[Closed] An interesting blog post from my LBS

It's disingenuous to say 'save 50p by buying from an online giant'... If that were the case (stuff being just [i]slightly[/i] more expensive at LBS than online) then I would use mine more often. But when they regularly charge me double the price for bits for what I can buy them online for, they are taking the biscuit. Recent example - needed a brake adaptor. 5 mins to LBS. Only ones they had in store were xtr (apparently 🙄 ) - 12 quid. These are 6 quid on CRC and to be honest I would have been happy with a 3 pounds cheapo from ebay. Being dim I bought it anyway as I had asked for a brake adaptor, he had gone out the back to get one and I was too polite to walk away. But, as I did walk out my thoughts were... 'last time I ever do that'

I mainly shop online for the sheer convenience of having stuff delivered to work and being able to shop on work's time. I rarely have time to go into town, probably shop in town maybe 2-3x a year.

I don't think he's referring to CRC, more the Tax dodgers...

more the Tax dodgers...

Who are?

People normally name Amazon, although as Amazon don't actually make a profit (their strategy is to invest every penny in growth), it's a mute point.

refers to ebay in the blog.

I'd guess Amazon invest every penny after dividends and bonuses, as it doesn't come across as a workers co-operative...

😉

He is correct folk moan about all sorts of things when the reality is business can only exist if we buy stuff from them. if we stop due to their tax practises they will change. If no one bought a starbucks coffee till they started paying tax they will be paying tax by Friday.

It wont happen as we want cheap rather than principles...see also supermarkets rather than the high street etc

it's a mute point

You are joey from Friends and I claim my £5 🙂

He regurgitates an article on amazon so i presume them. The only problem with attacking Amazon is that they don't make much money, they made a loss in the second and third quarters, if you are making losses you don't pay tax.

I'd guess Amazon invest every penny after dividends and bonuses, as it doesn't come across as a workers co-operative...

They don't pay dividends, much to the annoyance of share holders!

Mefty, it's definitely ebay that he speaks about and links to. I read it before linking to it here.

Mefty, it's definitely ebay that he speaks about and links to. I read it before linking to it here.

Sorry I even skimmed it. Apologies, ebay is even trickier to tax as they are just a marketplace, they have limited need for bricks and mortar operations.

I like the idea of supporting LBSs, but then I think about how often I see them supporting local business by using public transport instead of driving a car bought from a multinational using fuel from a garage owned by an even bigger multinational, so I order on line and get the parts delivered cheaper.

Why would I use public transport
The bus takes almost 2 hours
The train takes about 1.30 hours
By car about 45 min
By bike about 45 min

It wont happen as we want cheap rather than principles...see also supermarkets rather than the high street etc

. If no one bought a starbucks coffee till they started paying tax they will be paying tax by Friday.

It wont happen as we want cheap rather than principles..

interesting pair of thoughts there JY.
I dont use starbucks and havent, but that my choice and the queue in the one in town last time i passed shows my POV isnt for everyone.

where is that, live online list of companies to avoid?
and more to the point, where do you draw the line?

*cuts the power and goes out to forage for tomorrows breakfast*

Why would I use public transport...

I cant support a lbs. I have to support a family. Cycling is an expeesive additional expense sadly. If you said I'd have to double spending on it and drive/park for every item I'd stop cycling. I wonder how many stopped?

if you are making losses you don't pay tax.

Hmmm, and it'd be in your interest to file a loss so you don't pay tax wouldn't it 😉

I have an LBS just a couple of minutes walk away.

Not that I use it much. it was nearly double the cost for my last purchase. Didn't even win the 'helpful advice' bit of the experience.

Social security payments on salaries are tax, pensions too. Anything a company has to pay to the state. Companies use and abuse the discrepancies between EU states to find a cheap home in Europe, which may not be the place with the lowest company/income tax but the place with the lowest overall tax bill. Multinational companies will centre profits where they pay the least tax and employ labour where it's cheapest. The losers in this system are countries which offer their citizens the best infrastructure, health care and social security safety net.

You vote every time you buy something, vote wisely. I've never bought anything from E-bay (but have three lights that were bought for me). The chances of my LBS having cones for an XT hub, a reservoir kit for Formula brakes (or even pads), a 1990 Flite saddle or a Nobby Nic in 2.2 x 27.5 are zero so I use CRC etc..

The chances of my LBS having cones for an XT hub, a reservoir kit for Formula brakes (or even pads), a 1990 Flite saddle or a Nobby Nic in 2.2 x 27.5 are zero so I use CRC etc..

