Is it price fixing? if so why is it allowed ?

[Dave7]

Looking at new bike prices (particularly Specialized) every dealer seems to be exactly the same price. Even when it comes to sales (Specialized are starting one in the next week or so) every dealer offers exactly the same discount on the same bikes.
As an e.g. I've been looking at the Spec' Roubaix and to a penny all main dealers are the same price.

 

[Cyclist33]

So? I don't see what the problem is?

Stu

 

[machew]

It's not price fixing unless there is an agreement between the shops to sell at a price, however there are spiders on the web that will look at other sites prices and adjust the price accordingly eg Amazon price book at over $23m

 

[Dave7]

So? I don't see what the problem is?

Stu

The problem (as I see it) is that if every dealer is exactly the same price then it would appear that those prices must be set by Spec'.....which I thought was ilegal (though I have been known to be wrong before).
To my limited knowledge manufacturers are allowed to set a RRP but not a minimum price. All dealers have a margin and it is up to them what % discount they give.....or not.

 

[mickle]

It's an unspoken agreement between all of the dealers. Better independants long ago realised that discounting was damaging their corner of industry. With strong, premium brands like Specialized, Oakley, Marin, Brompton there is no requirement to discount because enough people are prepared to pay the asking price. If you don't want to pay what Specialized and its dealers thinks is a fair price for their products go buy something else.

Is the lowest price all that people care about these days? What about a thriving high street? What about the survival of your local shop and its employees?

 

[dellzeqq]

I despair. The service offered by a bike shop is part of the deal. If you're looking to save a fiver, then go right ahead, but I reckon you'd be better off buying it from somebody who will put it together well, give you a free service after three or six months, and stand by it if it proves to be defective.

And how do you know what you're buying if you haven't ridden the thing?

Put it this way, Dave........I can undercut a professional photographer any day of the week. With a borrowed camera and less than no idea how to use it. I somehow doubt that my efforts would equal theirs. What would your advice to a person commissioning a photograph be?

 

[Beebo]

If a dealer over discounts a Specialized bike they will quickly become ex-Specialized dealers. The company are controlling the market and the sale of their product.

Its the same with watches, you wont find Rolex, Omega or Breitling watches discounted in the same way that Casio and Seiko will be as a high end manufacturer has to protect their brand image.

A manufacturer can choose who sells their items and who doesnt. You may remember Tesco imported a load of "grey market" Levi's and tried to sell these at a knock down price, Levis took them to court and won on the grounds that only they could decide who sells their items and by selling them at tesco the brand image was being diminished.

 

[Dave7]

I haven't said there is anything wrong with it.
I haven't said I am trying to save a fiver.
And I am trying to buy from a LBS .
I was merely reflecting on the results of my search and asking the question.
I ran a succesful business for 15 years and was never interested in competing with the cut price boys-so I am more than happy to deal local, pay a bit more and keep the LBS in business......as I say-I am merely asking the question......but not sure I should have now.

 

[Dave7]

If a dealer over discounts a Specialized bike they will quickly become ex-Specialized dealers. The company are controlling the market and the sale of their product.

Its the same with watches, you wont find Rolex, Omega or Breitling watches discounted in the same way that Casio and Seiko will be as a high end manufacturer has to protect their brand image.
quote]
That is the point I'm trying to establish........I haven't seen any discounts at all-they all appear to be exactly the same.

 

[DCLane]

They may be the same price, but you'll find you can use voucher codes/cashback site to get a discount;

e.g. I got £100 off my Ridgeback last year from Evans with a discount code, plus £30 from a cashback site
e.g.2 The replacement bike (warranty plus cash) I bought last week - I was able to use a voucher to get free accessories

 

[Sore Thumb]

I have a couple of not so local bike shops that I try to buy from. They give good service and if you buy from them enough they tend to give you a discount. There are a couple of local bike shops that I would not touch.
However when I was looking for some new pedals my local shop was selling for £150 and even with a discount they were still a bit expensive. So managed to get them from a reputable on line site that also run a shop, but too far for me at £74. A huge saving, however good my lbs might be i also have to look for the best deal.

 

[SoloCyclist]

When I wanted to buy my watch it was the same price in the few jewellers that stocked them and completely unavailable online. I went to each shop and said there are three shops that sell this watch in Glasgow and they are all the same price (Same Parent Company as it happens). What will you do to make me buy it from you. One said ' Nothing we don't discount' one said 'we could do something but can't commit to a figure' one said 'We'll give you 10% off'. So I left with my nice new watch,

I think the shops are obliged to advertise at the same price to stop price wars and devaluing the brand, but in reality if you are ready to spend they will compete with each other for the sale, even if it's a few freebies thrown in, which several shops advertise without haggling to get around the 'price fix'

 

[stu1903]

I work in a bike shop and we are told by the brands that no discouning is permitted until a certain date which is usually just before the new models come out. When the green light is given for discounting, a max discount limit is usually set.

Failing to comply and they threaten to stop supplying you that brand as you are damaging the brand.

 

[ianrauk]

You may not get a discount on a bike but you usually get a good few extras thrown in for nothing. For example. When I bought my Roubaix Elite I also got thrown in for free, a pair XT SPD pedals, 2 Spesh bottle cages, a pump and some lights which added up to a fair old bit.

 

[RecordAceFromNew]

It's an unspoken agreement between all of the dealers. Better independants long ago realised that discounting was damaging their corner of industry. With strong, premium brands like Specialized, Oakley, Marin, Brompton there is no requirement to discount because enough people are prepared to pay the asking price.

I work in a bike shop and we are told by the brands that no discouning is
permitted until a certain date which is usually just before the new models come out. When the green light is given for discounting, a max discount limit is usually set.

Failing to comply and they threaten to stop supplying you that brand as you are damaging the brand.

I am not a lawyer, but I would have thought these practices of "unspoken agreement" or overt dictat by the brands are unlawful.

I think the OP asked a fair question, i.e. why is it allowed?

I despair. The service offered by a bike shop is part of the deal. If you're looking to save a fiver, then go right ahead, but I reckon you'd be better off buying it from somebody who will put it together well, give you a free service after three or six months, and stand by it if it proves to be defective.

I have a lot of sympathy for a good LBS, I really do, but let me be the devil's advocate the point the OP made is you can't even save a fiver (when cost of sales is clearly different for different shops). Why shouldn't the more cost efficient shop be able to increase its sales and total profit by being able to sell at a lower price? And if a bike sold proves defective whatever the price any shop will have to stand by it as part of the warranty if not the SOGA and other UK and EU regulations, doesn't it?