Specialized Founder Mike Sinyard Blasts Amazon’s Price Check App

specialized attacks amazon price check app and warns bike shop retailers against it

In a letter to Specialized dealers on Tuesday, company founder Mike Sinyard warned independent bicycle retailers to be wary of Amazon.com’s new Price Check app.

The complete letter is copied here after the break. Bicycle Retailer & Industry News (BRAIN) has posted two excellent articles (part one and part two) of why it matters and how and why it affects both dealers that sell through Amazon and those that don’t.

Plenty of shops supplement their income selling parts on eBay and Amazon, but, as BRAIN suggests, it’s the ones that are selling online without the authorization of the brands that typically slash the prices to a point where they’re hurting the market. Two of brands called out in Sinyard’s letter, Sidi and Louis Garneau, told BRAIN they require online resellers to maintain MSRP on current model year products but that older inventory may be discounted.

For as long as we’ve been cyclists, prior model year goods have a long history of being closed out at discount, often sold in large lots to blowout mail order companies like Jenson USA. What’s becoming an issue is the ease with which consumers can now price check and order via smartphones directly from the brick and mortar bike shops.

LETTER FROM MIKE SINYARD:

Dear Specialized Dealer,

Is your store a fitting station for your online competition?

Amazon.com recently launched a free app called Price Check that allows consumers to use brick-and-mortar shops for research, then easily buy many cycling products online right from their mobile device.

Here’s how it works: when in your shop, consumers simply scan a bar code, type in the product name or take a picture to see the product and prices from a variety of online retailers. After ensuring they have the right fit by trying on the product in your store, and talking to your staff, they can buy it from somebody else with the press of a button.

Participating brands include Pearl Izumi, Shimano, Louis Garneau, Giro, Bell, Fizik, Sidi and CatEye.

Who loses in this situation? Certainly not Amazon. And, at least in the short term, not the cycling brands selling through bike shops and Amazon. But what about you?

By buying product from brands that severely undercut you, you are supporting your competition. Why finance your own demise?

Please investigate for yourself by downloading the free Amazon app.

Amazon is clearly interested in the cycling space, and is hiring talent from the bike industry (including from Specialized).

In related news of brands that leverage the IBD while simultaneously undercutting them, Easton-Bell Sports dropped the fruitless suit it filed against Specialized before Interbike. Was this legal maneuvering just carried out for publicity?

Whether the current news is mobile device apps or lawsuits, the underlying issue remains the same: some suppliers support the IBD and some do not. For the sake of your business, examine your suppliers’ strategies and vote with your dollars. The entire bike industry is watching.

Click here to see how Amazon’s Price Check App works in store (Video here)

Thank you for your continued support.

Sincerely,

Mike Sinyard
President & Founder
Specialized Bicycle Components

Comments

Dan - 12/30/11 - 10:50am

Oh no, the Specialized oligopoly may come to an end, what will happen when people have more options. Honestly I feel bad for the small shops that can’t compete with online price, but when Specialized complains I don’t feel bad for them. May be you can sue Amazon like you’ve sued everyone else.

Chad - 12/30/11 - 11:00am

“Honestly I feel bad for the small shops that can’t compete with online price” ~Dan

A lot of Online sales are below dealer wholesale costs, not even big shops are willing to give someone a product for free, and some money on top of it.

Adam - 12/30/11 - 11:10am

The letter was sent to local bicycle store owners not to the consumer. His point, to shop owners, is to examine what products they are choosing to sell. Margins in bike shops are extremely low. A sole shop owner is not in the business to get rich (actually barely making a living). The internet has already destroyed the brick and mortar camera and book stores. Hey cyclists, do you enjoy going to your local shop and talking about bikes? Do you appreciate the knowledge they have? Do you appreciate your bicycle mechanically working? Please think of this the next time your about to order via your laptop……

Sevo - 12/30/11 - 11:12am

Dan-You must not own a shop or have any experience in one. Specialized is probably the best all in one brand out there. Solid bikes, leader in helmets since day one, leader in gloves since day one, leader in optics since day one, leader in tires since day one, leaders in shoes since day one, and ditto for saddles.

And bonus….Sinyard still rides. A lot.

This doesn’t hurt Specialized. But it does hurt their shops and Sinyard sticking up for this retailers is admirable in such a fashion. Yep, he’s calling out his competitors poor business practices. Yes it strengthens the reason to buy Specialized. But you can’t go wrong as a shop by making this switch. And Specialized protects it’s dealers fairly well plus offers them a product as good as any.

And if knocking Specialized for litigation is your best argument, probably should stay at the kiddy table and be seen, not heard. Litigation is a fact of life in a large corporation to small business. Specialized is protecting its’ brand. I don’t blame them. I would.

Sal - 12/30/11 - 11:13am

The other nasty part of Amazon’s plot is that your community doesn’t get the sales tax money that helps build local bike paths, bike lanes, bike parking, recreation centers, safe routes to school and other projects that cyclists use. Whatever you may think about Specialized or any other manufacturer, when you deprive your community of tax dollars, you are only hurting yourself and other cyclists. And buying local creates jobs and allows the mechanics and shop rats to make a living. The projects and jobs you save may be your own.

Michael - 12/30/11 - 11:15am

There is certainly nothing wrong with trying to save money by buying online. However there is a special place in hell for those that go into bike shops, try on stuff and ask questions then buy online. If you seek advice from bike shops, you should purchase from them.

Josh - 12/30/11 - 11:15am

Well would you rather they support local bike shops or join internet retailers themselves? There are hundreds of bike manufacturers you can choose from; I see no oligopoly. And anyway, Sinyard isn’t complaining – he’s making his dealers aware of something that is negatively impacting their business. He is doing them, and us, a service.

Scooby - 12/30/11 - 11:37am

@Sevo I must respectfully disagree whole heartedly; a leader I think not, an innovator? Yes! From his start in mountain biking he took someone else’s mountain bike bike idea and mass manufactured it. The Horst Link is also someone else’s idea…….. get my direction??? He does well at improving things. Specialized has made many improvements to the cycling experience but he is far from a leader unless you consider being one of “the big three” a leader. If you’ll look closely…. I think most of his bikes are manufactured by Giant Bicycle Manufacturing.

It’s America and consumers are free to shop wherever they wish. It’s up to us in the retail business to come up with a solution and not complain about how they are undercutting us. Let’s quit complianing and develop a business plan folks!

I must make one point! It’s pretty low-class (I wanna use alot of four letter words here) to go into a shop and use them as your fitting room for stuff you know you don’t plan on buying there. That’s the perk you recieve for a brick & mortar shop.

Andrew - 12/30/11 - 11:51am

I see this as Sinyard trying to protect his way of doing business. They develop alot of concept based products and the concepts themselves which are fruitless without the backing of a human, preferably in a shop. Specialized is in a position in the market where they can make such “moral” claims. Its a shame that a large company like Bell Giro Easton are not. Sinyard is not the only one at the wheel with all of this, alot of people and companies have a stake in Specialized (ie: Merida).
Having worked for small and large bike shops, I can say that we are always trying to sell more than a piece of foam to strap on your head, or some new kicks to clip in with. We are selling our stores passion, community, and economic (buy local) beliefs (yes even the big ones). Although I am not always drinking the Specialized kool-aide that comes with every new idea, I respect that Sinyard and Specialized have the balls to bring up a topic that should be a concern to the entire industry.
I admit, Specialized is trying to have its foot in all parts of the cycling experience. But is it their fault they do some of those parts better than alot of other companies? I mean who knew those dorky looking seats back in the day would work for alot of the market. (I still prefer traditional) I think critics who feel like Specialized is limiting their selection are shopping at the wrong kind of shops. There has never been a time where a Specialized rep has discouraged me from selling similar products right next to theirs. Sometimes they loose, sometimes they win. Its called consumerism. Buy what works for you and if your shop cant provide by in stock items or ordered, then go somewhere else.
Change the type of store you shop at, or help change your current store to work for you better. Local Bike Shops love to sell you whatever you want.

craigsj - 12/30/11 - 11:56am

The Amazon effort is not unique nor does it enable customer behavior that doesn’t exist already. It just makes it easier. The issue exists independent of Amazon.

Any local retailer who doesn’t understand that instant global communications, payment and worldwide overnight shipping are competition will go under. The key with any business is adding value; whining about what Amazon is doing isn’t adding value.

Andrew - 12/30/11 - 12:13pm

@craigsj – well put… Agreed…. Amazon is just doing what Amazon was designed to do, collect markets. As for the bike industry, it needs to work together on all levels. Adding value is key! But, when a brand you sell in your store is decreasing the value of the product on your shelf by allowing it to be sold under what you pay for it online? That brand should be scolded by the LBS and those who support what we do. Its our way of adding to the *values* we sell.

Kovas - 12/30/11 - 12:41pm

I agree with craigsj, added value is key. Value that’s beyond the physical product purchased. If you don’t add that value, good luck surviving in today’s click-click-buy-now world…

Lots of brick and mortar are adapting, and succeeding: Buy a DSLR at a camera shop, get a free clinic. Buy a bike at a shop, and get a free 30 day tune-up. Good luck getting that kind of added value with an on-line purchase. Shops have to be able to offer product And service. Sure it’s more difficult with lower-cost items (like the helmet in the vid), but not impossible.

Specialized-is-right. - 12/30/11 - 12:46pm

I agree with Adam. When you go to your local cycling stores and pay MSRP, you’re supporting so that shop exists at that location. Most shops make little money, and they need that profit margin from MSRP to stay afloat. I just went by a shop near-by, and it’s in chapter 11. Unless you’reTyler/Marc&Co., most of us need these shops for repair services.

Alex - 12/30/11 - 1:06pm

I don’t get the uproar about this app. Price checking apps are not new, they’ve existed for a decade. I buy a lot of things at my LBS. I also buy from Amazon, PBK, Treefort, and Wiggle too. Amazon is giving the consumer access to information, and there is nothing wrong with that at all!

Adam - 12/30/11 - 1:07pm

A knowledgeable bike shop staff adds a huge amount of value to a purchase because it helps a customer to buy the right thing on the first try. Some shoppers take a very shortsighted view of their purchasing decisions and see internet sales as a great way to save some money; in some cases, lots of money. The irony of the ‘bike shop abuser, internet purchaser’ practice is that if it continues, bike shops will disappear and cyclists who once thought they would save wads of money by testing in the store and buying online will have to buy two or three times in order to get the bike, clothing or repair part that actually works for them. All those savings? Gone. The long view reveals that a good bike shop employee will save you money because with their research and advice, the consumer minimizes the risk of buying the wrong thing and wasting money.
And lets not forget the saying, “membership has its privileges”. A customer that makes friends with and shows loyalty to a bike shop gets special attention and sometimes even a price break. On the other hand, renegade shoppers do not get these perks and bike shops quickly learn that such individuals are not worth their time and attention. Good business is a two-way street between retailer and consumer. Make it worth a retailer’s time to help you and a retailer will make it worth your money to support them.

Adam - 12/30/11 - 1:15pm

@Alex – careful with your terminology here. Don’t make the mistake of confusing Data with Information. The internet provides data. Data needs to be filtered and interpreted in order to get information. One of the best places to become informed enough to purchase the right product is at your local bike shop.

Chris - 12/30/11 - 1:25pm

This is just Specialized spinning stories to try and convince their shops to stop carrying a variety of products that compete with theirs. I guess this method is better than threatening price markups and withholding discounts for those who continue to carry a competitors product. Still makes him and the company look like an ass.

This, and any other barcode scanning app aren’t new, they’ve existed for years, since the rise of the modern smartphone. This isn’t Amazon targeting the cycling community like he tries to spin. It’s Amazon doing what they do best, offer products at often significantly cheaper prices, and they want to prove it to you.

It boggles my mind that so many big cycling names like Specialized think they can fight the rise of e-commerce and sell only through local stores and not lose ground to its accessory competitors. Only certain product markets really reinforce that model, and cycling isn’t one of them.

Whatever - 12/30/11 - 1:30pm

I used to hate Specialized too, them I met Mike. Class act. They win by playing fairly and in this letter he is telling HIS dealers HE isn’t going to screw them if they pick up more stuff from the big S. It’s the others are doing the screwing.

halfwheeled - 12/30/11 - 1:33pm

I have no sympathy for Specialized since they seem to be completely fine with asking $8000+ for a bike. That is price gouging loyal customers like myself.

Fine, if they want to play that game, then I’m going to vote with my wallet and price check the heck out of anything with the big S name on it. Sorry Specialized, internet has a way of keeping manufactures in check, and as a consumer, I’m going to exercise that right.

Yan - 12/30/11 - 1:35pm

I personnaly own a bikeshop in Montréal and we do sell specialized bicycles and components and I can tell you that they are the best to take care of their customer. They are one of the biggest brand on the market right now and they do all they can to protect their dealers so they can do a good business and stay wealthy. They also provide us with the best informations and the best knowledge of their own products but also on the bike industry in general. We do also sell on ebay old stuff during the winter but we never sell something new at discounted price, the thing is that we are in business to stay in business and when we don’t make money on what we sell, we have no reason to do what we do. I personnaly think that customers should pay a good price, not too expensive but just the price of the market. What we see sometimes on those website, is price below our cost and how they do that, it’s by selling stuff that comes from the grey market, stuff that should have been installed oem on next year’s bike. Like Mickael said, when you go into a bike shop and try a pair of shoes that you will after buy on internet, you’re stealing time from the bike shop!!! If the bike shop guy spend 15 minutes with you, it’s like stealing a 15$ light to put on your helmet!!! Thank you for your understanding. :)

Wah Wah - 12/30/11 - 1:39pm

I bet everyone complaining about this practice will gladly buy shoes, clothes, appliances and electronics online after going to the local department store or mom and pop TV store. Get over yourself. In the end, all that matters in the amount of money in my checking account. If I can get something cheaper elsewhere, I am going to do it.

Huffman - 12/30/11 - 1:49pm

I “shop” Amazon, Performance, Nashbar, etc. to see what’s out there then head to the LBS to see if they can order it or a similar product for me. Most times if you are a regular LBS customer you get as good a deal as anywhere else. I’m also willing to pay a little more to keep as much of my money in my community as possible and this is one way to do it. I’m friends with the owners & workers in my local shops and want them to succeed.

If we don’t, local bike shops will be like camera stores – far and few between.

work - 12/30/11 - 2:03pm

@craigsj has it quite right.

The consumer chooses what to buy and where to buy it and does so based on VALUE, price, range, service availability and a host of other factors including convenience, staff attitude (or lack of) etc etc. – Just like we all do.

Blaming the competition is the same as saying the competition did a better job at understanding the above.

Good shops will thrive – those taking a margin without adding enough value will rightly struggle.

Same goes for brands – Mike S take note.

Specialized-is-right. - 12/30/11 - 2:30pm

Haha….so true, Adam.
The shops that I frequent usually give me discounts or free service on certain repairs. At the end, I’m actually saving more money. As for Wiggle, or Chain Reaction, remember when you buy from them you are supporting jobs there, and not here in the US.

Jason Wong - 12/30/11 - 2:33pm

Is it possible that the markups for items in the bicycling arena are to high? I’ve seen tights sold as “biking tights” without chamois have a price of 75 dollars. Than turned around, gone to the running area and seen similar tights sell for 35 dollars. “Technical riding jackets are made in varying quality so that companies can sell similar products with stepwise rising prices”. The materials may be nicer, but probably don’t warrant a difference of 100 dollars or more, and the often cited “research” on the cut and materials can’t cost that much.

Does Mike Sinyard feel like we shouldn’t shop around? This is akin to the music industry hating on digital music sales. Music sales are actually at an alltime high, only the producers of music were unable to innovate to control the digital market thus retailers like amazon and apple took a piece of their pie.

Like anything in business either adapt innovate or perish.

anon - 12/30/11 - 2:41pm

Jesus Christ specalized and LBS , welcome to android version 1.5 circa 2009… emmm this app (although it wasn’t amazon’s name) has been available since that time (actually even built in some builds on googles devices).. Now that amazon has one dedicated to just their site it’s all the sudden a problem? Google’s built in scanner has again been able to do this since 2009 and it doesn’t just search amazon for the best price either.

