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  1. #1
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    Haggeling with LBS?

    Hello, I am not finding great prices where I live when it comes to bikes. $350 for Trek 4300, $360 for Hardrock, ect.

    What I would like to know is how much should I expect for the LBS to throw in with these bikes? What have your guys experiences been with haggeling with your bike shop? And lastly do the stores usually have model end clearance in around October?

    Thank You

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    Haggling?...

    Quote Originally Posted by RideTiLLiDie
    Hello, I am not finding great prices where I live when it comes to bikes. $350 for Trek 4300, $360 for Hardrock, ect.

    What I would like to know is how much should I expect for the LBS to throw in with these bikes? What have your guys experiences been with haggeling with your bike shop? And lastly do the stores usually have model end clearance in around October?

    Thank You
    no. Getting last years model for less? In my experience...usually. Normally you get some free tune ups. Sometimes after the first 100miles or so and some places give them for the first year. This doesn't include parts like tires, etc. Bike shops don't make a heck of a lot on bikes. They do make more on clothes and such though. Won't hurt to ask for something off, just don't expect it and get peeved when they don't. Oh you can sometimes buy less on line, but if you have a problem with the bike what are you going to do then?

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    $350 and $360 for 4300 and Hardrock.

    Must be nice. Here in Charleston, SC, they are $419 each with V-brakes. $429 for the '07 Spec. And $459 for Kona Fire Mountain w/disc and $600 for Kona Blast.

    Talk about no deals!!!! Unless anybody knows of any for me???

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    a lot of times they will give you a deal on a helmet when buying it with a bike, especially if it's your first real bike.

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    Quote Originally Posted by RideTiLLiDie
    Hello, I am not finding great prices where I live when it comes to bikes. $350 for Trek 4300, $360 for Hardrock, ect.

    What I would like to know is how much should I expect for the LBS to throw in with these bikes? What have your guys experiences been with haggeling with your bike shop? And lastly do the stores usually have model end clearance in around October?

    Thank You
    your prices don't sound that bad. And if they are the models with disc brakes, you are really getting a good deal.

    A bike shop is not a car dealership as so many seem to think they are. You make it hard on them, not to mention really annoy them, when you try to haggle prices. I used to work at a Performance--prices were already set very low, so we did absolutely no haggling. We couldn't even if we wanted to! (higher-ups would have our heads--and I'm speaking as a manager). it would annoy us to no end when people would try to haggle--when they were already getting the lowest possible price (since we price matched, too!). Granted, Performance is not the same as your typical LBS since it's a huge chain run corporately.
    I bought my first real FS bike from a mom and pop LBS, and built a great relationship with the shop. But I never tried to haggle, and they always took care of me.

    I always used to wonder: do people who think they should be able to haggle prices in a bike shop try to do so in other retail stores: Walmart, supermarkets, clothing stores? Found out, they do

    As for when shops start discounting last year's models--depends on when they start getting the new stuff in. Sometimes that can be as early as September or October, but sometimes the manufacturers don't get them out until December or January.

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    Get a helmet, maybe a water bottle, upgrade on the saddle (especially women specific) bell.

    Yeah I haggle, some stores dont, but all they haft to do is state their policy.

    The best results for haggling occur when it is non confrontational.

    PS I am spending closer to $1000 to $2000 a bike, for a family of six (two more to go).

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    Not much

    Quote Originally Posted by RideTiLLiDie
    Hello, I am not finding great prices where I live when it comes to bikes. $350 for Trek 4300, $360 for Hardrock, ect.

    What I would like to know is how much should I expect for the LBS to throw in with these bikes? What have your guys experiences been with haggeling with your bike shop? And lastly do the stores usually have model end clearance in around October?

    Thank You
    They may discount the accessories as they have a higher markup. As for the bikes, don't expect much of a discount. These are low end bikes and they aren't making a ton of money on a $400 bike. If you get 5-10%, be happy. Once you get up over a grand or so, I think that there may be a bit more wiggle room.

    Bob
    'If Wal-Mart sold parachutes, who would jump?' Frank Havnoonian (quoting his father) Drexel Hill Cyclery

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    Ok sounds good, I know the bikes are low so there wont be too much discount. My local dealer has KHS, Specialized, and Iron Horse; he said he would throw in a helment. So I am thinking I will ask them to throw in a computer/speedometer instead. I am just more found of the 4300 vs. the hardrock (weight).

