Tried to support the local shop

[BSWIFT]

Today, I went to buy a battery for my wifes VStar Silverado. An internet dealer had the battery for $55 with free shipping. I decided to check out the local dealerships, see if they had it in stock and pay 10% more + tax to have it today. Well, was I surprised. Local dealer had the battery, same part number as the internet dealer, $130 + tax! I was absolutely shocked.
I like to support my local shops but I'm not an idiot. Even for the convenience of having it the same day, more than double the price is outrageous. I would have paid 25% + tax more to have it today but not more that 100% more + tax.
I'll order the part online and have it by next weekend and use the difference to ride somewhere!

 

[Vic]

I know, it's crazy. You could probably buy online and have it shipped overnight and still pay less.

 

[jaction125]

I went into the local hoda dealer this saturday.

2 chain adjuster bolts
2 nuts= $17.86 :bang:

 

[karterron]

I have gotten to where I don't buy from dealers unless I have a prior relationship with them. Otherwise, bring your jar of vaseline with you.

 

[blackduc98]

Find a small local independent bike shop, and you'll be able to order thru them anything that Parts Unlimited or Drag Specialties or Tucker Rocky normally distributes. I go to a local one-man Harley shop (and I don't even own a harley) and he charges me at or below suggested retail price, sometimes as little as 10% above the lowest internet price. You can negotiate with a one-man shop, but you can't negotiate with a big dealer.

When I need OEM parts then I try to buy them thru ronayers.com (I just wish I could buy my Ducati parts from them too).

 

[kdx200chick]

I usually print off the page from the internet site showing the best price and bring it into the dealer. I've been really lucky getting them to price match. Plus, I don't end up paying the shipping.

 

[dezryder]

Dealers have a lot more overhead than internet sellers, and are probably paying more for the parts also. But I agree that over double the price is a bit much.

 

[KiwiBird]

I went to a Honda dealer for a part and when they brought it out it still had the factory pull slip on it. I know how to read the codes on them and I gave them a good talking to when I saw they were charging 25% over recommended retail.

 

[blackduc98]

Dealers have a lot more overhead than internet sellers, and are probably paying more for the parts also. But I agree that over double the price is a bit much.

The "overhead" argument makes sense for items which the dealer stocks since he probably had to pay upfront for those parts. But most of the time the dealer doesn't have what I need in stock anyway. All he has to do is type my order into the computer and a couple of days later the distributor delivers parts to him. The dealer won't place the order until I pre-pay for it, so he's in no danger of losing any money. Seems to me that 15% premium on top of dealer's COST is a reasonable profit margin. Just for comparison purposes, Exxon-Mobil recently reported record profits and the entire country is up in arms over "price gouging". But as it turns out, in percentage terms their record profits represent something around a 10% profit margin.

BTW, I think that "suggested retail price" is much higher than 15% over cost. I recently bought a Yuasa battery which you can get from the internet for $79. Parts Unlimited SRP is $112. My local harley shop ordered the battery for me from PU and charged me $89. I'm sure the harley shop made a reasonable profit on this transaction. Now you do the math: if $89 includes a reasonable profit, then how much markup does $112 represent? To top it off, my local Yamaha dealer wanted to charge me $124 for the same battery.

 

[CR Swade]

The "overhead" argument makes sense for items which the dealer stocks since he probably had to pay upfront for those parts. But most of the time the dealer doesn't have what I need in stock anyway. All he has to do is type my order into the computer and a couple of days later the distributor delivers parts to him. The dealer won't place the order until I pre-pay for it, so he's in no danger of losing any money. Seems to me that 15% premium on top of dealer's COST is a reasonable profit margin. Just for comparison purposes, Exxon-Mobil recently reported record profits and the entire country is up in arms over "price gouging". But as it turns out, in percentage terms their record profits represent something around a 10% profit margin.

