Confused about mountain bike prices???

jonnyashworth

Recently whilst looking at the new Nomad Frames I noticed how cheap our American cousins seemed to be able to buy the frame for compared to us.
For the Nomad frame we pay £2800 where as in the U.S you can buy it for $3000 (£1800). I realise that Santa Cruz is a U.S based company and there for they probably pay minimal import duty on their frames, even though they are made in Taiwan. However I did a little research and found that to import a frame valued at $3000 into the U.K for a U.S company would cost £85 and there would be £382 VAT to pay on top of that. This would mean that the price of the frame is still being inflated by £533 extra within the U.K and I cant figure out why??
Surely the costs incurred by the retailer, distributor etc etc are pretty similar in the U.K and the U.S???

This got me to thinking....... is this the case with other company's????
In the U.K you can buy a lapierre zesty 427 E:I for £2750 where as in the U.S it costs $3999 (£2385) this is a saving of £365 on what we pay... The costs incurred by Lapierre to physically get the bike into the U.S or the U.K will be similar as the bikes are produced in the far east however being a French / E.U company they will pay no import duty to get their bikes into the U.K but will have to pay it to get their bikes into the U.S... So how come its cheaper over there????? :evil: :evil: :evil: :evil:

This seems to be the case with components as well and I am sad to say I found this discrepancy........
Hope E4 Tech 3 Disc brake.... (bear in mind these are produced in the U.K)
U.K rrp = £150
U.S rrp = $207.41c (£123.67p)

Are we just suckers in this country or am I missing something???

Thewaylander

There is a cost of living difference to these countries too.

But yeh we normally get screwed over compared to the americans..

markhewitt1978

Yeah a lot of things are cheaper in America - remembering they have different tax too of course. I remember looking at how much my car would cost in the USA - it was half the price, and double the engine size!

jonnyashworth

I have taken tax into account in my comparissons

ilovedirt

Yeah that confused me over in america - they don't include tax in the price. Everything is way cheaper over there though (well, unless you go to san francisco, like we did. Mega bucks over there...).

Palmer82

Anything coming to the UK from the US will also be subject to both vat and import duty so that also pushes price up.

Thewaylander

Palmer82 wrote:

Anything coming to the UK from the US will also be subject to both vat and import duty so that also pushes price up.

True, but the frames are done in the far east, so import is from there not America surely.

cooldad

Still subject to VAT and duty.

njee20

Certain brands are worse than others. Santa Cruz and Niner really spring to mind. Titus were horrendous for it back in the pre-Planet X days too, although in that instance I think it was partly because of their widespread popularity in the US and the fact it was a one man band here. Frustrating for sure.

Trek and Specialized (for example) are pretty similar to here, so it's not universal.

True, but the frames are done in the far east, so import is from there not America surely.

No, because you don't buy from the Far East, you buy from the US vendor. That's no different to saying that Orange bikes are made in the Far East, so why don't we pay import on those?

97th choice

Giant have their prices on the various websites, the trance 1 is $3500 in the US, £2299 in sterling and €2799 euros

If you apply todays exchange rate it would be £2086 and €2519. Close enough to take into account variations in tax etc.

j_l

In a similar vein a friend of mine wanted a specific US made surfboard, over here they were about £3,000.00 in the us they were $800.00, so he hopped on a plane and collected it incorporating a holiday with it, when on holiday he used the board so didn't declare the goods on return to the UK as they were 2nd hand.......

2 birds- one stone and cheap US holiday all in one go..

jonnyashworth

I realise that a U.S company's frame will have VAT and import duty on it in the U.K and I take that into account in my working out of the Nomads cost in the U.K vs U.S but somewhere someone is hiking the price up by £500+ to us brits :evil: :evil: :evil: :evil: :evil: the chain only has a few links in it......

