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Wednesday
Dec112013

The New Rail

It's time to introduce our newest wheel, which we've decided to call...  THE ROUBAIX!!!  No, no, no, I'm just pulling your leg.  It's the Rail 34.  Why Rail 34?  Because it's a Rail that's 34mm deep, is why.

We decided to make a 34mm deep Rail because you asked for it.  The Rail 52 has done very well for us and for you since the day we announced it, and it does everything we intended for it to do.  I would say that it's better in cross winds than I'd hoped it would be, and that it handles better than I'd imagined it could.  People have used them to win an armful of races, they've done gran fondos on them, they've taken them on all sorts of surfaces, etc.

Still, people wanted something shallower (which must be why I'm such a hit at parties), so here we are with something shallower.  Why 34?  The 52 is at a magic spot, right where it can be really really fast without getting really heavy, and still be manageable enough to use most-to-perhaps-all of the time.  We wanted to get into territory where the new wheel would be different enough that you wouldn't be splitting hairs between the two.  It's still possible to draw a great shape at 34, one that gives the same magnificent ride that 52s give (a function of width and stiffness), should prove nearly invisible to cross winds, and be quite rapid to boot. 

We also know that people want more from their wheels than to be just a hair gel and a desert topping. They want to race on them and train on them and take them on unpaved roads and get them with disc hubs and race cross on them and all that kind of stuff.  For that mandate, a shallow-ish rim works just a treat.  They're also lighter than 52s.  They're not flyweight wheels, once again we didn't chase every last nanogram out of them, because in this real world where you don't have a team car following you with a brace of spare wheels, leaving a few nanograms in offers far more benefit than detriment.  You don't have to baby them.  They'll be very comparable to Zipps and Enves of similar depths.

You're probably wondering whether we've tunnel tested them, and the answer is that we haven't.  Not yet at least.  With the 52, a huge part of the point was being able to prove that it was as fast as very fast wheels of similar to slightly greater depth.  It is, and if you are looking for a wheel to go fast like that, the 52 is that wheel.  We are sure that the 34 will be fast.  How fast?  Fast enough for us to be able to put it up against some meaninglessly slow wheel and tell you that it will save a bunch of time in an artificial construct (a construct whose artifice doesn't obviate its credibility - it's still the best tool we've got to do the near-impossible task of rating how fast different wheels are).  We're sure we've caught the beat on the critical points of the mandate, and we know they'll be quick. 

Pre-order price will be $1145 with standard hubs, and $1445 with White Industries hubs.  In stock price will be $1285 with standard hubs and $1545 with White Industries (which will match the 2014 Rail 52 pricing). 

We'll be opening up the pre-order shortly after New Years, so ordinarily talking about this now would be jumping the gun, but we're going to be doing the dojo pre-order much sooner than that, and you can order your dojo with 34s. Delivery is planned for mid-April, and our history with delivering per dates is great so far.

Questions?

Friday
Dec062013

dojo Pricing and Build Options

Our 2014 bike is called the dojo. Not the Dojo, or the doJo as we would name it if we wanted $38 million in venture capital. If you would like to give us $38 million, please do so without the expectation of equity.

Yesterday Facebook blew the eff up when we asked it what it thought the price of the dojo would be, fully built with Force22, a Deda Zero cockpit, and our FSW 23 wheels that come with White Industries hubs standard. 100+ comments in a few hours is unsubtle enough even for us to pick up on. That, or you all want to win a free pint glass for guessing correctly. 

Below is what the pricing and options look like. We'll be building these into a configurator in our store over the next couple of days so you can pull on all the drop down menus you like and see how your final product changes. For all of these options, you'll naturally be able to choose stem length, bar width, seatpost setback, tape color, cassette ratio and standard or girlie-tee compact crankset. 

Note also that these are pre-order prices. In-stock prices aren't finalized but will likely be about $400 more for the frameset and somewhere between $600 and $800 more for the complete bike, depending on wheels, gruppo and build kit.

