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That's pretty predatory. 10% on the wholesale price is probably much less than 10% of the retail price
by readthenotes1 2y ago
That's pretty predatory. 10% on the wholesale price is probably much less than 10% of the retail price
- icegreentea2 2y agoRetailer gross margins on bikes is ~50%. As in you normally sell a bike for roughly twice the wholesale price. But apparently a typical bike store runs a net profit on the order of 5-10%. Having your COGs jump 10% is pretty significant then your net profits are that slim. It would wipe out a 5% net profit for example. https://www.bicycleretailer.com/opinion-analysis/2013/06/14/blog-formula-high-profit-bike-stores https://www.bicycleretailer.com/opinion-analysis/2013/06/14/... https://sharpsheets.io/blog/how-profitable-is-a-bike-shop/ https://sharpsheets.io/blog/how-profitable-is-a-bike-shop/
- readthenotes1 2y agoSo if gross margin is 50%, tarrifed bike will be a lot less because it doesn't include r&d, marketing, support, whatever app track has etc. The 2017ish 10% tarrifs increased retail costs 1-2%--unnoticeable vs background inflation
- SonOfKyuss 2y agoIt’s a good thing we still have consumer protection agencies to look into predatory practices…