The Bikeconomics (Mega)Thread

TheKaiser wrote:

"If I had to give one piece of advice to almost any business, it's this: reduce the number of choices you offer your customers. I've...

"If I had to give one piece of advice to almost any business, it's this: reduce the number of choices you offer your customers. I've mentioned this elsewhere in the thread, but the more small business financials I look at, the more this rings true—objectively so."

Amen, brother. Preach.

For years, I've thought that exact same thing about the number of choices, in particular every time I look at the 5.10 shoe offerings, or the Maxxis tire catalog. We all know that there are like 3 good shoes in the 5.10 line, and somewhere between 3 and 5 good tread patterns in the Maxxis DH/Enduro line. Whenever I'd see some announcement of a new product that heavily overlapped with existing ones, I'd go "Why?", and that seems to have been bourn out by the apparent low penetration of these products in the market. Ain't nobody buying heavy and lame Hellcat shoes, or fast wearing low traction Dissector tires. Yet they thought it was a good idea to cut a new set of molds, etc...to offer customers "more options"? Instead, 5.10 would have been better off improving their durability, and Maxxis would have been better off ensuring their tires measured up near the stated size. 

OK, rant over, and in both of those companies defense, they do seem to have pared down their lines in the past year or so.

anotherbikerguy wrote:

The Dissector out here catching strays... I'll just say it works well for my local terrain, since I don't want to derail this conversation too much...

The Dissector out here catching strays... I'll just say it works well for my local terrain, since I don't want to derail this conversation too much. Especially because I generally agree with you. I'm often confused by companies offering a) many variants of essentially the same thing (Maxxis, for example, has so many different combinations of casing/width/sidewall color/rubber compound) or b) an ever-increasing range of products/services that seem to stretch the limits of the brand's original core competencies. (Apparel might be the most glaring example of this -- why did Yeti, for example, decide to launch a clothing line? To name just one of the brands that have decided to slap their name on some shorts or a $90 "tech tee.") 

So why do they do it? That's an open question and a serious one. How much of the decision to continually increase a company's offerings is driven by pressure (internal or external) to grow a company in a way that just isn't possible if all you want to do is make one thing really well? How much is potentially driven by the constrained scope of sponsorship/visibility opportunities in this little world of ours (e.g. TRP developing a drivetrain so that teams can run its brakes without being in conflict with SRAM/Shimano deals)? What other reasons am I totally forgetting/overlooking?

ballz wrote:

Sounds like you never worked closely with sales people.

ballz wrote:

Sounds like you never worked closely with sales people.

anotherbikerguy wrote:

I try my best to avoid them.

Mwood wrote:

Intend has done a great job of taking German engineering and making it sexy, something most German bike component companies have failed at. Look at Syntace...

Intend has done a great job of taking German engineering and making it sexy, something most German bike component companies have failed at. Look at Syntace, x-12 axles anyone?, pretty much fell off the face of the US market and seem to have gotten caught up in KTM. Trickstuff is another one that got rolled into DT Swiss, but they took a long time to get a foothold in the US market and haven't really got to stick(try getting their brake pads). Props to them and I hope they kept up producing sick stuff! 

Another note: Trickstuff and Intend are both from Freiburg, Germany, and there is a a lot of mtb passion there. You could definitely find bike-loving engineers who will move there and work for a lot less than any other engineering role. Fun fact: Dorel used to have an engineering office in Freiburg. It was conveniently situated between the brewery and the mtb trails. 

 

bulletbass man wrote:

I work in the restaurant industry.  The easiest to operate and most profitable bars and restaurants have a small core menu and a few specials to...

I work in the restaurant industry.  The easiest to operate and most profitable bars and restaurants have a small core menu and a few specials to provide new choices for regulars and move soon to be expiring product.  Fastfood is a great example of this.

The full service restaurants that do the most sales however have large menus.  And it’s not even close.  There’s a reason Cheesecake Factory is one of the most successful restaurant brands and is often the top selling full service restaurant in their area.  The busiest restaurant I have ever worked for had nearly 250 individual menu items.  I had more individual pickups on my one station than the entire menu at the next job I worked at.  But we also did more sales off that station than we did at the entire restaurant I worked at next.