Bogey - 12/30/11 - 3:12pm

IMO, this was a very ignorant and hypocritical thing to do. If they feel so strongly about it why does Specialized do this very thing on their own website (example: http://www.specialized.com/us/en/bc/SBCEqProductList.jsp?sid=2011EquipTires26_Specials&pscid=1008&scid=1132)?? They’re constantly clearing out stuff that my LBS carries. I’ve never ordered anything from the Specialized site but it would make more sense for them to offere these deals to their LBS’s and pass some savings along to the customers.

Anyways, I buy quite a bit of my stuff online but the few LBS’s that I frequent can usually give me a fair deal on the items that I’m looking for especially when it comes to soft goods. There is great value in being able to try helmets and clothing as well as being able to touch the parts that your’e buying. I wouldn’t dare go into any shop, try something on then order it online.

Jon - 12/30/11 - 3:35pm

Dear Mike.

Boo Hoo.

b*tcH - 12/30/11 - 3:45pm

Cant please everyone, Support your LBS. I know the bike shop has the tools for installs and repairs!

Michael-Vittoria Shoes - 12/30/11 - 4:20pm

While we are not affected by this issue, we could have been. We were approached by 4 different people from Amazon.com while at Interbike this year. They were asking to have us become an Amazon Retailer, similar to the other brands mentioned. Fortunately, I am not a fan of this method and the family that owns Vittoria would never allow it, so it was a non-issue. But I could see how many companies look to this as a way to turn more sku’s and of course run out the last year model items.

One major problem is the lack of regulation for online retail companies. Lack of tax base and fees which could help curb this problem. The problem with a company like Amazon being charged taxes is once that state charges, Amazon will threaten to leave that state to one that is more “friendly” towards business. So this entire thing truly comes down to our elected officials and their desire to get re-elected! So once we can control that issue, many of the other problems can follow and come in line with reality.

While we compete directly with Specialized on one item, I do applaud them for making people aware. At the same time, many things we have heard over the last 5 months also has been that dealers are not allowed to buy what they want for fear of lost discounts, loss of exclusivity or even loss of dealership for specific products. Which of course is what the lawsuit was with Bell/Easton and Specialized. So while making people aware, the heavy hand of large companies is nothing but the thumb holding down the IBD. To truly make thing even, it would be wonderful to see even play fair and agree to open their dealers up to everyone and everything they want.

Dave - 12/30/11 - 4:52pm

I like that most of the “Anti Specialized” people have ignored that you can typically haggle pricing at your LBS. The point of the letter is to let SHOP OWNERS know that this app is out (believe it or not, not everyone has a smart phone or internet), so they can do their best to help customers and retain the in store purchases which ultimately keep their business afloat.

Shopping around is fine, but when you look in the shop and buy solely online you are wasting the shops time, and essentially stealing from them. Doing so consistently will eventually mean they stop helping you as thoroughly, which can mean less informed purchases, and with enough people doing this constantly could mean closing of local shops, which in turn means you won’t be able to try before you buy or have your bike fixed.

I can definitely see this affecting the smaller, mom-and-pop style shops, especially in the smaller towns. I am sure most of you think “Who cares”, right? Well those shops going under means less competition for the bigger shops, which in turn means less competitive pricing all around, which means even your online store pricing goes up over time, because there will no longer be actual stores for the online shops to try to beat the pricing.

Also keep in mind when you install the parts wrong or break them on a ride and need to get the bike fixed, online stores won’t be able to do that for you.

And to the person whining about the $8,000+ dollar bike, LOTS of companies clear that cost. Specialized happens to make NUMEROUS bikes well under that price point. Stop acting like it is the only thing they offer. Do you complain to your friends about Ford having trucks for more than 25 grand? How about Mercedes for making a sedan that is over 40 grand? I mean they must be ridiculous considering you can buy a truck for under 20, and a sedan for under 15 grand that is well built, right? Everyone has different wants and needs, and Specialized does a damn good job accommodating people of nearly any financial situation. Just because you don’t need/want it doesn’t mean the world shouldn’t have it available. The high end stuff that comes out and is super spendy at first nearly always comes down in price over time. Look at DA Di2, quite expensive when released, and they had to custom build servo motors for it. Since then, Shimano managed to use generic servo motors and bring the price down, hence Ultegra Di2. Sure it weighs a little more, but the pricing is coming down. So those $8,000 dollar bikes of today will be the $3,000 dollar bikes of the future.

Matt - 12/30/11 - 5:18pm

Customer service, that’s what is lost. Its a slippery slope and unfortunately leads to customers being cheated of the “cycling experience”. If customers want to be free to to see a saddle in a store, price check and buy it online, throw it on your bike and go for a ride great. But along that entire process the customer is cheating themselves to so many of the things that make the cycling community so great. Interacting with other cyclists, sharing experiences, expert knowledge, and more importantly having a place to come back to are what set shops apart from other retail experiences. There are a large number of people out there armed with basic fit and repair knowledge which can be very dangerous. Cycling is a serious sport where the wrong equipment and bike set up could get someone killed. Why so serious? Ok look at it this way someone buying the wrong seat from SUPERGO.COM riding it and hating it could be what keeps them from ever riding their bike. Often time people don’t know what the difference between a $30 Bell Spring saddle and a BG Riva and why one may be better for that 12 mile commute to work.

Of course not everyone is a novice. I have found though that most forum dwelling experts (myself included) can benefit from getting out from behind their monikers and mingling with other local cyclists. Either at a shop or a ride or both!

Of course there is the issue of price and well unfortunately there isn’t much that can be done with that. I guess smart retailing would help clear out older models before they become a problem but cases like Shimano…

Online purchasing is bad but everyone does it. They key is to know when it’s appropriate. There is good that comes from this. Bike shops will be forced to evolve, offer services that online retailing can’t, and find ways to further enhance and bring the cycling experience to others.

wv cycling - 12/30/11 - 5:30pm

I’m still placing bets on which Big Bike Company (Trek/Cannondale/Specialized/Giant) is going to do DIRECT TO HOUSE sales of bikes from company site first.

Which one do you think? Who’s going to sabotage the middle man first?

Chris - 12/30/11 - 5:45pm

@Sal

You nailed it! It strikes me as completely hypocritical when people rant about Wal-Mart destroying local communities but these same people then turn around and shop at Amazon. At least when people shop at Wal-Mart tax money is being collected and used to fund services such as libraries, police and fire protection, parks, schools, etc. When you shop at Amazon the local community gets nothing.

As for the LBS situation, I have very mixed feelings. I spent years working at a LBS but I’ve also worked for very large retailers (we’re talking annual sales measured in the billions). On the one hand, local businesses can directly cater to the unique needs of their communities and offer products available for immediate use without having to wait for UPS to arrive. On the other hand so many shops seem to be run by people who may have a strong passion for cycling but don’t seem to know the first thing about how to run a business or how to manage a retail store. The shops often look like little more than an overgrown garage sale and the owners too often seem to have little understanding of basic inventory and merchandising concepts. For example, clothing is an area where you often want to try a product on before handing over your money – exactly the sort of service only a brick and mortar store can provide. Despite this too many shops still seem to have dismal clothing selections.

tommy - 12/30/11 - 5:56pm

@ dave, its pretty naive to think that you can haggle down an $8k bike, to what? 7k?. There are plenty of examples LBS advertising their supposed “clearance” prices still hovering at $6k, which is still insulting. Seriously, add up the cost of each component, even at retail price, and you wont even come close to $8k, thus = pure markup profit at the expense of the consumer.

Look at the rate at which bikes prices has inflated compared to the rate of income for your average middle income professional and you will see that Specialized is participating in anti-consumer behavior and the LBS is blindly accepting it as just doing business. Nice try.

And its BS that Specialized warranty is worth the extra $$. Look at the epic shock maintenance schedule, something like required service every 20 hours, which if you don’t prove that you took it to the LBS and have it serviced, SBC may VOID your warranty should you have issues. You can blow 20hours in one bike riding vacation.