True, but like any local shop, if we used them, they'd surely have more stock, more choice.
I always think of the old style 'fork handle' hardware shops that had everything, and they knew where it was. You could buy one hinge, or three screws or whatever. The modern mega warehouses are just horrendously frustrating places to deal with.

That's sadly the way things are going with everything, but like nearly everyone, I search out the cheapest prices I can so am as guilty as anyone. 😕

Remember back (not so long ago either) that for anything vaguely well priced you'd have to look out for a specific ad in the back of a mag?

If you wanted a second hand bike you'd look in the back of mbr etc? Otherwise you had NO choice. The internet has created choice (and built many many many bikeshops into bigger business too). Many bike related businesses have started and flourished due to the internet.

The convenience of online shopping is the major factor for me. My lbs is only open during my working hours mon-fri. I could go Saturday but have better things to do.

Thats an obvious and good point- why not open 12-8 daily instead of core hours of 10-6? I know the bigger stores now have longer opening.

The World's Saddest Bike Shop Owner 🙁

Thats an obvious and good point- why not open 12-8 daily instead of core hours of 10-6?

Presumably shop workers/business owners are quite partial to having a life too?
🙂

Many years ago we were predominantly a craft shop. Then QVC and big craft barns arrived so we expanded our gift side .The big craft places then went bust.
We now get disgruntled old dears moaning at us that we don't stock craft stuff. " I always used to get all my craft stuff from you." Reap what you sow.

The biggest issue for me is fairness of supply, when a LBS has to admit that their trade price is less than an online retailer is selling for it's easy to see how the market is distorted. Grey/OEM etc. is having a serious effect, it may only be a short term win for the consumer.

Presumably shop workers/business owners are quite partial to having a life too?

Often if you work in retail your day off is in the week isn't it?

Often if you work in retail your day off is in the week isn't it?

Surely ebay (and Amazon marketplace for that matter) is a massive enabler and supporter of small one man/woman businesses, and should be praised, rather than pilloried?

Whether these pay taxes is another matter entirely...

I bought my Reverb from Pete at Summit to Sea. Best price around at the time, certainly for a UK Reverb, and was useful when the warranty return was needed.

it's a mute point

Pardon?

Hmmm, and it'd be in your interest to file a loss so you don't pay tax wouldn't it

Amazon is well known for not making profits and not paying divvies - they replough everything in the business, supposably because they want to increase the capital value of the company.

We sell on ebay, ... I can promise you we're working hard to reduce our reliance on this side of the business.

Hmm. I'm far from being any sort of businessman, but the only advice I'd feel like giving any local business anywhere is "get on eBay".

Hmm. I'm far from being any sort of businessman, but the only advice I'd feel like giving any local business anywhere is "get on eBay".

Hmm. I'm far from being any sort of businessman, but the only advice I'd feel like giving any local business anywhere is "get on eBay".

Including cafes and windowcleaners?

eBay has its uses for businesses, but with an effective fee of around 20% it's a lot of margin to give away for the privilege.

mikewsmith - Member
The biggest issue for me is fairness of supply, when a LBS has to admit that their trade price is less than an online retailer is selling for it's easy to see how the market is distorted. Grey/OEM etc. is having a serious effect, it may only be a short term win for the consumer.

POSTED 33 MINUTES AGO #

Surely that's how you would hope things are . It's when your trade price is more than online retailers are selling for that you have difficulty .

I get a lot of my big purchases from my LBS as they give me as good, or better prices than online most of the time. Their problem is where the distributors sell things to them at the same price or more than it is available on the internet. Then they usually are up front about that I get it from the internet.

That means I go back to them and they have a repeat customer and they stay open.

You are joey from Friends and I claim my £5

Joey said 'moo point', as in 'your point is moo'. I claim the original £5 levy, £5 from you for your error, £5 in expenses and 20% VAT.

£18 please.

Surely that's how you would hope things are

Or the day of is spent doing accounts, orders, invoices and payroll. Or in the shop doing all the jobs you can't do when you are working.

From the blog:

the number of ebay orders we get from customers within 15 minutes of our store would amaze you!!

You see?

That there should be setting off all sorts of alarm bells in the mind of the shop owner!

He needs to start asking himself [u]why[/u] that's happening and what he is doing wrong that means that people just up the road are not coming to his bloody shop!

Thats every small business! I rolled over 15days holiday from last year and even when I take the odd day off my mobile beeps with an email or someones trying to call me.

Maybe it wouldn't if you got your work done instead of pissing about on here all day

Pook people would still call/email/text me regardless. Not all of us can work from home and when your setting off for work. I'm at work already - have you noticed that when we go out on a ride I refuse to take my phone with me or a watch?

the number of ebay orders we get from customers within 15 minutes of our store would amaze you!!