So I’d assume maxxis goals is to get more product out there.  They have a million options (the vast majority they retain) for the people who want to try things or one specific tread in one or two specific variation.  And then at the same time there is always something on discount somewhere for people who just want a decently made and decently performing tire.  They want to have plenty of products to fill the wall of your lbs.  or so that when you scroll online there is 5 maxxis options to one from continental and two from scwalbe.  So every time you are at the lift at the bike park half the bikes or more have a maxxis tire on them.  So that product managers can spec exactly what they want on the oe side.

Not necessarily the business model I would go for but if you are willing to do the work there is a lot to be said for pushing to increase revenue at the expense of profit margins.  In fact it was essentially the norm forced by post world war 2 tax codes.

jeff.brines wrote:

Plenty of businesses are built on offering consumers maximum choice, Nike, Amazon, the Mexican restaurant down the street, etc. Optionality can be a real value-add in...

Plenty of businesses are built on offering consumers maximum choice, Nike, Amazon, the Mexican restaurant down the street, etc. Optionality can be a real value-add in the right space with the right execution. But more often than not, neither is the case.

You're right the Cheesecake Factory is a successful business. But compare it to a food service company like Chipotle (who has a simple menu), and the gap is massive. Cheesecake is worth $2.5B with 2–3% net margins; Chipotle is worth $60B with 12–14% margins. Sure, multiple factors contribute to that difference, but menu simplicity is undoubtedly one of them.

In smaller companies especially in industries like cycling, there are hidden costs to expanding SKU count. If the customer gets something truly better, it's worth it. If not, it’s just a tax. Worse, too many options can lead to paralysis by analysis, hurting the buying experience.

It's hard to “kill your babies.” Putting on the Rick Rubin hat and deciding what makes your product catalog exceptional, and what drags it down, takes guts. The lazy approach is to offer everything and see what sticks. The bold approach requires real product intuition or sharp analytical judgment, with the understanding you could be wrong. Offering a ton of products is often a hedge. You might survive that way, but you probably won’t thrive - but of course the devil is (always) in the details...

Cheers!

jeff.brines wrote:

At first glance, this always seems like the safer way to approach a project, but in my experience, it usually ends up being the exact opposite.To...

At first glance, this always seems like the safer way to approach a project, but in my experience, it usually ends up being the exact opposite.

To justify the costs of design engineering, tooling, assembly setup, and ongoing support, you typically need some amount of "real scale". Otherwise, it's super tough to amortize costs in a way that makes sense. And for smaller companies, juggling multiple production cycles, changing gears from "this" to "that" and supporting everything can get overwhelming fast, even if you’re outsourcing big chunks of it.

Not saying it can’t be done, but more often than not, I see businesses spinning their wheels due to SKU bloat way more than from not having enough options.

If I had to give one piece of advice to almost any business, it's this: reduce the number of choices you offer your customers. I've mentioned this elsewhere in the thread, but the more small business financials I look at, the more this rings true—objectively so.

TEAMROBOT wrote:

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy...

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy, and is exploding with business. The other company offers burgers, tacos, salads, breakfast sandwiches, pancakes, desserts, fried chicken, lattes, burritos, is always empty, and is closing locations. Companies should work hard to avoid being Jack in the Box. As Ron Swanson famously said, "Never half ass two things. Whole ass one thing."

A brief thought about Cheesecake Factory and Maxxis: these are great examples of the other side of the coin, but it takes ENORMOUS scale to make it profitable to offer that many choices. If you are smaller than GIGANTIC, you would do better to focus on core products and not spread yourself too thin. There are too many companies that aren't lean and mean like Frameworks and also aren't huge and diversified like Maxxis, and that middle ground can be a no mans land. A lot of extra work, not a lot of margin, and a lot of SKU's to juggle and potentially get stuck with if and when macro trends change.

TEAMROBOT wrote:

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy...

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy, and is exploding with business. The other company offers burgers, tacos, salads, breakfast sandwiches, pancakes, desserts, fried chicken, lattes, burritos, is always empty, and is closing locations. Companies should work hard to avoid being Jack in the Box. As Ron Swanson famously said, "Never half ass two things. Whole ass one thing."

