Let Specialized Eat Their Own Droppings
03-13-22, 05:14 AM
#1
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Let Specialized Eat Their Own Droppings
"Specialized is putting a lot of chips behind D2C, and both retailers and consumers will have the opportunity to vote on that bet with their dollars in 2022 and beyond."
The quote above came from a BRAIN opinion piece written by Rick Vosper. As most cycling enthusiasts know Specialized has been direct to consumer for quite a few years, first with a hybrid model, and now bypassing the dealer completely. At first it was OK as revenues were given to the dealer who then delivered the product to the consumer. With the bypass of the dealer and shipping direct to the consumer the dealer collects less than half the revenue it would have under the hybrid program. This is still a win for the dealer as he had zero dollars invested in the sale other than the folks that bought direct from Specialized after wasting the time of a bike shop employee gathering information and selecting a bike in a dealer showroom. Dealer did the work and received a very poor margin if any on the sale. Nice job SBC.
All the dealers know that once the D2C program becomes established and the kinks worked out SBC will cut the dealer out of the loop completely. Our local Specialized dealer where I worked full and part time over the past 40 years is going through with their orders this spring, but after that they are moving on to another brand. It is my hope that all the SBC dealers in the USofA join together and drop the SBC brand. Let Specialized eat their own ****.
The quote above came from a BRAIN opinion piece written by Rick Vosper. As most cycling enthusiasts know Specialized has been direct to consumer for quite a few years, first with a hybrid model, and now bypassing the dealer completely. At first it was OK as revenues were given to the dealer who then delivered the product to the consumer. With the bypass of the dealer and shipping direct to the consumer the dealer collects less than half the revenue it would have under the hybrid program. This is still a win for the dealer as he had zero dollars invested in the sale other than the folks that bought direct from Specialized after wasting the time of a bike shop employee gathering information and selecting a bike in a dealer showroom. Dealer did the work and received a very poor margin if any on the sale. Nice job SBC.
All the dealers know that once the D2C program becomes established and the kinks worked out SBC will cut the dealer out of the loop completely. Our local Specialized dealer where I worked full and part time over the past 40 years is going through with their orders this spring, but after that they are moving on to another brand. It is my hope that all the SBC dealers in the USofA join together and drop the SBC brand. Let Specialized eat their own ****.
Last edited by cb400bill; 03-13-22 at 05:25 AM.
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03-13-22, 06:03 AM
#2
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"Specialized is putting a lot of chips behind D2C, and both retailers and consumers will have the opportunity to vote on that bet with their dollars in 2022 and beyond."
The quote above came from a BRAIN opinion piece written by Rick Vosper. As most cycling enthusiasts know Specialized has been direct to consumer for quite a few years, first with a hybrid model, and now bypassing the dealer completely. At first it was OK as revenues were given to the dealer who then delivered the product to the consumer. With the bypass of the dealer and shipping direct to the consumer the dealer collects less than half the revenue it would have under the hybrid program. This is still a win for the dealer as he had zero dollars invested in the sale other than the folks that bought direct from Specialized after wasting the time of a bike shop employee gathering information and selecting a bike in a dealer showroom. Dealer did the work and received a very poor margin if any on the sale. Nice job SBC.
All the dealers know that once the D2C program becomes established and the kinks worked out SBC will cut the dealer out of the loop completely. Our local Specialized dealer where I worked full and part time over the past 40 years is going through with their orders this spring, but after that they are moving on to another brand. It is my hope that all the SBC dealers in the USofA join together and drop the SBC brand. Let Specialized eat their own ****.
The quote above came from a BRAIN opinion piece written by Rick Vosper. As most cycling enthusiasts know Specialized has been direct to consumer for quite a few years, first with a hybrid model, and now bypassing the dealer completely. At first it was OK as revenues were given to the dealer who then delivered the product to the consumer. With the bypass of the dealer and shipping direct to the consumer the dealer collects less than half the revenue it would have under the hybrid program. This is still a win for the dealer as he had zero dollars invested in the sale other than the folks that bought direct from Specialized after wasting the time of a bike shop employee gathering information and selecting a bike in a dealer showroom. Dealer did the work and received a very poor margin if any on the sale. Nice job SBC.
All the dealers know that once the D2C program becomes established and the kinks worked out SBC will cut the dealer out of the loop completely. Our local Specialized dealer where I worked full and part time over the past 40 years is going through with their orders this spring, but after that they are moving on to another brand. It is my hope that all the SBC dealers in the USofA join together and drop the SBC brand. Let Specialized eat their own ****.
You can't fire me, I quit!
03-13-22, 06:13 AM
#3
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There's a fight that will never be won, the younger generation is buying online whatever the LBS does. The LBS had better get in to service accessories and fitting big time, that's going to be the only game left soon. That and selling a few boutique brands for the cash-rich old guys. Or, take your money and run: sell to Trek and become a factory store.