That shows you that online opens up another revenue/awareness to potential customers but also- how bad is the shops own website?

vinnyeh - Member
Surely ebay (and Amazon marketplace for that matter) is a massive enabler and supporter of small one man/woman businesses, and should be praised, rather than pilloried?

Exactly, and they do. I often buy from small bike shops via ebay and it is the best of both worlds, the item will be competitively priced, I know it is in stock and I don't have to waste my time driving around local stores to find it.

This benefits the LBS too as they get a larger audience, increase their brand awareness and can make use of the staff they employ when there are no customers.

The problem is a lot of businesses are reluctant to change and play the victim rather that evolving and taking advantage of changes.

I assume the biggest pressure you face hora is competition from online people with tiny overheads running in foreign tax jurisdictions buying their raw materials at lower costs than you can?

klumpy - Member

We sell on ebay, ... I can promise you we're working hard to reduce our reliance on this side of the business.

Hmm. I'm far from being any sort of businessman, but the only advice I'd feel like giving any local business anywhere is "get on eBay".

Just check out the eBay fees and you will see why the principle means by which price advantage is being injected into the equation is firms deliberately obfuscating to exploit the tax arbitrage.

Summit to Sea seem like lovely folk from when I've met them......but they are based in the arse end of nowhere on Anglesea. I'm going to take the opposite tack and say that the internet has been a wonderful thing for allowing relatively small niche businesses like theirs to thrive in out of the way places. 20 years ago I worked part time for a windsurf retailer who had taken the odd but successful decision to base his business in the Midlands about as far as possible from the sea. His logic (& it apparently had worked) was that no one bought his merchandise when it was windy as they were sailing and that it was better to base yourself close to where people lived - and a lot of folk live in the Midlands and drove to coast to sail on windy days. The Internet is a virtual equivalent, putting the shop in people's living room and work place.

I am currently getting the assistance of a small dad and his lad bricks and mortar business with a website at the other end of the country to me to purchase a component that is incredibly niche. They make a business out of selling these and similar items. Without the internet I would never have found the business and I don't think I could have bought it locally before or after the Invention of the internet. Without getting business from all over the country they would not generate the number of sales required to survive. It's a win win. They are now my LWS (local widget shop) - they just happen to be 350 miles away.

Every change in technology and cultural habits is going to have economic winners and losers and it is very easy/lazy to just point to the losers whose business model now simply makes very little sense. But let's not forget the small, niche businesses capable of surviving financially making a stable living whilst providing excellent service that simply could not have done so in another era.

Convert, Pete told me that he opened the shop because he wanted to meet the needs of people coming to Anglesey who's weekend was ruined by poor planning and preparation (forgetting a paddle for example). It's really a kayak/climbing shop that expanded into bikes because they were asked for bike parts by locals. He seems to embrace the internet, but takes issue with the big sales channels extracting their profit from the UK and putting very little back. Unusually, he appears to be a socialist shopkeeper!

I think his point(and it is my LBS, so I have spoken to him after all isn't that one of the things we use them for, just a chat) is that ebay take a huge chunk of his margin (as we've already established, ebay is 'competitively' priced so margins are reduced), which they then extract from the UK economy through clever accounting. As he said to me "People complain about the lack of a pay-rise in their public sector jobs, but then shop with tax dodgers, it's like spending all your wages and then complaining you have no savings for your holiday".

As I said in my OP, an interesting blog post and it appears to have encouraged some debate.

Just check out the eBay fees and you will see why the principle means by which price advantage is being injected into the equation is firms deliberately obfuscating to exploit the tax arbitrage.

Even private users get free listings, 10% final value, plus PayPal. Those are better if you're a business seller. Call it 15% though if you want. If most of the businesses on there pulled out of ebay how much do you think their trade would drop? 80%? 90%? 99.9%?

Some businesses obviously use it in parallel with a bricks and mortar shop and/or e-commerce site, but many many more are using it as their primary means of selling, and doing infinitely better than they would with expensive high street premises. Thinking of the number of random car bits I've bought, or electronic stuff.

I have every sympathy with the LBS but no-one entering into that sort of business any time in the past 5 years should be whinging about how the retail world is these days and anyone who has been around longer should at least have some sort of "exit strategy" if they are finding it hard going. It is still the case that many bike shop owners are doing it because they think they have some sort of societal role or that they simply reckon they can make a living from a hobby. Both of these options are to be commended, just don't criticise the rest of the word because they don't see things the same way.