I agree with halfwheel, the great thing about the internet is that it puts the knowledge base in the hands of the consumer is a good thing. There is definitely a HUGE markup going on here that the internet has allowed consumers to access and make that judgment for themselves if the price is fair market rate. Wah wah is right, too. I’m betting everyone commenting here purchase online, purchasing bike goods online is fair game, too.

So Dave, there are two sides to each story, please don’t drink the cool aid and do some critical thinking. Everyone has a right to purchase from who ever they want, online or not. Its not about right or wrong, but more choice and educating the consumer, ie fair market.

As for LBS, I love you guys but please get you head out of the 19th century and learn to compete in an internet world. Its here and if you think your service is reason enough to charge 20-50% markup, then, hey good luck with that. You are a dying breed, as many examples of other brick and mortar companies who ignore online competition.

Russ - 12/30/11 - 6:37pm

That industry and those brands already exist… Motobecane for example. None of them will do that because it would take a complete restructure of the company in order to be set up properly for that kind of direct sale.

Additionally, I do not think they need too. These top brands you mentioned have been doing extremely well, and I would doubt they would water down their names by skipping the dealers. After all these products are only any good if they are built and maintained correctly, and the right product is sold for the purpose in mind.

Just to humor you though… Since Cannondale was acquired relatively recently by Pacific Bicycle Group Inc. They would be the first if any, but I think you would see them first in dept stores and quality hacked, before online distribution.

Russ - 12/30/11 - 6:43pm

Additionally everyone who thinks Mike is bashing Amazon is wrong, he is upset with brands that undercut shops and is telling everyone that he (Specialized) does not.

Amazon just facilitates it, but the real problem are the brands that form and rely on LBS to support them and then once large enough cheat the LBS by selling customer direct and competing with the dealers for sales.

Most industries that have products that require educated professionals have price floors. The sick thing in the cycling industry is that a brands require LBS to follow a MAP pricing schedule and dealer must charge certain prices to remain authorized dealers, then in the same breath of air sell direct for less and cheat the dealers out of the sales. Effectively the shop talks the product up, educated everyone and then the manufacture is sniping the sales by offering their products at a lower, but even more profitable price then what they sell to dealers. SICK SICK SICK Good on ya Mike!

Just my 2 cents.

J ruff - 12/30/11 - 6:52pm

You all keep talking about online retailers and bike shops.. this is more about the brand manufactures selling directly through amazon. You think it’s bad now with internet retailers undercutting the lbs… wait until Amazon and manufactures undercut the online retailers.

Online retailers get their stock through distributors and in some cases directly form the brand manufactures (same and the LBS) and so there is still markup, just not as much since they can get lower prices for buying in higher volume. Now if Easton, Shimano, Sidi, etc. can clear out all their old stock in one fell swoop through amazon while keeping most of the profit… why bother with anyone else.

wigs - 12/30/11 - 9:46pm

the most pathetic group of cyclists are the “club/group” riders. they are overwhelmingly left-leaning, politically, and complain about sales tax.

moral of the story: most cyclists are hypocrits. focus on the customers who appreciate your existence.

fluff - 12/30/11 - 9:52pm

Thule might be the absolute worst at allowing firestorm sales.

Matt - 12/30/11 - 9:56pm

One word for you all. GLOBALISATION. Although I agree it’s unfortunate to see LBS disappear it’s a sign of the times. Like it or not it’s here to stay. Take for example a Pinarello Dogma Frame here in Australia. US retail price is around $5000. Australian retail price is around $8000. Now take into consideration that the AUS dollar and the US dollar are generally of equal value (and often the AUS dollar is higher). Would you be happy to spend an extra $3000 for exactly the same thing?? That’s just an example but the same applies to all other brands here. I know economies of scale need to be taken into consideration but still……. I would never buy a bike/frame online but you get my point. No such thing as a national market anymore, it’s a global market.

Someone - 12/30/11 - 10:11pm

To anyone that thinks this is “out of line” on Specialized’s part, Shimano pulled a nice one where basically “sought to clear up their gray market” by increasing wholesale cost of goods while maintaining retail price. Also, markup on cycling parts is pretty reasonable. Clothing is much, much higher (anywhere, not just bike shops, not just sports industry).

I do agree that added value is key. It is harder than people outside the industry think. Most customers have no idea when their bike isn’t working properly, or when there’s a compatibility issue, or when they are doing an install themselves that they have no idea how to. The same guy that complains about a crankset costing 200 dollars, or suspension overhaul running a hundred bucks doesn’t have the same problem versus auto parts (where markup can be more around 200 percent, versus the 50 to 70 percent that is standard in the cycling industry), since he would never even dream of trying to fix his car.

Topmounter - 12/30/11 - 10:58pm

Fortunately I live in an area with several excellent LBS’s that do a good job with their inventory and pricing. If they have what I need in stock, then I always buy from them rather than on-line. However, the area where almost all of them struggle is when I need something specific that they don’t have in stock… they can’t seem to break out of their standard “orders go in on Friday, we get it by the next Friday” routine…. which is fine if that’s how they want to run their business, but I’m not sitting on my duff for almost two weeks when I can have the part in a day or two and be back on the bike.

And as far as Specialized goes, as an LBS, if you buy in and sell out to Specialized hook, line and sinker, then I’m sure they’re great, but back in my bike shop days, I was on the other side of their soul-selling formula (twice even) and I’ll never buy another Specialized product, nor will I recommend them to anyone. I like my LBS’s to also be IBD’s and not soup-to-nuts “company stores” that push one brand, even if that brand doesn’t suit the customer for whatever reason.

MissedThePoint - 12/31/11 - 12:18am

Talk about drama, and free publicity for Amazon’s price match app. Good to let dealers be more aware of the issue, but this isn’t only the bike industry, but the retail brick and mortar store industry altogether, especially specialty stores.

Besides solving the sales tax issue, these stores need to build relationships beyond the sale, rather than simply being a merchandise outlet. Service benefits add extra value and can “buy loyalty”. I buy from REI, Backcountry, and other dealers that back up the products they care with a guarantee. Enrich customers’ lives locally, but supporting the local community and hosting fun events, within your specialty. Don’t underestimate the power of community, learn to leverage it and nurture it. Try create a club thing, which allows you to keep customer profiles that allow you to better service customers and provide a personal touch, and also allow you to reward them by offering exclusive rewards like some sort of club kit for loyalty and continued patronage (socks, bandana, visor, jersey, stickers, etc.). Could be as simple as doing group rides, maintenance clinics, skill clinics, tours, beginner meetups, etc.

sambo - 12/31/11 - 12:25am

specialized wrongly assumes that price is the only factor.

sambo - 12/31/11 - 12:29am

the average LBS needs to suck it up and offer something for sale rather than specialized or bontrager… so many LBS are simply concept stores for trek and specialized, sucks. i want variety and i want a range of sizes. if amazon has it, has free shipping and offers an easy return then i will buy from them. if the LBS offers better service, good selection and decent variety then i will buy from them. most LBS are weak when it comes to actually having parts in stock then they gripe about people buying online, amazing. stock the stuff i want and i will buy it from you. thanks.

MissedThePoint - 12/31/11 - 12:29am

I think Specialized is working towards to franchise dealio, thinking that IBD can pop up to cover certain radius of customers, offering the same price on their stuff, like McDonalds. They can analyze others like Carl’s Jr and offer competitive prices, but that’s not the bike industry. Bike stuff is expensive, while fast food is not, so people will look to spend the least and learn to live without extra luxuries, as it’s already enough of a luxury to own such bike related stuff.

I figure it would be best to get them to use it more to make them feel it’s worth it. Invite them to do club stuff and use the local store as a “base camp” to prepare. Offer community discounts. The store should be the hub for the community of enthusiasts.

Mike - 12/31/11 - 12:37am

Its quite hypocritical of Mike Sinyard when he farms out the majority of his bike manufacturing to overseas builders. I create jobs in the USA and get better deals on line in the process. Sinyard wants to get top dollar and create jobs overseas. Its no wonder our local bike builders cant make it. Boo Hoo Mike.

slug - 12/31/11 - 1:01am

local bike builders charge too much for their garbage frames anyways MIKE

matt - 12/31/11 - 1:43am

@Mike.

