You are reading a single comment by @gbj_tester and its replies.
Click here to read the full conversation.
-
isn’t madison the UK distributor for Shimano?
Yes, but what they distribute to bike shops is retail packed components. Wiggle, and all the other big online stores, buy OEM components which come in poly bags, not nice cardboard boxes. Shimano sells OEM gear at a much lower price than retail boxed gear, and the OEM customers also avoid having to provide a living for a local wholesaler (e.g. Madison)
In the case of a big OEM, the components don't have to pass through any intermediaries, they are drop-shipped from the component factory to the OEM's assembly facility, whether it's a real one like Giant or an imaginary one like an internet store's fulfilment warehouse.
gbj_tester
Cheers M_V and King_Saxlingham. Selling for no/minimal profit or repeat business makes sense as an explanation, particularly given Wiggle’s wide product offering. Would the assumption ergo be that wiggle makes minimal profit or even a loss on new Shimano product lines, when they’re priced aggressively?
Also, although I might have misunderstood something at some point or perhaps I’m missing something obvious, isn’t madison the UK distributor for Shimano? How can a retailer buy larger volumes of this season’s stock than the national trade stockist?