Industry Magazine Question: What are your margins on bike sales?
We sell bikes mostly through our collaborative build process. The process entails an initial consultation, a fit session as well as building up the entire bike with our customers. We have done over 400 of these, and its how I started the business in my backyard. This process allows us to charge MSRP on all components (for the most part) as well as a labor rate for the build. It certainly takes a bit longer than pulling a bike off the rack, but we are all about developing a deeper connection with our customers, not a retail relationship. Margin for the build (including labor thrown into the equation) is between 50-60%...and we get a customer for life.
Assembling bikes out of boxes for a 35% percent margin, and up-selling the transaction with accessories, doesn't interest me at all. This is what differentiates us from a vast majority of the 175+ bike shops in NYC. Its harder to work this way, but far more rewarding.