Yeah Mike is really doing nothing for American jobs. Too bad Specialized USA has grown by 10% this year and is hiring in this down economic time.

http://abclocal.go.com/kgo/story?section=news/business&id=8450362

Will - 12/31/11 - 2:03am

Canyon bikes (Germany) sell consumer direct. They sponsor a TDF team and seem to do just fine with their new bike purchasing model.

I personally don’t mind buying directly from the manufacturer (ROLF wheels, New Balance shoes, to name a couple). If it were my choice to put the money in the hands of the individuals that actually made the equipment vs. some middle man (online or LBS), I would choose the people that made it.

I bought a snowboard last spring from the guys at NEVER SUMMER that actually made the board in Denver. . . now, if I could only find guys that make a nice carbon frame nearby. . .

James - 12/31/11 - 3:23am

I dont usually get involved with these discussions because lets face it why try to preach to creationists and so on, but i will say a couple of things, first off specialized as a brand are doing alot to help support the local bike stores with products that are unavailable online that perform better than the competitors product in many cases (and this does not mean cheaper with a better groupset that isnt performance) . Also online shopping is a fact of modern life and there is nothing anyone in the bike industry can do to stop it and all Mike is trying to do is alert stores to this so they have the choice to stock or not stock these brands at their own discretion.

Jason - 12/31/11 - 9:59am

Specialized is merely trying to justify the shackles that it places around it’s dealers. As a former shop manager who fully supported Specialized products in my shop, I was stunned when they decided that our $500,000/year that we spent wasn’t enough and they opened a Specialized concept store 1 mile away in a town of 20,000. This happened without warning and without discussion.

We were a shop that supported choice and had a large selection and our success was based on that. Specialized was large part of the mix and brought in quite a few new customers, but it was at a huge sacrifice for the cash flow of our business. We were constantly pushed to carry more products and floor a larger percentage of their bikes. At the same time they were opening many other specialized dealers in our surrounding towns and we were unable to get any margin out of the bikes since every shop was fighting for the sales.

The decision to drop Specialized from our shop was easy at the point that they opened the local concept store. We were effectively pushed out of the Specialized market by the company itself, who became our competitor for the same product (through a local shop owner). I don’t see how this is supporting the dealer, the consumer, or the cycling industry in general.

After going through this experience and now seeing Specialized writing to dealers about their competition, I realize that they only care about themselves and selling more products. They don’t care about their dealers, their consumers, or their business partners.
They are making a story that competitive pricing and consumer options are bad for LBS’s.

I disagree. Specialized is bad for LBS’s.

fg4 - 12/31/11 - 10:24am

I think a lot of you are missing the point (on both sides of the argument).
The issue here is manufacturers that DO NOT hold their online dealers to MAP (minimum advertised pricing)
While it is illegal to ‘fix pricing’ in the US it is completely legal to ask a dealer (online or brick and mortar) to advertise the price of a product at a certain level. Dealers who fall below these MAP standards should BE CUT OFF BY THE MANUFACTURER.
Selling direct should not threaten the LBS (unless you are inadequate as an LBS); if MAP price is maintained. If I have the choice to buy a product for $99 on Amazon, or the same product for $99 at my LBS (where I don’t have to wait on shipping, can get advise, or possibly a free install…ect) Where am I going to buy it? I would contend that manufacturers that sell online, but maintain suggested MAP are not hurting your LBS. They are offering customers in areas that may not have an LBS that carries their products a way to get them (manufacturers would be stupid not to) They are als putting out information on their products that consumers can use to go to the LBS and request that they order the products for them (this happens all the time)
If you own a shop and you think that people should by from you simply because you ‘love bikes’ and have taken the time and money to put a shop in their town you are sorely mistaken. You must offer your customer a REASON to buy from you; i.e added value in the form of customer service and willingness to do a little extra. I visit tons of shops. There are VERY FEW that have quality customer service. The PEOPLE that work in your shop are the reason that people come back to your shop (or never come back to your shop). The ‘brands’ you are selling matter very little (as long as you have what it takes to fulfill your customers needs)
Shop owners must take a stand; REFUSE to sell products from manufacturers that allow price chopping on the internet. Tell their sales reps that you will support their products when they support your shop. Without the LBS these manufacturers CAN NOT MAKE IT! I am so sick of hearing LBS’s complain about the internet. Guess what guys? ITS NOT GOING ANYWHERE! Embrace it, fight it, use it, ignore it, but please stop bitching about it. As a retailer you have leverage (even if Specialized tries to convince you otherwise) USE YOUR LEVERAGE. Stop acting like you are powerless in the shadow of the all mighty internet. Wake up. The manufacturers can’t do it without you. Remind them of that.

fg4 - 12/31/11 - 10:29am

I think a lot of you are missing the point (on both sides of the argument).
The issue here is manufacturers that DO NOT hold their online dealers to MAP (minimum advertised pricing)
While it is illegal to ‘fix pricing’ in the US it is completely legal to ask a dealer (online or brick and mortar) to advertise the price of a product at a certain level. Dealers who fall below these MAP standards should BE CUT OFF BY THE MANUFACTURER.
Selling direct should not threaten the LBS (unless you are inadequate as an LBS); if MAP price is maintained. If I have the choice to buy a product for $99 on Amazon, or the same product for $99 at my LBS (where I don’t have to wait on shipping, can get advise, or possibly a free install…ect) Where am I going to buy it? I would contend that manufacturers that sell online, but maintain suggested MAP are not hurting your LBS. They are offering customers in areas that may not have an LBS that carries their products a way to get them (manufacturers would be stupid not to) They are als putting out information on their products that consumers can use to go to the LBS and request that they order the products for them (this happens all the time)
If you own a shop and you think that people should by from you simply because you ‘love bikes’ and have taken the time and money to put a shop in their town you are sorely mistaken. You must offer your customer a REASON to buy from you; i.e added value in the form of customer service and willingness to do a little extra. I visit tons of shops. There are VERY FEW that have quality customer service. The PEOPLE that work in your shop are the reason that people come back to your shop (or never come back to your shop). The ‘brands’ you are selling matter very little (as long as you have what it takes to fulfill your customers needs)
Shop owners must take a stand; REFUSE to sell products from manufacturers that allow price chopping on the internet. Tell their sales reps that you will support their products when they support your shop. Without the LBS these manufacturers CAN NOT MAKE IT! I am so sick of hearing LBS’s complain about the internet. Guess what guys? ITS NOT GOING ANYWHERE! Embrace it, fight it, use it, ignore it, but please stop whining about it. As a retailer you have leverage (even if Specialized tries to convince you otherwise) USE YOUR LEVERAGE. Stop acting like you are powerless in the shadow of the all mighty internet. Wake up. The manufacturers can’t do it without you. Remind them of that.

Yerma - 12/31/11 - 11:52am

Interesting conversation. MS’s letter is appropriate to give shops a heads up on secondary manufactures the shop may carry. On local vs internet: after 30 years of riding, racing and wrenching, I now typically buy accessories from the local shops but that’s about it. Most of the shops in my area won’t give much discount (5-10%) and have an exclusive to the bike line in the region. I also try not to waste the shops time by researching a product there simply to buy it online but will admit to looking at jacket, or wheel-set and not buying from them. But there is more to it than that. Many shops suffer from racer arrogance and employee ignorance, regardless of their “passion” for cycling and of course price is usually an issue. Shops that are willing to work with you on the price of a high end bike are getting fewer. I agree that large companies like Spesh and Trek provide wonderful products but if the argument is buy from brick and mortar shops to support local community/revenue/ etc. shouldn’t we also then be buying from small frame builders like Parlee, Moots and others?
IMO when the bigger frame manufacturers decided to only to honor warranties for the original owner of the frame-set to “protect dealers” they lost my loyalty. Why purchase a new $3-4K bike that will have no future warranty for a second owner should I decide to sell it a year later? If you make a quality product you should stand behind it. High end audio went through this years ago and the manufactures who were the smartest simply required the second and third owners to register the sn as the new owner. Admittedly most of these companies offered 5-10 year coverage not “limited lifetime”.