BTW, I think that "suggested retail price" is much higher than 15% over cost. I recently bought a Yuasa battery which you can get from the internet for $79. Parts Unlimited SRP is $112. My local harley shop ordered the battery for me from PU and charged me $89. I'm sure the harley shop made a reasonable profit on this transaction. Now you do the math: if $89 includes a reasonable profit, then how much markup does $112 represent? To top it off, my local Yamaha dealer wanted to charge me $124 for the same battery.

15% huh? Most small businesses would die a nasty death on a 15% margin. 35-40% is more realistic w/ 50% on some items. Fact is this...most internet pricing you see is often at , near or below a local retailers wholesale. I can sell a $1100 dollar item w/ a MSRP of $1399 and can find it on the internet for $699...$150 UNDER my wholesale cost. It's BS plain and simple.

Them to add insult to injury, the customer wants me to install it for them if they buy from the internet sharks. We won't...let the internet take care of install, warranty and cusotmer service. Hope the product comes w/ a big heaping helping of good luck

 

[dirt bike dave]

I agree with Swade.

If the dealer is truly making excess profits, someone should step up, open another store and compete with him. The fact that nobody does (or they go out of business when they try) says a lot.

I think the dealer 'overhead' is a lot higher and includes a lot more items than many of you guys think.

Since he is making fewer transactions due to internet competition, each transaction has to carry more of the overhead burden.

Let's say you want to buy a washer that retails for $1.50 but had a dealer cost of $1.00. You think the dealer is raping you and making a 50% profit. But the dealer's overhead averages $15 per transaction. In his eyes, it cost him $16.00 to get $1.50 out of your wallet. If he was to make a 25% profit on that sale, he would have to charge you $20 for the washer. He knows he can't charge $20 for a washer, so he hopes you are going to buy something else while you are there. He sets $1.50 as a price and crosses his fingers.

It's the big transactions that keep him in business. If you are going to come in twice a year and buy $15 in parts and bitch at him cause you can get it for $10 on the internet, he would probably rather you stay out of his shop. Unless you are going to buy a bike someday.

 

[Vic]

I agree with Swade.

Since he is making fewer transactions due to internet competition, each transaction has to carry more of the overhead burden.

He could make more transactions if his prices were more competitive.

Even if a dealer has stellar customer service (I'm still trying to find one), he cannot expect someone (me) to pay more than, maybe, a 20% premium.

Would you rather make 20% or 0%?

 

[dirt bike dave]

As in Swades example, the dealer simply cannot cut prices enough to compete with the internet providers for price-sensitive buyers. Especially on small transactions. The choice is more like 'would you rather make 0% or 2% but have lots more headaches?' If the 2% profit on parts is a very small part of your overall business (new bike sales and service being bigger) and you already have enough headaches in your life, you would choose not to compete on parts, but put your skills and energy into sales and service.

So the dealer prices his parts just low enough to still capture the business of the guy really does not care much about price and the guy who will pay a premium to support a local dealership.

For someone who also buys motorcycles or has his bikes serviced at the dealership, the dealer can afford to give a deep discount on parts, maybe even pricing them at or near internet levels.

One of my local dealers has high prices on parts AND motorcycles. I don't patronize him, because I am price sensitive. But I can understand why he chooses to do what he does.

 

[dezryder]

Support your local dealer

I'm glad to see that some of you guys are supporting your local dealers. A local dealer (gone now, sold the shop to get a regular paycheck, save marriage, etc.) became a great friend and riding buddy of mine.

Strictly a euro offroad bike shop. When Cagiva bought out Husky, they made him floor a certain number of their road bikes! You might have 30 days free flooring, then either buy the bikes, or pay flooring costs until you sell them.

The dealers need to have better locations than the net sellers, IE, higher rents. (Net sellers could be running the biz out of a garage in TJ.)They need more insurance. Someone stains a $50 dollar jersey while thumbing through the rack...dealer eats it. More bookkeeping, and on and on. Also, many sponsor local talent.