Change is constant, and change can truly suck.
Change is constant, and change can truly suck.
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03-13-22, 06:33 AM
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Wonder what the return policy is if someone orders a bike and it doesn't fit, or something isn't to their liking. What happens if a Specialized bike has a faulty crank bearing, things are not adjusted correctly (and the buyer isn't good at adjustments) and the local dealer has switched over to a diff. brand because of Spec's D2C policy? Personally, I wouldn't buy a bike I couldn't ride first. Can see their policy going sideways in so many ways. I won't even attempt to speak for everyone, but this rider appreciates his LBS. Haven't purchased a bike in a while, but when/if I buy another new one, it would be from the LBS.
Last edited by freeranger; 03-13-22 at 06:46 AM.
03-13-22, 06:42 AM
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If there is no price savings to the consumer, why would they buy direct? I can see the value buying direct from Canyon due to cost savings. Direct from Spesh? Why.
If the return and warranty policy included shipping both directions? Maybe. So, when the SRAM derailleur blows up, will Spesh handle the claim with SRAM and ship me a new derailleur? Immediately? If not, it would be a no-go for me. That is really the only reason for me to buy stuff from a bike shop, dealing the Mfgs on warranty
If the return and warranty policy included shipping both directions? Maybe. So, when the SRAM derailleur blows up, will Spesh handle the claim with SRAM and ship me a new derailleur? Immediately? If not, it would be a no-go for me. That is really the only reason for me to buy stuff from a bike shop, dealing the Mfgs on warranty
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03-13-22, 07:13 AM
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Where did you see that there will be no price savings? I didn't see it in this thread. Or are you speculating? It actually won't affect me because I won't buy a bike from Specialized or Trek. But, that's for other reasons.
03-13-22, 07:34 AM
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There's a fight that will never be won, the younger generation is buying online whatever the LBS does. The LBS had better get in to service accessories and fitting big time, that's going to be the only game left soon. That and selling a few boutique brands for the cash-rich old guys. Or, take your money and run: sell to Trek and become a factory store.
Change is constant, and change can truly suck.
Change is constant, and change can truly suck.
Or the LBS leaving their larger brick and mortar and renting space at a larger brewery beer garden kind of place where group rides leave from already anyway.
Also the whole Velofix mobile shop thing is something they needed to sorely get into as soon as that started, but not many have.
03-13-22, 07:37 AM
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Yes, I'm sure this will backfire on Specialized. I mean, the bf brain trust surely knows more about market trends than the people who run a billion dollar corporation.
03-13-22, 07:52 AM
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Add s-works bike to cart
Look at price
Compare price to LBS price
Looks same to my eyes
03-13-22, 07:55 AM
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I envision the LBS transitioning to a destination spot that happens to also sell or fix bikes: coffee shop or bottle shop/beer garden kind of deal. Food truck a couple nights a week or weekends.
Or the LBS leaving their larger brick and mortar and renting space at a larger brewery beer garden kind of place where group rides leave from already anyway.
Also the whole Velofix mobile shop thing is something they needed to sorely get into as soon as that started, but not many have.
Or the LBS leaving their larger brick and mortar and renting space at a larger brewery beer garden kind of place where group rides leave from already anyway.
Also the whole Velofix mobile shop thing is something they needed to sorely get into as soon as that started, but not many have.
A place to hang out?
I can't see it.
But, I do see your point, they need to make a change and it seems they have failed on the service front with the extremely long waits to get an appointment for service. A lost opportunity. Charge more and focus on service.
03-13-22, 08:25 AM
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We went through this awhile ago in NYC, owner closed down his large space traditional bike shop and now does repairs and custom builds in a shack; now makes more money and is less stressed due to lower expenses. The company that went DTC without notifying us is now not doing well, I doubt S will meet the same fate.
03-13-22, 08:35 AM
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Really?
A place to hang out?
I can't see it.
But, I do see your point, they need to make a change and it seems they have failed on the service front with the extremely long waits to get an appointment for service. A lost opportunity. Charge more and focus on service.
A place to hang out?
I can't see it.
But, I do see your point, they need to make a change and it seems they have failed on the service front with the extremely long waits to get an appointment for service. A lost opportunity. Charge more and focus on service.
03-13-22, 09:02 AM
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Until recently, my home shop was a bike/coffee shop. They bought a building a block away and split up their coffee and bike businesses, though. Frankly, I'm not sure that this was the right decision. The two operations have more breathing space, which is nice, but I do wonder if they're going to miss some of the incidental sales and exposure from the coffee traffic. My club has always met outside of the joint space and we'd often grab a coffee and occasionally be tempted by the odd bike-crap purchase. This year, I don't know where we're going to meet, but we will be forced to choose and one of the two will probably miss out on some business. If I had my say, I would have kept both together but moved to a larger space that could accommodate the expansion of both.