Gary - 12/31/11 - 2:55pm

Why would I buy a bike helmet for 70$ at my LBS when I can get the same one online for 40$? That’s just throwing money away.

Mech F.T. Lieu - 12/31/11 - 3:39pm

What a laugh, from the big name Mfr to say something absolutely counter to real market economy. Its just a plot to try to justify the name keeping the price tag artificially inflated instead. This had nothing to do with protecting the independent brick and mortar shop nor protection to the consumer. Its just pure greed from the Mfr side.

Tony - 12/31/11 - 4:00pm

Sinyard is the hypocrite here. When Specialized starts making all their products in the USA, I will shop exclusively at LBS.

briann - 12/31/11 - 4:08pm

Specialized allows their Globe brand bikes to be sold online.
Google it….
Hypocrisy at it finest-

marc - 12/31/11 - 4:26pm

i owned and operated a bike shop for some years and closed just a few months ago. i can’t tell how many times people would use me for information, recommendations, fitting and otherwise general expertise just to order something online… many times bringing that very item back to me to show me “how cool it is” and what a bargain they got it for. i can’t hold consumers at fault for wanting to save money, we all do, but i will hold manufacturers at fault for not enforcing better pricing policies. it starts from the top! when people ask why i closed i say “the economy and the internet”… it’s a war of attrition that many shops can’t win in the long run, and that is a great loss for the entire world of cycling.

Mike - 12/31/11 - 6:55pm

S L U G, ok I wont ask. You are so funny (LOL). Keep buying at your local bike shop, that’s your choice, you probably work there anyway (LOL). You are most likely for carbonizing the world. cheers.

Mike - 12/31/11 - 7:10pm

@ Matt, You must have been forced to go to Mike Sinyard’s brain washing weekend. I used to sell specialized, their company SUCKS. But I did here that they were coming out with their own Soda pop, That’s refreshing.

Topmounter - 01/01/12 - 12:30am

As far as Specialized goes, as an LBS, if you buy in and sell out to Specialized hook, line and sinker, then I’m sure they’re great, but back in my bike shop days, I was on the other side of their soul-selling formula (twice even) and I’ll never buy another Specialized product, nor will I recommend them to anyone. I like my LBS’s to also be IBD’s and not soup-to-nuts “company stores” that push one brand, even if that brand doesn’t suit the customer for whatever reason.

cjeder - 01/01/12 - 10:54am

Somewhere is China is a container full of more 2012 Cat eye computers, Sidi shoes, and Specialized what-evers than can be sold in a year. The real issue is: who bears the risk of excess stuff? Specialized, like other big brands, prefers to get all this stuff under contract with a dealer, recouping their capital costs on the front end and shifting the risk of inventory to the dealer. To do so, they need to promise that this risk will be rewarded with a higher retail price for the item. Otherwise the model fails.

This is a raw deal for independent retailers and customers alike. Bike shops are faced with commitments to maintain high inventories of goods at high wholesale costs. IBD must must either pass these costs on to the customer, or fold under the pressure of their immense inventories. Sadly, both occur all too frequently, with small shops closing their doors and customers paying higher prices.

That internet sellers so frequently shellac IBD on pricing is far less a function of their low overhead, but their ability to circumvent the IBD supply chain. Rather than vilify the internet as unfair competition, the real question is why so few brick and mortar retailers haven’t taken a lesson from their online competition and attempted to leverage new technology to improve the efficiency of their supply chain.

Danno - 01/01/12 - 3:19pm

Though I agree that using an LBS’ services and then buying online is a poor move, I’m not sure what the fuss is about – I haven’t seen Specialized products for sale at lower prices online or mail order since the mid-90′s (Supergo, anyone?) When I walk into the LBS’s now I see one choice for just about every product – Specialized at the Specialized store, and Trek/Bontrager at the Trek store. And one price – MSRP. I’ve got too many hobbies to pay Concept Store prices for my toys, so I’ll continue shopping around for the products I want at the prices I’ll pay. Just as Specialized has shopped around for decades having their products made in overseas markets.

John - 01/01/12 - 3:41pm

I think Specialized has finally run up against something they can’t steem roll over. Sinyard has little by way of a salient point. Stop carrying brand that slash prices, to what effect? Consumers in all markets continue to become better informed about pricing and purchasing options, trying to fight it will only relegate you to antiquity. There is no moral to this story,other then compete or die. If the LBS can’t give consumers what they value most they are bound to fail. There is nothing new in that story.

Some bottom lines:
-Specialized makes a great product in a market crowded with great products. In short they are not that special.
-All markets evolve and the Internet is pushing that evolution at speeds never before imagined.
-the current bike industry model is flawed in many ways including cost, value, ecology and marketing.
-the industry relies on cheep labor from non-home markets, from vendors with huge volume
-the bike industry is not a small market and it is dillusional to pretend like it is

All that said I would hate to see the demise of the LBS, (specialized can go). Bike shops need to focus on things that can’t be sold online, both obvious and not so obvious. Shops need to provide exceptional customer service and support under all reasonable circumstances. If a customer is cross shopping with amazon help them, educate them, keep them in the shop, keep them coming to the shop. Too many shops are filled with too many precious egos, this has to change. Keeping the customer in the shop will help create loyalty, and opportunity. Many things just can’t be bought online and many things just plain can’t be bought, as long as this is the case there will always be room in the market for the LBS.

sambo - 01/01/12 - 9:09pm

i just cant feel sorry for bike local bike shops. if their sales are low and they cant keep customers then they are doing it wrong. not carrying a full line of parts is a self fulfilling prophecy – why would i come to the LBS to order a product that i can get cheaper and faster via the internet. to all the individuals that work in or own bike shops:

1. carry at least one of every part in a groupo. not having a derailleur in stock is beyond annoying.
2. if you dont have what the customer wants, then right away say “i can order that for you, have it in 4 days or less and shipping is free.” then install the part for free.
3. dont just sell specialized, trek and bontrager crap. i want sometime italian from time to time.
4. dont just sell one brand of clothing. we are all shaped different and i just cant tolerate Louis garneau.
5. give your regular customers some breaks from time to time. if i am going to buy a whole box of GUs then cut me a deal.
6. have shop sponsor weekly rides and dont drop people. riders want to be friends with the bike shop. if none of your lazy employees are willing to lead a group ride then offer someone a deal on a bike if they will do a weekly ride for your shop. make absolutely sure that you have at least one group ride a week that beginners and intermediates can do.
7. welcome anyone that comes in the shop even if they bought a part on the internet. people still need it installed and this is your chance to bond with a customer and engender some loyalty.
8. have a bling section in your shop. highlight it. when my family comes in to buy me a gift then know who i am and what bauble in the bling section i want.

this isnt a difficult industry and people are willing to pay huge amounts for bike related materials. if you cant keep your shop open then you have no mind for business, no concept of customer service and your selection sucks.

Adam - 01/02/12 - 12:04am

Does everyone claiming that bike shops need to either keep up with online competition or quit remember the last time they had a problem with their computer and had to phone a call center in Bangalore, India? It began with being on hold for 20 minutes. Then, they went through their scripted checklist one thing at a time and after an hour of reboots and uninstall/reinstalls, the issue still hadn’t really been sorted out? All you wanted was to talk to someone that speaks clearly in your same language and show them or let them hear exactly what weird thing your computer was doing.
The next time you had a problem, you visited the Geek Squad desk at a local Future Shop or Best Buy, You showed someone the problem and symptoms in person and had a satisfying resolution.

The same is true for a cyclist. You can’t figure out what that “tick tick tick” noise is and why your shifting is so unreliable. You want to try to resolve this over the phone? Do you have the right tools and skills?

What Mike Sinyard is lamenting is that manufacturers that compete with their own retailers by selling on line and facilitate the usefulness of the price check app are doing a disservice to the cycling industry and its customers. Every time a shopper abuses the local shop by mining them for info and fitting and then buys cheaper on line, they push that shop one step closer to closing their doors. All the services that a cyclist truly benefits from will be gone. It will make cycling less accessible to the world and fewer people will start cycling in the first place (let’s face it, in today’s instant gratification world, if something is difficult to get into and requires more initial time investment than a few minutes, most people will look for something easier). Fewer cyclists means the on-line market will shrink. Quite simply, the on-line market NEEDS local bike stores to exist and be successful in order to ensure their own continued sales success. The cycling industry needs the service that bike shops can provide.

