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False Economy
Editorial by Tom Demerly.


Tom in the Eco Challenge


We are smack dab in the bike-buying season. It was nuts in here last Saturday, the kind of nuts I like. We were fitting people, swiping credit cards and writing up sales. Since I make my living off this, I love this time of year.

With the bike buying season comes the attendant bizarre and illogical behavior we often see when anyone is contemplating a $1000 + purchase. One of the most common versions of this financially induced dementia is the false economy of used bikes.

With the current popularity of E-Bay and other on-line resources for buying used bikes the used market is hotter than ever. People who spent a year in the sport or bought the wrong equipment to begin with are itching to get rid of what they have and recover some cash. On the surface, buying a used bike with low miles for $800-900 that originally sold for $1500+ sounds like a shrewd move.

Problem is, it’s false economy.

The price you pay for a bike includes all the parts of the bike itself, obviously. But it may or may not include another set of things that have a tangible, intrinsic value. Those things are what the person who sells it to is willing or capable of doing to be sure the bike is correctly suited for you and how you will use it.

I wrote an editorial singing the praises and lamenting the pitfalls of E-Bay last year. It is in our editorial archives under “Caveat Emptor”. Check it out if you’re interested.

Buying a used bike is not like buying a used car. The single most important determining factor in bicycle performance is fit. There are at least 13 variables on every bike that directly and substantially influence fit. The chances of you finding a used bike with all 13 of those variables exactly as you need them is, well, one in 13 at best.

How do you know what the exact parameters for those 13 variables are anyway? I’m talking specifically about things like handlebar width and shape, stem length, aerobar shape and length, shifter and brake position, saddle type, saddle fore/aft and seatpost type, crank length, pedal type, cleat set-up and on and on. The chances of getting all those things right on a used bike are very remote. The chances of you even knowing when they are correct are even more remote.

I hear you: You say, “Oh, but I am just a beginner…. I don’t need all that. I used my Dad’s old 10-speed in my first triathlon. Anything would be better than that.”

Well, anything might be slightly better than your Dad’s old 10-speed, but at $800 for something only slightly better than your Dad’s old 10-speed doesn’t it make sense to just stick with your Dad’s old 10-speed and save the $800?

Beginners and first timers need fit services and the correct bike more so than experienced athletes do. Once an athlete puts some time on a correctly fitted bike and understands the factors that really go into bike fit then they are better equipped to make buying decisions on their own. Interestingly enough, it is the second and third time buyer who is most likely to not buy used and understands the value of buying a new bike precisely fitted. This is usually because their first attempts at bargain shopping burned them so bad they learned the hard way.

Let’s take a nuts and bolts, dollars and cents look at a typical used bike purchase that actually happened last week in our store. This is a typical example of the false economy of used bike purchases:

Kathy is a second year triathlete. Last year she did two triathlons and enjoyed them. She did them on a borrowed bike that she knows did not fit her. She understands that bike fit is important but doesn’t have the cash to buy a new bike for her second year in the sport. She also doesn’t feel she needs one of those “fancy” bikes since she only aspires to doing a couple Olympic distance races and one day maybe a half Ironman in a year or two. She talked to other people about buying a bike and done a lot of research on the Internet. She feels she has been diligent in her search and is an informed consumer.

Based on her research she discovered a 48cm Super Kona Deluxe triathlon bike would fit her. She finds a Super Kona Deluxe used for $700. It has been raced four times and trained on one summer. The person who owned it is starting a family and leaving the sport for a while. Kathy’s research revealed the Super Kona Deluxe sells new for $1499.99 plus tax. The person selling the used bike is willing to throw in the pedals that cost $129.99 new. All Kathy has to do is buy some shoes, which she found mail order on sale for $89.99 marked down from $159.99. It looks like Kathy’s total out-of-pocket for this project is $829.99 including the shoes and shipping costs for the bike and the shoes. Compared to over $1789.97 for the same package new she is saving a whopping $959.98. Clearly Kathy’s bargain shopping skills are paying off.

Or are they?

Kathy gets the bike and one of her friends who knows about bikes helps her assemble it. She is pretty handy herself so between the two of them they do a fine job.

During the first three or four rides Kathy notices the bike needs some adjusting and a friend recommends she get a bike fitting and maybe a tune-up. She has read on Internet triathlon forums and heard from her friends at the pool how important bike fit is. Since she is beginner she assumed this did not really apply to her. However, her first few rides reveal the bike “Just doesn’t feel right”.