  • Frameset Only: $1045
  • Add a gruppo
    • SRAM Force22: +$868
    • SRAM Red22: +$1719
    • Shimano Ultegra 6800: +$804
    • Shimano Dura Ace 9000: +$1808
    • Shimano Ultegra Di2: +$1219
    • Shimano Dura Ace Di2: +$3183
    • Campagnolo Chorus: +$1319
    • Campagnolo Super Record: +$2420
  • Add a build kit (bars, stem, post, saddle, tires, tubes, bar tape)
    • Deda Zero: +$336
    • FSA SLK: +$491
    • Ritchey WCS alloy: +$363
    • Ritchey Superlogic carbon: +$793
  • Add wheels
    • November FSW 23 with White Industries hubs (your choice of color): +$745
    • November Rail 34 with White Industries hubs (your choice of color): +$1445
    • November Rail 52 with White Industries hubs (your choice of color): +$1445
  • Add professional build
    • +$200

So get out your calculators or set up your spreadsheets to see how much you're in for. Each of these options are just that - options. If you want to get a frameset and gruppo only and build up with your own kit, that's great. Or if you want a frame and wheels you can do that too.

Final artwork

We're close to final artwork. When we have it we'll share it here and also on a product page for the dojo so you can decide which colorway you'd like. The picture of the mockup at the right is very close to the final scheme for our Penguin Colorway, which will only feature the raw matte UD carbon and some white accents. We are also creating an all black version where the white accents you see at right will be replaced by a graphite with subtle contrast to the matte UD carbon. The White Industries hubs on the FSW and Rail wheels are available in 6 non-black colors, if you'd like to add some visual variety that way. 

The all black version will only be available through pre-order. We'll bring some bikes in stock but they will all have the white accents. 

Timing

Once our design agency finishes up with the artwork we're cleared for pre-order takeoff. The exact date of that is ASAFP. The pre-order will very likely run through Christmas so build that into your (or your favorite gift giver's) planning. With that timing, frames are arriving here in April. QA begins right away and we typically begin shipping the first frames within a few days of receiving them. Complete unbuilt bikes will also be ready to go, and built bikes will take some additional days depending on how many there are. 

At a glance builds

Our least expensive option for a complete dojo would be equipped with FSW wheels, a Deda Zero cockpit and Ultegra gruppo for $2930. If SRAM is your thing, Force22 set up the same way is $2993. Upgrade to an Ultegra bike with Rails and you're in for $3670 with Ultegra and $3693 with Force22.

Ultegra Di2 starts at $3345. SRAM Red22 is $3845 and up. Our least expensve Campy bike is with Chorus at $3445. 

Our halo build is built with DuraAce Di2 with Ritchey Superlogic and Rails, and is $6665. Add $200 to any of these prices if we're building it for you.

Questions?

Use the comments please. We're listening.

Sunday
Dec012013

When Black Friday Comes...

Hat tip to Steely Dan for today's title, even if Black Friday is now much more known for people leaving Thanksgiving dinner early to go play Fight Club with their neighbors in orders to save $8 on the latest TV.  Not for me, and I suspect if you are reading this, it's not much for you, either. I had a better time stealing a friend's Beetle Cat, getting out on the water with some friends, and escaping the gathering hordes that way, even if it was somewhat colder than ideal for a day on the water. 

I also suspect that a lot of you have been getting emails from various cycling vendors announcing their Black Friday/Cyber Monday/Crazy Eddie's Christmas In August sales.  Nothing wrong with a sale, but some of the discounts do give me pause.  A set of lobster gloves whose selling season is somewhat rapidly expiring (we are a fore-thinking lot, after all) that's normally $69 going for $59 is one thing (and I need some new lobster gloves...), but frames from big brand names, which originally sported the latest innovations and $3,500+ retail prices, going for $1,999 is one of those things that makes me go hmmm...  Why?

