Follow the Money

Purchasing a Bamboosero bicycle generates reliable income for the builders. For the umbrella Bamboosero organization, fees and profits fund the creation of new Bamboosero networks. These monies cover extensive training associated with a steep learning curve and the development of previously non-existent infrastructure. Bamboosero operates in remote areas introducing micro-manufacturing – a crucial first step towards generating economic growth. The rest of the costs and expenses are typical for the bicycle industry.

Pricing Structure

Category Description Margin Cost
Cost per frame (COGS) See detailed COGS breakdown below $109.40
Gross Profit Direct to builder – can be used for capital investment in their business 27% $40.60
Price paid to builder Subtotal $150.00
In country transportation Expense to cover transportation from production site to inspection center $25.00
Quality Assurance Inspection Inspection fee covers production oversight ensuring all aspects of frame are to specification and prepared for end user $25.00
Painting Cost of materials and labor for two part UV protectant clear coat $35.00
International Shipping Bulk shipments to reduce expense – subject to going rate for locality $50.00
Distributor’s Landed Cost Subtotal $285.00
Distributor Margin Fee to distributor for importing and distributing product to wholesale and retail customers 18% $72.00
Licensing fee (Bamboosero) Fee collected by Bamboosero to reinvest in brand’s quality reputation and for manufacturing expansion. 12% $50.00
Re-work Frame Reworking of frame once arrived-Alignment/Cracks/Paint Est: $133.00
Wholesale price Total $540.00
Retail Margin Standard margin for bicycle industry retail businesses to service the end user 40% $360.00
Retail Price (Frame Only) Total (not including tax) $900.00

 

Example of COGS using historical costs in Ghana

Cost of Goods Sold

Locally Sourced Cost
Labor *
$60.00
Bamboo
$2.00
Fiber
$1.00
Lacquer
$0.75
Subtotal Loc. Sourced
$63.75
Supplied by Bamboosero Cost
Treatment chemical
$3.00
Epoxy (fast and slow curing)
$20.00
Dropouts
$13.00
Head tube
$1.00
Bottom bracket shell
$2.00
Seat tube insert
$2.00
Brake bridge / other
$1.00
Subtotal Supplied
$42.00
Total Cost of Goods Sold
$105.75

 

Expenses (per frame) Cost
Gloves (reusable, 2 frames / pr.)
$0.25
Release wax
$0.10
Vinegar
$0.10
Lacquer Thinner
$0.25
Brushes
$0.10
Sandpaper (80, 120 and 220 grit)
$1.50
Electrical Tape (2 rolls)
$1.00
Markers
$0.10
Newspaper / Rags
$0.25
Total Expenses
$3.65

 

Total Direct Cost Per Frame
$109.40

 

*Bamboosero income on per person basis is comparable to what a tradesperson would earn in the same location. Bamboosero differs in that it aims to provide steadier employment than a rural-based tradesperson could otherwise count on.