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    I just purchased 2 rockhopper comp disc, My LBS was honest with me and showed me his cost. His cost was $496 on a comp disc. His price was $799 thats a pretty good mark-up in my opinion. I got them for cheaper but he still made a lot of money. What do you guys think is a fair mark-up 10 percent 20 percent. He told me his was 38 percent on bikes and 50 percent on accessories. I thought that was a lot. I was under the impression that the mark-up was around 10-15 percent and was suprised to find out what it really is. In my area there are around 10 LBS that are a Specialized dealer and I shopped tell someone gave me a deal I was happy with. whats your opinion?

  10. #10
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    Quote Originally Posted by Rhopf
    I just purchased 2 rockhopper comp disc, My LBS was honest with me and showed me his cost. His cost was $496 on a comp disc. His price was $799 thats a pretty good mark-up in my opinion. I got them for cheaper but he still made a lot of money. What do you guys think is a fair mark-up 10 percent 20 percent. He told me his was 38 percent on bikes and 50 percent on accessories. I thought that was a lot. I was under the impression that the mark-up was around 10-15 percent and was suprised to find out what it really is. In my area there are around 10 LBS that are a Specialized dealer and I shopped tell someone gave me a deal I was happy with. whats your opinion?
    bike shops, or most other businesses, would go out of business very quickly if their markup was only 10-15 percent. I'm surprised he has such a low markup. MSRP on that bike is $880. And that would seem to be a very low markup for accessories.

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    Fair markup

    Quote Originally Posted by Rhopf
    I What do you guys think is a fair mark-up 10 percent 20 percent. He told me his was 38 percent on bikes and 50 percent on accessories. I thought that was a lot. I was under the impression that the mark-up was around 10-15 percent and was suprised to find out what it really is.
    40-50% markup is fair, IMO. With that said, I shop around, and buy online, too. Like JWiffle said, the LBS would be out of business on 10-20% markups. I remember working retail and receiving a shipment of sweaters that cost $5.00 each. They were priced at $20.00 each, then put on sale for 50% off. Even at $10.00 their markup is still 50%.

    FWIW, I believe I have seen Shiggy post that the average LBS makes a net profit of about 3% per year. That should put things in perspective.

    Bob
    'If Wal-Mart sold parachutes, who would jump?' Frank Havnoonian (quoting his father) Drexel Hill Cyclery

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    I understand that the LBS have to make money, thats why they are in business, but I have heard a lot of people say LBS don't make very much money on bikes and I think that is BS. If the mark-up is 40-50 percent that is a huge mark-up. Not making very much would be 10-15 percent. There is room to haggle if the owner wanted to like he did for me. I paid $1249 for 2 comp disc's I was happy and he was happy, good deal for both.

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    Bottom line

    Quote Originally Posted by Rhopf
    I understand that the LBS have to make money, thats why they are in business, but I have heard a lot of people say LBS don't make very much money on bikes and I think that is BS. If the mark-up is 40-50 percent that is a huge mark-up. Not making very much would be 10-15 percent. There is room to haggle if the owner wanted to like he did for me. I paid $1249 for 2 comp disc's I was happy and he was happy, good deal for both.
    Bottom line is that you feel bike markups are too high and that others think it's low. Point taken. You got a great deal on two very good bikes. I've been recommending that bike quite often this year, especially to larger riders. Please post some pics as I'd love to see what this bike looks like. I get the sense that the Specialized web site doesn't do them justice. Let us know how you like the bikes, too. They are very well spec'd for their price.

    Bob
    'If Wal-Mart sold parachutes, who would jump?' Frank Havnoonian (quoting his father) Drexel Hill Cyclery

  14. #14
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    please edit your post.

    Quote Originally Posted by Rhopf
    I just purchased 2 rockhopper comp disc, My LBS was honest with me and showed me his cost. His cost was $496 on a comp disc. His price was $799 thats a pretty good mark-up in my opinion. I got them for cheaper but he still made a lot of money. What do you guys think is a fair mark-up 10 percent 20 percent. He told me his was 38 percent on bikes and 50 percent on accessories. I thought that was a lot. I was under the impression that the mark-up was around 10-15 percent and was suprised to find out what it really is. In my area there are around 10 LBS that are a Specialized dealer and I shopped tell someone gave me a deal I was happy with. whats your opinion?