That's a pretty big discount, right?  Does it make you wonder how they can discount that deeply?  How much margin is there in the frame in order to sell the aging inventory for roughly half the original price?  How much padding is there in the original retail price to guard against such radical markdowns?  These last two are rhetorical questions, and the answers are "a lot" and "a lot," respectively. 

One of the business risks that we most fear is inventory risk on frames.  The cycle from when we release the order to when we start selling frames is long, as we've discussed before, and it's a cash flow challenge of a fairly high order to finance 6 to 8 months of your sales cycle.  You can't get a lot of inventory turns out of frames because of the long lead time, and adding to all of that there's your exposure to having guessed incorrectly on size mix.  You don't want to wind up with a warehouse full of size 52 frames when the world wants size 58s. 

In order to mitigate this inventory risk, we invert the process: we call our Black Friday "pre-order." By doing the pre-order, we're able to avoid locking up all of our working capital into slow-turning inventory, and sell as many frames and bikes as possible with pre-determined sizing.  This takes A LOT of risk off of our shoulders, for which we pay you rather well.  The pre-order price is on the order of a 15% savings, in return for you paying between 3 and 4 months before you'll have the bike.  For those astute finance students out there, this equates to and APR somewhere between 45% and 60%.  Sure, for us, almost any other financing would be cheaper, but no other financing would mitigate risk in the way this does.  Frames sold from in-stock after the pre-order need to be priced to reflect the risk we retain in holding inventory.

We'll be launching this pre-order/Black Friday bonanza soon, and you won't even need to leave dinner early and stomp a fool to take advantage.

Thursday
Nov072013

Handbuilt Soul

Inspiration for the title comes from Nightmares on Wax, whose "Carboot Soul" certainly does have a lot of soul.  Give it a listen.  It's one of my favorite records to build wheels by.

A couple of weeks ago, I was beffuddled to read on some forum that our wheels aren't "true handbuilts." The only thing I can guess is that a wheel only qualifies as a "true handbuilt" if it's built to order for a specific person, out of parts specified either by or for that specific person.  We were also once accused of having no soul.  I can fluidly rhyme the entirety of Paul's Boutique, which I'd think would qualify me as having at least some small modicum of soul, but again I mostly plead ignorance as to what goalpost exactly we're kicing at there. 

This handbuilt thing popped into my head yesterday as I was building two sets of Rails, one putatively destined to become Mike's, the other mine.  I say putatively because it's a fancy word that I know and I do like to use fancy words, but also because the wheels in question are the first we're doing with the new White Industries colored T-11 hubs.  "Mine" are blue, "Mike's" are red.  The simple fact is that we are going to get decals on these, put them on Facebook, get orders for them within a half hour, and send them off without them over having had a tire mounted.  **EDIT - It already happened, without them getting on FB - Mike got screwed, his wheels are sold.  Sorry Mike**  And as I was building them, that knowledge was firmly in my head - that here I was building two sets of wheels, and whether they were going to actually wind up as ours or yours was totally immaterial to the process.  The simple reality is that they got built the way I build wheels, which through iteration, testing, and refinement has become what I'll modestly call a quite good way to build wheels. 

As the builds pile up and pile up, I know that my general skill at building is way beyond what it once was.  At this point there are two guys who help me with wheel production, and they are also very very good wheelbuilders.  I would gladly ride wheels that they built (part of the process of their builds is my post-build QC), and if Fabian Cancellara urgently needed a set of wheels and we had a pile of wheels sitting there I'd happily (eagerly, even) grab any set out of the pile, give it to him, and have it represent our wheel builds.  The corollary to that is that we could be building a set of wheels intended for either Mike or me, or Fabian Cancellara, and ship them to you instead.  There would be no difference.  I don't necessarily know why I use Cancellara as my example other than that when I've talked about this concept I've always used him for some reason.  That and that he's won big things and worn special jerseys while riding wheels from companies where that's not the case - wheels for pros are built off line, not for public consumption. 

So despite their being built by hand, they aren't handbuilts, and despite my obvious possession of mountains of soul, we are a soulless company, and that's fine.  I don't care about that, I just care that whatever you get from us is as good as it can be. 

