Wednesday, July 15, 2009

Online fraud in the bike industry. Again...

I don't recall the last time I heard of this happening to customers of a locally owned independent bike shop:

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Story: bikeportland.org

Fraud hits local customers of online retailer Nashbar

Northeast Portland resident Gabriel Tiller is sort of a bicycle renaissance man. He has won a national tall-bike jousting competition, taken top prize at the Zoobomb Century, earned a spot on the gravity-biking podium at the Maryhill Festival of Speed, he likes to do bike touring, and he has recently taken to mountain biking.

Most of the time, Tiller builds bikes from used parts lying around his garage or from the various sources around town. But often, he buys hard-to-find parts from an online retailer to feed his cycling habit.
Last week, he noticed several strange charges on his credit card that went to unfamiliar websites like “networkagenda.com,” “fedgrantusa.com,” and “gglprofit.com.” He immediately Googled them and found that there were many other people complaining online about similar fraudulent charges. A little more digging and he confirmed the culprit: Nashbar (also known as Bike Nashbar).
Nashbar (which is owned by North Carolina-based Performance Bicycle, Inc.) is a large, national online discount retailer of bike parts and accessories.
According to pages and pages of complaints from angry customers on BikeForums.net, Nashbar has acknowledged that one of their websites was hacked back in December 2008. However, according to this local newspaper story, the company didn’t tell customers about the security breach until July 1 of this year.
Also according to that story, Nashbar has sent out a letter to customers about the incident. Tiller says he has yet to receive a letter. He called Nashbar and they took down his details, but so far, they haven’t offered him any compensation.
I’ve tried several times to speak with someone at Nashbar about the issue. The two people I’ve gotten through to both refused to give me any information about the incident. The Nashbar “Customer Care” representative said she doesn’t handle information for the media, but she would not give me any other number to call. As I was trying to get more information from her, she just hung up the phone.
Nashbar has admitted that their customer’s credit card information was stolen in a security breach, yet they waited seven months to notify anyone about it and when asked to provide more information about the incident, they refused. (Update: I’m now trying to speak with someone at Performance).
As for Tiller, he’s keeping a close watch on his bank account.*********************
Online fraud and identity theft is probably the fastest growing area of crime currently - and even the careful consumer is susceptible. I don't want to try to paint a picture that Nashbar and it's parent company; Performance Inc., are solely at fault; but, the way in which they've handled the issue is the sort of thing that would put a local bike shop out of business.
Online discount retailers do not care about you, your cycling experience, and your future well-being. They are generally so large that the business you represent is a drop in their proverbial buckets and they will never know when you've decided to take your business elsewhere.
The independent, locally-owned bike shop near you on the other hand should be glad to see you each time you walk through their doors. Not only because you represent an opportunity to make money, keep the lights on, and stay in business; but if you've been a loyal, respectable, and reasonable client (clients are different from customers, by the way...a client typically has a relationship with their service provider); they'd be happy to see you drop in even if you don't spend a penny. I have many clients I feel this way about.
This relationship means that the bike shop respects you, your business, and your identity. Fraud is the kiss of death in today's hyper-competitive, economic-downturn-effected independent-retail environment. Your local bike shop cannot afford to disrespect you.
Now, respect is a two way street. And, if you disrespect your local, independently owned bike shop (if you haven't caught on yet - this means the guys who live in your area, aren't a part of some national or regional chain - more often than not a discount chain at that - and work their tails off week after week coming in before opening, staying after closing, and then getting up early on Saturday to come and do ride support for the local century or set up for a race in which you're participating; all because they love the same sport you do.) be prepared for them to vanish. What does it mean to respect your bike shop? Give them a chance to earn your business. When you need a part; don't assume they don't have it or can't get it. We usually have access to all the same stuff as the online places - and can get it to our door almost as fast as they can get it to your door - often for a competitive price or the same price after you account for shipping costs.
What else? Don't beat them up on their prices. They're not trying to gouge you. Most of the time they're keeping their prices as reasonable as they can. The extra few dollars you spend with them pays for that great store location; all the cool inventory you like to browse; the couch you sit on while you watch the cycling videos on the flat-screen television; the tools hanging in the service area; the flat-tire changing clinic you attended; and lets the mechanic put the wrench down and step away from the tune-up he was doing (which was promised to another customer to be done less than an hour from now, by the way...) to answer your question.
If you're not being respected at your local bike shop - first ask yourself whether you're being respectful to them; a little bit of loyalty and respect on your behalf can go a long way in softening the heart of the grouchy guy behind the counter - be prepared to search for a local shop that will respect you. But don't take us for granted, for one day we may not be there anymore.
The day that Nashbar shows up to do ride support for your local charity ride; you can clear your conscience.
Sorry, I'm feeling a little harsh today on this particular topic. But you're lucky I don't write about it as often as I think about it.
Thanks for reading anyway.

