Bike depreciation

General cycling advice ( NOT technical ! )
alicycling
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Bike depreciation

Postby alicycling » 30 Oct 2014, 7:42pm

What's the depreciation rate for a bike? About to sell one I bought new from Ribble at the start of this year. Thanks. :D

Grandad
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Re: Bike depreciation

Postby Grandad » 30 Oct 2014, 9:45pm

I wouldn't pay more than 50%

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willcee
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Re: Bike depreciation

Postby willcee » 31 Oct 2014, 1:11am

maybe a bit harsh at 50%!!! i tend to look at the kit which is fitted, together with the overall appearance and also what needs sorted ..if anything , try it on a short ride.. and would bid iro what it would break into plus a bit extra.. starter race type bikes a year old in good condition which originally retailed at 600, likely bought for 500 are still making 350 second hand.. on the other hand its not hard to spend a ton on sorting out what to the innocent looks to be good.. chain and cassette , bar tape and cables.. as they say ...your eyes are your merchant.. will

leftpoole
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Re: Bike depreciation

Postby leftpoole » 31 Oct 2014, 4:20am

In my own experience with bikes costing up to 2000 pounds to build, within 12 months if trying to sell around 800 is a price hard to get! Bike people in my opinion are generally friendly but pretty mean when it comes buying secondhand. I have been deeply upset at times.
On the other hand second hand frames and components usually fetch a better than 50 percent return provided in 'as new' condition..
John

RRSODL
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Re: Bike depreciation

Postby RRSODL » 31 Oct 2014, 7:15am

leftpoole wrote:In my own experience with bikes costing up to 2000 pounds to build, within 12 months if trying to sell around 800 is a price hard to get! Bike people in my opinion are generally friendly but pretty mean when it comes buying secondhand. I have been deeply upset at times.
On the other hand second hand frames and components usually fetch a better than 50 percent return provided in 'as new' condition..
John

Yes, I'd go along with that but on the other hand sometimes on ebay people pay silly money.

I saw a friend trying to sell a bike that he had upgraded a few components ie wheels and added fenders. The guy who wanted to buy ignored the much better wheels and fenders and only concentrated on what might need changing at some point like chain, cassette and tyres. Also the things he wanted to change like saddle and pedals. His offer was about 40%. BTW the bike was 5 months old. Talk about mean people :twisted:

pete75
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Re: Bike depreciation

Postby pete75 » 31 Oct 2014, 8:10am

If you're selling the bike now you've probably chosen the worst time for depreciation. You'll almost certainly sell it for more if you wait until Spring next year.

hamster
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Re: Bike depreciation

Postby hamster » 31 Oct 2014, 9:36am

I think 50% is probably about right. Remember that 20% of your purchase price is VAT for starters.

Breaking the bike down to components definitely gets you more. My LBS says that they cannot even source groupsets for the price Ribble sell them...let alone adding some margin and VAT!

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geomannie
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Re: Bike depreciation

Postby geomannie » 31 Oct 2014, 9:55am

Remember that 20% of your purchase price is VAT for starters


I hate to be a pedant but 16.67% (1/6th) of the purchase price is VAT, not quite so bad.

Cheers
geomannie

leftpoole
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Re: Bike depreciation

Postby leftpoole » 31 Oct 2014, 10:05am

geomannie wrote:
Remember that 20% of your purchase price is VAT for starters


I hate to be a pedant but 16.67% (1/6th) of the purchase price is VAT, not quite so bad.

Cheers



Quite right (correct in fact) due the genius of mathematics!
I have experience of. Selling bikes due to ill health (I still have poor health) but the next time (if at all) I will Ebay.
I had two Thorn Club Tours and an Audit 853 (not the present version) and each bike Schmidt hubs front and XT/LX components had cost me in excess of 2000! (mad) I tried for weeks (Summer) to sell around 1250 which was the price I raised for my Thorn Sherpa previously. I ended up with 800 each which still hurts.
John
Last edited by leftpoole on 31 Oct 2014, 11:38am, edited 2 times in total.

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mjr
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Re: Bike depreciation

Postby mjr » 31 Oct 2014, 11:36am

geomannie wrote:I hate to be a pedant but 16.67% (1/6th) of the purchase price is VAT, not quite so bad.

