Sunday, November 23, 2008

Equipment - $2 For 2 Screws?

He'd gone into an LBS (where, a few weeks earlier, he spent $120 on bike gear) after he noticed that he'd lost a couple screws off his shoes. He asked for, and received, two screws for his cleats. The shop guy actually took his shoe and fitted the screws, thereby verifying that the screws indeed fit.

The shop guy then charged him two dollars for the screws.

The rider went and found the same kind of screws at a big box department store for a lot less, I think $1.13 for four more such screws. I think this made him think that perhaps the LBS had ripped him off, or was expensive, or something. It just didn't seem right. So he posted his question online.

He got a bit of a response to his question, ranging from folks questioning his financial status (why worry over a couple of bucks), the amount of free time (questioning online the value of two screws), to the predictable HTFU.

I've been on both sides of the counter on transactions like this. Let me point out that my bike shop failed in part because I was too nice to the good customers. They didn't make me do it - I'm the one that gave them the discounts, priced the product, etc. But in the scheme of things it's the little things that add up to whether a shop stays open or closes.

So, are two screws worth two dollars?

First, figure the shop guy's time is worth, say, $60+ an hour. That's conservative I think, but that's what mechanics needed to make the shop 10 years ago. If he spends 2 minutes finding the screw (i.e. he is helping you and only you out, not keeping an eye on the store, not assembling a bike while chatting, etc), then his labor needs to be covered. $2 is about fair for 2 minutes at $60/hour. At $90/hour (seems like the standard car mechanic rate around here) it's worth 90 seconds of rummaging.

If the shop is a mess then you subtract a little, but if it's spotless, figure it's worth a bit more money (since they're "more efficient").

Second, the screws are a little unusual (they were screws for Carnac shoes, ones that require a bit more length than normal). A quick way of getting them would be to strip a pair of shoes for its screws, then hoping that someone that buys them gets pedals that doesn't require those exact screws.

But that's not the best way of doing it. Buying the screws separately (and not stealing them from another complete product) is "correct".

And to do that costs money.

For them to order a couple screws (from a bike distributor or even a McMasters) will cost them probably more than just $2. I work now in a hardware store (little one, not a big box one). We ordered screws for a very, very good customer, one comes in 1-3x daily, four boxes total. One box of screws wholesales for $13.72 and retail for $15.12 (Midwest brand, the ones that you find in the little pull out drawers). Okay, so we can't give the 10% discount, right? The kicker was the $9 in shipping (!!) for 4 boxes. Now the boxes cost us almost $16 each (forget about ordering time etc) and they retail for less.

It comes to that saying "You can have it fast, good, or cheap. Pick two of the three."

Our customer got the screws at $18 per box ($20 - 10% discount). He waited 3 days for them. The original online questioner got his two screws at $2, and waited, hopefully, a couple minutes for them. The convenience of not having to walk through Home Depot on a ride is worth something, maybe a not-stolen-bike, not slipping on the floor, something. The cost of the screws are not the point, it's the time efficiency and the fit (of the screws).

However... I've also been a customer. Even at large bike shops (Supergo somewhere in CA) I understand that things are not free. I bought 5 chainring spacers there when I realized I'd lost the spacer (but not the bolt) off the 5th hidden chainring bolt on my Record crank. The shop gave me a plastic bin of spacers to rummage through (took 10 seconds for the guy to pick it up and hand it to me). I know that this bin costs something like $50 wholesale, no shipping, not worrying about minimum orders, and the place that sells them requires, typically, a $600-1000 minimum order. After a minute I found the chainring spacers, took pretty much all of them (I think I needed five of them), pointed this out to the mechanic, and asked him how much for the spacers in my hand. I felt a fair market value was $5 ($1 each), a discounted price $2 (40 cents each), and a high price $10 ($2 each). I decided I'd pay $5 for the five spacers.

"A buck."

I protested. This was below even a "good" price.

"A buck? It's got to cost you 20 cents a spacer. It's got to be more than that."

"A buck."

I've never seen him before, never saw him since. Since he stood his ground, I let him. I went to the register and let the guy know there that the mechanic told me it was a buck. Because I felt bad about basically stealing from the shop, I also bought energy bars and tried to convince myself that I needed some carbon fiber dropped bars (they didn't have my size). I also came back to buy a cheap mtb frame (house brand, $150 for the frame) but they didn't have my size in that either, but I was too far away to carry it on my back while on my ride when I got the chainring bolts.

I know that the original questioner spent about $120 at the shop a couple weeks before, but that's not a huge transaction in the scheme of things - a couple tanks of gas now, or one tank a month ago. It could have been huge if he had engaged one of the smarter employees in some discussion about his love for cycling, how he's looking to buy an electronic DA bike in a month, etc etc. Then, if the shop (and its employee/s) was smart, he'd be on the very short "potential good customer" list. But if he was not engaging, not outgoing, shrugged when someone asked if they could help him, then he didn't make it on that list. He's a "regular guy" to them. Therefore there are no exceptions made unless that's how they are regularly.

