In article <[email hidden]>,
Tom Kunich' cyclintom@yahoo. com said:"e-RICHIE" <[email hidden]> wrote in message
news:[email hidden]...
Ryan Cousineau said:
but back to the issue at hand, from what i read here:
http://www.sprout.nl/column.jsp?id=442207
(scroll down to "PASSION"😉, the author says,
"...my guess he's earning a half million dollars per year...".
so. there ya' have it. it's online, so it must be true atmo.
e-RICHIE©T®
I wonder if anyone would bother to notice how much money he would have to
make off of each frame to garner an income like that from his business? I've
always thought that Richard was really out-standing for actually sponsoring
some cyclocross racers. But then, having worked in the motorcycle business
back when their income was about the same as a good bicycle business does
these days I'm aware of just how close the profit margins really are.
Well, I totally intend to spread the legend of e-RICHIE's vast money
vaults far and wide, but let's check that Sprout column.
Assuming the article's 2 frames/week is correct, let's just go and guess
that it's about 100 frames per year (in my model, Richie gets two weeks
off). The website says the starting price is $3400 for a frame now.
Now in fairness, to the Sprout guy, I bet that Richard makes just about
the best profit margins the frame-making business has to offer. I'm
guessing that because he can't make it up on volume, and because, well,
he has a two-year backlog of demand to help him when it comes time to
set prices.
I may be wrong.
I'm not gonna push out any explicit figures here, since it gets
embarrassingly close to asking Mr. Sachs what he makes, and my momma
raised me better than that. But note that the Sprout estimated earnings
seem to assume that Sachs Bikes makes about as much money out of the
Sachstoys catalog as it does out of building bikes.
This is actually a reasonable revenue model! As the biz thingy pointed
out, that's roughly the business model of Rivendell. Harley-Davidson is
another organization that is substantially floated by its merchandising
and accessories business.
No, seriously. I bet the marginal value for Richard Sachs Cycles is to
leverage the brand value by making more cool RICHIE-ISSIMO t-shirt
designs. The trick is to do that while making sure that the core product
that adds value to the brand (the, er, bike frames) is still kept in top
shape (in other words, you have to keep Richard in the shop building
frames at just the right rate and quality level).
Also, for obvious reasons, I'd like to propose a private-label Sachs
beer.
Having solved all of Richie's business problems, I will next suggest
some new frame geometry angles and some great ideas on brazing
techniques.
Knowledge just gets in the way of a good consultant,
--
Ryan Cousineau [email hidden] http://www.wiredcola.com/
"I don't want kids who are thinking about going into mathematics
to think that they have to take drugs to succeed." -Paul Erdos