A brief thought about Cheesecake Factory and Maxxis: these are great examples of the other side of the coin, but it takes ENORMOUS scale to make it profitable to offer that many choices. If you are smaller than GIGANTIC, you would do better to focus on core products and not spread yourself too thin. There are too many companies that aren't lean and mean like Frameworks and also aren't huge and diversified like Maxxis, and that middle ground can be a no mans land. A lot of extra work, not a lot of margin, and a lot of SKU's to juggle and potentially get stuck with if and when macro trends change.

jeff.brines wrote:

Love this...and now I'm hungry. Just to play devil’s advocate to my own thinking, we’re distilling a complex system like business success into a single-variable analysis: SKU...

Love this...and now I'm hungry. 

Just to play devil’s advocate to my own thinking, we’re distilling a complex system like business success into a single-variable analysis: SKU count. That’s a risky oversimplification that can easily distort reality. Of course, there are companies with massive SKU catalogs that do well, and others with tight SKU discipline that still fail. But if you were to try and analyze success vs sku count (say, by measuring net margin), especially in businesses under $100 million, I’d bet you'd see a clear pattern: fewer SKUs typically lead to better margins - and better margins tends to lead to higher success rates.

Obviously, many factors influence this. Business model, product category, position in the supply chain, customer type, geographic market, and access to capital all matter. In this case, we're mostly talking about bicycle companies. That usually means you're somewhere in a complex, often brittle supply chain, selling an elastic good to a price-sensitive, trend-driven consumer. If we were evaluating a company like 3M or McMaster, the calculus would look entirely different.

Even with exceptions like Maxxis or Shimano, I’d argue there's value in SKU reduction. Just because a company can expand its product line doesn't mean it should. Take Maxxis as an example. They offer 26 mountain bike tires, not counting all the variations in width, diameter, bead, compound, and sidewall. It’s honestly overwhelming. That level of optionality creates real cost and operational complexity. That cost eventually hits the consumer and may even suppress revenue if prices creep up too far for a wear item.  In my limited time doing product based profitability analysis work, I've often found a pareto distribution where 20% (or even 10%) of the company's offerings accounts for 80-90% of the revenue.

Maybe Maxxis has modeled all of this and found their ideal SKU mix. But I’d bet they could meaningfully reduce costs by trimming the fat, doubling down on what the market truly wants, and eliminating low-margin SKUs that hardly move. They might even pass some of the savings on to the customer and move more volume. That’s the kind of optimization where data science and business intuition intersect, and it's far from easy.

But again, Maxxis is an outlier for the purposes of this conversation; they are one of the few true real deal manufacturing companies (Cheng Shin Rubber), and they also deal with one of the least elastic goods on a bicycle (or motorcycle, automobile etc). They can operate in a way that only a handful of other companies in the outdoor industry can operate. 

TEAMROBOT wrote:

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy...

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy, and is exploding with business. The other company offers burgers, tacos, salads, breakfast sandwiches, pancakes, desserts, fried chicken, lattes, burritos, is always empty, and is closing locations. Companies should work hard to avoid being Jack in the Box. As Ron Swanson famously said, "Never half ass two things. Whole ass one thing."

A brief thought about Cheesecake Factory and Maxxis: these are great examples of the other side of the coin, but it takes ENORMOUS scale to make it profitable to offer that many choices. If you are smaller than GIGANTIC, you would do better to focus on core products and not spread yourself too thin. There are too many companies that aren't lean and mean like Frameworks and also aren't huge and diversified like Maxxis, and that middle ground can be a no mans land. A lot of extra work, not a lot of margin, and a lot of SKU's to juggle and potentially get stuck with if and when macro trends change.

jeff.brines wrote:

Love this...and now I'm hungry. Just to play devil’s advocate to my own thinking, we’re distilling a complex system like business success into a single-variable analysis: SKU...

Love this...and now I'm hungry. 

Just to play devil’s advocate to my own thinking, we’re distilling a complex system like business success into a single-variable analysis: SKU count. That’s a risky oversimplification that can easily distort reality. Of course, there are companies with massive SKU catalogs that do well, and others with tight SKU discipline that still fail. But if you were to try and analyze success vs sku count (say, by measuring net margin), especially in businesses under $100 million, I’d bet you'd see a clear pattern: fewer SKUs typically lead to better margins - and better margins tends to lead to higher success rates.

Obviously, many factors influence this. Business model, product category, position in the supply chain, customer type, geographic market, and access to capital all matter. In this case, we're mostly talking about bicycle companies. That usually means you're somewhere in a complex, often brittle supply chain, selling an elastic good to a price-sensitive, trend-driven consumer. If we were evaluating a company like 3M or McMaster, the calculus would look entirely different.

