I have several thoughts on this. When Rivendell Bicycle Works faces questions like this, it is 95% a financial question, and most importantly a cashflow question. RBW does roughly $2M in sales annually, and I will guess has roughly $400,000 to $600,000 of inventory on their shelves on a given day. That money that is tied up on the shelves shackles them. It makes it hard to pay rent, pay salaries, and buy more stuff for the shelves. They consistently have cashflow challenges, several times a year. The hard questions they have to ask themselves is whether there is a way to reduce the amount of cash tied up on the shelves without radically reducing sales volume.
All the made-to-order bikes have essentially ZERO impact on this. The only tiny pain-point when you order a Hilsen is that they only make you pay half up front. If you want to be helpful to RBW's cash flow situation, make a much bigger deposit on your made-to-order frame. Count on all the made to order frames remaining available, because they have very little impact on Riv's cash-flow. Scott got this 100% correct. Bikes that Riv has to order 100-at-a-time are SUPER painful to them from a cashflow perspective, so Clems, Appaloosas, Cheviuts, and Sams are all painful, and something has to give there. Even now they miss sales because they don't have any medium size Appaloosas or Cheviuts and even the next order of Cheviuts are almost sold out in 55. It is fun to speculate/debate what would hurt the least to cut. In my mind the biggest cash sink is complete Appaloosas and complete Sams. A hundred complete Appaloosas on the shelf is a quarter million dollars in retail value. A hundred Appaloosa framesets is half that, and you can build them up as they sell, ordering parts as you need them. We, the customers might end up paying $3000 instead of $2600 for the same bike, but that would help the cash flow situation. The real solution (in my mind) is a Riv FSA program (FSA=Flexible Spending Account). If 250 debt-free Riv customers each bought a $2000 store credit from Rivendell today, that would be a half-million in cash that Riv could use to ride through the ups and downs. If you know for a fact you are eventually going to spend money at RBW and you have money today, why not just buy a store credit from them today? That's the way we can have a say in what they keep on the shelves. Maybe Riv gives a TINY discount, like they sell you a $2100 store credit for $2000. If a ton of us who want to see them continue to succeed invested in that way, they would be WAY better off. They are not set up to manage tiny FSA's, so I don't think 2500 of us each doing $200 would be as helpful. The ideal situation would be ten people each endowing Riv with $50k, and call them silent partners, but that's not likely to happen. Bill Lindsay El Cerrito, CA On Thursday, September 15, 2016 at 9:46:30 AM UTC-7, Scott McLain wrote: > > I thought it would be interesting if someone could set up a google survey > on this to see how the numbers came back. Like others have said, > recognizing that there are a lot of variables that I don't know about and > probably wouldn't understand, I will share my uneducated opinion. > > Go build to order on the Waterford frames, but keep them all available. > Don't need to stock demo's at Riv HQ. Even if this mean a small price > increase. This is a boundary condition for me. I bought an AHH because I > wanted a MUSA bike. I am an engineer in the manufacturing industry. > > > -- You received this message because you are subscribed to the Google Groups "RBW Owners Bunch" group. To unsubscribe from this group and stop receiving emails from it, send an email to rbw-owners-bunch+unsubscr...@googlegroups.com. To post to this group, send email to rbw-owners-bunch@googlegroups.com. Visit this group at https://groups.google.com/group/rbw-owners-bunch. For more options, visit https://groups.google.com/d/optout.
