Opinions, please: Allied Cycles

[bob heinatz]

Very impressive if you are looking for a carbon bike. I will stick to my Ti frame. I think this sales model is how a lot of small to medium size bike manufactures are going to survive. If I was interested in a carbon bike Allied checks a lot of boxes for me.

[Burnette]

Originally Posted by oldpotatoe

Selling direct is fine and dandy but I wouldn’t want to sell anything as a dealer when I would need to compete with the manufacturer. I completely understand the direct vs dealer network gig and pricing. I’m just saying Allied needs to decide what it wants to be. Saying they have a dealer network which helps getting the word out about their little known brand then saying they want to sell direct is the same as trying on shoes then ordering MO. Great for consumer, not retailer. From a bike shop owner perspective, I wouldn’t carry them.

Bike shops are squeezed by bike brands to only carry their brand of bike and accessories, much to the peril of bike shops. But around here (NC, Piedmont Triad area), these same shops will work on anything you bring. If I went full build Canyon or Allied all four bike shops in three cities locally would work with me with anything I needed as far as fit, minor assembly and of course any of those accessories they have to push. They won't carry Canyon because Canyon is direct sales and even if they wanted to carry Allied and Allied went the bike shop route, the bike shop's contract with one or more of the big three would forbid it.

It's a different world and it is changing whether we like it or not. Turning away customers will only hasten the bike shop's closing date.

[oldpotatoe]

Originally Posted by Burnette

Bike shops are squeezed by bike brands to only carry their brand of bike and accessories, much to the peril of bike shops. But around here (NC, Piedmont Triad area), these same shops will work on anything you bring. If I went full build Canyon or Allied all four bike shops in three cities locally would work with me with anything I needed as far as fit, minor assembly and of course any of those accessories they have to push. They won't carry Canyon because Canyon is direct sales and even if they wanted to carry Allied and Allied went the bike shop route, the bike shop's contract with one or more of the big three would forbid it.

It's a different world and it is changing whether we like it or not. Turning away customers will only hasten the bike shop's closing date.

I worked on anything, any bike (including sram ) but there are bike shops here in the republic that won’t work on bikes they didn’t sell...dum. MY point is I wouldn’t sell a frame/bike where the maker would rather sell direct(of COURSE, they make more $) and also sell for less than I can(that magic 37 point margin(not markup) where at the end of the year a lbs breaks even, NO profit, no more debt).

[Burnette]

Originally Posted by oldpotatoe

I worked on anything, any bike (including sram ) but there are bike shops here in the republic that won’t work on bikes they didn’t sell...dum. MY point is I wouldn’t sell a frame/bike where the maker would rather sell direct(of COURSE, they make more $) and also sell for less than I can(that magic 37 point margin(not markup) where at the end of the year a lbs breaks even, NO profit, no more debt).

True, I see what you're saying. For a bike shop Canyon and Allied won't give them the margin, it's already taken. But that's the model going forward, even from the big three eventually. But making a buck from people who do purchase these direct bike is key to future bike shop survival.

One more thing, I know it may be hard to swallow for some, but there are tons of people who don't want to go to a bike shop like we know it. Ever. Even I have found it hard to justify using the bike shop model as it stands now. Change is a coming and direct bike sales is already here. Adapt or die.

If Allied prices like Canyon, does they will do very well direct, bike shops be damned.

[oldpotatoe]

Originally Posted by Burnette

True, I see what you're saying. For a bike shop Canyon and Allied won't give them the margin, it's already taken. But that's the model going forward, even from the big three eventually. But making a buck from people who do purchase these direct bike is key to future bike shop survival.

One more thing, I know it may be hard to swallow for some, but there are tons of people who don't want to go to a bike shop like we know it. Ever. Even I have found it hard to justify using the bike shop model as it stands now. Change is a coming and direct bike sales is already here. Adapt or die.

If Allied prices like Canyon, does they will do very well direct, bike shops be damned.