Pete told me that he opened the shop because he wanted to meet the needs of people coming to Anglesey who's weekend was ruined by poor planning and preparation (forgetting a paddle for example)

A fine motivation I'm sure but hardly a sound base for a business model. As my old employer used to say he was hardly going to feed his kids from the profits from a handful of broken UJs. I'm glad he's there and next time I'm sea kayaking in Anglesea I'm bound to pop in but I bet its the internet that keeps the wolf from the door for him.

It would be interesting to know what percentage of his profit walks through the door, comes through his website and comes via his eBay and Amazon (didn't know he did that) stores. In the past his stuff on eBay was often more expensive than the same item on his website - I guess that was him passing on some of the eBay love to his customers.

I won't go into all the detail but I have sympathy. I have mothballed a company that employed local people on proper wages to make clothing that was locally designed and made which, according to our customers, was REALLY IMPORTANT. That's until it's a bit more expensive than a cheaper version made in China. Then they also want it cheap. I gave up as it was too hard. Shame really.

I own a small LBS and its absolutely booming.
best period in our history (about 12 years)

we dont do anything with the internet, we advertise the shop on the net but thats it. business is with local people and we are thriving.

i think its all down to the staff and how good they are.

To respond to mike and ben, yeah eBay takes a cut, but this guy says he has a [u]reliance[/u] on selling on eBay, which suggests it currently works for him - if it didn't he wouldn't be relying on it? But he's still gonna stop.

I concede the point about window cleaners. 🙂

To respond to mike and ben, yeah eBay takes a cut, but this guy says he has a reliance on selling on eBay, which suggests it currently works for him - if it didn't he wouldn't be relying on it? But he's still gonna stop.

That doesn't follow - he might well be reliant on eBay sales at the moment, but recognises that it's not good for the future of his business to give away that much margin and control.

Really good price for that Park workstand though

Sancho - Member
i think its all down to the staff and how good they are.

I think you're right.

My local (to work anyway) is Condor in London, I use these guys a lot because they have a huge amount of stock, and will have lots of spares for most stuff, from odd mech hangers to S-Works 2006 BOA systems. The staff are great too, and are very helpful!

I think it is a really interesting topic.
Ebay is no longer an auction site, but simply a shop window or search engine. Same for Amazon.
People looking for something might go to Google Shopping, Ebay and Amazon and then buy the cheapest that didn't look shonky.

If one of those search methods doesn't bring your shop up, then you are going to struggle.

For cycling, where CRC and Wiggle (and perhaps to a lesser extent Merlin) have won is by being big enough and consistent enough to mean that they get added to that initial list. In fact people have seen enough consistent good pricing to mean that they might not even bother with a continued search if CRC had it in stock for a reasonable price.

So how does a shop like Summit to Sea sell effectively online? If you pay 15% to Ebay, then you immediately can't compete with CRC prices.

I guess this blog post is about trying to get noticed, shared on social media and try and elevate their profile to the point where we might consider adding them to our search flow.

Convert

As my old employer used to say he was hardly going to feed his kids from the profits from a handful of broken UJs.

Did you see the video he made a couple of years ago, makes John Lewis look like a bunch of amateurs...

Too much heat being directed at the consumers without looking at the manufacturer - I think bike companies could do more to support the LBS model - like exclusive colours on frames that were for retailers only - incentives to shop in-store or with the little guy .. I hear lots of LBS's moan about their punters but how often do they moan to the manufacturer ? I know some skateboarding companies have started to do shop only exclusive product - Basically the high street should stop competing on a like for like basis as they will always loose ... So I'm thinking HOPE could bring out a shop only anodized colour for example .. People like the rarities - that's when they'll pay a bit extra ..

What's the acceptable (stw approved) collective noun for bikes then?

scotroutes - Member
I have every sympathy with the LBS but no-one entering into that sort of business any time in the past 5 years should be whinging about how the retail world is these days and anyone who has been around longer should at least have some sort of "exit strategy" if they are finding it hard going. It is still the case that many bike shop owners are doing it because they think they have some sort of societal role or that they simply reckon they can make a living from a hobby. Both of these options are to be commended, just don't criticise the rest of the word because they don't see things the same way.

Well put.

Scotroutes,

just don't criticise the rest of the word because they don't see things the same way.

I didn't read the blog as a criticism, more a call to reflect on our habits and consider our actions. Maybe I'm more thick skinned??

😉

I assume the biggest pressure you face hora is competition from online people with tiny overheads running in foreign tax jurisdictions buying their raw materials at lower costs than you can?

Tiny overheads? How does that work? The more stock you carry the more it costs as a depreciating overhead, the bigger the unit, the more utilities the more staff to pick, pack, answer phones, emails, returns, restock etc etc etc.