Let me add a comment for those here that complain about the high price of things in bike shops. Someone complained that $8000 for a bike is a price gouge. Here’s a reality check for you. The shop probably paid $5500 for that bike. That $5500 investment could earn a much higher return if it was put into buying ten entry-level bikes which would sell much more frequently recoup costs much more quickly. That same $5500 could be reinvested multiple times before that single $8000 bike sells one time. For a retailer to afford to provide high-end bikes, they must earn a margin that makes it worth their while. You think the $6000 clearance price at the end of the season is still way to high? That just barely covers the costs. You want to see cool and expensive stuff at a bike shop? It’s going to cost you. Accept it.

As for clothing, if a pair of tights sells for $70 in a bike shop and something similar sells for $40 at a nearby running store, trust me, it’s not the same product. How stupid do you think the manufacturers and distributors are? And do you think the sales rep for that product would allow that to happen? Consistent and competitive pricing keeps everyone in business.
And who’s this clown named Tommy (5:56pm post) that thinks that they could custom build the same $8000 bike for less money by buying all the individual components at retail price? Go for it. Let me know how that works out for you. Tommy is the person that fills the internet with so much useless, free advice and expertise that makes consumers think they can get all the information they need to make a good, wise purchase online. Tommy, you are not the only cyclist out there. You may not need a bike shop for anything because you’re already an expert on everything (from your ignorant comments, this is likely not true) but the vast majority of the cycling world needs service from a bike shop. Bikes are not throw-away consumables like toothpaste and condoms. You don’t need a pharmacy to troubleshoot Colgate or keep your Trojan working at max performance.

Mike - 01/02/12 - 8:24am

AMEN to that Sambo, you hit the nail on the head.

Alex - 01/02/12 - 10:45am

@Sambo I agree 100%

There is this since of entitlement with the bike industry that just makes sick to my stomach. The demonizing of Amazon is laughable by a company that manufactures everything overseas and props up an inefficient and outdated LBS model.

90% of LBS suck. I live in major metro area and there are probably 25 LBS within 15 miles of me and two of them are alright. For most purchases, I get zero value add out of an LBS.

The pricing of bikes has gotten way out of control. I ride an s-works SL3 that I ordered the month it was released. The frame was $2600. The equivalent frameset exactly two years later (s-works SL4) is $3900. The price has doubled while the product only has marginal improvements!

I don’t know what my next bike will be, but I can almost guarantee that it will not be a Specialized.

Steve M - 01/02/12 - 12:07pm

Lot of good points- the LBS’s have become depressingly bad. They have so much inventory devoted to Specialized and Trek, that finding something interesting is a rarity. It is the heavy handed inventory flooring of these companies impose that make finding a Campy derailluer online a necessity. If you are buying Campy parts online you probably already know how to turn three screws to install it.

On the other hand the manufacturers tend to turn a blind eye to their own distributution policies. Buy a part from some retailer online, have a problem and the manufacturer blames you the customer for purchasing it from a non authorized retrailer. Wtf?

J ruff - 01/02/12 - 12:41pm

SAMBO!!!

Well said… I can’t tell you how many times I’ve walked into a bike shop for something they didn’t have in stock, or came in looking for a certain type of item and found only two choices at most… the LBS has effectively pushed me out of their store and I see NO point in going back… Especially with the attitude they all have as soon as I disturb them by asking for some service.

Chase - 01/02/12 - 3:22pm

He’s not going after the app. He’s going after his competitors in the accessories market.

“Pearl Izumi, Shimano, Louis Garneau, Giro, Bell, Fizik, Sidi and CatEye”

Bike shops make their money in service and walk-in sales from people decent enough to support them. Or they go under. This app didn’t change the game. The internet already took care of that.

Echo - 01/02/12 - 3:36pm

1st- There is no reason for all of the hating on Specialized all they are trying to do is point out something that is effecting every local shop. All of the big manufactures have there pros and cons and most of us turn a blind eye to the things we ride or favor. So lets stay focused here.

2nd- As far as your shop have every part in stock are more then 2 or 3 choices for thing, all that stuff costs money. Most shops are not going to have huge budgets to have that many choices. Cloths and some other thing are an exception. As far as repair parts and groupo stuff its the same why have all this stuff sitting around trying up your money that you could be using for other products. And really how often (if you take care of your stuff) do thing like that break. Not often besides those occasional accidents. At the most you wait a week, pay msrp and get the right part the first time. You buy online and get the wrong part your have to wait to return it and get the new one but you could have just gone to your shop the first and for about the same price after all is done.

3nd- Why in the world would you expect the same treatment if you go into your local shop to show off or complain about the cool new part you bought online and how much you saved. You just don’t do that. Then you expect them to care but that’s not going to happen because you going out and buying that online is hurting there business witch could led to them losing there job. Also don’t expect the same treatment with you interweb part you can’t get to work as if you bought it from your shop. Also most of the time if your a regular customer and you don’t shop online and not always looking for a deal they tend to work with you sometimes. Always looking for a deal at a shop will get you nothing but the treatment that those interweb shoppers receive. Treat your shop right and they will treat you the same way.

BJ - 01/02/12 - 4:45pm

Also, some shops do just target families and average riders. Specialized is a great brand to have in those kind of shops looking for hybrid bicycles and cost effective shorts/helmets. At the same time, they manage to make some of the best bikes and gear on the planet. It may not be hand made, it may not be made in italy, it may not be made in the US, but it’s some of the best value out there. Compare some bike models and take 1 second to not look at fucking shifters for a change and find out what the frame is made of, the wheels, the fork, and other important parts that don’t effect the ‘shifting’. I would take a Specialized with 105 over some generic bike with Ultegra any day because the frame will be nicer, lighter, and stronger. Same goes for Giant, Trek, and Cannondale… not everyone is looking for the top of the line bikes. How are Cervelo’s comfort hybrids looking? How about Pinarello’s entry level mountain bikes? There is a huge world of cycling outside of roady dorks. THAT IS WHY YOUR LBS CARRIES A ‘BOX’ BRAND. THEY DON’T CARY YOUR STUPID LITTLE NICHE BRAND BECAUSE IT DOESN’T REALLY SELL THAT WELL AND PROBABLY IS A PILE OF JUNK ANYWAYS. Some of us like bikes because they are fun, not just to show how much money we can spend on something pointless

Mindless - 01/02/12 - 5:33pm

Specialized can screw themselves in the left ear.

They outsource all manufacturing and peddle their wares for stupidly high prices. They should shut their pie up.

shop dude - 01/02/12 - 10:47pm

Very interesting discussion. I work at a Specialized/Trek dealer. First of all, anyone reading this is probably a hardcore cyclist and doesn’t need to go to a bike shop very often. People who say that local shops suck have to understand that bike shops don’t make a ton of money. Yeah I hate shop employees with shitty attitudes. I don’t very much like customers with shitty attitudes either. Attitude is everything in life. Bike shops are struggling, and the only way they will survive is by stocking what sells, which is usually boring $400 bikes. I agree that Specialized and Trek accessories are pretty boring and its nice to see some other brands out there, but the big companies seem to strongarm the shops into buying lots of their product. We all want and need diversity! The quality of specialized and trek’s products are great, but I will say that it bums me out that nothing is made here in the US anymore. This is why our economy sucks. Who can afford a bike when they are collecting unemployment? For $4000, I think a person should be getting a US-made bike. Ultimately what it comes down to is this: The world is controlled by the greedy for the greedy. Greed on the bike industry’s part, and greed on the consumer’s part. We would like to think that the bicycling industry is better than other industries, but we humans are corrupt, greedy creatures who can’t control ourselves. This is why we have shot ourselves in the foot by exporting all of our manufacturing, and we now have $10,000 S-works bikes that are made in Taiwan. Maybe good for Taiwan’s economy, and certainly a great product, but not good for Americans in the long run.

