Rapha closes North American office

[peanutgallery]

If your stuff is always to be found on sale...where's the value? D2C or no. I can only imagine the cost of returns and exchanges for this. Soft goods are tough, ladies clothing is even tougher. Hard goods, like wheels, are a little better

Not sure what the panic is all about...1 or 2 less tanks of fuel for the Gulfstream per month of a certain walmart heir and it's all good. Wondering if Bentonville ever loses money?

Originally Posted by November Dave

If you buy from them at 25% discount from retail, they're making out better than they would be selling them through a dealer. Implementing an omni-channel pricing strategy is one of my main concerns right now. Not being able to hold your retail pricing is problematic, though.

I'm sure a big part of their losses are accounting losses tied to the sale of the business. That's how PE and LBOs work.

Rapha Core bibs have become by far my favorites. I bought 2 pairs at $100 instead of $130 retail, but I'd easily pay $130 for them after using them for a year.

[avalonracing]

All I know is that their Core short-sleeve jerseys were perfect. Nothing trendy... sleeves that weren't too long nor too tight and a collar that was an actual classic collar. Of course last week I got an email stating that they have updated their Core line now with longer short sleeves and less of a collar. B*stards.

[Pegoready]

Originally Posted by adub

Rapha has become the Eddie Bauer of cycling clothing

Damn. That’s accurate innit?

[fourflys]

Originally Posted by adub

Rapha has become the Eddie Bauer of cycling clothing

Really, what high dollar/high marketing brand hasn’t?

I still say the Brevet jerseys are some of the best for the purpose.. but a cost that makers like Torm can beat.. but I’ll still probably pick them up when I see them for sale used..

[holliscx]

Originally Posted by adub

Rapha has become the Eddie Bauer of cycling clothing

Shots fired

[November Dave]

Originally Posted by peanutgallery

If your stuff is always to be found on sale...where's the value? D2C or no. I can only imagine the cost of returns and exchanges for this. Soft goods are tough, ladies clothing is even tougher. Hard goods, like wheels, are a little better

Not sure what the panic is all about...1 or 2 less tanks of fuel for the Gulfstream per month of a certain walmart heir and it's all good. Wondering if Bentonville ever loses money?

Absolutely - if you can't support your retail price, that's a big problem. There are obviously tons of things that can cause this - you've trained people only to buy during a sale, you're not convincing people of your value prop, you're overpriced relative to compelling competitors, you have no control over your retail selling outlets and they're competing with one another on price and devaluing your brand, etc.

If I recall correctly Rapha started as D2C and then went more omni, but they've had this softness around holding retail pricing further back than the sale to Waltons.

Selling D2C isn't all free money at all, but the costs associated with returns are going to come to you no matter your distribution architecture. And clothing has notoriously high starting margins to cope with all of this. Average realized margin is way way lower than starting margin as a result.

I'd actually say that being down 7% over the last year isn't bad on its own given what we've seen in bikes and comparable industries, but I haven't seen enough info to put that in context. I don't get the sense that Rapha's demise is imminent, if only because they have enviable access to capital.

[litcrazy]

I think that cycling apparel is a particularly hard business.

In the outdoor apparel market in general, the real growth potential comes from going beyond hardcore users (Patagonia, Prana, Northface...).
While yoga pants went mainstream, so one wears cycling apparel as athleisure wear.

It also seems that by chasing a broader marker, Rapha compromised their reputation with those seeking for the elite. As others have said, a lot of their product lines are still quite solid in my mind.

I'm not sure how much their quality has slipped vs their elite appeal has slipped. Their classic and brevet jerseys have a real niche. Their brevet shorts and classic knickers are awfully good. Their classic and core shorts are big winners with my wife and daughter. We don't hear so much from female riders here, but they both go with their Rapha shorts/knicker/tights when they're planning for big rides. I've been given the impression I should only buy Rapha shorts for them going forward.

I do think they've trained me to wait for sales.

I also think by aiming for a larger audience, they've lost their high-end/elitist appeal. When I visit my kids in NYC, there are so many riders wearing Rapha, not just hardcore riders. This is less of an issue in Albuquerque (less road culture, less disposable income). I think this pushes the hardcore market away. For a certain rider, seeing non hardcore riders wearing their gear diminishes their view of it, even if the product hasn't changed.

Therefore I think the Eddie Bauer comparison only half right. Like Eddie Bauer, they've trained people to wait for sales. But unlike Eddie Bauer, they still have a sports focus. Until they brought back the First Ascent line, Eddie Bauer had fully given up on the roots/outdoor wear. Rapha in this sense would be closer to Patagonia/Northface/Arcteryx. Except, they can't cash out on becoming the streetwear of choice for so many. Except for a sweatshirt or two, almost everything they sell is actually for cycling.