    There is no reason for you to be discussing shop COSTS on bikes that were told to you in confidence. (sp?) Please, shops do not make a lot of money. If you think that the markup is huge, try running a shop.

    You are aWAY out of line. If you do not think so, try telling the fellow that told you his prices that you are discussing those prices on the net. See what he says.


    Yes, I work at a shop. I do this because it is my passion, and I am able to money wise. (wife is an engineer) I have 14 years of research, 7 years shop time, building bikes, fitting, and so on.

    This is killing me, and people like me. I make almost nothing, but you (and others) want to nickle and dime us to death. What do you do for a living? Do your sustomers haggle with you on your pricing?

    Please think about what you are doing, long term. You are driving VERY professional people in to other job areas. Think about it.
    Last edited by damion; 07-26-2006 at 12:33 PM.
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    well said.

    Quote Originally Posted by Call_me_Clyde
    40-50% markup is fair, IMO. With that said, I shop around, and buy online, too. Like JWiffle said, the LBS would be out of business on 10-20% markups. I remember working retail and receiving a shipment of sweaters that cost $5.00 each. They were priced at $20.00 each, then put on sale for 50% off. Even at $10.00 their markup is still 50%.

    FWIW, I believe I have seen Shiggy post that the average LBS makes a net profit of about 3% per year. That should put things in perspective.

    Bob

    So do the math. At that rate, how large is the yearly sales if the shop owner ONLY needs to make $40000 a year. Come on, people, think this through. You are shooting yourself in the foot here.
    gfy

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    I was not told this info in confidence, I was not told to keep it to myself. I see no problem in letting others know what the cost is. How many times have you told your customers the cost. I personally appreciated the honesty and will give him my business again in the future. It sounds to me like you are mad because the owner told me some big secret. He was honest and told me what he had to sell the bike for to make money after he assembled the bike and paid his staff and so forth. You say "Please, shops do not make a lot of money" Making $299 on a $799 bike is a lot of money to me. Sorry I let your secret out of the bag. Like I said I know they have to make money, my point was there is room to haggle, if your shop doesn't do it great the next shop someone goes to might. If you had to give me 5 percent off to make me feel like I got a good deal then I see nothing wrong with that. Speaking of work I'm a Correctional Officer and I got to go....have fun!!

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    Quote Originally Posted by Rhopf
    I was not told this info in confidence, I was not told to keep it to myself. I see no problem in letting others know what the cost is. How many times have you told your customers the cost. I personally appreciated the honesty and will give him my business again in the future. It sounds to me like you are mad because the owner told me some big secret. He was honest and told me what he had to sell the bike for to make money after he assembled the bike and paid his staff and so forth. You say "Please, shops do not make a lot of money" Making $299 on a $799 bike is a lot of money to me. Sorry I let your secret out of the bag. Like I said I know they have to make money, my point was there is room to haggle, if your shop doesn't do it great the next shop someone goes to might. If you had to give me 5 percent off to make me feel like I got a good deal then I see nothing wrong with that. Speaking of work I'm a Correctional Officer and I got to go....have fun!!
    Maybe the shop is "making $299" on the sale, but consider their costs.

    The shop pays to have the bike shipped to them. They pay for a mechanic to build it. They pay for a salesperson to sell it to you. Then they pay the mechanic again when you get your free tuneup. If there is any money left, it will pay for rent, electricity, insurance, etc.
    Bike shop owners are not getting rich at your expense.

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    Quote Originally Posted by Rhopf
    I was not told this info in confidence, I was not told to keep it to myself. I see no problem in letting others know what the cost is.
    you know what...go ahead, post all the costs of bikes...demand only a 10% markup...
    I'll tell you something else, too...if every shop started selling bikes with only a 10% markup, the only place you would be able to buy a bike is Walmart (actually, I doubt they would carry bikes, either, if all the markup they got on them was 10% because they would be losing money; the only reason they would keep carrying them is hoping you will buy a bunch of other stuff at normal markup while you were there.)

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    Exactly.

    Like I said before, if he sees nothing wrong with letting ou "little secret" out, whatever.

