Bikenomics – New Zealand

Rolling oxymoron

Last month I splashed out on a new set of Rockshox Pike forks for my Yeti, they cost me a small fortune. They are the best thing since sliced bread (but that’s another story)

You may be upset to hear that I bought them from an English online store, for half the price of what they would have cost me if I had bought them in New Zealand.

It is sad but the trend among mountain bikers is to buy from online stores, because it is cheaper, and why wouldn’t you – it saves you money!

However, I am a rolling oxymoron. I am quite happy to part with the reddies in online stores, but not so happy to buy anything in New Zealand, for fear of paying too much.

You do obviously get those die-hard Local Bike Shop (LBS) spenders, who would rather spend their money propping up the local community (and good on you).

But it’s not really propping up the LBS, it is in fact probably feeding the greed of a select few who are monopolising the bike trade and making a killing. I would suggest these are the importers, distributors or middlemen.

bicycle_money

Bike prices in New Zealand

Mountain bikes are now almost certainly cheaper in New Zealand than anywhere else, and this is partly because of the NZ dollar being strong (although weakening now) and their growing popularity which has driven up demand and meant importers can order more (economies of scale).

Bike part prices

So why are parts so expensive in NZ and are they in fact more expensive than say the US or England?

Generally speaking parts from an LBS would be comparable anywhere you bought them in the world, there may be slight fluctuations.

However, large online stores can reduce costs by operating out of cheaper premises, away from the high street. They can buy more stock because they have larger premises to store it, and because they have a far greater footfall i.e. anyone on the internet can access them, they can sell more. Lastly because their operating costs are less they can reduce their profit margins on each sale, further reducing the cost to the consumer and making their shop more desirable.

So where is New Zealand going wrong ?

We need one of the bigger bike shops to take a risk.

It’s no use Nz shops selling stock online for the same price as you would in the shop on the high street. This is typically what online sellers do in New Zealand. They have a small shop and sell the stock they have in the shop online.

Someone needs to buy bulk and direct and reduce the cost of parts for everyone or get the distributors or middlemen to take a pay cut. Get the ball rolling with a few cheaper parts (e.g. Shimano gear) and then build from there.

It’s clearly a big ask, but until it happens we will be stuck with expensive parts and looking overseas for our gear.

 

One thought on “Bikenomics – New Zealand

  1. I hear you. I try to support my local bike shops here in the Alps when ever I can, but if I’m not in a hurry, its so much cheaper to buy online. I guess the drawback is the expense of returning goods if you order the wrong part.

    Like

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