parts company were to set U.S. and domestic prices at
> parity, the slightest devaluation of the dollar (not hard to imagine) would make them a
> dumper--which is, of course, absurd.

> >The production cost is practically incidental. And the whole concept is meaningless when applied
> >merely to a domestic market.
>
> It's pretty meaningless all around. The U.S. bike parts market probably gasped its last breath
> when Bendix stopped making coaster brakes here. Oh, wait, there were GripShifts, which may or may
> not still be made here.

If anything, the US bike parts market is enjoying a minor renaissance, particularly in the mountain
bike field. It is now quite possible to spec a top-line MTB with no Shimano parts, something that
might not have been possible marketing-wise (or because XT/XTR-quality equipment wasn't really
available for every bit of the bike, or because it was so boutique the expense would have priced
most bikes out of their niche) until recently.

Shimano's Saint group is a specific response to several trends in mountain bikes: between ISIS BBs,
numerous aftermarket cranks, SRAM drivetrains, and disc brake systems (where Shimano seemed to lose
a lot of its usual "XT/XTR=the best available" cachet), they found themselves squeezed out of
aftermarket elitism, and SRAM and these other small (and frequently American (and also Canadian,
which I like to mention as a citizen of America Jr.) makers have been going after the high-end OEM
market too.

Of course, it's worth noting that Shimano is a "Japanese" component company in the same way that a
lot of frame or component makers are "American": the design is done in the home market, but almost
all the manufacture happens in Taiwan or China. The few parts and frames that are domestically
manufactured tend to make a big deal about it: Rocky Mountain builds all of their frames here, and I
believe Cannondale builds all of its frames in the US still, though that may change.

SRAM is probably the biggest domestic component maker, though nobody would compare in size
to brand S.

--
Ryan Cousineau, [email protected] http://www.sfu.ca/~rcousine President, Fabrizio Mazzoleni Fan Club
 
In article <[email protected]>, David Reuteler
<[email protected]> wrote:

> Ryan Cousineau <[email protected]> wrote:
> : which I like to mention as a citizen of America Jr.
>
> please, give yourself some credit. i prefer America Sane.

Bart Š "So, to win Gretta back I have to go to Toronto."

Homer ... "Canada? Why should we have to leave America to visit America Junior?"

From "Bart Wants What It Wants", _The Simpsons_

"Americans watch television. Canadians watch American television."

- a comedian I can't remember, probably from SCTV, explaining the
observational distance of Canadian comedians,
--
Ryan Cousineau, [email protected] http://www.sfu.ca/~rcousine President, Fabrizio Mazzoleni Fan Club
 
[email protected] (Eric Holeman) wrote in message
news:<[email protected]>...
> In article <[email protected]>, JP
> <[email protected]> wrote:
>
> >I stand by my definition: dumping is the practice of selling a product in a foreign market at a
> >price below which it sells in the domestic market.
>
> That's absurd. For one, it makes no allowance for different transport costs...

Yes it does.

> For another, even if a Japanese bicycle parts company were to set U.S. and domestic prices at
> parity, the slightest devaluation of the dollar (not hard to imagine) would make them a dumper

No it wouldn't

> >If you stop and think about it, if you base it on the production cost, every single business that
> >is losing money would be "dumping" its product or service. It is the disparity between the
> >protected domestic market and the unprotected foreign market that makes dumping a predatory
> >practice.
>
> I suppose this is as good a time as any to point out that plenty of Shimano parts that are sold in
> the U.S. likely come from China and Taiwan, and that many of the OEM parts probably never go any
> where near Japan.

Good point. Irrelevant, but good. Just because they are made in China does not mean that they can't
be dumped. Now *that's* absurd!

> It's pretty meaningless all around. The U.S. bike parts market probably gasped its last breath
> when Bendix stopped making coaster brakes here. Oh, wait, there were GripShifts, which may or may
> not still be made here.

I think the more meaningful question is whether dumping Shimano parts here drove out European
manufacturers that were not dumping. Try buying a TA or Stronglight component in the US, or an SRAM
(Sachs-Huret) road derailleur anywhere.

The determination of whether someone is dumping or not is not so simplistic that it would result in
a finding of dumping in the situations you described, unless it were driven by domestic politics.

JP
 
[email protected] (JP) wrote in message
news:<[email protected]>...
> [email protected] (Eric Holeman) wrote in message
> news:<[email protected]>...
>
> > It's pretty meaningless all around. The U.S. bike parts market probably gasped its last breath
> > when Bendix stopped making coaster brakes here. Oh, wait, there were GripShifts, which may or
> > may not still be made here.
>
> I think the more meaningful question is whether dumping Shimano parts here drove out European
> manufacturers that were not dumping. Try buying a TA or Stronglight component in the US, or an
> SRAM (Sachs-Huret) road derailleur anywhere.
>
TA components, or at least their Cranks, Chainrings and Pedals are available here: TA Zephyr
http://www.peterwhitecycles.com/zephyr.asp TA Alize http://www.peterwhitecycles.com/alize.asp

Rivendell, Bicycle Classics, Sheldon Brown/Harris and a few others also carry TA stuff.

Stronglight is available either through ThorUSA/KHS Bicycleparts http://www.thorusa.com and both
Excel Sports and Nashbar carry a few things.

Sram stuff is available thru most of mail order houses like Jenson USA, Performance, etc.
 
[email protected] (JP) wrote in message
news:<[email protected]>...

[snip or dump]

> The determination of whether someone is dumping or not is not so simplistic that it would result
> in a finding of dumping in the situations you described, unless it were driven by domestic
> politics.
>
> JP

Dear JP,

Your last words made my eyebrows disappear into my long-receded hairline.

What, besides domestic politics, drives the "finding" of dumping? Who, besides domestic politicians,
issues such "findings" with any practical effect?

I hope that the weather on your planet is as nice as it is here on mine.

Carl Fogel
 
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