    My point is that the shops are not out to make a killing. If you see nothing wrong with asking for 5% (or whatever) off on a product when you have no history with teh seller, go ahead. Please, do not expect to get it.

    If you are going to ask for a break, at least make it a mid/ high end product so that there is more room. past model years is another way to get a break. Just look at how it can appear from the other side of the sale. That is all I ask



    Normally, I do not get involved with this type of discussion. I will try not to in the future. There is no point.
    gfy

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    Just a question but do you guys feel the same about buying a car? Are you afraid if you don't pay MSRP the dealership will have to close? I really didn't want to start a big issue. I just don't see anything wrong with asking for a better deal. I never expect it or would get mad if it not given to me. It is my choice to buy the product and it is the persons choice to sell the product. I had no previous experience with this LBS I'm just getting back into the sport and was very happy with my purchase. I have recommended other to his shop in hopes that they to will buy a bike from him. I'm sorry if I offended anyone that was not my intention. Its not just LBS, I have bought televisions, freezers, other home furnishings from small mom and pop places and have asked and gotten better deals. I just don't see anything wrong with it.....Sorry.

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    I understand.

    Quote Originally Posted by Rhopf
    Just a question but do you guys feel the same about buying a car? Are you afraid if you don't pay MSRP the dealership will have to close? I really didn't want to start a big issue. I just don't see anything wrong with asking for a better deal. I never expect it or would get mad if it not given to me. It is my choice to buy the product and it is the persons choice to sell the product. I had no previous experience with this LBS I'm just getting back into the sport and was very happy with my purchase. I have recommended other to his shop in hopes that they to will buy a bike from him. I'm sorry if I offended anyone that was not my intention. Its not just LBS, I have bought televisions, freezers, other home furnishings from small mom and pop places and have asked and gotten better deals. I just don't see anything wrong with it.....Sorry.

    You With cars, the ticket price is way higher, so for a given percentage, a car has more "Room" in the price by default. Here in Anchorage, the Car dealerships are huge. Tons of money. (btw, no, I do not haggle. I just do my research ahead of time, finding the best deal between price/service, and go that way.)

    I understand the logic behind what you are saying, what I am telling you all is that the "wiggle" room that you are asking for is not there. Some customers want us to be well trained, and knowledgeable, but are not willing to pay for it. (not pointing fingers, just be aware that there is an issue for the future.)


    With a $500 mtb, ther is NO room to wiggle. I guarantee it. Any offer of a break is just an insult to the customer. It is way easier to give breaks on the accessories, as there is a larger markup. Not huge, mind you, but larger.
    Last edited by damion; 07-26-2006 at 11:13 PM.
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    Just a question then....If there is no room to wiggle than why do LBS cut the price on last year's model? Do they get a break from the manufacture or something. They cut the price to move product, they have sales to move product, hoping that by moving product and getting people in the store they will sell more accessories and make money on other things. So they do have wiggle room when they want it. I'm not suggesting that they sell at a price that they would have to close the doors. I need and want my LBS to stay open.

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    Quote Originally Posted by Rhopf
    I understand that the LBS have to make money, thats why they are in business, but I have heard a lot of people say LBS don't make very much money on bikes and I think that is BS. If the mark-up is 40-50 percent that is a huge mark-up. Not making very much would be 10-15 percent. There is room to haggle if the owner wanted to like he did for me. I paid $1249 for 2 comp disc's I was happy and he was happy, good deal for both.
    If a bike shop has $1,000,000 in sales per year, a 20% margin means that the bike shop only makes $200,000. A $40000 manager, $25000 mechanic and 3 $10000 part timers takes up $95000 in payroll, without adding and taxes or insurance. What about utilities? rent? advertising? shipping (a boxed mtn bike can weigh 30-50 lbs and gas prices are rising)? shop supplies? credit card processing fees? shoplifting losses? The margin for a bike shop isn't there to make money, its there to keep the doors open and the lights on. I once worked at a bike shop that make about $300,000 during a busier month. After ALL costs, with about a 45% margin, we made around 10,000. Right around 3% like Clyde said. During the off season months, we lost money. A bike shop CAN NOT survive with a 20% margin.

