Salomon/Atomic moving to on-line model???

[jim-ratliff]

The following note was from John Nugent (Neuvation Bicycles, sells very good wheels at very good prices, web only) and talking about Mavic.  But I couldn't help but notice that other brands owned by Amer-Sport Group were Salomon and Atomic.  How does the local ski shop compete with this if, as is likely, it becomes a trend. Many ski shops compete now with some level and type of selling on the Internet (at least at close-out), but how can their web presence compete with the large infrastructure and resources of a "PFS Web".

What does this say long term about how we buy skis.  There may not be guys at the "local store" to recommend skis because the store has been priced out of the ski business.  Where is the limit at which we appreciate the service provided by the local store and go ahead and buy there instead of taking the information home and ordering the same thing on the web??

I sort of miss the "local book store", I wonder how many other "local ______ stores" will also be missing in three years.





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Mavic selling consumer direct?
Probably not.  At least for now.  But this article in BR&IN states
Last week, PFSweb, Inc., a Texas-based e-commerce company, announced it had reached a multi-year agreement with Amer Sports Group, Mavic's parent company.PFWeb said it would work for all of Amer's brands, which include Mavic, Salomon, Atomic, Wilson, Suunto and Bonfire.?
Mavic says their business model is different than the other companies in the Amer Sports Group and would not lend itself to selling consumer direct.  My interpretation of that is that they would lose a large part of their dealer business overnight (and they are already getting Internet sales through some of those dealers) so the whole thing doesn't make sense for now.
Yet when a large consumer products group including the brands above makes such an overt move to sell consumer direct it sends shivers through retailers already in shock over the loss of sales to the Internet.
BR&IN notes in their July 1^st magazine that the Glusking Townley group estimates Internet sales at $2B or over 1/3 of the total market.  While it's true that many of those sales are through bike shops, the bulk go through Amazon, Craigslist, Ebay, and others, and it's only going to get bigger.
The bike industry, for the most part, really hasn't reacted.  I think most are aware of what's going on but they have so much invested in supporting bike shops they can't afford to alienate them.  They are caught between a rock and a hard spot.
There are a number of companies trying to bridge the gap between Internet sales and bike shops but unless a bike shop makes a large investment in Internet sales they have little or no chance of success.  Local bike shops have a few shops to compete with in their local markets, Internet retailers compete with thousands. You can't do that in a few hours a day.
One thing is certain. In five years, the bike industry will be totally different than it is now and throughout history, the companies that have succeeded have focused on two things - finding out what consumers want and giving it to them.

[jbotti]

I estimate that I have bought 75% of my skis online. I am not sure that educated consumers want or need the added commentary of a local shop guy (who always has a point of view usually based around his profitability). I am much more in the darwinian camp on things like local bike and ski shops. if they truly add value they will survive. But often the extra layer of cost is not worth what you get for it. Having a choice is great.

In skis the ability to demo is very important for a lot of people. But I bet that most skiers that demo lots of skis are doing a good percentage of the demoing at Brand sponsored days where the local rep shows up with lots of skis. I am not sure how much value local ski shops actually provide, and this is why it continues to be a very tough business.

I actually feel stronger about trying to support local bike shops because I don't like to do all my bike work myself. So I actually choose to buy components from them when I know I am paying a higher markup  than I would online because I want them to stay in business.

Some products will never be sold direct. Many products lend themselves quite well to direct to consumer selling. Again being able to choose is a great option.

I guess your point is that the choice may disappear over time and we will all be left with only the direct option. I can live with that assuming that it comes an appropriate level of cost savings.

[Svend]

I don't think the local ski shop or local bike shop will ever disappear, and I don't pay much heed to such doomsaying.  It seems to me that such predictions are often posited by those who would benefit from their occurrence, as a way to influence the reader and change their thinking and behavior. 

But there are things a local shop can offer that no online retailer can ever match.  Ski shop:  boot fitting; helmet fitting; tuning and repair services; etc.  Bike shop:  bike fitting; demo rides (walk-in, chat about bikes, take a few for a spin to see how they feel); tuneup and repair services; parts and accessories (most shops around here offer these at prices similar to online, so why buy online?).  The only time I buy bike parts online is when I need something unusual or unique that I can't find locally -- a particular tire, for example.  But I would never buy a complete bike online.  Skis are different, and I am comfortable buying online, and have done so several times.  But again, that is often because I can't find a particular model here locally.  And only after exhaustive study of every online review I could find, to make sure the model was appropriate and a good match.

Re. service, I do most of the work on our bikes and skis myself, but I would sorely miss not having a good local shop nearby to get some skis base ground, or a headset installed in one of our bikes, etc.  That is the kind of work I have neither the ability, the tools, or the desire to undertake.  And I find the cost of having a shop do it is very reasonable -- $45 for a stone grind; $20 to install a headset; $20 to true and tension a wheel...all bargains as far as I'm concerned.  And while I'm in the shop, I often buy parts and accessories because it's convenient and the prices are quite reasonable (I likely wouldn't do it if I felt I was being gouged).