Even with exceptions like Maxxis or Shimano, I’d argue there's value in SKU reduction. Just because a company can expand its product line doesn't mean it should. Take Maxxis as an example. They offer 26 mountain bike tires, not counting all the variations in width, diameter, bead, compound, and sidewall. It’s honestly overwhelming. That level of optionality creates real cost and operational complexity. That cost eventually hits the consumer and may even suppress revenue if prices creep up too far for a wear item.  In my limited time doing product based profitability analysis work, I've often found a pareto distribution where 20% (or even 10%) of the company's offerings accounts for 80-90% of the revenue.

Maybe Maxxis has modeled all of this and found their ideal SKU mix. But I’d bet they could meaningfully reduce costs by trimming the fat, doubling down on what the market truly wants, and eliminating low-margin SKUs that hardly move. They might even pass some of the savings on to the customer and move more volume. That’s the kind of optimization where data science and business intuition intersect, and it's far from easy.

But again, Maxxis is an outlier for the purposes of this conversation; they are one of the few true real deal manufacturing companies (Cheng Shin Rubber), and they also deal with one of the least elastic goods on a bicycle (or motorcycle, automobile etc). They can operate in a way that only a handful of other companies in the outdoor industry can operate. 

jeff.brines wrote:

At first glance, this always seems like the safer way to approach a project, but in my experience, it usually ends up being the exact opposite.To...

At first glance, this always seems like the safer way to approach a project, but in my experience, it usually ends up being the exact opposite.

To justify the costs of design engineering, tooling, assembly setup, and ongoing support, you typically need some amount of "real scale". Otherwise, it's super tough to amortize costs in a way that makes sense. And for smaller companies, juggling multiple production cycles, changing gears from "this" to "that" and supporting everything can get overwhelming fast, even if you’re outsourcing big chunks of it.

Not saying it can’t be done, but more often than not, I see businesses spinning their wheels due to SKU bloat way more than from not having enough options.

If I had to give one piece of advice to almost any business, it's this: reduce the number of choices you offer your customers. I've mentioned this elsewhere in the thread, but the more small business financials I look at, the more this rings true—objectively so.

TEAMROBOT wrote:

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy...

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy, and is exploding with business. The other company offers burgers, tacos, salads, breakfast sandwiches, pancakes, desserts, fried chicken, lattes, burritos, is always empty, and is closing locations. Companies should work hard to avoid being Jack in the Box. As Ron Swanson famously said, "Never half ass two things. Whole ass one thing."

A brief thought about Cheesecake Factory and Maxxis: these are great examples of the other side of the coin, but it takes ENORMOUS scale to make it profitable to offer that many choices. If you are smaller than GIGANTIC, you would do better to focus on core products and not spread yourself too thin. There are too many companies that aren't lean and mean like Frameworks and also aren't huge and diversified like Maxxis, and that middle ground can be a no mans land. A lot of extra work, not a lot of margin, and a lot of SKU's to juggle and potentially get stuck with if and when macro trends change.

notanengineer wrote:

I agree on premise. The point I was trying to make in a previous post is that it’s not appropriate to compare the business models of...

I agree on premise. The point I was trying to make in a previous post is that it’s not appropriate to compare the business models of Maxxis and Chipotle wrt SKU count. 

In manufacturing/factory business models there is cost associated with producing a good AND not producing a good – both from a financial metric and a game-theoretic perspective. This can lead to production recommendations that are not intuitive to those unfamiliar with manufacturing calculus, but still translate to higher profit. I.e. when waste cost is high or when competition for material (pricing) is high. This sort of data science paired with business intuition has taken many names over the years and has grown to encompass many fields, from operations research, industrial engineering, management science, decision science etc all of which have foundations in math, stats, and cs. The math is mature and the underlying problems are well defined and analytical. 

The manufacturing comparison is interesting though, and I believe the SKU reduction recommendation still holds. Consider 3m and their adhesives. 3m has a large SKU count of adhesives but each SKU serves a specific use case. If you are a potential customer looking to bond a specifically porous material, in a specific humidity and temperature range, the feasible set of SKUs that solve your need will be very small. So although SKU count at a company like 3m is large, each SKU is very focused i.e. there is no SKU bloat for SKU bloat sake.