There's simply no comparison in the costs of running a dealership vs selling on the internet.

Support your local dealer...where else can you go fondle that accessory item you only saw in magazines or drool all over the new bikes? :nod:

 

[dezryder]

One of my local dealers has high prices on parts AND motorcycles. I don't patronize him, because I am price sensitive. But I can understand why he chooses to do what he does.

FWIW, I'm price sensative too, but I still try to keep my business local. I live a block away from a very small mom and pop grocery store. A half pint of sour cream cost more than a pint in a bigger store. I still buy a lot of things there. They need to make a profit too. Besides, their really nice folks. And like 'Cheers'...everybody knows your name.

 

[Okiewan]

Unless you are going to buy a bike someday.

And they make SQUAT on bikes. Service and parts from returning customers is where they make their living. Except, now we buy our parts from some ambiguous poser on E-Gay. The dealer loses, makes no profit and Joe Bargin Boy wants him to stock every conceivable clutch cable on the planet? "Basstard didn't even stock a clutch cable for my 92 YZ!!" Sorry... YOU determined his stock and how fast you can get the parts AND service.

So many people expect the local shop to wipe their ass with the 5% they are willing to pay... sorry folks, it doesn't work that way. And then, they want the dealer to stock everything they can possibly need.

Tell ya what.. the people that rant have NO IDEA what it takes to run a business. That's the bottom line.

I want it tomorrow, I want it to come from your stock, I want you to kiss my arse and I want you to make no profit. The dealer's reaction? Please shop somehere else.

The REAL price for the bargin basement shopper is being paid. Trust me.

 

[Chili]

Very true Okie. As MX'ers we lost a dealer here that was 100% for MX. He ran a track, promoted races, sponsored racers etc. Shortly before he pulled the plug (on MX not his dealership) we had a conversation where he told me flat out MX'ers killed it for him, they want everything for nothing or cheaper than nothing. They want bikes below his cost, deeply discounted parts etc. He stated it was getting to the point that it was costing him money to sell mx bikes. The next season he pulled the plug on everything and now is primarily a streetbike shop with no involvement in MX or racing.

 

[Rich Rohrich]

he told me flat out MX'ers killed it for him, they want everything for nothing or cheaper than nothing.

I'll second that. :nod:

 

[Vic]

Of the many dealers I've dealt with over the years, all but a few seemed to have the attitude that they were doing me a favor by just existing. The bad experiences I've had with dealers far outweigh the good and I'm really not that hard to please. I don't think I'm alone in this experience. So, I should pay more for bad attitude and bad service?

The huge growth of mail-order and ,now, internet sales is about more than just price.

 

[Chili]

Of the many dealers I've dealt with over the years, all but a few seemed to have the attitude that they were doing me a favor by just existing. The bad experiences I've had with dealers far outweigh the good and I'm really not that hard to please. I don't think I'm alone in this experience. So, I should pay more for bad attitude and bad service?

No you should not pay more for bad attitude and bad service. More than anything I'm trying to perhaps put a light on how some of these guys ended up with the poor attitude.

Within 2 hours of my place ( and mostly within 30 minutes) I have the following dealerships available at my disposal.

Kawasaki - 4 dealerships
Suzuki - 4 dealerships
Honda - 3 dealerships
Yamaha - 4 dealerships
KTM - 1 dealership

Some of these are multi line dealerships so I don't have 16 dealerships in the vicinty.

Out of all those dealerships I would happily deal with 2 of the Kawi dealers, 2 of the Suzuki dealers, 1 of the Honda dealers, the KTM dealer and 1 of the Yamaha dealers. I'm not willing to pay a huge premium to deal locally but I do understand for a dealer to have it in stock costs him $ versus an internet/mail order shop that doesn't stock anything and simply drop ships from the manufacturer once an order is received. Am I really that lucky to have that many shops local that are reasonable to deal and prices that are only marginally higher than the internet or is some of the expectations of your dealer unrealistic?