Thursday
Oct312013

Frameconomics

It seems like all we do is talk about wheels lately, huh?  Well, there's a lot to talk about about wheels, and we have some really really nice wheels.  If you're on the mailing list, you'll know that we've just announced a Rail trade-in program, where you can trade in your older November carbon clinchers for new Rails.  It's a great program, but talking about wheels is not my purpose here today. 

Have you noticed that there are relatively fewer carbon frames going around these days?  I don't mean from Trek, Giant, or Specialized.  I mean like Blue (the company was shuttered a couple of weeks ago), and Van Dessel (their primary cx bike is the very cool new aluminum "Aloominator"), and companies sort of that size and smaller.  There are a bunch of different market forces at play creating that.

One is what I call the forest syndrome at the bike dealer.  The big companies are the tall trees and they soak up the sunlight and the moisture from the ground and the big get bigger and the small fight over what's left.  This is decidedly not me wearing some punk hat right now, it's a simple fact of the way things go.  In order to thrive in that environment you really have to be well adapted and do something unique.  We've chosen to go a different route entirely, and that's been pretty good for us so far.

Another thing is floor plan financing.  This is really part of the forest syndrome, but it bears talking about quickly.  The bikes that you see on the shop floor are being financed.  The bigger brands can finance more stuff at better terms than smaller ones can.  They have more access to capital, and their draw as brands puts people through dealer doors, so the dealers generally need them to thrive.  It drives a lot of shop floor homogeneity, but until it becomes a bad thing (dealer sales don't meet expectations, dealer gets behind financing) it's a good thing in terms of keeping inventory available to buy.  As the bike buyer, you pay for it, but that's part of the stew. 

A big and growing challenge for a lot of brands on the undercard is lead time and carrying cost.  If you want to buy frames from someone worth buying them from a) they're not cheap, b) you have to buy a ton of them, and c) there's a long lead time after you pay for them and before you get them.  So, say you are a company like us, and you are aware of and have access to the companies that you want to be buying frames from.  In order to have bikes to sell, you need to buy what we politely refer to as a metric f**kton of them, and pay for them at time of order.  Anywhere between 90 and 120 days from that time (from the quality suppliers, lead times have been growing, and prices have been rising), they'll be ready to ship to you, so you're out the use of that money for that entire time, and you're paying the vig on whatever of it you had to borrow. 

Call it 100 days later, you get the nice notice that the frames are ready to ship to you and you get to pay the shipping cost then, and soon enough customs duty and broker fees as well.  If you do it like we did our last pre-order, when the frames were a bit at risk of arriving behind our promised delivery window, you air freight them.  That costs a ton.  If schedule allows, you sea ship them.  That takes a ton of time.  Say you've shipped them by sea, which takes on average about 30 days from Taiwan.  Now you are looking at a clean 4 months from when you've paid for the frames to when you even have them.  Then you start selling them, but because of the nature of this whole morass you are taking any where between 6 months and a year of inventory in the shipment. 

If you've taken 6 months worth of inventory, you're going to sell approximately half of that inventory in the first three months and half of it in the back end.  Say your sales go well and you sell half of the inventory in the first two months (which, incidentally, has now given birth to your resupply problem).  So now you are starting to get recoup some of your investment that you made 6 months ago, and if sales continue to go well, you will get out of the red and into the black before much longer. Hopefully you've gotten the size mix right so a bunch of your inventory doesn't become a white elephant. 

Most small businesses simply don't have the capital to finance COGS (cost of goods sold - one of the acronyms I do use, and often) for half of their year's sales for 6 months.  The various responses to that are going out of business (a la Blue), or shifting to a different supply (Van Dessel), or realizing that their original plan of doing pre-orders is actually really smart (us). 

As with every blog post about complicated topics, I've had to leave out a lot in order to keep it to a length you might actually read.  If the world slows down just a little bit hopefully I will be able to fill in some of that shading.