sinnerman":46o5qqij said:
I think discounting the stock will devalue the brand even further.
To my mind the "ONLY" reason they stayed on top so long is the Way ATB sales did business.
Sadly the market has changed Considerably.
Mark My words, If paligap take the Discount Road, its Doomed.
yeah that was sort of my point, discounting does devalue a brand, but only to a point, usually, what i mean by that is we are now in a constant year long loop of the new model, the is a finite period at which a bike is sold for it's retail price and annoyingly that time is mostly the off season as the new 'year' model tends to be launched at the end of summer, the 2014 models have already been ordered by dealers and alot will already be in stock. that means that the dealer is going into the less busy part of the year, winter, with high stock values on bikes that in alot of cases may sit in the shop till spring at which point they sell but then people start considering the new model again, should i wait? etc.
this means that distributors and shops start considering discounting, but the playing field isn't fair, between shops or distributors, if the marks ups on brands were the same across the board it wouldn't be so bad but it isn't, a specialized or a giant dealer makes more per bike than an orange does and so on. but then it's also how little a dealer is prepared to make to get the sale.
my point with ATB is that i think they run it how it should be run, meaning insisting on rrp because it protects the brand and the dealer and dealers who discount get reprimanded or binned in extreme cases, the problem comes when other dealers discount when marin/atb won't even consider it, so you then as a dealer end up with a brand that is a little more expensive than others anyway which can be a sticking point and also it isn't discounted until the new model is sat next to it. the rep used to insist that we didn't discount until we had the new model, this to me was crazy, if you know the distributor has none left and the new model is due inside a month you should try and sell that bike at rrp but if you have a customer on the edge it's better to discount to tip them over the edge rather than not discount, not sell the bike and then get the new model and maybe have to discount it more to then sell it instead of the new model.
does that make sense?
regarding Paligap though, look at the history, originally set up by ex carrati sport people, the very people who put GT into halfords, and that went well didn't it, lost the brand/went bust/whatever, then they get kona, which ruined a good brand at a good but small importer (2nd level imports) who had kept the brand small but successful in this country, then they stuck them in halfords which again like gt ruined it for every bike shop dealer, not to mention the owners of the bikes who then struggled to get parts etc. then the owners of paligap split, one going to another importer, who then quits that new job because kona want him to run a european hq for kona, but if one thing can be assured about the way paligap and previously carrati sport did business is that they always have discounted, and in big terms aswel, while this is initially good for bargains it can never last, because at some point people realise that there is never any point in buying the new model because if they wait just 4 to 6 months they can pick it up for 40% off. brand ruined, why? because if the brand doesn't make money then somewhere along the line someone goes bust, if we get lucky it's the distributor as opposed to the brand.