But I digress, or rather back on topic, I would expect those companies with flexibility to scale their manufacturing and operations to meet current demand to do better than those who “bet the house” on the latest trend. I believe there is a famous quote about how low tide exposes those who’ve been swimming naked, but it escapes me at the moment. 

 

p.s. for those interested in some manufacturing math, prompt your favorite LLM with something like “generate a stochastic blending optimization problem for a tire manufacture” and then ask it to reformulate the problem to introduce a penalty for waste of unused resources. Even in a toy problem, it becomes easy to how complexity grows quickly.  A demand constraint in these sorts of problems can be the focus of an entire team.

Thanks for the discussion!

TEAMROBOT wrote:

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy...

I agree 1000%. I always give the example of In-N-Out vs. Jack in the Box. One of these companies offers very few choices, is always busy, and is exploding with business. The other company offers burgers, tacos, salads, breakfast sandwiches, pancakes, desserts, fried chicken, lattes, burritos, is always empty, and is closing locations. Companies should work hard to avoid being Jack in the Box. As Ron Swanson famously said, "Never half ass two things. Whole ass one thing."

A brief thought about Cheesecake Factory and Maxxis: these are great examples of the other side of the coin, but it takes ENORMOUS scale to make it profitable to offer that many choices. If you are smaller than GIGANTIC, you would do better to focus on core products and not spread yourself too thin. There are too many companies that aren't lean and mean like Frameworks and also aren't huge and diversified like Maxxis, and that middle ground can be a no mans land. A lot of extra work, not a lot of margin, and a lot of SKU's to juggle and potentially get stuck with if and when macro trends change.

jeff.brines wrote:

Love this...and now I'm hungry. Just to play devil’s advocate to my own thinking, we’re distilling a complex system like business success into a single-variable analysis: SKU...

Love this...and now I'm hungry. 

Just to play devil’s advocate to my own thinking, we’re distilling a complex system like business success into a single-variable analysis: SKU count. That’s a risky oversimplification that can easily distort reality. Of course, there are companies with massive SKU catalogs that do well, and others with tight SKU discipline that still fail. But if you were to try and analyze success vs sku count (say, by measuring net margin), especially in businesses under $100 million, I’d bet you'd see a clear pattern: fewer SKUs typically lead to better margins - and better margins tends to lead to higher success rates.

Obviously, many factors influence this. Business model, product category, position in the supply chain, customer type, geographic market, and access to capital all matter. In this case, we're mostly talking about bicycle companies. That usually means you're somewhere in a complex, often brittle supply chain, selling an elastic good to a price-sensitive, trend-driven consumer. If we were evaluating a company like 3M or McMaster, the calculus would look entirely different.

Even with exceptions like Maxxis or Shimano, I’d argue there's value in SKU reduction. Just because a company can expand its product line doesn't mean it should. Take Maxxis as an example. They offer 26 mountain bike tires, not counting all the variations in width, diameter, bead, compound, and sidewall. It’s honestly overwhelming. That level of optionality creates real cost and operational complexity. That cost eventually hits the consumer and may even suppress revenue if prices creep up too far for a wear item.  In my limited time doing product based profitability analysis work, I've often found a pareto distribution where 20% (or even 10%) of the company's offerings accounts for 80-90% of the revenue.

Maybe Maxxis has modeled all of this and found their ideal SKU mix. But I’d bet they could meaningfully reduce costs by trimming the fat, doubling down on what the market truly wants, and eliminating low-margin SKUs that hardly move. They might even pass some of the savings on to the customer and move more volume. That’s the kind of optimization where data science and business intuition intersect, and it's far from easy.

But again, Maxxis is an outlier for the purposes of this conversation; they are one of the few true real deal manufacturing companies (Cheng Shin Rubber), and they also deal with one of the least elastic goods on a bicycle (or motorcycle, automobile etc). They can operate in a way that only a handful of other companies in the outdoor industry can operate. 

notanengineer wrote:

I agree on premise. The point I was trying to make in a previous post is that it’s not appropriate to compare the business models of...

I agree on premise. The point I was trying to make in a previous post is that it’s not appropriate to compare the business models of Maxxis and Chipotle wrt SKU count. 