Well, no new bike feels right at first, they all feel a little weird. Most people find they have to meet the new bike position half way. But just the same, this bike feels very strange and she decides to invest in a bike fit and do it right. After all, she saved over $900 on this purchase so a few bucks to get it perfect is money well spent.

She schedules a bike fit appointment with a store that has a staff of three triathletes who have done many races all over the world. The guys in the store are experienced and come recommended.

At her fit appointment she tells the bike fitter the saddle makes her sore, her lower back gets sore after an hour on the bike and her feet go numb. The bike fitter asks her to demonstrate applying the brakes and she can barely get one knuckle over the brake lever. When the bike fitter asks her to shift gears he discovers she must move her hands three inches on the handlebars to reach the shifters, and it is difficult for her to get the chain to go from the small chainring to the large chainring.

With the bike fit complete the fitter discovers she needs the following to make the bike fit correctly and function correctly:

Change required Cost Reason
New, shorter aerobars $119.99 Aerobars too long
New, narrower base bars $59.99 Base bars too wide
New, shorter stem $59.99 Stem too long
New cables due to cockpit
Length change
$21.00 Cables too long
Bar tape $11.99 Old tape ruined
New cranks $149.99 Cranks too long
Center mount seat post $89.99 Was too far back
New saddle $159.99 Old saddle uncomfortable
New 12-23 cogset $49.99 Original 11-21 “too hard”
Labor for fit $150.00  
Labor for mechanicals $80.00  
     
Total finished cost $1010.09  

So now we find out Kathy’s used super Kona Deluxe actually cost her $1782.91. Also, the shoes she bought were too large, causing her foot numbness. She was able to exchange them but had to take a credit since the mail order place was out of the smaller size. Kathy then had to find shoes elsewhere at full price and at a delay.

Ultimately, Kathy saved $7.06 if you don’t count the five hours she spent in the bike shop for the two fittings (one to find out what was wrong the other to confirm the changes were correct) and 80 miles of driving to and from the bike shop twice for the fittings.

And for her $7.06 savings Kathy still has a used bike with a year of wear on it. So, in the next 60 days she will need new tires and a new chain, another $150+ of work. There goes the great deal.

Now, before you roll your eyes and say, “This is bullshit, it is just Demerly trying to sell bikes for Bikesport, Inc.”, let me assure you- You’re right. I am trying to sell bikes.

Let me add that had Kathy bought a new Super Kona Deluxe we would have changed all those components for her completely, absolutely 100% free of charge. That is right, $1010.97 worth of work for free.

How is that possible? If I swap a brand new 172.5mm crank for a brand new 170mm crank it doesn’t cost you or me a thing. You bring me a used one and it is worthless to me. To us, within reason, parts are interchangeable. Now I’m not going to give her a Dura-Ace crank in exchange for a Shimano 105 crank. But to me a 170mm Shimano 105 crank new in the box is the same as a 172.5mm Shimano 105 crank new in the box. It doesn’t cost me anything to switch those.

Now, in fairness, Kathy can take all the parts that didn’t fit her and post them on E-Bay and probably get back $500. But it is a lot of work to process the auctions, ship the stuff and make sure all the people who won the auctions are happy.

Let’s assume that, for arguments’ sake, the only thing Kathy needed was a new stem, saddle and aerobar- about the minimum it takes to get a bike to fit. She is still out the time and money for that stuff, and she still only has a used bike.

Here’s the point: If Kathy had bought a new bike she would have had to make two trips to the store, maybe only one. The bike would have been correctly fitted the first time and she would have received a year worth of free labor- all her tune-ups before races would have been covered. When Kathy left the store with her NEW 2004 Super Kona Deluxe she would have had a perfectly fitted, new bike with fresh, new tires, tubes, cables and chain. If anything went wrong with it, it wasn’t her problem- it was ours.

You guys get the point: We’re trying to sell new bikes as opposed to you buying used ones. We do that because, obviously, we’re here to make money. I guarantee you though, when someone brings us a used bike that needs to be completely re-sized, we make a healthy profit. Many people believe buying a used bike is the answer to all their problems and they save a ton of cash. While the above example is about as bad as it gets (but it does get that bad) at the end of the ordeal you still have a used bike and you will have to spend some time and money getting it right.

Most of the time a used bike does turn out to be false economy.

 

 
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