Mike - 01/03/12 - 8:32am

Echo, BJ please. LOL. Your LBS has priced themselves out of the market. They, your LBS, can buy off Ebay just like everyone else. But, they choose to find kids that don’t know a damn thing so they can pay them less money with no benies. What happened to the old school mechanic that took pride in his job and therefor provided great service? I was a mechanic for 27 years and I had to go elsewhere because I was to expensive to keep. No service, no knowledge, online for me.

Evan - 01/03/12 - 2:12pm

I am as capitalist as they come, and I celebrate the increased competition that online selling brings.
HOWEVER
one thing I will not do is go into a store to try something on, and then order it online for cheaper.
having a brick and mortar storefront and the opportunity to try things on brings me real, tangible VALUE. (the advice of the sales staff usually has no value, but thats another topic)
To use this service, but not pay for it in regards to buying the products there is wrong, and it doesnt take an econ degree to see that the brick and mortars will go away and then you will not have the opportunity to try things on.

for stuff I dont have to try on, or get advice on? well, sorry boys but its fair game. most of the succesful online bike shops started out and still are regular brick and mortar stores. dont whine to me for not supporting my LBS by paying over MSRP for parts just because you were too lazy to get your store online.

James - 01/03/12 - 2:17pm

I’ve done the reverse: Shopped online for the best price and then asked the LBS where I’m a regular if he can match or come close. Way I figure, I’ll save, break even on shipping, or come close in price and still get the support and service I desire. If my LBS owner balks at meeting a price, it’s probably for a good reason; I’ve paid more for some items at his place (small goods, like bar tape, inner-tubes, lights, etc; a FSA Gossamer crank, which cost $20 more than the sale price online), but all-in-all, I considered the transactions successful because I got what I needed or wanted immediately.

Sometimes low price is the only differentiator. Other times, not. Per a lot of commenters here, the value shops add is key. Also, it doesn’t hurt to attenuate the attitude — people come to LBS for knowledge, but not to be beaten over the head with it… (e.g., someone comes in with a SRAM-equipped bike, for goodness sake, do NOT launch into a 20-min disquisition on why SRAM “sucks”).

Monkey - 01/03/12 - 5:17pm

http://www.forbes.com/sites/larrydownes/2012/01/02/why-best-buy-is-going-out-of-business-gradually/

Gang, all great opinions. Read the above article, very well written piece I might add, and replace the words BestBuy with Specialized. I think there is something to all of this.
Specialized is threatened by external business and competitions, because they have over reached in their business model out in that small nowhere town they work from. They over promised to so many of the pro cycling teams in the last few years, they are killing themselves to just stay above water by threatening anyone, anything that gets in their way. They are paying millions and millions of dollars to support their brand and these pro teams – they have lost local/regional focus and who is their customer.
Local cycling teams can no longer afford to purchase their products when they make them available. Cycling teams and clubs ride more than most and deserve to get the better deals, however this is lost again, because the S has lost focus on who is out there promoting their product. They are starting to appear like microsoft did years ago, running their biz with a hammer and a giant bulldozer – it’s not consumer friendly and there are about 50 other places that make bikes, not just Amazon.

They force, with a heavy hand, like bestbuy, the consumer and the bikeshop owner to sell their name, their products and their clothing. They force the owner to purchase X number of bikes which in turn sells units for them, however, they are no longer thinking of the business owner and how over reaching this type of model is….I remember when Cdale did this – to our dealers here – guess what the shop stopped selling cdale.

So, lets get back to the article. Think about the items BB didn’t have in stock all of a sudden, during one of the busiest retail buying times of the year – Specialized does this – they do it to force the shops to buy when it’s convenient, they short manufacturing on cranks, frames and parts all to create demand for their product. They could fix this – but they don’t – it’s an attempt to make them look special and allow them to keep pricing high and continue to raise pricing with less quality components for more money.

Just in case you didn’t see this – more S-bulldozer: http://www.bikerumor.com/2012/01/03/specialized-sues-volagi-cycles-claims-disc-brake-liscio-rips-off-roubaix/

OK GO

Mike - 01/03/12 - 8:44pm

Oh look, Mike Sinyard and Specialized are suing someone else. That’s awesome, NOT! I will never buy anything Specialized, NEVER! Mike Sinyard thinks he came up with the bicycle concept and will sue anyone that builds a bike remotely like his. What a freak.

Isaac - 01/04/12 - 12:13am

I feel comfortable selling a Trek or Specialized because they are designed and prototyped here in the US, I have had conversations with the engineers, product managers and even Mike Sinyard. These larger brands offer lifetime warranties on their frames and back their products 100 percent.
Mike’s problem with Amazon is the same problem we at bike shops have: Amazon cuts away at the supplementary products that we can sell to make a decent margin. I sold an $8000 Madone to someone without any hesitation about the price of the bike but couldn’t sell a set of Dura-Ace pedals because they could be bought on amazon for $150 off of MSRP with no price protections.
Most bike shops make very little money, with profits being about %5 of total sales so when you buy that $1000 bike the owner is only really taking away FIFTY DOLLARS afters all the bills and employees are paid.
Highly qualified staff is expensive and new tools come out every year to work on ever expanding technologies, I know of very few people who can properly install electronic shifters on complex triathlon bikes.
So keep buying your stuff on the internet, we at bike shops will just have to keep raising our service prices because the internet will not fix your bike or give you a proper fit

Mike - 01/04/12 - 8:12am

So, tell me how many bike shops give proper fits, or is throwing your leg over the top tube, and yep two fingers, is a proper fit? Come on. As far as tools go, very few new tools are required each year for bikes. Actually, it takes fewer tools to build and maintain a bike then it did in the, lets say, the 80s and 90s. I agree with some of your statements Isaac, but it sounds like you haven’t been in the bike business long.

John - 01/04/12 - 6:14pm

You know, bike prices have been getting way out of line. Specialized is hardcore in trying to protect their turf, and high salaries, as always. All while they mass produce bikes in China or Taiwan for maximum profit. You can’t blame em but you won’t see me on one. I don’t care what hot shot rides one. That hot shot can win on any good bike. I think the more competition in this industry, the better. I look forward to the day when Amazon “occupies” a bigger space at Interbike than Specialized. I’ll bet Amazon will treat it’s potentual customers better as well. Go ahead and sue. Only makes you look like a someone who is scared that your easy profits might take some more elbow grease in the future.

Rich - 01/07/12 - 1:34am

I don’t think someone mentioned this yet, but Sinyard doesn’t give a damn about LBS’s! HE’S JUST PISSED BECAUSE AMAZON HIRED AWAY HIS CONSUMER DIRECT SALES GUY!

Seriously, you can’t make this up! Check this out from BRAIN:
Amazon.com appears to moving more aggressively into sales of bike gear with the hiring of Paul Calandrella as Senior Vendor Manager for Cycling. Calandrella most recently was involved with Specialized’s consumer direct sales efforts.

Calandrella starts at Amazon early next month. Watch BicycleRetailer.com later this week for an interview with Calandrella and more on Amazon’s bike program.

Tom - 07/13/12 - 5:04pm

One thing that hasn’t been mentioned – A lot of these online retailers also have brick & mortar shops. Many are doing online price matching. I don’t understand this at all. We know the big boys like Jenson and Nashbar pay less for product than an LBS. Why would an LBS match their prices? Anything to get a slice of that online pie.

Leanne Lerma - 05/08/13 - 5:15pm

I am so mad….Specialized is so insecure about their product (of which everyone in my family owns or has owned one) that they have demanded the little bicycle shops that sell their product to ONLY sell Specialized….they MUST give up sales of all other brands….it makes me so mad….I am in the market for a new road bike….but it won’t be a Specialized….

Chris - 07/14/13 - 6:25pm

Makes me want to go out and buy a Specialized just to support them. Just not from the guy (to be nice) that posts new specialized bikes on Craigslist in Tucson, AZ under MSRP… oooops did I just say that? Get ‘em

Randall - 08/14/13 - 1:18pm

Leanne,
That sounds like a load of BS. There is no way Specialized would ask dealers for exclusivity because they would be laughed at.

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