I'm racing the Killington Stage Race this weekend. Blogs need pictures, here it is.
We get a goodly number of requests from shops to sell our wheels. I don't know if the world in general knows this, but any legitimate shop can buy rims from us at a discounted rate, one that actually allows shops that can build wheels to sell Rails. Why, then, don't we sell complete wheels through shops?
First and foremost is that in order for us to make it work for shops, we'd have to raise prices by quite a bit. If a shop isn't making 40% margin on wheels, there's no way in hell they're going to stock them. That's nothing but an accurate statement of the economic realities of retail. Less than that, we're not going to get the time of day from retailers. You can argue all day and night about the relative merits of dealers, I will simply sum up my thoughts as "there are great ones and there are others that are not great." The capacity to do wheel builds is probably a good proxy for the shop being good in other ways, but that's an untested thesis.
The other thing is that, with rims, we're willing to take a quite low margin for ourselves. We, whether rightly or wrongly, feel like a Rail-build customer going through a shop is a customer gained to the Rail universe, rather than an opportunity cost against a direct sale. But the primary reason we welcome the lower-margin-to-us shop rim sale is that we aren't production constrained on rims. We've got the supply chain dialed to the point where, when a rim order comes in, boom we just ship them out and continue life as normal.
Wheel builds take time. We are, indeed, time-constrained. If we opened up the dealer channel full bore, we might create a situation where all of our wheel building time was dedicated to low margin (to us) dealer sales. Without raising prices, if we gave dealers a 40% margin (which, let me emphasize, is the bare minimum they even want to consider), we would make approximately no money on those sales. In order for us to make any money at all whatsoever on those sales, we would have to reallocate the direct labor that goes into wheelbuilding into a general overhead pool, which essentially means that we'd be doing the builds for free. That ain't happening. We've developed WAY too much skill and value the time it takes to build a set of wheels way too highly to just give it away. Plus, the amount that we allocate to direct labor on wheel builds is absolutely nothing like an acceptable overall margin to us in any case. So it's a useless exercise.
Many people who are far along enough in their cycling to be considering a set of wheels like Rails are, quite honestly, at a competence level where any shop would be happy to have them on staff. They're fully capable of researching the purchase on their own, and don't need any support in getting them up and running. Modestly, I will also say that we work pretty hard at providing direct support to our customers. For these people, the higher costs associated with a shop-based purchase of complete wheels just wouldn't make sense.
We're very into supporting shops and wheel builders who run with the Rail build program. We've had an awesome experience with all the shops and builders who've taken part. We also support them pretty hard with low barriers to entry (minimum rim order = 1 rim) and very easy logistics, so we think that program is a great one for all involved.
Rick – Maybe I missed something but I think we're agreeing with one another?Kevin – Thanks. All goodRico – I used 34s for the hilly circuit and mountain-y road stages. Mostly because a) they were built and I had no time to build a new set b) I had tubeless tires on them, my luck with crappy VT roads is horrendous and c) they were what I'd been using. I had a set of 52s with a Powertap set up for the TT bike. If I'd had a set of 52s built with normal hubs I'd at least have used them for the circuit. Unfortunately, having made the winning break in the queen stage, my perfect crap luck held and I pinch flatted a tubeless (yes it happens, yes it's super rare – it takes a hell of an impact, one which would have flatted any type of tire. The rim was fine, fortunately). Despite the break being nearly 3' ahead of the field the wheel truck was behind the field – probably they'd had too many flats to deal with already. Almost 4' after I flatted I had a new wheel and my weekend was finished. VT roads hate me.
Dave, did we (I) miss it in your post, or did you neglect to relate which of the Rail wheelsets you chose for Killington? Inquiring minds want to know….
I bought my Rail 52s from the LBS Action Wheels listed on the November site and I could not be happier. I pretty much have the same build as a November built wheel with the exception of DT aerolight spokes. I ended up paying a little bit more for the wheels but knowing the guy that built the wheel is a major plus. Wheels are a wear item so it's nice to able to show up the Friday before a race weekend and get the wheels serviced and not feel like the guy that purchases everything online. My wheels get a lot of comments and it's nice to say November rims and my trusted LBS in the same sentence. The Novembers with the White Industries hubs are getting closer to the 2k range and I'm afraid that if prices go up much more people that don't get it will look elsewhere for their wheels. Kevin.
NOOOO! I think the appeal of your product would be lost if sold in shops – it would simply add to the cost, putting the rail up there with other big names. I like that you are "small" cater to your customers, as well as your business model. The way you do business, lets the consumer have a great product at a reasonable price – even if the consumer opts to have an outside builder build up a set. In my eyes, the Rail 52 would not be so attractive at a much higher price point, not to mention that expanding leads to other issues. I like the customer comes first approach and that you are the face of the product. I bought my rails because of this (even though I had a builder assemble them) and may think twice if the price increased by high margin. Your whole model cuts out the middleman and does not play into market hype. I email a question, I get an answer…QUICKLY! I would hate for this to stop. I bought YOUR product because of the model, reputation, and how you do business.
Love the new custom options for wheel builds. I really like matching hubs/nipples. Great move!!