03-13-22, 09:18 AM
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This is the way of the world sadly, I just was comparing the prices online vs. my local dealer and online was the same and in many cases my shop was cheaper in complete bikes.
I wouldn't buy a spec online, my dealer is too good to not support. But with other retailers going this way I am sure they are just trying to keep up.
I wouldn't buy a spec online, my dealer is too good to not support. But with other retailers going this way I am sure they are just trying to keep up.
03-13-22, 09:18 AM
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Just wondering… do shops make most of their money from bike sales or service and accessories?
John
John
03-13-22, 09:21 AM
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Until recently, my home shop was a bike/coffee shop. They bought a building a block away and split up their coffee and bike businesses, though. Frankly, I'm not sure that this was the right decision. The two operations have more breathing space, which is nice, but I do wonder if they're going to miss some of the incidental sales and exposure from the coffee traffic. My club has always met outside of the joint space and we'd often grab a coffee and occasionally be tempted by the odd bike-crap purchase. This year, I don't know where we're going to meet, but we will be forced to choose and one of the two will probably miss out on some business. If I had my say, I would have kept both together but moved to a larger space that could accommodate the expansion of both.
03-13-22, 09:31 AM
#17
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We went through this awhile ago in NYC, owner closed down his large space traditional bike shop and now does repairs and custom builds in a shack; now makes more money and is less stressed due to lower expenses. The company that went DTC without notifying us is now not doing well, I doubt S will meet the same fate.
We also had a chain - Hilltop - get acquired by Specialized recently. Still the same shop and employees, but now they only do Specialized. I just happened to have a Specialized so it's kind of a win-win for me since one of their locations was one of my go-to LBSs.
03-13-22, 09:44 AM
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Angry Catfish. That's exactly the shop I thought of when reading GhostRider62 's doubting post. I've only been in there a few times, but there were always plenty of people hanging out in the coffee bar area.
03-13-22, 11:29 AM
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Specialized sells good tires, can't speak to their bikes or business model. 
Wonder who makes their tubulars?
Wonder who makes their tubulars?
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03-13-22, 11:53 AM
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This is still a win for the dealer as he had zero dollars invested in the sale other than the folks that bought direct from Specialized after wasting the time of a bike shop employee gathering information and selecting a bike in a dealer showroom. Dealer did the work and received a very poor margin if any on the sale. Nice job SBC.
The current mechanism would have cut them out of the loop, and the sales commission.
03-13-22, 12:04 PM
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I wrenched for an "S" shop a few years back, I already want them to eat droppings....
This will massively up-end that particular shop. Their business model was to go for hard sell on new bikes, while leaving their entire service department to be staffed by whoever they could find to work for minimum wage. Naturally this led to regular turnover (unless the owner liked you, then he might throw his wife at you. Apparently open marriage. Rumor mill had his daughter actually fathered by an assistant manager)
This will massively up-end that particular shop. Their business model was to go for hard sell on new bikes, while leaving their entire service department to be staffed by whoever they could find to work for minimum wage. Naturally this led to regular turnover (unless the owner liked you, then he might throw his wife at you. Apparently open marriage. Rumor mill had his daughter actually fathered by an assistant manager)
03-13-22, 12:05 PM
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They want to cut out the folks who got them to this point. It is rather disgusting. Without shops supporting him, Ole' Mikey S would have been still in his van down by the river.
I think if the Click to Brick program was way better compared to this, the customer was still cut out of any useful knowledge to help them pick a bike or part or whatever but at least it was built up by professionals at a shop and the shop would get a little from it and potentially more if the customer decided hey I need accessories or service or something like that. Now they are just saying "hey shops..." *middle finger* *middle finger* "...you guys are the worst but we are still going to have you handle the warranties when they screw it up and we are taking away product you could sell to further cut you out, oh yeah and we switched to SRAM"
I think if the Click to Brick program was way better compared to this, the customer was still cut out of any useful knowledge to help them pick a bike or part or whatever but at least it was built up by professionals at a shop and the shop would get a little from it and potentially more if the customer decided hey I need accessories or service or something like that. Now they are just saying "hey shops..." *middle finger* *middle finger* "...you guys are the worst but we are still going to have you handle the warranties when they screw it up and we are taking away product you could sell to further cut you out, oh yeah and we switched to SRAM"
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03-13-22, 03:34 PM
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So right now, d2c for Spesh means that the price is the same whether you have it delivered directly or have it shipped to a store and assembled. Is the op complaint that spesh offers d2c at all or that spesh should charge more for direct delivery? I don't get it, if lbs assembly is so important, why would anyone choose the direct delivery option if it costs the same?