In manufacturing/factory business models there is cost associated with producing a good AND not producing a good – both from a financial metric and a game-theoretic perspective. This can lead to production recommendations that are not intuitive to those unfamiliar with manufacturing calculus, but still translate to higher profit. I.e. when waste cost is high or when competition for material (pricing) is high. This sort of data science paired with business intuition has taken many names over the years and has grown to encompass many fields, from operations research, industrial engineering, management science, decision science etc all of which have foundations in math, stats, and cs. The math is mature and the underlying problems are well defined and analytical. 

The manufacturing comparison is interesting though, and I believe the SKU reduction recommendation still holds. Consider 3m and their adhesives. 3m has a large SKU count of adhesives but each SKU serves a specific use case. If you are a potential customer looking to bond a specifically porous material, in a specific humidity and temperature range, the feasible set of SKUs that solve your need will be very small. So although SKU count at a company like 3m is large, each SKU is very focused i.e. there is no SKU bloat for SKU bloat sake.

But I digress, or rather back on topic, I would expect those companies with flexibility to scale their manufacturing and operations to meet current demand to do better than those who “bet the house” on the latest trend. I believe there is a famous quote about how low tide exposes those who’ve been swimming naked, but it escapes me at the moment. 

 

p.s. for those interested in some manufacturing math, prompt your favorite LLM with something like “generate a stochastic blending optimization problem for a tire manufacture” and then ask it to reformulate the problem to introduce a penalty for waste of unused resources. Even in a toy problem, it becomes easy to how complexity grows quickly.  A demand constraint in these sorts of problems can be the focus of an entire team.

Thanks for the discussion!

Dave_Camp wrote:

This might not be the correct thread for this- but how does a company like Intend make any money on that fork they just released?From the...

This might not be the correct thread for this- but how does a company like Intend make any money on that fork they just released?

From the press release- the initial run is 85 units priced at 1450 (euros?)... that's only 123,000 in revenue.  Not enough to pay for the engineer much less testing/prototyping etc etc.  Maybe this one is a hit and they can sell a few thousand per year?  Probably makes sense at that volume.

Hurts my brain coming from RS where we'd break way more than 85 units in the test lab.  

smelly wrote:

That’s pretty much what I think about most of the bike industry. I can’t fathom how it’s done, and it’s not super surprising we are seeing...

That’s pretty much what I think about most of the bike industry. I can’t fathom how it’s done, and it’s not super surprising we are seeing so many companies struggle. 

I saw a picture of everyone who works at WeAreOne. There’s like 40 employees. How the heck are they selling enough wheels to pay 40 employees? At a low average peremployee cost of $50k that’s $2 million in salaries alone. And I assume that’s a low salary in BC. Who know what their margins are, but that would require 20,000 rim sales if $100 from each rim just goes to payroll. dang. How many rims are they selling? And it’s not like they made a disposable aluminum rim, so people aren’t replacing them left and right. 

Dave_Camp wrote:

This might not be the correct thread for this- but how does a company like Intend make any money on that fork they just released?From the...

This might not be the correct thread for this- but how does a company like Intend make any money on that fork they just released?

From the press release- the initial run is 85 units priced at 1450 (euros?)... that's only 123,000 in revenue.  Not enough to pay for the engineer much less testing/prototyping etc etc.  Maybe this one is a hit and they can sell a few thousand per year?  Probably makes sense at that volume.

Hurts my brain coming from RS where we'd break way more than 85 units in the test lab.  

smelly wrote:

That’s pretty much what I think about most of the bike industry. I can’t fathom how it’s done, and it’s not super surprising we are seeing...

That’s pretty much what I think about most of the bike industry. I can’t fathom how it’s done, and it’s not super surprising we are seeing so many companies struggle. 

I saw a picture of everyone who works at WeAreOne. There’s like 40 employees. How the heck are they selling enough wheels to pay 40 employees? At a low average peremployee cost of $50k that’s $2 million in salaries alone. And I assume that’s a low salary in BC. Who know what their margins are, but that would require 20,000 rim sales if $100 from each rim just goes to payroll. dang. How many rims are they selling? And it’s not like they made a disposable aluminum rim, so people aren’t replacing them left and right. 

whitesq wrote:

The perception of volume is interesting here. For fun, here's some rough math, let me know if you think it's tracking. The best estimate I could find...

The perception of volume is interesting here. For fun, here's some rough math, let me know if you think it's tracking. 

The best estimate I could find on unit sales was ~140 million bikes sold globally per year. Wild guess, but let's assume 1% is high end mountain bikes, (1.4 mil). Next we can look at Vital's community survey (https://mtb.survey.vitalmedianet.com/?year=2024) and see rough market share of fork brands, so let's go with Fox and round it to 30% market share on OEM spec which equates to 420K forks annually. Now assume 260 working days in Taiwan per year for a production of roughly 1,615 forks per day. If Fox runs two shifts (16 hours) per day that's about 100 forks/hour. 

Using the same logic for rims, 1.4mil bikes = 2.8 million oem spec mountain bike rims per year. If WR1 makes 20K/year that covers .7% of just the new bikes sold per year. Going back to the vital survey, another way to look at it is, 30% of people said they plan to buy a wheelset in 12 months and of that WR1 has 5% market share. This might be a stretch, but if we only use the new bike buyers and assume 30% them will upgrade rims that equates to 42K rims/year for WR1 to produce. So then the question becomes, can they produce ~160 rims per day? Assume an 8 hour work day so 20 rims/hour. I believe the cure time is 45mins to an hour so you have 20 molds tied up there, so at the same time you probably want 20 molds at layup, 20 at cleanup and 20 at inspection. Based on the video it looks entirely possible they could have ~80 molds in process at any one time. 

Sorry for the nerd out, but do you think it's ballpark?

sspomer wrote:

only slapping this in here because of the topic of wages that came up. here's how much you can make in rural tennessee working at a...

only slapping this in here because of the topic of wages that came up. here's how much you can make in rural tennessee working at a massive gas station (saw it on the way to windrock). nearly quarter of a mil for experienced GM lol

sethimus wrote:

how much is a big mac in that area?

sethimus wrote:

how much is a big mac in that area?

mickey wrote:

Bucee’s is a a consumer cult that is all about buying branded merch with the beaver character on it.   A Texas-based corporation, they have just...

Bucee’s is a a consumer cult that is all about buying branded merch with the beaver character on it.   A Texas-based corporation, they have just expanded to the southeast in the last few years.

People who generally aren’t into consumerism(like the women who live in my house) somehow find Buceee’s merchandise to be hilarious.   Swimsuits, hats, fleece blankets for every holiday- endless imported merchandise is the core of the Bucee’s phenomenon. 

The $9 bbq sammiches are pretty decent for gas station fare though.

sethimus wrote:

how much is a big mac in that area?

mickey wrote:

Bucee’s is a a consumer cult that is all about buying branded merch with the beaver character on it.   A Texas-based corporation, they have just...

Bucee’s is a a consumer cult that is all about buying branded merch with the beaver character on it.   A Texas-based corporation, they have just expanded to the southeast in the last few years.

People who generally aren’t into consumerism(like the women who live in my house) somehow find Buceee’s merchandise to be hilarious.   Swimsuits, hats, fleece blankets for every holiday- endless imported merchandise is the core of the Bucee’s phenomenon. 

The $9 bbq sammiches are pretty decent for gas station fare though.

sethimus wrote:

how much is a big mac in that area?

mickey wrote:

Bucee’s is a a consumer cult that is all about buying branded merch with the beaver character on it.   A Texas-based corporation, they have just...

Bucee’s is a a consumer cult that is all about buying branded merch with the beaver character on it.   A Texas-based corporation, they have just expanded to the southeast in the last few years.

People who generally aren’t into consumerism(like the women who live in my house) somehow find Buceee’s merchandise to be hilarious.   Swimsuits, hats, fleece blankets for every holiday- endless imported merchandise is the core of the Bucee’s phenomenon. 

The $9 bbq sammiches are pretty decent for gas station fare though.

jonkranked wrote:

are the locations all corporate owned, or is it a franchise model?

mickey wrote:

Corporate.  These stations usually have more than 100 gas pumps.  Selling gas is a lot like selling complete bikes, no margins.  Merch and to some extent...

Corporate.  These stations usually have more than 100 gas pumps.  Selling gas is a lot like selling complete bikes, no margins.  Merch and to some extent foodservice is how they manage to pay workers.

In South Carolina, they actually closed a public rest area on i95 to make room for a bucee’s near myrtle beach.