Spotted while I probably should have been doing something else 😉
Over on Pinkbike the guys visit the Taipei Cycle show after pondering the question of how hard it would be to just start their own bike company…
And, not surprisingly, the answer is ‘yes’, of course they could start their own bike company! You can turn up with a sack of cash and order some frames. But.. Judging from some of the industry experts they talk to, what you get back in return could be a bit hit and miss!
You also need to be aware of all the other things involved with starting and running a business, cash flow plans, marketing, insurance etc. You know, all the dull stuff!
They mention some numbers, although these seem rather general. You wonder if they’re trying to obscure the figures so people don’t sit there working out how much of a cut bike companies are taking!
If we’re thinking of a batch of 100 frames here – that would be $10,000 liability insurance? It seems rather high, I’d have expected it to be in the region of $500 for the lot; not that many people sue bike companies!
And $100 shipping? For a single frame via air freight maybe, but for 100 frames going via sea container? Much less!
In case you were wondering, bike shops work on a margin of around 30% – so a bike that retails at $1000 would have been purchased by the shop for around $650. You can work backwards from there remembering that distributors and manufacturers need to make their cut too!
There’s some great insight into the whole Far Eastern manufacturing scene in the video including people from Pivot Cycles and X-Fusion contributing their thoughts.
I think I’ll stick with having single frames made in China, it seems to be pretty reliable compared to having frames made in Taiwan! And running your own business looks like far too much work 😉
You can read the original article over here: