Indalo was right to question why Germany with its high labour rates can build bikes but we can't any longer in the UK,excepting specialist niche products.

One of the big problems in the UK are our business rates. When I started in business some 40 years ago, rates were always considered 30% of rents but now in many cases the rates bill is greater than rent.If you look on the news section of the Sunday Times,page 9 'squeezed stores quit high street'-it gives an example of a 2000 sq ft unit (say 50ft x 40ft,thats not big) with a rates bill of £160,000,the American owners have same size units in Germany with a rates bill of £10,000,they ask 'what do you get for your £160,000',the honest answer is nothing.

To survive in the high street now you need to buy product for pennies and sell it for tens of pounds(that means Asia),only the big multies have the buying power to generate those kind of margins,the small independent with a 50% mark up is wasting his time.

I go to Memmingen in Bavaria for the Eurobike show,its a beautiful bouyant town with lots of well stocked individual shops that are able to offer top quality product for fair prices,those shops would never survive in the UK.

Similarly I have a customer in Germany who has a warehouse similar size to mine but his rates bill is 10% of mine,he was given the land by the local council on a peppercorn rent.

The reason why all of the big german bike manufacturers have moved into e-bikes is that they have been given cash incentives to do so from the german government under the auspices of 'green' targets.

The reason our councils need these big rates is to fund their pension schemes which represent a massive hole in their budgets,as shops are going bust they put up the rates to the remainder,the law of diminishing returns!

We could make bikes in the UK again together with lots of other products and we could get the UK building again by one simple move-give rates relief for next 10 years only on new build commercial units, at the moment you would have to be the village idiot to make any investment in the UK.

Dave

Kudoscycles

because we gave manufacturing away as thought it below us. Now have to import everything. instead we lived on rabid property inflation, until that bubble burst and everything came tumbling down. The consequence of this, a disenfranchised young who cant find jobs, let alone anything else!

 

What a grim future..............NEXT!

There is a tiny market for £2K plus bikes in the UK.

 

If the market was as big as in Germany, there would be a greater chance of a UK maker filling it.

 

Brompton is a bit more than a niche maker, they succeed mostly because there are plenty of customers wanting to pay them £1K for a bike.

I'm looking around for a road bike for my wife and having trouble finding much for under 800-1000 +. this is considered a budget price bike.

 

I held a carbon wheel in my hand in LBS yesterday ..it weighed hardly anything and on sale for £1200 the one next to it was £2500

Edited December 2, 201213 yr by eddieo

The powers that be in this country have a long history of killing the goose that lays the golden egg. It is obvious even to the village idiot that there are reasons why Germany is more successful than the UK. Why is it that we are incapable of learning from other peoples mistakes. The problems facing anyone trying to start a business in the UK are virtually insurmountable. Far too much BS and red tape, much of it of EU origin.We were once the workshop of the world.

The powers that be in this country have a long history of killing the goose that lays the golden egg. It is obvious even to the village idiot that there are reasons why Germany is more successful than the UK. Why is it that we are incapable of learning from other peoples mistakes. The problems facing anyone trying to start a business in the UK are virtually insurmountable. Far too much BS and red tape, much of it of EU origin.We were once the workshop of the world.

 

Things won't get any better whilst the present bunch are in power either. Cameron and Osbourne are making us eat their @rseholes whilst simultaneously sneering at us for not knowing which wine best accompanies their @rseholes. There exists the utmost contempt for engineers and innovators in this country. I spent 5 years getting an MSc in Mechancal Engineering and if the subject ever crops up, people generally think that I have qualified as some sort of washing machine repair man (not that there is anything wrong with being a washing machine repair man, but there is a difference!).

Ironically, I am a retired washing machine repair man!

Ironically, I am a retired washing machine repair man!

 

Did you train up tilson before you left.

Did you train up tilson before you left.

 

 

Didn't stick with it. Couldn't see much future in engineering even though I enjoyed it.

whilst simultaneously sneering at us for not knowing which wine best accompanies their @rseholes.

 

Now now tillson.....you should know that its a nice chilled french rose' from La Liviniere in the Minervois.....

 

Lynda

Ironically, I am a retired washing machine repair man!

 

It was a bad choice of words on my part neptune. Makes me sound like a pretentious fool.

 

Since leaving engineering I have set my goals in life as being a twat and to achieve £uck all. Things are working out just fine.

It was a bad choice of words on my part neptune. Makes me sound like a pretentious fool.

 

Since leaving engineering I have set my goals in life as being a twat and to achieve £uck all. Things are working out just fine.

 

Did you become a banker? Or work for a quango?

Dave

Kudoscycles

Ironically, I am a retired washing machine repair man!

 

Irony's good. Never retire from that!

@Tillson. I am sure you meant no harm in referring to washing machine repairmen. It was a trade that was very good to me, and I was self taught and self employed. It must be very disheartning to have spent so much time studying for a qualification that seems to have been of little use to you. Do not give up on your life, I am sure you will find your niche. All the best opportunities I had, were the ones I created for myself from nothing. I would hope that the same will apply to your good self.

Ironically, I am a retired washing machine repair man!

 

well come on guys! best make plse?!?!:p

Red Tape

 

I have written this post 3 times to try to keep it brief.

Its not common knowledge that under distant selling regs,if you sell more than the vat turnover to private individuals in any EC country you have to register for vat in that country....for some reason the later EC countries have a threshold limit of only 35,000 euros per annum. I have a friend who supplies flat packed product all over Europe,he has exceeded the vat turnover in 11 EC countries....HMRC is trying to force him to register in all 11 countries and advise others he is close,he could end up having 17 different vat numbers,making quarterly vat returns to all 17 countries-he is compelled to having an agent in each country,communicate in their native language(hows your swedish,latvian and greek)and making an annual trip to each country,He will end up giving away £200k of vat revenue that currently goes to our goverment, and making a claim back from the UK and giving £300k spread around Europe-if he fails to abide he can be heavily fined or prison,it could send him bust!

Its a shame he is a local success story,he tried to involve our local MP but he didn't understand the problem and it looked like a political hot one!

Enough to make you want to join UKIP!

Dave

Kudoscycles

Is it because lots of British Companies can see bigger profits getting things made abroad cheaply and still charging the same prices for their goods ? The prime example is Dyson , always whining about no help for Engineers , he closes his production here and transfers to Malaysia , but still charges the same prices . He still has development here , but how can you train well rounded Engineers without access to a production environment ? I suppose staring at Computer screens is his idea of producing Engineers . You would need to join Westland Helicopters to see how it should be done , like I did 56 years ago .

if he fails to abide he can be heavily fined or prison,it could send him bust!

 

.....or send him mad.

well come on guys! best make plse?!?!:p

 

Washing machines Ed? If so, the short answer is Miele. The longer answer is any German built machine.

 

You don't go far wrong with Bosch, (surprise surprise!) AEG or Siemens. After those, you pay your money and take your pick from Zanussi, Indesit, LG, Beko, Hotpoint, Maytag, Whirlpool and any others you see in the shops.

 

If you have a Dyson, it's probably a collector's piece already!

 

Indalo

There is a tiny market for £2K plus bikes in the UK.

 

If the market was as big as in Germany, there would be a greater chance of a UK maker filling it.

 

Brompton is a bit more than a niche maker, they succeed mostly because there are plenty of customers wanting to pay them £1K for a bike.

 

How much of the Brompton is actually made in the UK out of interest? I thought most of the bike was manufactured in Asia and the parts shipped to UK and just assembled here?

No reason why we could not build our own bikes if the conditions were right. Having previously worked in the offshore wind industry it was a very similar story with wind turbines and other major components made mainly in Denmark and Germany. There are however a number of British frame builders out there as well as a few bike builders e.g. Pashley. There is a great book about the British bike building industry (see link at bottom). Manufacturing needs to be looked at and barriers removed. Germany benefits from the Euro as other countries drag down the value of the currency making exports cheaper. At the moment the focus is mainly on high value manufacturing and design in the UK. Personally I think something needs to be done sooner rather than later. I think a British bike would sell, Brompton have done it for folding bikes. The key would be a quality bike which could sell in Germany and the rest of continental Europe.

 

Made In England: a beautiful book about artisan bicycle builders | Bicycle Business | BikeBiz

Fair point maybe regarding Brompton but I am sure a similar point could be made for German made bikes and other European bikes. The devil is in the detail :o

There is a tiny market for £2K plus bikes in the UK.

 

If the market was as big as in Germany, there would be a greater chance of a UK maker filling it.

 

Brompton is a bit more than a niche maker, they succeed mostly because there are plenty of customers wanting to pay them £1K for a bike.

 

I think this hits the nail on the head.. it's a simple case of economics, supply and demand.. the UK could make e-bikes, if the demand was there, or at least at the prices they would need to sell at.. some small conversion builders do very well and make a decent living from it by all accounts, but manufacturing e-bikes from scratch here is a whole different scenario.

 

The problem the UK and most other developed countries face is the impossibly cheap labour of Asia and their mass production capabilities. The quality of Asian goods is often shoddy due to being churned out in such high volume in sweat shops, compared to what you would get from British manufacturing standards, it doesn't compare.. you get what you pay for, as the saying goes, and it seems the British public wants cheap mass produced goods from China.

 

But for many businesses starting out or looking to move into bike selling, are they going to make a massive investment in UK-based manufacturing with high labour costs, or just use the existing and cheap manufacturing factories of China. Most will take their design and go to China and say build this, because end of the day they can make more money and don't have to make a big capital investment with all the risk.

 

I think British manufactured goods are increasingly seen as luxury items for wealthy, discerning buyers who want the very best quality money can buy and they're prepared to pay. There are some items that are still made in Britain, still the very best, and still affordable though, like clothes and hats ;-)

 

I think China is just increasingly unbeatable though for manufacturing on consumer items.. although their design capabilities do seriously suck, some of the stuff I've seen is shocking..but if you give them a good design, they can build it to a good standard.

Edited December 2, 201213 yr by morphix

"The reason our councils need these big rates is to fund their pension schemes which represent a massive hole in their budgets,as shops are going bust they put up the rates to the remainder,the law of diminishing returns!"

Quote from Kudos's original post.

 

Just on a point of information, it is many years since councils set the business rates, its a central gov't responsibility.

https://www.gov.uk/introduction-to-business-rates/how-your-rates-are-calculated

Morphix,I agree with most of what you say but the big difference is the comment about sweatshops....this has images of workers producing product in bad working conditions and for sure I have been to some awful factories but they have the cash to put into high quality machine tools....my auto wheels are produced in an immaculate factory with a flow line of die casting-xray checking-machining,they have 24 italian cnc machining cabinets(£3mill each),running 22 hours per day,each machining a wheel every 12 mins-the owner is only 26 years old.

The bike frames are mostly produced on cnc robotic welders,eliminating labour only costing $1.50 per hour.

Honda have a factory in Wenzhou that produces a lot of the top end motor bike and auto components,11000 employees,the quality control there and cleanliness is above criticism.

 

Lets be honest any bike below about £1.3k is either chinese made or mainly chinese parts and some of these bikes are very high quality. Its only above that price level that we start to look towards the German product and thats principally because of the Bosch motor ,the remainder of the bike can often be chinese,if the chinese do finally get their act together on a crank drive motor the price of crank drive e-bikes will plummet. The choice will then be between a chinese hub drive bike at around £1k, a chinese crank drive bike at around £1.2k or a german Bosch crank drive at about £1.7k upwards,that day is closer than most realise.

Dave

Kudoscycles