[LivingProof]

"Before it all changed, it was different"

Internet buying has certainly changed the local retail business in many sports. More and more, there a few large local retails and far fewer mom and pop shops.  One local small ski shop told me sales were off 80% this past winter. One issue I find distrubing is that internet sales are exempt from state sales taxes. I enjoy the tax break, but, it's just so unfair to the brick and mortar shops, plus, all our states need the income.

 To Jim's question about the future prospects of direct shipping to consumers, I would not be surprised if manufacturers with very specific products tried this method. Mavic's business is very narrow in scope in the competitive bike wheel sector. They are not stock on pre-built bikes, so, why would consumers single them out as a wheelset of choice at premium prices? Mavic is not on my preferred list right now. 3 years ago, I bought a set of their wheels which are made with coated steel spokes which are now pitting as the coating is deteriorating. I'm also not a fan of Mavic's proprietary components forcing us to return to them for repairs.  Before next season, I'll be on different wheels and Nuvation may become my next wheelset.

I have a great local bike shop that has a service shop with very reasonable pricing and fast turnaround time for repairs. They are fixed in their pricing of components, sometimes to their detriment. When I switched to compact cranks, I was a little miffed that I had to pay list price plus the full installation. So, a few weeks later,  they put my internet bought cranks on the bike for their very reasonable shop fee.  One needs to be a very dedicated biker, with deep pockets, to consider have a custom bike built.

[Svend]

It just occurred to me that Nordica USA has been doing direct sales for at least the past couple of years, and maybe longer.  If you go to their website, you can buy direct from them -- skis, boots, accessories.  So I guess this is not totally new to the ski industry.

[jim-ratliff]

I agree with Living Proof about the Sales Tax issue. Web stores Shoppers no longer need the advantage of avoiding state/local Sales Tax as an inducement to order online.
Interestingly, when I order from the Performance Bike website, they have to collect Sales Tax on the order because they also have retail stores in Virginia. If I order the same thing from TreeFortBikes or BikeTiresDirect then they don't pay sales tax. So even web sites aren't on a level playing field.


I will say that I try to do as much business through the local Performance Bike store as possible. They have been quite helpful and they will price match web store prices (including their own web).
I have found that most bike stores, in fact, will jump at the opportunity to price match against the web rather than lose the business completely. Perhaps the manufacturers (or distributors) provide back-end relief on such sales.  In fact, I found the Sidi MTB shoes Lynn was looking for in a store down here.  The store owner actually thanked me and commented to a rep standing next to him how much he appreciated customers giving the local store a chance, and that was at a noticeable discount.  We paid tax, but also had the conveniences of being in a store such as being able to try the shoes on before buying.


Are there web pricing and channel control models that work well for the customer other than Amazon? How would it impact the local ski shop if the manufacturer focus was to support the local shop without requiring them to carry complete inventory (and to order it way ahead of time) by simplifying the shopping experience (or the shop re-order experience) using the web?
I like Mike's line.  Everything was different before it changed.

[LivingProof]

The below is from a friend who occasionally lurks in our forum.


What people do not realize that if/when they order over that Salomon/Atomic model is that the product order goes to the closest retailer and the product in shipped from there and that dealer gets the sale. This is no different than what Blizzard, Nordica, Rossi, Dynastar, K2 have been doing for years through Shopatron. The only difference is that Salomon is keeping that step in.

[jbotti]

If it's just like Shopatron, it's likely we won't be using it much or at all. Everything is at full list. It's great when you really want or need something that you can't find, but beyond that it's just overpriced. That is really not selling direct to the consumer.

I guess we can all stop worrying about our local shops!

[jim-ratliff]

If it's just like Shopatron, it's likely we won't be using it much or at all. Everything is at full list. It's great when you really want or need something that you can't find, but beyond that it's just overpriced. That is really not selling direct to the consumer.

I guess we can all stop worrying about our local shops!

Agreed.  That was one of John Nugents points. Those that have been successful are because they provide what the consumer wants. My concern is that the consumer want's low price but actually need's some of the service not associated with lowest price channels.


But interesting information -- I had never heard of Shopatron. And, interestingly, sounds like the Shopatron model still requires the dealer to pre-purchase inventory, so the dealer is assuming all of the risk of the market (bad snow year, the dealer is the one that suffers?).

[Philpug]

  Shopatron is not at LIST, it is at MAP, what every shop will have it at until MAP policies end, usually in FEb/March. The Salomon program will be along the same lines basically trying to save a level of margin that goes to a middleman/seller like a Shopatron. The products that are ordered out of any of these manufacture sites get sourced from the closest dealer that can fulfill the order. This model like a Shopatron or what Atomic/Salomon are doing actually HELP dealers be working with the inventory that they already own.

As far as risk..everything is a risk. The key to it is to know your market/consumer and buy smart. Next year most inventories WILL be short, if you want something that will be hot next year, buy early because everyone..EVERYONE bought short for next year.

[jbotti]

Thanks for the clarification Phil. That is what I meant I just didn't know what it is called. I also don't think that this price changes on Shopatron even if it is April.