But don’t the big boys allow the bike shop to make something by having the bike delivered and built by the dealer? If bought direct? I don’t think trekspecializedgisntcannondale sell direct yet, as in bike goes direct to consumer.
Yup, I’m glad I’m out of the bike shop scrum but my shop was service(60%+ of gross) and frames not sold direct(Moots, Waterford/Gunnar)....but if somebody wanted a Moots and brought in a yuge box of parts? Fine...no issue.

During the pre .dot bomb blood letting, we advertised that we would help the consumer find the bike/ frame, on our laptop, buy it, send to us for build....then the WWW had its hiccup. I still think it’s viable. We do a fit, help person pick the Canyon spec’ed how they want, it’s sent to us for assembly, fine tuning. We get a wee slice of $ to provide the service, no bikes on floor, just tools....

[djg21]

Originally Posted by oldpotatoe

But don’t the big boys allow the bike shop to make something by having the bike delivered and built by the dealer? If bought direct? I don’t think trekspecializedgisntcannondale sell direct yet, as in bike goes direct to consumer.

Yup, I’m glad I’m out of the bike shop scrum but my shop was service(60%+ of gross) and frames not sold direct(Moots, Waterford/Gunnar)....but if somebody wanted a Moots and brought in a yuge box of parts? Fine...no issue.



During the pre .dot bomb blood letting, we advertised that we would help the consumer find the bike/ frame, on our laptop, buy it, send to us for build....then the WWW had its hiccup. I still think it’s viable. We do a fit, help person pick the Canyon spec’ed how they want, it’s sent to us for assembly, fine tuning. We get a wee slice of $ to provide the service, no bikes on floor, just tools....

That was the plan. But for how log will they feel obligated to do so? I wouldn’t count on it long term.


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[Burnette]

Originally Posted by oldpotatoe

But don’t the big boys allow the bike shop to make something by having the bike delivered and built by the dealer? If bought direct? I don’t think trekspecializedgisntcannondale sell direct yet, as in bike goes direct to consumer.
Yup, I’m glad I’m out of the bike shop scrum but my shop was service(60%+ of gross) and frames not sold direct(Moots, Waterford/Gunnar)....but if somebody wanted a Moots and brought in a yuge box of parts? Fine...no issue.

During the pre .dot bomb blood letting, we advertised that we would help the consumer find the bike/ frame, on our laptop, buy it, send to us for build....then the WWW had its hiccup. I still think it’s viable. We do a fit, help person pick the Canyon spec’ed how they want, it’s sent to us for assembly, fine tuning. We get a wee slice of $ to provide the service, no bikes on floor, just tools....

There was much heat earlier this year about whether the big three would still give shops their margin on direct sales. I think they do but as Canyon and others join the market, that margin will shrink back to the manufacturer.

Yes, you did good to get out when you did but I think you were better footed back then than the poor shops around me are right now. You were more independent and higher tier, more dynamic, flexible. They are locked into a brand or two on everything with low inventory and high prices way out of line with what I can get. Ugh. Outside of the shop I have unlimited options and better prices.

Back to Allied, their model is solid but the market is saturated. Their product is good, it's price that will make or break them. I can get a Canyon Aeroad CF SLX 8.0 DI2 for $5,200. If they can do close to the same, IMO they have a shot at making it.

[oldpotatoe]

Originally Posted by Burnette

There was much heat earlier this year about whether the big three would still give shops their margin on direct sales. I think they do but as Canyon and others join the market, that margin will shrink back to the manufacturer.

Yes, you did good to get out when you did but I think you were better footed back then than the poor shops around me are right now. You were more independent and higher tier, more dynamic, flexible. They are locked into a brand or two on everything with low inventory and high prices way out of line with what I can get. Ugh. Outside of the shop I have unlimited options and better prices.

Back to Allied, their model is solid but the market is saturated. Their product is good, it's price that will make or break them. I can get a Canyon Aeroad CF SLX 8.0 DI2 for $5,200. If they can do close to the same, IMO they have a shot at making it.