  24. #24
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    More thoughts

    Quote Originally Posted by Rhopf
    Just a question then....If there is no room to wiggle than why do LBS cut the price on last year's model? Do they get a break from the manufacture or something. They cut the price to move product, they have sales to move product, hoping that by moving product and getting people in the store they will sell more accessories and make money on other things. So they do have wiggle room when they want it. I'm not suggesting that they sell at a price that they would have to close the doors. I need and want my LBS to stay open.
    They probably get some incentive from the mfr to move last year's leftover models. They also might have to eat the cost just to move the bike. Yes, they have wiggle room.

    Please understand that this is a sensitive subject for us all. For the consumer, we want as much as we can get for our money. For the business owner, they want to make a profit. For the LBS employee, they want to maintain their livelihood.

    Your original post centered on your opinion of what LBS markups should be. You asked the rest of us for our opinions. We gave them to you. My read on your posts is that you take issue with the markup on bikes because in your opinion it's excessive at 35-40%, and that LBS owners and employees shouldn't begrudge offering you a discount, especially if it's only 5-10%. I think this is a fair summary of some of what has transpired.

    Nobody begrudges you for getting the deal you got. You negotiated well, my friend. The fact is the owner of the LBS probably did this because it was a volume deal (probably made the same profit on two bikes as he did on one. It's one transaction, one lump sum profit) and to promote good will so that you will come back and buy more goods without expecting a similar deal. I tip my hat to the guy who did this for you, too. On the issue of revealing his cost, whether you want to believe it or not, I don't believe the guy wanted this information to be shared with others, let alone posted on a discussion board. Cost, while not necessarily a secret, is information that privileged few are given access to.

    Again, you got a great deal, and the LBS has every right to their markup. It's a free market economy. While the markup may seem excessive, I think people have rightly pointed out all of the costs that you probably didn't consider. It's not just the cost of the bike, but everything else it takes to run a brick and mortar LBS.

    Enjoy the bikes and let's get on to other issues rather than cotinuing to peck at a festering wound.

    Bob
    'If Wal-Mart sold parachutes, who would jump?' Frank Havnoonian (quoting his father) Drexel Hill Cyclery

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    Quote Originally Posted by Rhopf
    Just a question but do you guys feel the same about buying a car? Are you afraid if you don't pay MSRP the dealership will have to close? I really didn't want to start a big issue. I just don't see anything wrong with asking for a better deal. .
    There's nothing wrong with getting a deal when you can. And yes, many shops do build in some wiggle room in their prices because they are able to afford to sell way under MSRP; others cannot afford to wiggle much at all. I was pointing out that a 40-50% markup is normal in retail and necessary to stay in business. Old stock does get discounted, because eventually you start losing money on it when it sits in your store and nobody wants to buy it because they want the latest and greatest.

    As for car dealerships, they're based around a bargaining system. They also receive incentives from the manufacturers, etc., so they can still make a bundle even while giving you a "great" deal. Personally, I don't like to shop at car dealerships that use the haggling system; I find it a terrible experience. So I do some research, and purchase at dealerships that list their lowest prices and don't haggle--maybe don't get quite as good a deal, but the process of purchasing the car is so much easier and nicer (not to mention the salesmen are usually nicer and less sketchy) that it is worth it.

    Of course, I do have to wonder if the owner volunteered the information about his cost on bikes or if you hounded him for it. I've never been in a shop or any store where that information was handed out as the norm, so I'm guessing it was the second. A little bit a haggling may be fine, but hounding someone for a deal is just in poor taste.

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    Enough said, By the way I bought 3 bike from him the third was a Specialized "hot rock" for my 3 year old son. Have you seen them.....way cool!!! Again I didn't mean to offend anyone.

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    None taken. Honest.

    I am not upset at you at all. I completely understand each side. Please understand the side that I am coming from. I am 36yoa this week. I am educated. I CHOOSE to work in a shop because it happens to be my passion. I want to continue to do what I am doing, but I (we) need and deserve to get paid well for our life's work. (as does anyone else.) For a shop, I do well, but undercutting the shop profit margin does nothing for my well being.


    Also, it is important for you to know, most of us do not work for a comission. (unlike car dealerships) This is a good thing service wise most of the time, but the sales staff has NO vested intrest in getting the right sale, except by their own passion and motivation.


    Thanks for taking the time.

    Damion.
    gfy

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