Imagining Bikes - Conceptualizing II

Dave Krafft and I had this prototype number 3 which we loaned out to people of the MN HPV club to ride and to get feedback. This one time, the guy comes back from a ride with his friends and offers to buy the bike. Dave and I looked at each other and then answered that it was a prototype and not for sale. How would we price it, if it were? Time spent and materials? And, you're talking about guys who never really put something down but carry things around in their heads and multi-task. We even wake up in the middle of the night with an "Aha!" Or, if one finds a new way of making something work and magnify its' usefulness by a factor of two or three while replacing expensive parts and making it simpler? How does one go about making it affordable?

First of all, the bike was thrown together, parts of it worked as to its' gear train but the shifter needed work and we weren't happy over the seat design. It still needed work. I mean, hey, it's a prototype! It wasn't even painted! But the guy was adamant. "Name your price."

We finally just told him it wasn't for sale although we would let him copy it and help him build one for himself. Guess he wasn't interested in doing so.

This brings me to the title of this weblog, NRX bikes.

A friend and I were batting around how one would charge for products which were beyond cutting edge. The concern was, how would one be able to afford one?

Not just that, but as a prototype experimental bike, there are insurance concerns as well as concerns of the designer person and company.

As a consumer/user, what would I want? What would I need?

My Grandfather ended up being many things in life but one job he ended with was as a used car salesman. Yeah, one can laugh over that today. But, if I told you that even though he worked many years in semi-retirement and change dealerships, over four generations of customers from a five state region would find their way to him, would you begin to understand that he was not your ordinary salesman? Even though he never once proclaimed himself as this or that, I noticed fathers bringing their young sons or a new young family from this state or that state to do business with him when I was going to work with him while staying over. I noticed how pissed off his fellow coworkers would get when people would show up asking for him and refuse to do business with any other. So, one day I just asked him why this was so? His response has stayed with me these many years. It was this. "I sell them what they need, not what they want. And, if they're adamant, I just go ahead and sell them what they want but tell them that this car or that car would be better for them and why. In not too long a time, they show back up and then ask for what they need." He never would say,"I told you so," or gloat over it. He would just get on with it as though they had just arrived on their first visit. He would ask about their family, what do they do? What is their daily life like? Are they mechanically gifted or just need the minimum transportation without a lot of breakdowns? Do they have kids? How many? Are they wanting more kids? Do they travel a lot or just around their area? He would ask, and then he would listen. He did the same to the men who worked in the service department. In this manner, first he would have an idea of his product, then he would try and match up his client. If he didn't have anything on the lot to sell them today, he'd tell them so. They'd leave a number, and if something showed up which would suit their needs, he'd call or write to them. If they needed something right away, he might get on the phone and call around, and send them somewhere else. The owner confronted him once after co-worker's complaints, and never again. Sure, today they might lose a sale, but the customer would return to his starting point the next time and besides, everyone has friends and, or, relatives and word spreads quickly as to who to trust.

The owner decided to retire and closed down the business. My grandfather came home and did his usual routine. The next day, he stayed home. When I asked why he was home, he told me. I asked if he was worried about losing his job? No, he said, something will turn up. Less than a week later, the owner of one of the largest Chevrolet dealerships called him up. My grandfather took the call calmly, and after a while he put down the phone and told me who it was, and that he was going to see him the next day.

My grandfather had contracted polio when he was around twelve years old. Being one of nineteen children and a cripple had limited what he could do in life. As it was just in one leg, he sometimes had to resort to using a cane but usually, he just tried to get by without it.

Couple that with his age, and ones sees that today, in this world, he would probably have never work again.

The owner of the Chevy dealership met and hired him the next day. When he noticed my grandfather having a hard time getting around, he went out and bought him a surrey'd golf cart for just him and his customers to use. In no time, his sales off of his used car lot jumped as word got around that he was working there.

One day, he noticed that a couple came in and were looking around at the new cars, and kept trying to get someones attention. All of the new car salesmen acted too busy to help them, so after a while, they spied my grandfather and came over to him, asking for his help. He patiently explained to them that he could only sell used cars but they pleaded with him. He tried to get another salesman to help them but, they were too busy. Finally, he told them he knew nothing about the new models but he would help them. He did, and he sold them a new truck. When the paperwork went through, the head of new vehicle sales just demanded that the owner fire my grandfather. My grandfather just sat and didn't say a word until the owner turned to him and asked his version. When my grandfather had finished, the owner told him he was welcome to sell any car on his lot that he liked.

My grandfather ended up working for that dealership long after retirement age and only part time of the year. But, the owner kept his golf cart in storage, covered, with instructions that no one else was to use it.

My grandfather taught me many lessons but mostly I feel he taught me about value and selling to the ones who will use your product. Foremost, be honest and keep your sense of honor. Give them what they need, not necessarily what they want. The use of something is what brings value, not the want of it. The want of it is superficial and is like the picked flower. It wilts early. Something you need in your everyday life will be used often and return its' value each time it is used. In a consumer society, this fact is often glossed over by selling techniques which manipulate the buyer.

How many times have I gone to a garage sale to find upright bicycles for sale at a fraction of the price they were when new? How many of them basically rusted from little use and no care? We measure how well the bike business is doing by how many units sold over the new year. The cost of refurbishing an old used model is higher than an off of the rack model. In twenty years, the new model will be the old, but little, at this rate of change, will have changed between the old and new. Just the price. The metal will rust, the tires will rot, the plastic will crack, the leather will break down. The grease will coagulate, the bearings will freeze up, and the cables will be immobile. Not always, but many times I've seen this.
So, what is my point?
I don't believe the industry is giving good value. Why do I feel this way? Probably because I feel they've left the honor and trying to people like Pope, who led people astray, manipulated them for his own gains and basically duped them into believing he had engineered a final product while denying any competitors access to the market to give consumers another choice. Besides, he ended up secretly aligning with the internal combustion guys to run the bikes off of the roads.
What niche markets are moving in the bike market place? Where is the growth overall? Probably not in the middle where the safety model is the bulk offered. It is my understanding that a do over of the safety, the mountain bike, has leveled off. They seem to be waiting for the next do over, and it's not happening. However, there is the cabled, tune able frame which I've already done. Don't even know if they'd consider such a thing.
It seems as though the bike manufacturers are part of this huge flywheel that is turning and the most weight is in what is offered by the manufacturers which is where they have most of their capital tied up in fixtures of the safety model. I priced a fixture the other day for turning out the safety model. It varies but the upward figure is around ten grand without add-ons. With the price of frames being what they are, how many frames would I have to sell at what price to make a profit? If I had to compete with Asian manufacturers or even Latin American, well, one can see the problem. The large manufacturers produce the versions of the safety.
The problem of the gear train stagnation is all about Shimono.
All of this brings me back to giving people what they need. Too many times, big business dictates to the market place as to what will be offered based upon their profit, not what the people need. Not just that, but the most profit. For this reason, once the capital investment is made as to the kind of fixtures to build the models, a certain number of units has to be made over the life of the fixture, over a certain length of time. For this reason, the large amount of capital involved comes off as being conservative as to change once the model which provides the most profit is chosen.
How many of these large monied investors ride a bike every day and use it for their main vehicle of choice? I would venture to say not one has the experience.
For my financial model I would say not to sell bikes of a prototype model. Lease them.