New Bike in the market

akshaymahajan · 5th October 2010, 21:17

I like the initiative you are taking. But I believe you are mixing two segments together.
If they are custom made to order bikes, with a powerful engine and finish as you described, no doubt the cost of production will be high and to start off with sales you will keep your margins low. Plus you sell only a limited number of bikes. So break even point will come after quite a long time. If you have no financing problems or this will go on side by side another business till you break even, it sounds good.
Otherwise I dont know. Because trust me if you have good money, you can sell anything at the price of gold given that you have a brilliant marketing team. People are buying a pair of shoes for 50 grand.
You mentioned Koenigsegg. They make custom made cars but they aim only at the super rich. They dont compete with market prices. They set there own standards and with people who want exclusivity, money comes down on the list.
People will pay 20 lakhs for a 5 lakh product if they know that its one of a kind hand built product. And then after paying so much they trust the company to keep up there customer service and not shut down overnight. Decide what segment of the market you are aiming at. Either go super exclusive and make like a few hundred bikes a year, or make VFM bikes , the cheapest in the 600cc segment but mass produce and if possible tie up with some known name.

manasm · 5th October 2010, 22:17

Akshay,

We dont want to be super exclusive nor are we looking at mass production of cheap bikes. Our goal is to be in the middle - a best in class product with competitive pricing. It may work or it may not.

We are ok with not making big margins if it helps us get into the market and stay in. The jobs we are faced with right now is to be best in class while keeping costs low. We dont want to re-invent the wheel, but at the same time, we dont want to take a part we feel to be substandard or does not fit the personality of the bike or just something we feel could be done better.

In India, we are not allowed to have the traditional "custom made" bikes like they have in the West.

I only mentioned Koenigsegg since I believe they take a lot of effort and R&D for their products - both engineering and design. We dont want to compete with market prices, we want to try and create a new segment altogether by targeting the right kind of people as customers.

We would love to tie in with known names, but so far have not been able to talk to anyone in those companies. If you know anyone, would love to have a discussion with them.

Manas

Quote:

Originally Posted by akshaymahajan

I like the initiative you are taking. But I believe you are mixing two segments together.
If they are custom made to order bikes, with a powerful engine and finish as you described, no doubt the cost of production will be high and to start off with sales you will keep your margins low. Plus you sell only a limited number of bikes. So break even point will come after quite a long time. If you have no financing problems or this will go on side by side another business till you break even, it sounds good.
Otherwise I dont know. Because trust me if you have good money, you can sell anything at the price of gold given that you have a brilliant marketing team. People are buying a pair of shoes for 50 grand.
You mentioned Koenigsegg. They make custom made cars but they aim only at the super rich. They dont compete with market prices. They set there own standards and with people who want exclusivity, money comes down on the list.
People will pay 20 lakhs for a 5 lakh product if they know that its one of a kind hand built product. And then after paying so much they trust the company to keep up there customer service and not shut down overnight. Decide what segment of the market you are aiming at. Either go super exclusive and make like a few hundred bikes a year, or make VFM bikes , the cheapest in the 600cc segment but mass produce and if possible tie up with some known name.

aargee · 6th October 2010, 08:20

@Manas - I don't want to spoil your plans; but incase you have the passion & are not able to continue due to the bureaucratic morons, then you may want to consider the option on built to customize.

This customization is like choosing the engine & fabricating all around. Means, building a 250cc cruiser with Kwacker engine; however, you need to use the existing frame but will have to customize accordingly & at the same time adhering to engineering. Hope you got the point.

ganeshtvpm · 6th October 2010, 09:23

@Manas. I appreciate your passion and intentions. But engine technology except for our useless commuter bikes have nowadays gone way too far for a startup company.So a better idea would be to source an engine from any of the manufacturers who don't have any operations in India and build a nice bike around that. This way you can atleast cross the hurdles like arai and rto (at least emission norms). This can be of a negative impact on the pricing of the bike but anyways you can finish your prototype in a time framed manner rather than researching for an engine build from the scratch.

5th October 2010, 21:17	#31
akshaymahajan BHPian Join Date: Oct 2009 Location: Delhi Posts: 597 Thanked: 449 Times	I like the initiative you are taking. But I believe you are mixing two segments together. If they are custom made to order bikes, with a powerful engine and finish as you described, no doubt the cost of production will be high and to start off with sales you will keep your margins low. Plus you sell only a limited number of bikes. So break even point will come after quite a long time. If you have no financing problems or this will go on side by side another business till you break even, it sounds good. Otherwise I dont know. Because trust me if you have good money, you can sell anything at the price of gold given that you have a brilliant marketing team. People are buying a pair of shoes for 50 grand. You mentioned Koenigsegg. They make custom made cars but they aim only at the super rich. They dont compete with market prices. They set there own standards and with people who want exclusivity, money comes down on the list. People will pay 20 lakhs for a 5 lakh product if they know that its one of a kind hand built product. And then after paying so much they trust the company to keep up there customer service and not shut down overnight. Decide what segment of the market you are aiming at. Either go super exclusive and make like a few hundred bikes a year, or make VFM bikes , the cheapest in the 600cc segment but mass produce and if possible tie up with some known name.
	() Thanks

6th October 2010, 08:20	#33
aargee Senior - BHPian Join Date: Jan 2010 Location: TSTN Posts: 6,236 Thanked: 9,642 Times	@Manas - I don't want to spoil your plans; but incase you have the passion & are not able to continue due to the bureaucratic morons, then you may want to consider the option on built to customize. This customization is like choosing the engine & fabricating all around. Means, building a 250cc cruiser with Kwacker engine; however, you need to use the existing frame but will have to customize accordingly & at the same time adhering to engineering. Hope you got the point.
	() Thanks

6th October 2010, 09:23	#34
ganeshtvpm BHPian Join Date: Aug 2009 Location: trivandrum Posts: 69 Thanked: 15 Times	@Manas. I appreciate your passion and intentions. But engine technology except for our useless commuter bikes have nowadays gone way too far for a startup company.So a better idea would be to source an engine from any of the manufacturers who don't have any operations in India and build a nice bike around that. This way you can atleast cross the hurdles like arai and rto (at least emission norms). This can be of a negative impact on the pricing of the bike but anyways you can finish your prototype in a time framed manner rather than researching for an engine build from the scratch.
	() Thanks