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> serving you probably is probably a net-negative for us cost-wise I never understood why businesses do things like this. In many industries there is often a c

> serving you probably is probably a net-negative for us cost-wise I never understood why businesses do things like this. In many industries there is often a class of customer that it is proclaimed "we don't make any money on them" and as such they provide a low quality of service. If you actually lose money why don't you raise prices on them? Why are you worried about losing a customer you claim not to want in the first place?

princekolt 6y ago
It's in the article. Because these are the kind of customers who provide no loyalty back. They'll drive an hour to get a part from a different shop because it's cheaper. There's nothing you can do to attract this kind of customer apart from lower margins. So why bother with them if you can run your business well by focusing on everybody else?
- willcipriano 6y ago
  If you aren't happy with selling items at the price you are selling them at, why sell them? I just don't see the reason to be rude about it.
- marcosdumay 6y ago
  Then increase your prices to a level you would be happy, and if they want to buy somewhere else, let them. Doing low quality work is a great way to lower both your reputation and job satisfaction. And you better be 100% certain of each customer's lifetime value, otherwise you'll have a problem.
  - pixelbash 6y ago
    > And you better be 100% certain of each customer's lifetime value, otherwise you'll have a problem. This resonates with me. When i was younger I used to get ignored a lot at certain kinds of store. Now I have more money I still avoid them on principal.
  - mauvehaus 6y ago
    The article’s point is that they can’t, or they’ll lose the custom of the people who have no loyalty to their LBS and shop on price alone.
    - marcosdumay 6y ago
      I get the exact opposite point from the article... Anyway, if you want to serve low-margin customers, optimize your business against them, and be happy with those low margins, because you won't get any of the high margin ones. Also, publicize your low-margin focus (tell up-front that you won't do non-billable services, and what service comes with what item), otherwise you'll be full of annoyed customers wanting reparations after a bad interaction.
- watwut 6y ago
  The claim is that this particular customer is net loss. In that case, the customer driving elsewhere because you raised price or stopped selling is a gain. The concept of selling part in a loss instead of raising price and then treating customer badly so that he does not buy that is still mystery.
  - brudgers 6y ago
    The more absurd idea is stocking parts that sell at a loss (outside of a specific loss-leader sales campaign).
- pmontra 6y ago
  I do some basic repairs myself (up to changing the chain or ball bearings) but I don't want to do anything that requires special tools or dynamometer keys or just too much time. Sometimes the shop owner tells me to buy some parts myself (I remember the rotors of the disk brakes of two new wheels.) I bring them to him and he does the repairs. Maybe he was me pay more for his time but it's OK. Btw, the shop was flooded by customers looking for new bikes at the end of the lockdown here (Italy.) That lasted for a month with long lines at every bike shop until the warehouses run out of parts. I saw an increase of people using bicycles at least until temperature got past 30 C (86 F.)
hakfoo 6y ago
I'd expect some cases it's about customer development and long-term relationship development. If you sell me a $200 basic steel bike, you might be selling near or at cost. But if you've earned my trust and comfort as a customer, I'll be back to buy my spare tyres, oil, replacement parts, and eventually the higher margin $800, $1500, $6000, and $20,000 bikes.

princekolt 6y ago

It's in the article. Because these are the kind of customers who provide no loyalty back. They'll drive an hour to get a part from a different shop because it's cheaper. There's nothing you can do to attract this kind of customer apart from lower margins. So why bother with them if you can run your business well by focusing on everybody else?

willcipriano 6y ago
If you aren't happy with selling items at the price you are selling them at, why sell them? I just don't see the reason to be rude about it.
marcosdumay 6y ago
Then increase your prices to a level you would be happy, and if they want to buy somewhere else, let them. Doing low quality work is a great way to lower both your reputation and job satisfaction. And you better be 100% certain of each customer's lifetime value, otherwise you'll have a problem.
- pixelbash 6y ago
  > And you better be 100% certain of each customer's lifetime value, otherwise you'll have a problem. This resonates with me. When i was younger I used to get ignored a lot at certain kinds of store. Now I have more money I still avoid them on principal.
- mauvehaus 6y ago
  The article’s point is that they can’t, or they’ll lose the custom of the people who have no loyalty to their LBS and shop on price alone.
  - marcosdumay 6y ago
    I get the exact opposite point from the article... Anyway, if you want to serve low-margin customers, optimize your business against them, and be happy with those low margins, because you won't get any of the high margin ones. Also, publicize your low-margin focus (tell up-front that you won't do non-billable services, and what service comes with what item), otherwise you'll be full of annoyed customers wanting reparations after a bad interaction.
watwut 6y ago
The claim is that this particular customer is net loss. In that case, the customer driving elsewhere because you raised price or stopped selling is a gain. The concept of selling part in a loss instead of raising price and then treating customer badly so that he does not buy that is still mystery.
- brudgers 6y ago
  The more absurd idea is stocking parts that sell at a loss (outside of a specific loss-leader sales campaign).
pmontra 6y ago
I do some basic repairs myself (up to changing the chain or ball bearings) but I don't want to do anything that requires special tools or dynamometer keys or just too much time. Sometimes the shop owner tells me to buy some parts myself (I remember the rotors of the disk brakes of two new wheels.) I bring them to him and he does the repairs. Maybe he was me pay more for his time but it's OK. Btw, the shop was flooded by customers looking for new bikes at the end of the lockdown here (Italy.) That lasted for a month with long lines at every bike shop until the warehouses run out of parts. I saw an increase of people using bicycles at least until temperature got past 30 C (86 F.)

hakfoo 6y ago

I'd expect some cases it's about customer development and long-term relationship development. If you sell me a $200 basic steel bike, you might be selling near or at cost. But if you've earned my trust and comfort as a customer, I'll be back to buy my spare tyres, oil, replacement parts, and eventually the higher margin $800, $1500, $6000, and $20,000 bikes.