03-13-22, 03:41 PM
#24
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Would have been nice if the OP put a link to the article:
https://www.bicycleretailer.com/indu...1#.Yi5j-S2ZPUI
So not quite the gloom and doom most of you are making it out to be, but adding another option for customers to choose from.
It also seems to be in response to Trek and other companies trying to squeeze them out of distribution areas:
https://www.bicycleretailer.com/indu...1#.Yi5j-S2ZPUI
Starting next week consumers who want to buy a Specialized bike will have many options:
1. They can walk into a brick-and-mortar Specialized dealer, including independent and company-owned stores.
2. They can find the bike they want on Specialized’s website and then use the site’s dealer locator to find a nearby dealer who has the bike in stock, and then contact that store about a purchase. Specialized told dealers that the dealer locator will be positioned prominently on the website.
3. They can buy directly from the Specialized website and have the bike delivered to a Tier 1 or Tier 2 Specialized dealer closest to them. The dealer will assemble the bike and the customer will come pick it up. The dealer would get 50% of the normal margin on the sale.
4. They can buy directly from the Specialized website and opt to have the bike delivered to their home in a mostly assembled state, similar to what consumer-direct brands like Canyon offer. Specialized will use facilities in Salt Lake City and Ohio to pre-assemble bikes for this delivery option, and then ship them in larger boxes to the consumer. The packaging will include tools and QR codes that direct consumers to assembly videos.
5. They can buy directly from the Specialized website and opt to have an assembled bike delivered to their door by a Specialized dealer. The dealers will provide “white glove” delivery and fitting, and the dealer will receive 75% of the standard margin for providing this service. This is the same margin now offered to dealers fulfilling click-and-collect purchases.
1. They can walk into a brick-and-mortar Specialized dealer, including independent and company-owned stores.
2. They can find the bike they want on Specialized’s website and then use the site’s dealer locator to find a nearby dealer who has the bike in stock, and then contact that store about a purchase. Specialized told dealers that the dealer locator will be positioned prominently on the website.
3. They can buy directly from the Specialized website and have the bike delivered to a Tier 1 or Tier 2 Specialized dealer closest to them. The dealer will assemble the bike and the customer will come pick it up. The dealer would get 50% of the normal margin on the sale.
4. They can buy directly from the Specialized website and opt to have the bike delivered to their home in a mostly assembled state, similar to what consumer-direct brands like Canyon offer. Specialized will use facilities in Salt Lake City and Ohio to pre-assemble bikes for this delivery option, and then ship them in larger boxes to the consumer. The packaging will include tools and QR codes that direct consumers to assembly videos.
5. They can buy directly from the Specialized website and opt to have an assembled bike delivered to their door by a Specialized dealer. The dealers will provide “white glove” delivery and fitting, and the dealer will receive 75% of the standard margin for providing this service. This is the same margin now offered to dealers fulfilling click-and-collect purchases.
It also seems to be in response to Trek and other companies trying to squeeze them out of distribution areas:
Specialized has been the most challenged by the trend of Trek — and now Pon — acquiring retail stores at a rapid pace. In several markets, Trek or Pon has acquired some of Specialized’s largest dealers, leaving the brand without distribution in those areas. Specialized has responded by buying up some stores of its own, and by opening company-owned fulfillment centers.
Last edited by nel e nel; 03-13-22 at 04:05 PM. Reason: post script
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03-14-22, 08:40 AM
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Direct to consumer makes a bit of sense to me now that I've got a few bikes (and ridden or test ridden more). On the one hand, I've got enough experience to know what I'm looking for (at least as far as geometry) to buy a bike sight unseen online. On the other, I know there's jobs I can't or don't want to do on a bike, so I appreciate having a bike shop nearby to do those services, and I don't mind helping to keep them in business.
I keep wondering how that all works for someone who's never had a well-fitted bike. I've seen a few manufacturers' traveling bike shows, but they've never had the models I wanted to test ride in my size. Is the "price uber alles" crowd going to pay for a bike fitting before they buy, and have the fitter help them pick out the right model or size? I can hear it now, "I'm saving $200 buying direct, and you want $250 to tell me what to buy??" Or is the buyer going to say, "My last bike came from K-mart, this is so much better! This is $3,000 between my legs, of course it's awesome!" only to hang the bike up three months later, never to be ridden again.
I keep wondering how that all works for someone who's never had a well-fitted bike. I've seen a few manufacturers' traveling bike shows, but they've never had the models I wanted to test ride in my size. Is the "price uber alles" crowd going to pay for a bike fitting before they buy, and have the fitter help them pick out the right model or size? I can hear it now, "I'm saving $200 buying direct, and you want $250 to tell me what to buy??" Or is the buyer going to say, "My last bike came from K-mart, this is so much better! This is $3,000 between my legs, of course it's awesome!" only to hang the bike up three months later, never to be ridden again.