Why are bike stores in Canada so uncompetitive?

It could be import prices, but who knows? 

 LBS will always have a higher price versus online retailer, but what LBS lacks in cheaper prices always makes up for it in service such as custom fittings and usually free lifelong maintenance.  Try that with eBay or a typical online shop.  

 I don't know the details of your situation, but could the same model bike or wheelset be configured differently marking up the price even more? 

Not sure about the exact details, but an LBS told me that many manufacturers/distributors from the U.S. and overseas have different fixed pricing based on currency. He made it sound similar to publishing companies that fix prices on the dust jackets with a huge Canadian price markup, like up to 30% over the U.S. prices, never taking into consideration the fluctuating exchange rates, but more importantly not accounting for the recent parity in our dollars. I've been in a similar situation where I'd much rather buy from a shop and have them install and warantee the component but they just can't price match U.S. prices because of this. And by U.S. prices, I mean the U.S. MRSP, which can differ from the Canadian MRSP, which again, is higher in may cases despite our dollar parity. I was also told that import charges were huge; I know I sometimes take a huge hit when ordering parts from the U.S. and overseas - sometimes stuff will go under the radar, but when Can Customs gets their hands on it, I've paid as much as 110% in fees for components, even used stuff.

A closer comparison would be comparing online Canadian shops to your LBS and I think you'll see the prices more inline with each other. I haven't found any Canadian E-tailer that can come close to matching the huge online U.S. warehouse cycle shops.

Everyone seems to make valid points. It's a confusing topic. I don't know the reasoning. All I know is I have yet to see anything worth buying at a Canadian bike store. Even with shipping costs and brokerage fees etc. and even with waiting for the product, it seems the difference is cost (at least for a student like me) is worth looking else where.

I was inquiring about Ultegra rear derailleurs a couple weeks ago and called TWO LBS and both quoted my 250.00, where is the world they get that number is beyond me. You can get this part pretty much anywhere else (online/US) for around 60-100.

It kinda does seem like all the Canadian bike stores are still working on a 70cents to the dollar type of exchange rate. I think they just feel really comfortable with the fact that bikes (unlike other goods such as electronics) are probably not AS easy to import. Also, it does take a little bit more knowledge and experience to be able to shop online for these types of things. Does it justify the price gouging though? I don't think it's fair.

The global marketplace is getting smaller really fast. I await the day when Canadian bike retailers will have to step up to the plate and start competing for business.

While we're on the topic of how bad Canadian retailers are... does anyone know any good ones?

Any recommendations in the GTA? I'd say so far I've been pretty impressed with Enduro Sport, they have good selection and at least they're pretty in tune with MSRPs. And they're service seems to justify the rest.

Also what are the best Canadian ONLINE stores? I know Brauns.com and LaBicicletta.com but I'm not too enthused about their prices. Any others?