It's never been a secret that Patagonia is one of the brands we most admire, and whose principles and actions we try to emulate. Through many eras of fashion, their aesthetic has always been instantly recognizable, sometimes influenced by the zeitgeist (did everyone read this week's newsletter?) but never bullied by it. It's a rare Patagonia item that looks out of place 5, 10, or 20 years after it's new.
One area in which we split from Patagonia is in pricing. Their well-earned and quite popular nickname is Patagucci. So ubiquitous, in fact, that spell check didn't even blink when I typed it. They staked out their ground when their market was one hell of a lot less crowded than it is now, and have performed well enough to be able to charge what they do all along. While we are very much in lock-step with their philosophy on price integrity and stability, our margins are much much lower than theirs (Mike and I both happen to have unique insight into this, Mike through a personal connection and me through my brother's former company having tried like mad to convince them to go public, which they quite correctly refused to do). Much lower.
While we strive to give great service (and there are currently three cycling companies I'm waiting for return calls from, one of which has gotten three calls from me going back three weeks with nary a word, so we know the crap service that is all too common in this market), we haven't priced in a "whatever happens, we'll just spend money to make it right" insurance policy for ourselves. If we charged $1200 for an alloy build inferior to ours, we'd probably fly to your house to set your wheels up or if you ever thought something was amiss. As it is, we've been asked to foot costs of return shipping to "fix" wheels that were built more or less as well as can be done. We've lost every cent of our margin paying for return shipping on a new build that was definitely way out of dish, only to find out that the dropouts in the fork it was being used in were at fault. And we've been tasked with truing a wheel that had been used in dozens and dozens of crits, including one in which it was crashed profoundly enough that the rider broke several bones (the wheel was trashed beyond any hope of repair, although it had been ridden to several race wins in the state in which it was given to us).
A guy who helps out in the shop and I were discussing this situation yesterday, and he said "talk about sending your children out into the world..." Totally spot on. When we put a wheel into a box, it literally is like sending a child off to live on its own. We've "raised" that child as well as we can, imparting all of our experience and expertise, absolutely and genuinely with the wheel's owner's interests firmly in mind. Like, to an absolute fault. We want nothing more than every wheel to give its owner total satisfaction. But like I wrote in a post this spring, our pricing structure doesn't support a waitress serving canapes and espresso while you're waiting for your oil change. We have a great warranty, with very clear terms. If there is a material error with one of our wheels, we will fix it. We reserve the right to go beyond those terms, and have, but maintaining our price levels (which are, any way you slice it, tremendous), we have to exercise discretion.
You folks did right in my books. When the flaw was discovered in my Rail 34s I saw no hesitation on your part to honour your commitment. There are very few companies who stand behind their product the way you do in this and a heck of a lot of other industries. As a result, I'm a customer for life "and" I promote your product to a lot of other riders (especially when they are drooling over the Timoneria). Keep up the great work and let me know when you decide to go public – I'll make an investment…
You're better than Patagonia. I can't afford Patagonia even with the pro form prices I can get.
Paul, No, but I understand where the point gets missed. We talk about stuff that other people don't, and we have to do so in relatively few words. This was a tricky one to write, because I didn't want to offend people, yet there was still a point to get across. Part of what makes us us is that we do talk about things like this. Perhaps you don't or don't want to understand how we do things, but the vast majority of our customers do, and appreciate us sharing things like this with them. We deal with warranties quite well, per the terms of our warranty terms or better. Our warranty terms are good, and very standard – the big leader is that the customer pays return shipping, and if a warranty is determined to exist, then we'll pay return shipping. In one recent instance, we were asked to provide a brand new wheel, along with a return label for the existing wheel, for the customer to use while we investigated a perceived problem. Even if the perceived problem had turned out to be a real problem, which it was not, that's just not service that's possible to provide. Had we done that, we would have burned the time and materials to build and ship a new front wheel, the shipping cost to deliver that wheel, and the shipping costs of returning the original wheel. I don't know your business, but if you are building costs in to provide that level of service, your business is either selling Bugatis or you are overcharging the vast majority of people who expect service per the agreement in place when they purchased your product. We're responsive as hell. There's no way we're signing up for a firm commitment to do this, but the two situations that motivated this post (of which neither turned out to be a deficiency in materials or workmanship, btw – the examples given are proxies) got responses WAY outside of business hours. Considering that the three calls to other companies I mentioned are still as yet unreturned, we think that returning emails at ~8p on a Friday and then again on Saturday morning is excellent. Our turnaround in performing warranty service is outstanding – I'd go so far as to say that we get customers back up and running by the time most companies have even made a determination on which way to go (or perhaps even returned the customer's contact!).Snark aside, thank you for helping to further articulate our point. Our warranty is a contract, which has been priced in to the product. We reserve the right to do better than that contract, but we also reserve the right to perform per that contract. Warranties happen, and no one wins when they do. When one of our products fails to perform how it should, we rectify it quickly and effectively. If it is demanded of us that we throw open the checkbook in response to a whole bunch of things that fall outside warranty coverage or procedures, that's where the failure point happens.Again, thank you.
So, you guys haven't set your pricing to cover the cost of running your business and you write a blog post proclaiming that? That's amusing, but I'm not sure I'd share it so widely. Even if you are very well connected and happen to know a guy who once knew a guy who worked selling backpacks.