Plus the last line. You don't start bigger, you get bigger by starting small and investing hardwork and all your money into the venture. CRC didn't suddenly spring up did it? The bloke worked at it and grew it.

Almost anything with a cash till in their business is their to try and make a profit.

Tiny overheads? How does that work? The more stock you carry the more it costs as a depreciating overhead, the bigger the unit, the more utilities the more staff to pick, pack, answer phones, emails, returns, restock etc etc etc.

Plus the last line.

From direct experience, retail is not a particularly pleasant place to be.

For me, the enhanced opening hours argument is well and good if you would rather be at work than home. I preferred/prefer home and as such it stopped being a good fit for me.

Adding more hours to your business with no increase in margin = fools errand. Best option, move on. Do something else.

Some people moan and some people do. That's just life. I chose to be a do person and it reaped dividends.

Tiny overheads? How does that work? The more stock you carry the more it costs as a depreciating overhead, the bigger the unit, the more utilities the more staff to pick, pack, answer phones, emails, returns, restock etc etc etc.

Have a look at the costs per sq ft of a city retail unit against a warehouse unit on an industrial estate. Have a look at the costs of hiring and training knowledgeable and skilled staff against the costs of hiring box-pickers on short contracts. Have a look at stock depreciation as a percentage of overall turnover - some LBSs have things in stock for years (even decades) just in case, big retailers turn stock over quickly.

Really, any LBS trying to compete with an online retailer is on a hiding to nothing. Shops that do well are the ones who aren't selling on price, they're selling on service, specialist skills, knowledge and convenience.

But the Venn diagram of STW users and LBS users doesn't show much intersection 😉

A fine motivation I'm sure but hardly a sound base for a business model.

Yeah best thing for a LBS to do is forget about mountainbikes and sell road and commuter bikes.

The singletrackworld crowd are not a target market for an LBS.

We have dropped all but two of our mtb brands this year and re-focused on clothing accessories and service.
Still got some sweet bikes but these require time in the shop to spec and are not ideally suited to internet sales.
We have also looked at what we sell and tried to focus on brands that arent sold down the street.

The LBS is a great place to be working, customers are great, except some, but a **** is a **** no matter what hobby they have.

i love cycling and the sport of cycling and so do our customers so we sell what they want and we all have a good time, next stop is coffee and cake. would love a belgian style bar too, just need the landlord to let us have the next unit along.

Phew, that was close.
I almost commented on Summit To Sea's hypocrisy of urging people not to "[i]Save 50p by buying from an online giant[/i]" when you can actually [url= http://www.sportpursuit.com/sales/seatosummit-dec ]save £10+ by buying their products from an online giant[/url].
I wonder how many people get taken in by the similar name and logo?

I wonder how many people get taken in by the similar name and logo?

never heard of either of them!

I used to use my LBS's fairly regularly for odds and ends. Nothing big, but probably £20-£30 a month. £12 for a brake addapter isn't bad if you need it and it gets you out riding, it's only £6 more than CRC. Then one day I needed brake pads. They didn't have shimano, was a generic brand ok? Yup, ok, they're £17, ok (thinking that's double the price I could get similarly generic pads online) walk back over to the till, £34, they were £17 each! The brake pads on my MG which havent been a standard part since 1977 so probably get made in much smaller quantities by actualy brake manufacturers like EBC cost less than that, and these are tantamount to "generic brake co. of China".

I still use them for stuff that wont be any cheaper on CRC (stans fluid, chain oil, etc) but after that I no longer use them out of any kind of preferance or loyalty.

Have a look at the costs per sq ft of a city retail unit against a warehouse unit on an industrial estate. Have a look at the costs of hiring and training knowledgeable and skilled staff against the costs of hiring box-pickers on short contracts. Have a look at stock depreciation as a percentage of overall turnover - some LBSs have things in stock for years (even decades) just in case, big retailers turn stock over quickly.

Have a look at the costs per sq ft of a city retail unit against a warehouse unit on an industrial estate.

One has to be bigger for storage, handling etc. So lets look at it as an over all cost huh rather than foot per foot price.

Have a look at the costs of hiring and training knowledgeable and skilled staff against the costs of hiring box-pickers on short contracts.

Also- you are telling me that shop staff are all N.I'd and PAYE/properly employed and fulltime? no seasonal or Sat/weekend staff then in a shop?

some LBSs have things in stock for years

I've NOTHING against bikeshops. They can only sell you the closest product to what you are looking for. Online retailer, searched can immediately sell you the exact branded product, in the right colour, size and at the right price.

So yes naturally a LBS's customer is not a seasoned bike enthusiast but someone who is newer to the sport/hobby.