Bikes cost more than they used to. Duh. Of course, they do. First, you’ve got baseline inflation, then you’ve got the assimilation of new technologies, the increased cost of trans-oceanic shipping, and the new supply-chain pressures exposed by the pandemic, not the least of which is a workforce who is less healthy and simultaneously demanding higher wages.
A little over a decade ago, when I got into the industry selling custom bikes, one of the big sales challenges we faced was explaining to consumers why they should spend more on a custom bike than they would on a production bike. Then production bike prices shot through the roof, and that whole line of argument became moot. It’s easy to spend $5-10k or more on a bike that only offers a few sizes now.
There’s a much larger, distinct conversation to be had about what bikes SHOULD cost, but that’s for another time. Today, I just want to think about what it costs to fix bikes, how I expect those costs to rise significantly, and why.
I talk with a lot of shop owners in my day-to-day life. Many are friends, and they’re candid with me about their economic challenges. There seem to be two major drivers in the rise of service costs, and the first is an increasing reliance on service income. There was a time when shops were much less focused on their service departments as profit centers. Service was a vehicle for selling replacement and upgrade parts. It was a way to get customers through the door, and the general feeling was that, if you could break even at service, that was a reasonable driver for component and bike sales.
But then suppliers started pulling back from retail. Actually, not so much pulling back as going around. Direct-to-consumer sites proliferated, and they could sell the same products online without a brick-and-mortar rent. First the suppliers empowered online retailers with volume discounts. Then they got into the D2C game themselves. And this trend started with easy to ship products like tubes and accessories, which were high volume, high margin products for shops, and now extends deep into complete bikes at all price points.
As it turns out, consumers like not going to bike shops. They like buying discounted products on-line and having them delivered to their door. Suppliers like keeping more margin and gaining direct access to their end-users. Capitalism craves efficiency. Let’s hold our value judgments about that for now.
Faced with declining product sales revenue, shops have rethought their service departments. Maintenance and repairs, after all, can’t be performed online. Most riders still depend on a shop for service.
This brings us to the second major driver of increased service costs, technology.
Even as they circumvent retail, bike makers continue to make bikes more and more technologically complicated. It takes longer to bleed disc brakes than it does to change rim brake pads. It takes longer to set up tubeless tires than it does to load up a set of tubes. Increasingly, hoses and wiring are run internally, so it takes longer to assemble bikes, AND then to service them. A basic tune-up takes longer now. Virtually everything about the bike is harder to work on than it used to be, and that has fueled an increase in riders depending on a shop rather than doing their own work at home. I’m one of them.
Increased demand drives higher prices.
Most shop owners sharpened their pencils and did the math on service, realizing they need to get $100 or more per hour to make any money at it. As bike tech has become more complex, the mechanic’s job has become more specialized, and it has become much more difficult to retain the good ones.
Society does business online, and that’s where people want to work, not in retail.
We have written before, countless times, about the dangers of proprietary technology and a failure to support bicycle retail, but the trends we see in bike world mirror the trends in the world at large. Purchasing continues to move online. Retails margins continue to erode. Many bikes shops are becoming, in effect, delivery and service centers, and that means service will have to be a reasonable profit center.
So expect to pay more for all the work you need done on your bike, and if you’ve gone all in technologically, expect to pay an absolute premium and to wait longer and longer for that work to be done.