I also shake my heads at the threads when someone enquires about the fit of a helmet or boots before ordering. Invariably someone tells them to go down to the local dealer and try them on before ordering from xyz.com for 15% less. It's a nice luxury to have until the local dealer is gone.

I'm not some rich dude with more cash than brains, MX racing is putting a serious dent into my finances and I'm working a second job on the side to cover the expenses.

 

[CR Swade]

So many people expect the local shop to wipe their ass with the 5% they are willing to pay... sorry folks, it doesn't work that way. And then, they want the dealer to stock everything they can possibly need.

Tell ya what.. the people that rant have NO IDEA what it takes to run a business. That's the bottom line.

I want it tomorrow, I want it to come from your stock, I want you to kiss my arse and I want you to make no profit. The dealer's reaction? Please shop somehere else.

The REAL price for the bargin basement shopper is being paid. Trust me.

AND that same person wants a top-flite service tech to available for whatever widget is being marketed...all on a salary that should be in accordance w/ that techs expertise but sadly is often more in line w/ what the shop can afford from the whopping 2-10% made on retail sales.

My little company refuses to match price, installs only what we sell (internet shopper need apply elsewhere) and somehow manages to maintain that magical 40-45% overall margin complete w/ a shcedule that is most always full a month in advance. Often we are among the highest of the bidders on any given larger-scale job but still usually get the nod...comes down to service and making sure we provide the value for the customer in spending more w/ us. As far as the internet shoppers that want me to match or sell at my wholesale I respectfully advise them to shop elswhere. The local low-ballers still have never figured that out...

The same arguement can be made for cycle shops...the good ones don't need to be the cheapest on the block, nor should they. Their market is NOT the internet/2% profit shopper. If they are targeting that market, the shop is going to die a pretty ugly death as it turns into a 2% shop, complete w/ 2% techs etc

Personally I still use my two local shops (Letko and Cycle Zone). Do I spend a little more...most defintely BUT when I take in my SXF next week for a 20 hour check I know Mario (local longtime wrench guru) will provide top-flite service. I refuse to internet or Walmart shop...maybe that is my modern day Don Quixote-esque battle. Bob is totally spot-on with what the bargain shoppers are now reaping from all of the internet price whore seeds.

This is business folks, not charity

BTW...good job again on the DirtRider internet bike...can't tell you enough how cool I think that bike is :cool:

 

[Vic]

The same arguement can be made for cycle shops...the good ones don't need to be the cheapest on the block

What about the other 95%? :)

 

[Tony Eeds]

I'm not some rich dude with more cash than brains, MX racing is putting a serious dent into my finances and I'm working a second job on the side to cover the expenses.

Heck Chili, Joe Public knows we ain't got no brains ...

I try to support local shops. Some make it an enjoyable experience and some don't.

Most of the shops in the DFW Metromess are dialing it up and becoming bigger and slicker. Many stock parts for their road bikes now, but off road parts are few and far between (unless you ride the bike of the year ... CRF450, YZ450, etc). I buy all my parts for my Pig from Service Honda. Not exactly home town, but home town service from the 'hood. :)

I usually order my KTM parts from my local shop, but they have just been bought by a new owner and I haven't got to know the new staff ... 100% turn over. They would routinely give me a 20% discount on all parts which got me within a hula-hoop of internet pricing, which was good enough for me.

 

[blackduc98]

15% huh? Most small businesses would die a nasty death on a 15% margin. 35-40% is more realistic w/ 50% on some items.