Yep. I feel you also need to be start from whatever price the end-of-season stock finished at, too, which is often a 40-50% reduction on the list price for big brands and maybe 25-30% for smaller ones. Then draw a line down to bog standard ebay/gumtree prices after about 10 years and make a prediction, or maybe slightly higher for well-kept but don't bet on it.

The advantages of buying a new bike are that you should be able to pick the right features for you, you can be more confident that it's never been jumped, raced or bodged, and that you deal with the maker about any guarantee in an unambiguous way. The drawback is that you'll probably never see most of what you paid again, except for a few hard-to-predict cases where rarity and desirability push the price back up again, and that if there are any bugs in the build then they've not been found yet.
MJR, mostly pedalling 3-speed roadsters. KL+West Norfolk BUG incl social easy rides http://www.klwnbug.co.uk
All the above is CC-By-SA and no other implied copyright license to Cycle magazine.

Bicycler
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Re: Bike depreciation

Postby Bicycler » 31 Oct 2014, 12:33pm

I'm not sure we can call second hand buyers "mean". If something's on the open market and can't be sold for a given price it is because it isn't worth that amount at that time to the people who may wish to buy it. Simple supply and demand; a bike is worth however much somebody is willing to pay.

Upgrades are unlikely to earn their money back unless somebody is looking for exactly the upgrades you have made. Unfortunately the SA 8-spd drum hub you installed may well not be quite as appealing to others as it was to you. rather than a benefit these things become "issues" to sort. Yes, bikes may be worth more sold as separate components and this may seem bizarre but a lot of people can't be bothered to strip a bike down and sell all the bits separately any more than you can

I suspect that mid range bikes do better 2nd hand than top models. Somebody with £600 to spend may see a massive improvement in quality of bike by buying 2nd hand in a way that somebody with £1200 won't.

There's also a risk factor. None of us knows what lives second hand bikes have led or what failure may be around the corner. For a couple of hundred quid you might take a punt, for a grand many would want it new with warranty.

whoof
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Re: Bike depreciation

Postby whoof » 31 Oct 2014, 1:26pm

If it cost you £1000 then you have to factor in that someone could buy the same bike new from Ribble on the RIde to Work Scheme for less than £700 and pay in monthly installments in some cases over 24 months.

kuba
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Re: Bike depreciation

Postby kuba » 31 Oct 2014, 2:52pm

Bicycler wrote:I'm not sure we can call second hand buyers "mean". If something's on the open market and can't be sold for a given price it is because it isn't worth that amount at that time to the people who may wish to buy it. Simple supply and demand; a bike is worth however much somebody is willing to pay.


Agree with the former but definitely not with the latter, many factors affect what potential buyers may wish to spend. First, big brands and retailers definitely manipulate the market by overpricing things, introducing supposedly new models, and then massively discounting at the end of the year (kudos to those who don't, such as custom framebuilders and the likes of Thorn). Cycle to work scheme skews the market too - when I worked for a small charity I couldn't take advantage of it, something to do with VAT I recall, but often saw bikes on eBay at the time where vendors clearly stated they were selling as only to get a newer bike on the scheme... Third issue is things like sizing and time of year, some sizes are more and other less popular, though judging by John's experience that can be quite random too. Finally, as stated above seems bikes fetch much more on eBay, no idea why but some bidding patters I saw looked pretty suspicious so that may be partially the answer... But no, wouldn't call buyers mean.

pete75
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Re: Bike depreciation

Postby pete75 » 31 Oct 2014, 3:20pm

kuba wrote: Finally, as stated above seems bikes fetch much more on eBay, no idea why but some bidding patters I saw looked pretty suspicious so that may be partially the answer... But no, wouldn't call buyers mean.

More buyers on Ebay. Does the seller end up with any more though after 10% to Ebay and 5% to Paypal.

Bicycler
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Re: Bike depreciation

Postby Bicycler » 31 Oct 2014, 5:08pm

Yep, many more buyers on ebay than in a simple classified ad. There's also the effect of auctions where people get sucked in and bid higher than they might elsewhere.

Of course factors influence what buyers may wish to spend but that is still supply and demand. You can't ever look at a single product in isolation. Something is only cheap or expensive in relation to something else. You may have your favourite tyres and they may be worth £20 to you, but they are only worth £20 as long as nobody comes out with something that does the same or better for £12. The value of 2nd hand bikes is always going to be partly linked to the price of new ones.