Santa Cruz bikes USA > Jungle products (U.K distributor) > Retailer....... so who is it that is slapping this huge price increase onto the frame

(sorry to santa cruz I realise all company's are doing this but I am just using you as an example)

njee20

No they aren't, certain companies do it far more than others - and SC are one of the worst culprits!

adamfo

The actual selling price of bicycle components are often cheaper in the UK that's why the likes of Wiggle, CRC etc. do so much business selling to the States.

I used to run a business on Ebay selling German made watches. The US importer was way more expensive so most of my sales ended up being shipped to the US.

adamfo

jonnyashworth wrote:

This seems to be the case with components as well and I am sad to say I found this discrepancy........
Hope E4 Tech 3 Disc brake.... (bear in mind these are produced in the U.K)
U.K rrp = £150
U.S rrp = $207.41c (£123.67p)

Are we just suckers in this country or am I missing something???

Hope is priced the same using your figures. £125 ex. vat

jonnyashworth

perhaps but hope products sold in the U.S will be subject to import duties and a final value tax of some sort along with shipping and distribution costs... they act as their own distributor in the U.K and are only shipping domestically!!!! So surely Hope products should be more expensive in the U.S????

cooldad

I suggest a strongly worded letter to the Mail.

jonnyashworth

lol if I write any more of those they might stop taking me seriously.

batmo

There are lots of other factors not mentioned so far that could contribute to a retail price difference. What about road haulage for example? The costs of putting 20 bikes in a lorry and moving them from port to warehouse to shop could be very different in the UK compared with the USA.

jonnyashworth

do you really think that could make that much of a difference???

Mountain bikes will be shipped from the far east in a shipping container to their destined country. (roughly the same wherever they go)

Where upon a distributor will deal with them...

Also considering that I can send a whole bike via courier anywhere in the U.K for about £30 I'm sure a distributor who sends literally thousands of bikes can do it cheaper than me.

So what else haven't I taken into account???

jonnyashworth

also I reckon that you could fit about 500 Nomad frames in a shipping container. So considering that the price discrepancy is about £500 unless a moving the shipping container to the distributor costs ££250,000 it does not explain it!

It would probably cost less than a grand to move a container from port to distributor (perhaps someone in the industry could clarify the real figures) so I don't even think it would account for a £5 price increase!!!!

Northwind

Some of it's perception- in the US Santa Cruz are a bit of a plebby brand, over here they've got an impression of boutiqueness, probably just because they're more expensive and less common.Everything's worth what the purchaser will pay for it after all.

But you can't compare like with like, sure you're maybe paying more for your bike but you're paying less if you crash it into a tree and need to go through healthcare. Just as one difference

jonnyashworth

true!

Remember I'm only using Santa Cruz as an example! Every Brand seems to do it... Yeti, Norco, Trek, Giane etc etc
Even U.K and E.U based brands!!!

paul.skibum

Unlike in the UK where VAT is included in the price you see in North America the VAT equivalent (GST and PST in Canada) is added at the till which makes for a fair price hike.

So when you see a US price that is not what you pay - although sales taxes are considerably lower than VAT in the UK (between 4% and 12% depending where you are).

Import taxes do make a difference too - US does not take so much of a bite out of the importers.

sabretalon

In America you have far more potential customers so you can sell it cheaper and make a good profit. The UK is a much smaller market, so companies here are paying almost the same price as the retail price in America.

As a company, I would not buy something in and store it, advertise it, prepare it and not make any money on it!

The retail companies in America are probably making the same margins, because they buy in such volumes from the manufacturer, they get a better discount. We don't get the same discount because we buy far less.

njee20

Every Brand seems to do it... Yeti, Norco, Trek, Giane etc

Giant aren't American, Trek are no more expensive over there.

As for less than £1000 to get a shipping container from a port to your door, I fear you have little idea of what most things cost...

jonnyashworth

I don't think £1000 would be too far off to be honest (depending on the distance to the port)

rockmonkeysc

It's not all bad. In the US Orange bikes are seen as overpriced but over here.....

mcnultycop

Just buy from Germany.

jonnyashworth

I think in future I will.

benpinnick

I'm guessing santa cruz do their own distribution in the us? That would explain the difference.