Keep in mind too that even huge bike shops are closing due to various economic forces. That guy who helped out the original questioner might have just gotten a big lecture on how "we're letting the shop bleed money from the little nuts and bolts we give away for free". And then the guy comes in and ask for two screws.

I don't think that the $2 is the point here. It's the principle of the transaction. It seems to me the guy hadn't thought about the other side of the counter, and apparently, after he got a bunch of responses, he hadn't. At this point he's happy.

But when he found the screws at Home Depot, he wasn't.

He was a disappointed and upset customer, the kind you do not want to have in any kind of economy. However, by asking the question online, and even putting up the poll, he asked the rest of us to address the principle of the question.

My answer?

If he had ordered the screws and they came in a couple weeks later (i.e. the shop scrounged together a minimum order to cover shipping, or at least an order large enough to absorb the insane shipping costs nowadays), and they charged him $2, that might be on the high side. Better would be "Well, they're supposed to be $2 but we're charging you $1".

If he'd bought a bike or two there (and the pedals and the shoes, which seem to have been bought elsewhere), I bet the screws would have been free no matter how much the shipping ended up costing them.

If the guy helping him said, "Look, I know the price is high, but that's what I have to charge, I'm really sorry, you can buy them or I can put them back in the drawer", then I think the original questioner might have been soothed enough not to say anything.

The communication between the shop and the customer is key.

If effective communication occurred at the original transaction, the original questioner wouldn't have felt a bit ripped off. He wouldn't have posted his question online.

And this post would be... not here.


Anonymous said...

I feel this way sometimes.

I've gone to my LBS to buy something I needed or wanted RIGHT THEN and then seen it online for 25-30 bucks cheaper even after shipping.

Is it a decent difference for someone on a students 'pay', yes it is. It's 10% of my MONTHLY paychecks from one of my two jobs.

Is the price difference worth it? You betcha. I bought a PI rain jacket that I wore the next day. I didn't have to wait, I didn't have to worry about size and fit, and I didn't have to worry about what would happen if I went out and got caught in the rain the next day.

I've bought things that I wanted right then from my LBS all the time, but unfortunately they can't compete for things that I can stock up on.

I go there to get something adjusted, they teach me how to do it and sometimes charge nothing. I go back, not with the expectation of not being charged, but with the expectation that I'll learn something while I'm there.

I asked if they were hiring this summer (yes, I'm thinking of sticking around to work, aka make ends meet, and race), and the owner's reply was that he was hoping that all his staff could stay...

Sometimes convenience outweighs the cost. And sometimes it doesn't. In the end if local businesses fail, then when you need that $2 screw, you're either going to have to drive 20 mins to find it, or you're going to have to spend an hour to find it, or wait a week for it to show up in the mail.

-Young rider.

Mike said...

This was a pretty insightful post, I doubt most customers put themselves into the LBS's shoes.

It reminds me of a situation last week. My old headset was becoming grindier over time, so I bought a new 1" threaded catridge bearing headset from a tiny importer ( because I knew my other options were really just a Record headset and Chris King, both of which are out of my budget.

I would have installed it myself, but wanted to have the steerer tube cut down so there were no spacers, so I bought it to a LBS. The guy convinced me it wasn't worth cutting 5 mill from the steerer tube, especially if something ever happens to those threads. So I had him install it, asked him about my very worn back tire and bought the exact replacement he happened to stock but maybe $15 more than the internet. Total bill was about $60, but I think I'm becoming a "good customer" in the process, and that's worth it.

No One Line said...

Aki, I appreciate your ongoing quest to bring more understanding to the relationship between bike shops and their customers.

One thing that frustrates me is people complaining about bike shops having higher prices than online retailers. As if a storefront and sales staff came free, and as if online retailers and brick-and-mortar shops didn't provide very different services.

Aki said...

All - thanks for the comments. Those on BikeForums will know that this came from a question posed by one of its members. That particular poster was sincere and appreciated the info, but I was amazed at some of the less positive responses. Ultimately, although a particular item may be worth only so much, the ancillaries (shipping, labor, etc) may be worth much more. The screw is not the valuable thing in this case - the labor, stock, and knowing where it is. If you go to a metal scrap yard for a screw, you really have to know exactly what you want and how to find it. A hardware store would be better, but a bike shop is the ultimate, at least for a bike related screw.

What I don't think is healthy is that many shops feel like they should give you a break. I used to think that way because I figured the customer simply couldn't afford the "real price". I didn't understand that their cars were $30-50k (mine was $1500), their salaries unfathomable, and that the "real price" was, to them, chump change. I try and buy things at shops, especially the hard things to find, and I inevitably have to fight to pay full price. A special order part shouldn't be discounted, but it seems every time I special order something, the selling shop tries to discount it. I appreciate the gesture but I also want them to be around next year for whatever next part I need.