2 comments:

  1. While I mostly agree with your post about supporting your local bike shop, there are a couple of points I'd like to bring up that are almost pet peeves to me about local stores:

    One is your claim that the local stores will probably have the same parts available as online. That is distinctly not true. Also, your comment that you can get the parts for the same cost or maybe even cheaper and save on shipping costs isn't quite true either. Even if you can get the part at the same price, I still have to make the effort to phone your store, talk to a salesman and hope that they understand which part to order and actually order the right part when they do make the order, and then I have drive to your store to pick it up. That might actually cost more than have it shipped to me directly. If, on the other hand, I order online, I can see all the choices I might have for the component/part that a local store might not tell me about.

    A case in point: I called a local music store for a particular type of drum stick the other day (yes, it wasn't a bike shop, but it's the same scenario otherwise.) When I was told they don't have that type of stick in stock but they could order it, I told them why bother? I can just order online myself, and save the trip to the store. If, instead they had had the stick in stock, I could come down and try it out, and buy it on the spot. It could have been a sale for them.

    I guess what I'm trying to say is that if a local store carries a well-stocked inventory of parts, then yes, I will patronize that store as much as possible, because I do appreciate being able to go down and see the part in person, and physically hold it in my hands, and be able buy the part on the spot, etc. If, on the other hand, they don't carry a lot of parts, I might as well just order them online, where I have the largest inventory possible to choose from.

    I realize that having a well stocked store is only viable in large metropolitan areas, but it amazes me that in places, say, like Phoenix, where I live, there are no well stocked stores. A case in point: If I want a wheel that isn't a Mavic, or a Shimano, or maybe a Zipp wheel or two, forget it, none of the stores carry any other brands. Might as well shop online and get exactly what I want.

    In summary, I do try to support the local bike shops as much as possible, and will even pay a bit more for their service, but if they refuse to have a lot of inventory, the stores are just killing themselves. And it's a shame.

    ReplyDelete
  2. Anonymous-

    I fully understand; and you make some valid points.

    However, while you occasionally roll the dice in regards to the knowledge of the salespeople at some stores, today's bicycle components are complex enough and there are enough compatibility issues that online shopping is not the perfect solution either.

    Example: will a Sram 10-speed cassette fit on a first-generation Shimano 7800 10-speed freehub body? Well, they're both 10 speed, and Sram uses Shimano spec. splines for their cassettes - but the answer is no. The first generation freehubs were designed only for Shimano 10 speed cassettes and are not backwards compatible or cross compatible like the more recent, more common 8/9/10 bodies that Shimano has reverted to.

    Your website can't look at your hub and tell you that won't work.

    Additionally, while there are probably as many types of drum sticks (if not more) than there are road bike tires, the plight of the bike store and music store and having everything in stock is similar. The largest supplier in the bike industry carries items from 452 brands. Carrying everything is impossible. We have to pick and choose the few items that our customers ask for or like to use. And many of us have 3 or 4 major suppliers to satisfy. The trick here is to keep asking for your favorite product. If we get enough requests, we'll likely give it a try. I have many great examples of such products.

    I get frustrated about the lack of good electric bass guitar gear here in Portland. Guess I was spoiled in Nashville. Even the Guitar Center here is weak. But, unless I keep asking my local guitar shops for stuff, they may not know that there is demand for that here.

    Finally, your wheel illustration. While there are many great products out there; in addition to satisfying suppliers (bike brands in particular have huge commitments to satisfy to have the "privilege" of selling their products) we also don't want to take a chance on certain brands which may not pay off. You see the big brands in the stores because they're usually a proven entity who is known to support their dealers and their product. Often, the bike shop may have had a bad experience with a brand or product and that is why you don't see it on their shelves. They've figured that the brand/product isn't worth the hassle of dealing with the issues that come along with it.

    Thanks for the comments. Keep reading and commenting.

    ReplyDelete

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