New Zealand bike prices WTF

[Ocean1]

I'm interested in this. I've been trying to work out why NZ prices for almost everything are so OTT. At one stage I even modeled every variable I could think of, nothing in that analisys showed up any hidden overheads of a size that would explain the price differences.

And yet there's companies that have failed here that were running on almost directly comparable business models to sucessful overseas branches of the same business.

I just don't gedit. The closest I can get to a causal link is the preponderance of monopolies here, they add compounding costs to the supply chain.

I'd love some clever bastard to explain it to me in simple terms.

[Daffyd]

I'd love some clever bastard to explain it to me in simple terms.

How about some simple bastard explaining it to you in clever terms?

[Ocean1]

How about some simple bastard explaining it to you in clever terms?

No shortage of that in the financial pages.

How about a simple bastard explaining it in simple terms.

Without taking his shoes off.

[Daffyd]

I can't improve on that one!

[YellowDog]

There were very similar problems in the UK before you COULD go elsewhere.

Back in the day when the UK manufactured cars, punters were getting fed up with being ripped off in a closed and protected market. Once it became common knowledge that you could buy an English Car (RHD) made in the UK from a Dutch or Belgium car dealer for 20% less than a UK dealer would sell it to you, then the piss-taking market had to change.

The low volume high market NZ culture has been changing of late with the Asian business methods migrating across, however some also seem quite happy to take the high profits too.

Whereas in the UK, you have very cheap and easy access to Europe, forcing the home market to evolve, we don't have this here in that we CANT go elsewhere.

OR CAN WE ?

The sooner the home market realises that it will be losing business and their livelyhood if they don't change (rather than whinging about traitor punters) the better.

Me thinks that - We'd all rather buy from NZ dealers - I would.

Whitcoulls is a great example of such ignotant stupidity. They lost out because they refused to meet the market. Many believe they are losing business to the internet and foreign players. This was their own fault. They had the opportuinity to take this business, but chose not to.

Postie Plus decided to embrace the new market and hence doubled its profits. It wasn't difficult, they just reduced their prices to meet the market. Clearly not run by the dumb arses running some struggling business sectors.

When given the choice of taking less cash or going bust, many choose to go bust.

[sfordnz]

Get out of the country then you moron. Open your eyes.

thanks for calling me a moron.

[ukusa]

When given the choice of taking less cash or going bust, many choose to go bust.

it's all a numbers game, take less profit per item, but sell more items.
I still think the importers/agents are where it's got to start.

I also believe that many shop rents in NZ are far too high. The building owners seem to think some shops are making far too much money, so up go the rents. A mate with a car sales has to sell on average 4 vehicles per week just to cover the rent/lease.

[HenryDorsetCase]

it's all a numbers game, take less profit per item, but sell more items.
I still think the importers/agents are where it's got to start.

I also believe that many shop rents in NZ are far too high. The building owners seem to think some shops are making far too much money, so up go the rents. A mate with a car sales has to sell on average 4 vehicles per week just to cover the rent/lease.

have a look at a lease for a shop in a mall. they are unbelievable: really expensive, and they want to see your books every year so they can ding you an extra % based on turnover. they say well, Westfield is a destination, our location means your business is successful.

thats why malls all look the same, with the same stores in, mainly chainstores.

I hate shopping malls.

[Ocean1]

have a look at a lease for a shop in a mall. they are unbelievable: really expensive, and they want to see your books every year so they can ding you an extra % based on turnover. they say well, Westfield is a destination, our location means your business is successful.

Percentage leases, common enough overseas. The base rates do tend to be fuck all overseas, though, cost of the asset itself , no more.

I hate shopping malls.

Unfortunately that makes just the two if us, the vast majority of suckers like paying vastly inflated prices for their chinese imports.

[SS90]

No shortage of that in the financial pages.

How about a simple bastard explaining it in simple terms.

Without taking his shoes off.

Ok then.

Geographic isolation aside, the major reasons for the NZ bike industry requiring vastly different operation models is simple......... It's already been mentioned, but it is simply market size.

Modern bike shops are, predominately, world wide, based on floor plan business models (for the uninitiated, that means bikes are supplied to dealers payment free for a period....... Of say... 3 months, after which the dealer either pays for them...or.... Pays a substantial interest until such time as that bike is paid for (logically this requires the bike to behold to a customer)

In bigger (pretty much any where else in the world) markets, this is, if you do your job right, normally a pretty simple task, as, the distributors spend significant time and money not only researching public demand for specific models, but also increasing their market share (not only their brand, but also joining forces with other brands and creating industry co-operatives that are designed to simply get more bums on seats.), thereby increasing evryones market share.

This is only possible when you have big market to sell your bikes.

In a small market like NZ, (with no specific import tariffs, other than GST) imports are readily available, making a small market, even smaller, so much so, that I remember when a large NZ well known brand importer started importing grey imports of their own bikes, available to sell to anyone in their dealer network, just to get a nibble of the pie that was on the table..... Crazy, but 100% true.

So we have a somewhat unique situation in NZ..... The worldwide business model of "floor plan" (the same business model that almost crippled H.D when the financial crisis hit the states) really is not a runner when applied to our market (simply because of the size of our market), granted plenty of shops operate on this scheme, but remember there have been many shops close their doors over the last 18 months...... And when "that bike comes up for payment," sales people get quite some pressure to sell, and, in many cases, customers are talked into buying bikes that just don't suit their needs, often resulting in punters leaving the market altogether......

The NZ market is somewhat unique, I read time and time again how people want "modern mall style" trading hours and staff numbers, but the fact remains... The old shops remain in NZ, operating on the same business model hay always have... Because in NZ, that's the only thing that works.... Anything else is courting disaster.

[shafty]

................So I'm tripping around the USA next month, --- what should I look for to send home? A few "Barn find " 1970's Jappa's? Suggest away..........

Cheers

[imdying]

lol, Canada

I hate shopping malls.

Me, I love em. I hate shopping, so having everything in one place, where's it's warm and everything accessible so I can get in, do my shit, and then get the hell out... perfect

[maxlev]

Dented front wheel on a pot hole. BMW 3 spoke alloy.
Asked dealer for price of new one, $650
He later corrected that to $1158

Got a price from a dealer in Germany $300 euro
At the time $300 euro was $600 nz.

Took it to Cambridge where it was straightened for $90.

I put it down to greed.

[HenryDorsetCase]

lol, Canada

Me, I love em. I hate shopping, so having everything in one place, where's it's warm and everything accessible so I can get in, do my shit, and then get the hell out... perfect

whenever I go* I end up being a pack mule for SWMBO and "we'll just have a wee look here"

*about once every 3 years

[imdying]

Remember, when she says "Just a wee look"...