Originally Posted by November Dave

Absolutely - if you can't support your retail price, that's a big problem. There are obviously tons of things that can cause this - you've trained people only to buy during a sale, you're not convincing people of your value prop, you're overpriced relative to compelling competitors, you have no control over your retail selling outlets and they're competing with one another on price and devaluing your brand, etc.

If I recall correctly Rapha started as D2C and then went more omni, but they've had this softness around holding retail pricing further back than the sale to Waltons.

Selling D2C isn't all free money at all, but the costs associated with returns are going to come to you no matter your distribution architecture. And clothing has notoriously high starting margins to cope with all of this. Average realized margin is way way lower than starting margin as a result.

I'd actually say that being down 7% over the last year isn't bad on its own given what we've seen in bikes and comparable industries, but I haven't seen enough info to put that in context. I don't get the sense that Rapha's demise is imminent, if only because they have enviable access to capital.

[marciero]

Regarding the Eddie Bauer model- one characterizing aspect is the licensing or branding of products from other companies. My Rapha Open U.P. calls to mind the Eddie Bauer Ford Explorer.

This idea reaches is tortured extreme in things like Jimmy Buffet retirement communities. No offense to anyone living in one-they seem pretty awesome actually.

[Likes2ridefar]

Originally Posted by marciero

Regarding the Eddie Bauer model- one characterizing aspect is the licensing or branding of products from other companies. My Rapha Open U.P. calls to mind the Eddie Bauer Ford Explorer.

The golden band along the bottom and little trees stitched in the seats made it worthwhile! As a kid we had an eddie Bauer explorer and before that an Eddie Bauer Aerostar van!

[makoti]

Originally Posted by peanutgallery

Not sure what the panic is all about...1 or 2 less tanks of fuel for the Gulfstream per month of a certain walmart heir and it's all good. Wondering if Bentonville ever loses money?

I was just in the Bentonville store two weeks ago. Had a fair amount of stuff in it, men's and women's, but for some reason it felt empty. Maybe by design, maybe the fairly large space for a boutique.
The town itself was doing just fine. Construction all over the place

[benb]

Eddie Bauer wait for sales?

I have a store right near my office and have been working there for 10 years next month.

I have never, ever seen almost the whole store not on sale. It's incredibly easy to buy their stuff at a huge discount almost all the time. They have a lot of good stuff too IMO. Their jeans and shoes and some other stuff like hats and gloves are terrible but they have a lot of great hiking shorts and pants and I have these new pants that look like dress pants but are more like a tech fabric and they are amazing... I'm not sure I've actually worn any of my real dress pants since I got them.

I guess I gotta look, if you can get Rapha core bibs for $130 that seems like a smoking deal if they are in the same quality range as Assos.

[Likes2ridefar]

IMO the rapha pro core bibs are good quality but material and fit pale in comparison to my Assos bibs…but they cost a lot more.

[fourflys]

Originally Posted by Likes2ridefar

IMO the rapha pro core bibs are good quality but material and fit pale in comparison to my Assos bibs…but they cost a lot more.

thought about trying the Rapha core stuff, but they really aren't made for clydes and I really like Giordana stuff.. can't imagine the Rapha would be any better..

[November Dave]

Originally Posted by fourflys

thought about trying the Rapha core stuff, but they really aren't made for clydes and I really like Giordana stuff.. can't imagine the Rapha would be any better..

I'm 15# more than what I raced at but I was skinny when I raced. If I showed up on the line of a 1-2 race people would scream "hey, KOOL-AID!" but my mom thinks I'm too skinny. That winds up being just about right for Rapha Core. Castelli and Giordana still fit well but I'm L in them where I'm M in Core. I'd rate my last pair of Giordana bibs as similar to but with slightly nicer material than Core, but they were probably $150 when I bought them in 2014ish, so probably $200 now.

[fourflys]

Originally Posted by November Dave

I'm 15# more than what I raced at but I was skinny when I raced. If I showed up on the line of a 1-2 race people would scream "hey, KOOL-AID!" but my mom thinks I'm too skinny. That winds up being just about right for Rapha Core. Castelli and Giordana still fit well but I'm L in them where I'm M in Core. I'd rate my last pair of Giordana bibs as similar to but with slightly nicer material than Core, but they were probably $150 when I bought them in 2014ish, so probably $200 now.

hmm, interesting on the sizing.. appreciate the insight!