How to make 2 million dollars in the bike industry

This guest post was written by Jeremy Smith (@jeremybsmith). Currently a web strategist for several industries, including bicycles, outdoor, architecture and planning, and apparel, Jeremy has been in and out of the bike industry for over a decade, with experience at the shop, vendor, and brand levels. I became acquainted with Jeremy last week after publishing my post on The Fleecing of Cyclists. Because of his experience I asked him to write a guest post from the industry perspective and he graciously accepted. Thanks Jeremy. A little about me and bikes. I’ve been working in and around the bike industry for over 10 years, on the both the retail and corporate side of affairs. I’ve also been a plain old bike consumer, struggling with pricing and value. It costs a lot of money to make the niche products that we consume as cyclists as a manufacturer, brand, or vendor. There simply isn’t the volume there to drive down wholesale costs enough to the level of other consumer goods. There’s always going to be the floor of wholesale pricing which is the cost of materials, labor, lights, rent, and so on for the manufacturer. Before I get too far into the specifics of the bike industry, let’s talk general consumer goods retail and pricing. The model varies, but if you take out the razor/cartridge and printer/ink nonsense, in general, when you go into a store, you are going to pay 2x what the store paid for the item. That 100% mark-up is there to pay people, rent, utilities, other marginal costs, and finally, to make a profit. That profit is...