Saturday, November 3, 2012

The Service Margin

In business, there are many ways of calculating profit, but if you distill any of them to their essence, it is this: money in versus money out.  On the service side, the cost of doing business is parts, consumables like lube and rags, and overhead like rent and utilities.  But those costs pale in comparison to payroll. 

On the plus side is the amount you bring in for service, which in turn is the margin you're making on the parts your mechanics are installing, and the money you charge for fixing whatever needs fixing on your customers' bikes.

So if you want to calculate your service margin, you subtract the cost of doing business (overhead, payroll, cost of goods sold) from the gross brought in by the service department.  This is an important metric.  Too high, and it could be argued you're overcharging your clients or underpaying your mechanics (though not many managers will be uncomfortable with margins that are too high).  Too low, and you're just not making money.  Businesses that don't make money don't stick around very long. 

I had a talk today with my service manager about our service margin.  He explained that we could no longer track the amount of service our service writers were selling; that this metric had been important in the past.

I'm uncomfortable with this.

I'm uncomfortable because tracking this metric creates a very clear incentive to oversell service, which means you're going to be encouraging your clients to do things they may not need to do.  This is how mechanics and service technicians of all disciplines get the reputation for being shady and ripping people off.  This is how a person can go into one bike shop and get a $300 estimate, and desiring a second opinion, will be told by the next shop that it will only take $150 to fix his/her bike.  It does not build trust.

Don't misunderstand me.  I understand business, and I understand that, as long as I want raises, businesses have to grow.  That includes the service side of a bike shop as well.  I also understand that you cannot improve what you do not measure.  As a mechanic, I want to know what my personal service margin is.  I want to know how much I've made for the shop vs. how much the shop has spent to keep my grumpy ass behind the bench.  And if that number isn't favorable, I'm going to get my ass in gear, voluntarily or otherwise.

So it seems we're at an impasse.  How do you grow your service business without creating an incentive to oversell service?  Bearing in mind I have no hard data to support this assertion (like most of the assertions I have), it's like this:  when a customer approaches my service counter, I want to give him/her all the info s/he needs to make an informed decision about what we'll do to his/her bike.  I want to give him a good/better/best, and an explanation of what happens after he decides.  Don't want to replace the chain right now?  OK, but you will likely be replacing your cassette the next time I see you.  Don't want to replace chain and cassette?  OK, but your shifting is going to suck, and there's nothing I can do about that.  Don't want to clean and lube your chain?  OK, but you'll be replacing it more often, at a greater expense.  Any of these options are OK with me - it is, after all, your fucking bike.  But if I recommend something and you say no, I want us both to understand what happens next.  It's all about managing expectations. 

Happily and more often than not, my customers do what I recommend.  I replace a lot of chains and cassettes, and I do it with a clear conscience, because I know the safety and performance of my clients' bikes is better, which in turn will make their experiences more enjoyable.

But if my service manager ever tells me I need to start pushing my number, I'll tell him where to shove it.

Sunday, August 12, 2012


I know why I do this, but I don't know that you do.  Every once in a while, it's valuable to take a few big steps back and reevaluate your purpose in doing what you do.

I started this because I was a frustrated bike wrench fed up with an sometimes-inept boss, a failing bike shop, and unappreciative customers.  Thankfully, that gig came to an end and better things came along.  I'm still Angry Bike Wrench, but I'm not angry for the same reasons.  So yes, this is cathartic.

My greater purpose though is twofold.  One, this is to be a forum for those fascinated by the mechanics of the bike and the bike industry.  The kinds of people who regularly check the Problem Solvers blog for new releases and occasionally, just for funsies, flip through their greasy, dogeared copy of Barnett's before falling asleep. 

Two, this is an attempt to give perspective that bridges the communication gap that often exists between the wrench and the customer.  It is this gap that still continually frustrates me, and it would be cathartic to provide a few examples.  Yes, nearly anybody can learn to fix a bike, but no, it is not easy.  It takes years of experience to learn to do it properly.  Please don't cite your expertise with cars, airplanes, washing machines, or woodworking tools as evidence that you can easily fix your own bike.  Also, I don't care if you're an engineer of any discipline.  Normally, this just means you're an extraordinary pain in the ass.

When I tell you you need a new chain and cassette, I am not ripping you off, at least not any more than the auto tech who tells you to change your oil.  Despite your inability to grasp the value in maintaining a bike, I have your best interests in mind.

Most bike shops function on the principle of first-come, first-served.  Even if it was within my ability to complete a tuneup on your bike in the next 15 minutes so you can race tomorrow, I will not do it.  Other people, people with more skill in planning and time management than you, brought their bikes to me before you.  I'm fixing theirs first.

If the other shop offered to fix your bike for less than I'm charging you for parts alone, you are more than welcome to take them up on their offer.  They will not be in business much longer.

Forgive me for stating the obvious, but smiles and hellos motivate me to bend over backward to make your cycling experience as positive as possible.  Demands and accusations make me want to teach you a lesson.

Most importantly, bike wrenches LOVE fixing bikes.  We are not getting rich.  We are learning few transferable skills.  We are working shitty, long hours during the time of year when everybody else goes to the beach and rides their bikes.  We do it because we love it.  We love diagnosing clicks and creaks.  We love taking a frame and a box of parts and creating from it your dream bike.  We love the revelation that comes when we raise your saddle a half inch and you realize what comfort and power feel like.  We love it.  Please remember that when you're staring down your nose at our greasy nails, tattoos, scabs, and scars. 

Tuesday, July 31, 2012

MORE Fucking Chain Stretch

Remember our good friend Steve-O who wanted the eight speed Long Haul Trucker?  Well, it seems his mindset/drivetrain longevity paradigm is alive and well in the minds of others.  I took an email today with the EXACT same argument:  I don't want ten speeds because those wimpy, skinny little chains stretch too fast.  I gave my usual argument that drivetrain cleanliness has more to do with longevity than the number of cogs, but I should've know better.  Nobody listens if you're telling them what they don't want to hear.

But then I had a thought:  what if I'm wrong?  What if eight and nine speed drivetrains really are more durable?  One instance of a person thinking this?   I wrote it off because Steve-O is a kook.  But two instances becomes more compelling.  So I'm putting it to you readers.  I want the most rigorous data you can muster.  I'll accept anecdotal evidence if that's all you've got, but the argument, "Eight speeds are more durable because I had this bike once..." doesn't really cut it.  Anecdotes are interesting and compelling, but I'd love to hear from somebody with more than one bike, or a couple of bikes with different drivetrains ridden under similar conditions, etc.   I want controls and variables if possible.

For the record, these are my points of argument:

1.  Chains don't stretch - they elongate as the bearing surfaces are eroded (not really controversial or refuted)

2.  There is a direct correlation between the rate of erosion and the amount of dirt/grime/nastiness on the chain (still pretty uncontroversial, but less universally accepted because there is no way to quantify the cleanliness of a chain, which makes that variable open to interpretation)

3.  Modern chains and cogs, regardless of the number of speeds, and when comparing components of comparable quality, are made of better materials with more sophisticated processes, which increases their durability.  This one requires some breakdown.  "when comparing components of comparable quality"  What I mean by this is a comparison of a DuraAce ten speed cassette to a Sora eight speed cassette is not a fair comparison, nor would be a comparison of a DuraAce eight speed cassette to a Sora eight speed cassette.  Presumable, the DuraAce is going to be more durable because it's a higher quality component, irrespective of the number of cogs.  For this comparison to be fair, we need to compare a DuraAce ten speed cassette to a DuraAce eight speed cassette, or an eight speed XT to a ten speed XT, etc.  The point may or may not be true.  I think we want it to be true, because what's the point of advances in technology and metallurgy if not to make stuff "better," but there exists the fact that "better" does not always equate to "durable" in the bike industry.  But since I'm a Polyanna, I choose to believe that better can and does mean more durable.

4.  People's drivetrains are not as clean as they think they are.  Again, some breakdown.  In the U.S., bikes are toys.  Toys do not require maintenance, unless said maintenance amounts to no more than charging and/or replacing batteries.  Ergo, if somebody wipes their chain down twice a season, they are, in their minds anyway, doing a good job of keeping their drivetrain clean.  I am a little anal about my chains - not so bad as some, but more anal than many.  On my road bike, which doesn't often see we weather, I lube my chain every third or fourth ride, and wipe it down pretty thoroughly before I take it out again.  On my MTB, I lube it and wipe it down every ride.  On my commuter bike, which sees all kinds of nasty, I use a heavier lube, and lube and wipe it every week or two depending on how wet it's been.  Regardless of the bike, if it gets wet, the chain gets lubed and wiped down.

It's not the most rigorous drivetrain routine out there, and I'm really unparticular about the lube I use.  Shit, when you work in the industry, you use whatever's free.  About the only one I don't care for is Triflow, but it's not bad, just not as good as some of the other stuff I've used.

My point is, that's still a lot more time and hassle than most "average" cyclists are willing to put forth.  Sure, there's a learning curve there, and the more you do it, the faster and easier it becomes, but we're lazy motherfuckers.  We don't like learning curves.

Actually, when I was working on Steve-O's LHT, I  threw the question to Zinn, and he took the time to answer it, which I appreciated, albeit pretty superficially.  I think it was because Steve-O had been corresponding with Frank Berto (author of The Dancing Chain), and Zinn didn't want to be left out of the conversation.  Basically, he (Zinn) also thought Steve-O was fucking crazy.

OK Minions, whatchoo got?  Send you data and/or anecdotes my way via a concise yet thorough, grammatically-correct, droll and/or wry comment.  If you choose to type it without using correct punctuation or spelling, I will punch you square in the baby maker. 

Friday, June 15, 2012

For the Love of Velox Tape

Well first, I noted with dismay one of my prior posts, the title of which suggests I would go off on the commentators who frequent VeloNews, Cyclingnews, Bikerumor, etc.  I so enjoyed my tangent of lovingly criticizing Leonard Zinn that I forgot to get back to bashing the posers, douchebags, luddites, and assholes who feel it's their duty to hate every fucking bike-related post on the interwebs.

Oh my god, Dura Ace is going to 11 speeds?!

Like this exact same thing doesn't happen every 3 to 5 years.

What do you mean I can't get an 11-38 cassette?  I've needed an 11-38 cassette for as long as I've been riding!  Surely the bike companies wouldn't miss out on the opportunity to sell THOUSANDS of 11-38 cassettes?!

Stack and reach?  I've been riding bikes for 33 years, and I've NEVER used stack and reach.  People who do are idiots!  People who DON'T use stack and reach are idiots!  I can't believe every bike company doesn't publish stack and reach measurements for their bikes!  The bike industry is idiotic!

And on, and on, and on, and on.

First, we've talked about planned obsolescence before.  I wanted this to be a Respectable Blog, so I looked for the original post, but I couldn't find it.  Fuck it.  Planned obsolescence, or The March of Technology, will come up over and over again, so just take 15 minutes to read through the pile of shit I've written over the last couple years and you'll be up to speed.

The bike industry is driven by technology and exists in a competitive economic arena.  Products will evolve into a form perceived by most to be better.  "Better" usually means lighter, stiffer, and cheaper.  Sometimes it means safer.  Eventually, I'm sure we'll get into the philosophical discussion of marketing, and which part of the dog wags the other, but not today.  Most people (noted exception - Grant Peterson, whose opinion I respect, though it often differs from my own) agree that bikes are getting better.

What this means is that products are going to change all the time.  Part of that change is adding gears.  Superficially, you can argue that the performance difference between a 10 speed drivetrain and an 11 are negligible, and you'll be right.  But you cannot argue that smaller gaps between gear ratios isn't desirable.  It doesn't happen often, but it happens: you're riding along, either in a paceline or against a headwind on your way to work, and the gear you want just isn't there.  You're spinning either 80 rpm, or 100, when what you want is 90.  Some care, some don't.  But enough people care that component manufacturers are going to keep adding gears.  So don't act like this hasn't happened before, or that it's some kind of insult to your intelligence or athletic prowess.

Second, just because you ride something and like it does not mean you represent a market worth catering to.  No, really.  Sometimes, you're just an insignificant outlier, like my ol' friend Steve-O who wanted the 8 speed drivetrain on his LHT.  He swore up and down that there were others like him, but if there were, Shimano would still be making an 8 speed, touring-specific drivetrain.  The last time my phone shit the bed, I didn't want a smart phone; I just wanted a phone that would make and receive calls and text messages, and that would store an address book.  Guess what.  They don't exist, unless you want to go with the ol' flip phone.  I got a "smart" phone, even though I don't have and don't want a data plan.  Was I pissed?  Sure.  But I was also realistic enough to recognize I'm an outlier, and I sure as shit didn't tell T-Mobile that they were missing out on millions of dollars in revenue because they didn't make the phone I wanted.

But I've digressed.  We were going to talk about the repair that stalled because my shop didn't have anything other than 10mm Velox tape.  Seriously?  I know...  There is more money to be made if you keep inventory lean, and with most distributors being within a day or two via ground shipping, just in time ordering is the new normal.  But seriously, there are certain things a shop worth a damn should just have in stock, and Velox tape wide enough to do a 26" wheel is one of them.  I ended up using the shitty butyl tape, which works, but dammit, that's just something I'm not OK with on a decent bike.  Ah well, at least this shop doesn't give away labor like the last...

Thursday, June 14, 2012

Bad Luck

Situation: a reasonably nice young man who'd recently (within last 2 months) purchased a bike from our shop came in, and the rear derailleur had grenaded.  I didn't have a chance to dig into it, but from what I could see, the spring in the P-knuckle, responsible for applying the pressure that keeps the derailleur cage pushing toward the back of the bike and tensioning the chain, had broken.  The derailleur hanger was still straight to the eye, and the derailleur itself looked "normal" for a couple months riding - a few dings and dents here and there.  Of course, he was JRA.

Now, I'm not unreasonable, but I'm also a hardened skeptic when it comes to the W-word.  Fact is, there aren't that many defective products out there.  Materials and manufacturing processes are great and getting better, and QC (most of the time) has followed the same trend.  I know it happens, but if we accept Occam's Razor, it's more likely that a stick or rock got flung into the drivetrain, unbeknownst to the rider, rather than believing it was bad materials or manufacturing.  Again, either is possible, but one is more probable.

Here's the rub: if this bike had been six months old instead of six weeks, the guy would probably have been singing a different tune.  I am now going to coin another ABW truism: the purchase of a new product does not put into effect a moratorium on bad luck.  Just because you put in a new tube does not guarantee you will be flat-free for any minimum amount of time.  A new derailleur does not keep sticks and rocks out of your drivetrain.  A new bike does not keep you from crashing out in the first turn of your Cat-5 shit show.  I'm sorry, because sometimes that sucks, but it's not SRAM's fault, or Shimano's, or Cervelo's.  It's nobody's fault.  Sometimes, bad luck and shitty things happen, even to good, responsible riders.

I don't know what we'll do for this guy; it's not my call to make.  If it were, I'd ask SRAM if they had any insight.  They know their derailleurs better than I do.  If they say the W-word, great.  If they don't though, I'd have a nice heart-to-heart with this guy, explain the ABW Bad Luck Truism, and offer to comp labor on a new derailleur.  If that wasn't good enough, I might go so far as to offer a discount on the new one, because I'm all kind and understanding and shit.

Thursday, June 7, 2012

Velonews Commenters

Jesus, where to start? Well, since it's such fertile ground for comment, let's start with Leonard Zinn and his reports on the rolling resistance of fat(er) tires. For the record, I think the following things:

1. Zinn is right
2. Zinn is also a little crazy
3. Zinn is not as scientific as he thinks he is
4. Zinn often draws very un-scientific conclusions veiled in Bad Science

Point 1.  I'm not an engineer, but I do have a background in science, and I do understand the scientific method.  The tests done to measure rolling resistance are sound, and the conclusions valid.  There is zero doubt in my mind that a 25c tire rolls with less resistance than a 23c tire, but here's the catch.  I believe this is true only if the conditions are exactly as they appear in the test.  This is an important distinction, because true life conditions will never, ever match those of the test.  There are too many variables totally beyond the control of the rider to ever realize the performance benefits of fatter tires, unless you are at the pinnacle of the sport and are literally pushing your equipment to the edge of its performance envelope.  Now, all those of you out there doing that, raise your hands.  I thought so.  Just get out there and ride your fucking bike.  So why do the rest of us schlubs care?

Because we're Mericans and want to believe we can buy speed.  It is so, so much easier to lay out the 180 bucks for a pair of 25c GP4000s and slap them on our ride than it is to put in the hours in the saddle that will actually make a difference over the course of a race.

You really think a 25c is going to allow you to upgrade to Cat 3 sooner?  Go ride your fucking bike.

Point 2.  Zinn really is a little crazy, but it's mostly in a lovable way.  For instance, when readers were writing in asking about storing bikes for the winter and he recommended spraying the whole bike down with 303 Protectant?  Brilliant!  I rushed out and bought a case!  Really Leonard?

Points 3 and 4.  There are numerous instances in which Zinn cites Good Science and then goes on to augment or refute those findings with his personal anecdotal evidence.  I don't have a problem with that, as long as the author is forthright about the nature of anecdotal evidence.  Anecdotal evidence is interesting.  It is compelling.  It begs good questions.  But you can't draw conclusions from it.  Too often I find Zinn drawing conclusions from anecdotal evidence that are presented as being equal to conclusions drawn from sound testing and large sets of data.  The plural of anecdote is not data.

This is my dream: I want a testing lab.  I want to spend my days devising tests to determine how much of the marketing is just hype, and how much is worth listening to.  I want to set up mock drivetrains hooked to electric motors so I can run chains for hours on end to see which lubes really work best (of course, given certain environmental factors).  I know what you're saying - "but what you want to do is what you just slammed Zinn for."  Maybe.  I think the difference is in the reporting.  I want to accumulate and present data.

Or maybe I'm still a naive schmuck, and there is no reality.  Perception is reality.  Testing shows that tied and soldered spokes are no stiffer than not, yet people will still swear til the day they die they are.  In light of that, does the testing then matter?  Can you perform double blind experiments that involve riding bikes?  I don't know, but I'd like to find out.