Saturated is correct. Some really excellent stuff manufactured in Asia(some junque too), I’m not sure ‘made in USA’ would sway that many. It’s a global access marketplace for just about everything(just got some really excellent 380 ammo from Italy and....Russia)...Made in the USA may work in the US(relatively small market) but I don’t thing Europeans or the Japanese care.

Again, glad I’m outta of it.

[adub]

This discussion could be carried over to any retail business selling any product or service..

An owner of ANY small business with good work ethic, great customer service, some business acumen will be successful.

[FriarQuade]

Originally Posted by oldpotatoe

Saturated is correct. Some really excellent stuff manufactured in Asia(some junque too), I’m not sure ‘made in USA’ would sway that many.

Again, glad I’m outta of it.

The manufacturing world is changing. Products coming out of Asia have gone up a lot in price. Plus you have to pay for them before they get shipped so you've got cash tied up for 6-8 weeks while the product is in transit. When you realize that you can domestically manufacture a bike part in the US in half the time it would be on the water and without the import hassell, QC challenges, cash flow hurdles and language barrier it starts to make the gap A LOT narrower than it was 2 decades ago when all the production went over there.

As soon as Allied makes a squishy bike I'll put my credit card on the table. Wish these guys the best of luck and they seem to have a team with a lot of industry experience and some decent backing.

And for all the Walton hate, does anybody who's actually related to Sam Walton still work for the Walmart corp? Not really fare to hold that against the Allied guys since all the Walton family does is cash their checks and put money back into their community, including the one I grew up in.

[Burnette]

Originally Posted by FriarQuade

The manufacturing world is changing. Products coming out of Asia have gone up a lot in price. Plus you have to pay for them before they get shipped so you've got cash tied up for 6-8 weeks while the product is in transit. When you realize that you can domestically manufacture a bike part in the US in half the time it would be on the water and without the import hassell, QC challenges, cash flow hurdles and language barrier it starts to make the gap A LOT narrower than it was 2 decades ago when all the production went over there.

As soon as Allied makes a squishy bike I'll put my credit card on the table. Wish these guys the best of luck and they seem to have a team with a lot of industry experience and some decent backing.

And for all the Walton hate, does anybody who's actually related to Sam Walton still work for the Walmart corp? Not really fare to hold that against the Allied guys since all the Walton family does is cash their checks and put money back into their community, including the one I grew up in.

Yeah, that Wal-Mart angle was brought up by a member that went four pages in another thread about the store. Allied's success or failure will have absolutely nothing to do with association with it's investors despite the axe grinding exhibited here.

[FlashUNC]

Originally Posted by FriarQuade

And for all the Walton hate, does anybody who's actually related to Sam Walton still work for the Walmart corp? Not really fare to hold that against the Allied guys since all the Walton family does is cash their checks and put money back into their community, including the one I grew up in.

The Waltons own 51% of Wal-Mart. The family still has ultimate control over the business decisions of the company. They built a $170 billion family fortune off a business that wreaked havoc across communities nationwide.

So yeah...cash the checks and all that. But plenty of bike companies don't take Walton money.

[Burnette]

Originally Posted by FlashUNC

The Waltons own 51% of Wal-Mart. The family still has ultimate control over the business decisions of the company. They built a $170 billion family fortune off a business that wreaked havoc across communities nationwide.

So yeah...cash the checks and all that. But plenty of bike companies don't take Walton money.

Looking at my 401k and all of the companies that are in my index fund I guess by your reasoning me and millions of investors are just awful.

Again, such outliers that beat that drum to death will have no bearing on the outcome of Allied's fortunes.

[Big Dan]

Originally Posted by Burnette

Looking at my 401k and all of the companies that are in my index fund I guess by your reasoning me and millions of investors are just awful.

Again, such outliers that beat that drum to death will have no bearing on the outcome of Allied's fortunes.

Do you have one?

[Burnette]

Originally Posted by Big Dan

Do you have one?

I'm reading about them now just like you. Judging them solely on one investor is to miss the product and story on a metric that the vast majority will not care about or base purchase choice for or against it.

Manufacturing in the US is still a tough gig, props to Allied for giving it a go.