Retail Markup on Bikes at LBS ?

I'm just curious having worked long ago in retail in a music store where A
markups were common, meaning the item was marked up 100% or cost the store
half at retail. I know a good LBS (local bike shop) will take quite a bit
more time in fitting a bike properly when selling it compared to Wal-Mart,
plus after sales adjustements, so I certainly don't begrudge a healthy markup.
But the cost of the bike, on the wholesale level, is about what percentage to
the MSRP?

thanks to all

Back in the day when I managed an independent LBS, we would get annoyed
with Trek because they would publish msrp (manufacturers suggested
retail prices) based on a 28% proffit margin when we normally did 33%
profit margin on all the other bicycles. Of that profit margin, we had
to pay shipping, assembly, payment on the loans, rent, heat, credit
card charges, etc. Customers would come in carrying Trek ads or
magazine reviews or buyers guides showing those prices and would get
put off if we marked them up higher. The best Trek we ever had was
their top of the line 720 touring bike. The reason this bike was so
great was we used it for a side by side comparison with the then
popular Specialized Expedition touring bike. The Trek was $180 more
and was not finished as well or equiped as well. THat bike sat for a
long time while the Expedtions & Sequoias & stump jumpers & rock
hoppers flew out the door.

The rest of the inventory was marked up double wholesale. Jersies were
always a problem because most would go unsold and get marked 1/2 off to
clear them out.

wrote:
Back in the day when I managed an independent LBS, we would get annoyed
with Trek because they would publish msrp (manufacturers suggested
retail prices) based on a 28% proffit margin when we normally did 33%
profit margin on all the other bicycles. Of that profit margin, we had
to pay shipping, assembly, payment on the loans, rent, heat, credit
card charges, etc. Customers would come in carrying Trek ads or
magazine reviews or buyers guides showing those prices and would get
put off if we marked them up higher. The best Trek we ever had was
their top of the line 720 touring bike. The reason this bike was so
great was we used it for a side by side comparison with the then
popular Specialized Expedition touring bike. The Trek was $180 more
and was not finished as well or equiped as well. THat bike sat for a
long time while the Expedtions & Sequoias & stump jumpers & rock
hoppers flew out the door.

I bought an Expedition, great bike, if a little heavy. I still ride it
on occasion. IIRC, the main competition at that time was the Miyata 1000.

28% really sucks. From what I understand the margins on bikes are much
better than that now, more around 35-40%, which still is a tough way to
make a living.

Thanks for the info. 28% would be tough considering the time you have to put
in and the time your paying your
employees to put in.

Rick

In article .com,
says...

Back in the day when I managed an independent LBS, we would get annoyed
with Trek because they would publish msrp (manufacturers suggested
retail prices) based on a 28% proffit margin when we normally did 33%
profit margin on all the other bicycles. Of that profit margin, we had
to pay shipping, assembly, payment on the loans, rent, heat, credit
card charges, etc. Customers would come in carrying Trek ads or
magazine reviews or buyers guides showing those prices and would get
put off if we marked them up higher. The best Trek we ever had was
their top of the line 720 touring bike. The reason this bike was so
great was we used it for a side by side comparison with the then
popular Specialized Expedition touring bike. The Trek was $180 more
and was not finished as well or equiped as well. THat bike sat for a
long time while the Expedtions & Sequoias & stump jumpers & rock
hoppers flew out the door.

The rest of the inventory was marked up double wholesale. Jersies were
always a problem because most would go unsold and get marked 1/2 off to
clear them out.

On 2005-08-18, rs wrote:
Thanks for the info. 28% would be tough considering the time you have to put
in and the time your paying your
employees to put in.

Rick

My LBS said 40% on the main brand. He also said that accessories and
service was the best marigin.


In article .com,
says...

Back in the day when I managed an independent LBS, we would get annoyed
with Trek because they would publish msrp (manufacturers suggested
retail prices) based on a 28% proffit margin when we normally did 33%
profit margin on all the other bicycles. Of that profit margin, we had
to pay shipping, assembly, payment on the loans, rent, heat, credit
card charges, etc. Customers would come in carrying Trek ads or
magazine reviews or buyers guides showing those prices and would get
put off if we marked them up higher. The best Trek we ever had was
their top of the line 720 touring bike. The reason this bike was so
great was we used it for a side by side comparison with the then
popular Specialized Expedition touring bike. The Trek was $180 more
and was not finished as well or equiped as well. THat bike sat for a
long time while the Expedtions & Sequoias & stump jumpers & rock
hoppers flew out the door.


The rest of the inventory was marked up double wholesale. Jersies were
always a problem because most would go unsold and get marked 1/2 off to
clear them out.

On Thu, 18 Aug 2005 10:10:59 GMT, Chuck
wrote:

My LBS said 40% on the main brand. He also said that accessories and
service was the best marigin.

Maybe that's why my LBS seems happy to see me ride in on a bike I
didn't buy there! (Mostly because they didn't, and still don't, carry
the model I wanted.) I think I, and the insurance company, have
bought more than a bike there by now.

Pat

Email address works as is.