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MSRP versus actual selling price

1498 Views 5 Replies 4 Participants Last post by  PotOdds
I know this is probably dependent upon your region and your negiotiating skills but what's the ballpark selling price of some of the following bikes?

2006 Specialized Stumpjumper Disc, MSRP $1600
2006 Trek 8000, MSRP $1539.99
2006 Trek 6700, MSRP $1099.99
2006 GF Big Sur, MSRP, $1539.99
2006 GF HKEK, MSRP $1099.99

Trying to get an idea of how prices compared between LBS and online.
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Well since they're this years prices then at most lbs's that's fairly close to what it'll cost you if your prices are correct. The markup at most lbs's isn't that much and having good negotiating skills plays about zero part in getting a different price than what's quoted. If you try and equate an lbs to a car dealership in terms of haggling/price markup/dealer incentives then you'll be sadly mistaken.
Prices are straight from the website. Last time I bought my bike was back in '98. I don't remember what the MSRP was.

It's interesting that you should say that. I thought it might be different. A number of online stores quote actual selling prices much lower than MSRP. In fact, the ad to my right advertises a 2006 Iron Horse 7.5 from Randall Scott which sells for $2649 from a listed $3299.99. IBEX does the same.
Well, depends on a few key factors.

Most important-it's not how long the shop has sat on the bike in question but When they bought it. Most shop owners work on a pretty tight margin and the discounts passed on to the consumer reflect this.

Items bought early in a model year generally cost the shop owner close to standard wholesale price-i.e there's not a lot of wiggle room around the msrp (a few hundred dollars here and there).

However, models purchased by the shop in the late summer (this does not include early releases of next year's models) are generally closeouts/ left overs sold at heavily discounted wholesale prices to the dealer who can-if they so choose to pass a chunk of that savings on to the consumer.

The kicker here is that not every shop gets a shot at purchasing these closeout models-as they are generally offered first and foremost to particularly loyal and aggressive hawkers of a given line. Randall Scott-seems a good example of this-longtime, loyal, particularly high profile, and I'd think relatively sizeable dealer of Iron Horse bikes undoubtedly gets first shot at purchasing topflight closeout models-hence the 600 discount. They also get a discount up front for purchasing a big chunk of a given line as well.

Bottom line-how much wiggle room there is surrounding a bike's MSRP depends on how much the dealer paid for the bike an question, and as a subset factor-who the dealer in question is. Even a bike that's sat in a shop for a while is less likely to see a heavy discount than a newer bike that an owner bought at closeout discounts (they have a set margin for each item--unless the situation has become hopeless--but you'd be surprised how patient most LBS's can be!).

Final thought:-higher priced bikes tend to have greater discounts and lower price bikes do not--afterall-there's only so many 3000.00 plus bikes that any manufacture can sell at full retail--and, as the price goes up-the consumer becomes more demanding and more careful of their purchase. And is why most shops know that in the long and short run they fare better in profit margin and customer satisfaction by selling 5 $600.00 bikes than one $3000.00 bike.
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Like was said, current year models before clearance time, means no big discounts. If you pay with cash, they may knock of some, since they dont have to pay the CC fees. probably 5% or less. I think markup on a bike is arround 30%, but when you figgure it takes an hour to an hour and a half for a good shop to put the bike togethor, space it takes up, overhead, etc. the shop doesnt really end up making a whole bunch, especially if they are a smaller shop.

Figgure a 1500 bike may cost them about 1150-1200. Add in an hours worth of work/time, and then any adjustments/tuning when you buy it, really they only make a couple hundred bucks on a bike, and they have to pay rent with that money.

Good analysis, SuperbMan.
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