I said 15% profit on items which they don't stock. The dealer acts as a simple keypunch operator for that particular transaction. He takes my money upfront, keys in my order into the computer, and usually doesn't even bother to call me when my parts arrive. He pays no shipping charges on any order over $60 from Parts Unlimited. He pays $15/hr to the guy who puts the parts into the stockroom and mans the parts counter. And yes, there is rent and lights and telephone and other administrative overhead. Fine, calculate total cost including all these items and then add a 15% profit margin on top of that. Yes, I understand that if I only buy a single washer for $1.50 then he loses money on it because it takes just as much effort to put that washer into the stockroom as it does for a $700 set of carbon-fiber pipes. But I normally buy much more than a washer...too much in fact. I would go see a therapist about that, but I can't afford to because I've spent it all at the bike shop :-)

BTW, in my local area the dealer which charges lowest prices (compared to other local dealers) happens to have the most extensive stockroom, the most knowledgeable parts guys and mechanics, and the best service. Their parts prices are usually within 20% of ronayers.com and it's always a pleasure doing business with them. If they weren't so far away from my house I'd probably never shop on ronayers.com again. I wish I could say the same about the rest of the dealers around here.

Now back to the proverbial washer for a moment. The washer really costs 20 cents at the hardware store, and we all know that. If you set your price at $5 for that washer, you are really telling me "piss off, I don't want your business". Every year I spend hundreds of $$ on parts and way more on service, and I will take it to some place which doesn't charge me $5 for that washer. I simply hate the feeling of being ripped off, and I won't patronize anyone who routinely makes me feel that way.

Fact is this...most internet pricing you see is often at , near or below a local retailers wholesale. I can sell a $1100 dollar item w/ a MSRP of $1399 and can find it on the internet for $699...$150 UNDER my wholesale cost. It's BS plain and simple.

Maybe I'm stupid, but I don't understand how it can be $150 UNDER your cost. Or to put it another way, what is stopping you from getting this item for $699 from the internet just like anybody else? Are you saying that your distributor is ripping you off? I don't run a small business (obviously) so it is likely I don't understand something fundamental about it. Please educate me.

Then to add insult to injury, the customer wants me to install it for them if they buy from the internet sharks. We won't...let the internet take care of install, warranty and cusotmer service. Hope the product comes w/ a big heaping helping of good luck

That's another position I don't understand. Why not charge those customers your true labor+profit rate? You are an expert in your field, so your customers have to pay you for your expertise. That's what my local harley guy does for things like tires. He is very upfront about it, and I understand and respect his position: he has to make a profit if someone walks into his shop with a set of tires bought off the 'net and wants to have them mounted on rims. He is willing to do that at his normal hourly labor rate..however long it takes to get the job done. Or you can buy the tires from him for full retail price and mounting will be included - either way it's the customer's choice. Doesn't that seem like a reasonable approach?

Anyway, sorry about the long rant. I really do want to support my local dealerships, but sometimes it's really hard to just close my eyes and pay whatever they ask, while knowing the price that is available to me with a few clicks of a mouse. And FWIW, I don't shop at WalMart either, but I won't pass judgement on people who do shop there.

 

[junkjeeps]

Fact is this...most internet pricing you see is often at , near or below a local retailers wholesale. I can sell a $1100 dollar item w/ a MSRP of $1399 and can find it on the internet for $699...$150 UNDER my wholesale cost.

How do these guys buy the same thing you buy so much cheaper?

I don't have any local dealerships anymore since Katrina. Closest dealer to me is about 30 min one way. I have the same problem with them. Pay full retail up front and we won't call you when it comes in. It's up to you to hound us to death to see if your parts have come in. Next closest to me is 45 min one way and they are great. I have a friend who works there and he takes care of me. Only problem is I don't have the time in a week to drive 1-1/2 hours to get parts. The internet ordering for me is a convenience thing. I would love to support a local shop. Before Katrina a friend of mine opened an independent shop and I used him pretty much 100%. He didn't reopen since the storm, so I'm back to internet shopping. The prices are good and it comes right to the door. I didn't spend any of my limited time in a week riding around burning $2.77 a gallon diesel. I wish I had the good dealerships you guys talk about within 30 min of the house.

Mark