#106
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Brent, I am very happy you decided to keep at building bikes, as you are incredibly talented. Selfishly, I am happy I bought my frameset from you when I did, but I completely understand your need to price your work in a rationale way that allows you to earn a decent living. I hope that this new model brings you that.
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#107
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#108
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so now is probably a bad time to order a long sleeve jersey off of his website huh...
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#109
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Are you seriously comparing the two situations?
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#110
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Well I can see making a decent wage for your labours. Building a bicycle frame by hand takes many hours of sweat and toil (I tried to repaint a frame and that was enough for me).
Good luck on your adventure. |
#111
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That said, if you Google Baumol's cost disease ... when some sectors of the economy display a rise in labor productivity and some don't, the ones that don't have their prices go up a lot faster, which is the Baumol effect aka disease. The big framebuilders can and do mass produce, which is the very definition of increased labor productivity. The one man custom shops of the world have to build by hand, and I don't foresee that their labor productivity can increase (once you get up to a certain skill level, that's about it). So, I think the one man shops are either going to get more expensive, or they'll have to accept lower wages if the market can't bear their price. From what Steelman said, he was doing the latter. That's not right. Imo labor is generally under-compensated in the US - there are certainly a number of egregious union contracts, but given that most of the US is not unionized, they would be the exception. But on the flip side, that means that gradually, the one man shops are going to get less affordable for cyclists. I could afford a Vanilla at my relatively young age as I got clobbered by a truck and I got a settlement from the guy's insurance company (albeit it could have been 3x larger and it still wouldn't have been worth it). If I hadn't, I'm honestly not sure it would have been worth it to me with what I'm presently earning, which is good but not Wall Street (and imo Wall Street is way overcompensated relative to the actual value they produce). I'm not saying it wasn't, just that I'm not sure I would have been able to produce the change. |
#112
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Really!?
Relative to what? Certainly not the rest of the world. |
#113
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I recall speaking with Bruce Gordon a couple years ago about one of his customs, the price tag was north of 5k and he felt quite justified in his pricing when considering the time, effort and experience that went into it and maybe he was right, but that was still too much money for me and I will bet he didn't sell too many of them. Perhaps the price of a handmade steel frame is artifically low because some of the artisans have working wives with benefits, lower overhead, less monetary ambition, high quality of life etc. No question you do some mighty fine work, so best of luck going forward. |
#114
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That was unclear. I meant labor vs capital, in the US. Yes, our overall labor costs are higher than anywhere else.
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#115
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Yes, indeed I am. PM me if you want to discuss.
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#116
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Originally Posted by b.steelman
"I know the new prices seem high. After my brain crashed and burned, and the decision was made to start over, some serious reevaluation was necessary to avoid a repeat. I have been doing this for almost 30 years and have sold a lot of bikes. Outside the satisfaction derived from seeing happy customers, the ratio of reward to hard work is out of balance. If you want to call me I will tell you the average bottom line on the schedule c for those years of work. It is embarrassing. Is it an evil thing if I want my wife and I to live on 60K instead of 21k? Most people in America make much more than a good frame builder and they don't work nearly as hard. If I don't sell bikes at the new prices, which are based on real costs and a decent wage, then it shows the market is unwilling to reward the skills needed to produce a top level product. I am not embarrassed by the prices because they are actually a fair value. You get a great bike and maybe I can buy some health insurance and start a small retirement account." Assuming you have built between 100 and 200 frames per year, this would imply a per frame profit of less than $200. Frame builders must really love their work. FYI, you can probably qualify for Medicaid at 21K per year. Best of luck with all future endeavors. |
#117
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#118
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As compared to the new Serotta pricing, Steelman pricing seems to be in line. Serottas now go for $3800-$8600 for frame/fork.
Steelman could be a "bargain" at $4350-$5500! Speaking for myself, I'd rather have the Steelman. Lest we need reminding, Serotta and Steelman aren't competing with Trek, Giant, Specialized, etc. They are "luxury goods" and competing with other luxury goods like Ducati's, Benz's, Rolex's, etc. Pricing for luxury goods is less elastic than pricing for a Trek. |
#119
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This was based on 25+ years at the bench and having handled thousands of frames-direct quotes from across the hall. Who knows what this really means. The numbers still suck. IMO, prognosis is guarded
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#120
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I guess that would make Spectrum, Firefly and Dave Kirk a lower/middle tier builder on pricing. Now that is a bargain!
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www.performancesci.com - Performance through science |
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