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The worst place to sell new units in the United States?

July 15, 2009
Filed under From the Editors

neil-blog1It’s really a bad line of thinking, but I’ll go there anyway simply because of its interest value.Where in the United States is it truly the worst place to be selling new units if you’re a metric dealer right now? It’s the West, and oh by the way, that doesn’t include California.

You see, for Powersports Business’ upcoming 2009 Market Data Book, our annual compilation of industry data, we’ve asked our friends at ADP Lightspeed to look at gross margin percentage on new units for both metric and V-twin dealerships.

For this study, ADP Lightspeed was able to examine data from more than 400 dealerships and then break the data up into six regions, including the Midwest, Northwest, Northeast, South, West and California.

The results were certainly compelling and unfortunately I can’t give them all away now. However, I can tell you that metric dealers in the West, in terms of their average gross margin percentage, were by far the worst, in fact more than twice as bad as those in the Northeast.

What was the average gross profit margin in the West? Throw out some guesses on this blog and if anybody comes close, I’ll come clean with the details.

Comments

6 Responses to “The worst place to sell new units in the United States?”

  1. Eric Neuer on July 16th, 2009 1:06 pm

    I figure if it is worse than the Northeast (where I am) it would be less than 6 percent. I’d love to know how to make it more, or if I am even close.
    Thanks, Eric

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  2. Kimberlee Love on July 16th, 2009 1:37 pm

    I’m going to take a wild guess – 9.6 percent – at the average GP margin in the West. But, hey! Does this include just new or new/used??

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  3. JAMI SUMMEY on July 16th, 2009 3:43 pm

    $630 IS MY GUESS

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  4. Neil Pascale, Editor - PowerSports Business on July 17th, 2009 6:11 am

    I’ll wait until the end of today to answer, but in reference to Kim’s good question: we’re referring to only new units now.

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  5. Jeffrey Smith on July 17th, 2009 6:28 am

    I’m guessing their selling them at cost to reduce inventory. So I guess their margains are holdback 5 percent if they are a Honda dealer, 4 percent for others.

    [Reply]

  6. Neil Pascale, Editor - PowerSports Business on July 17th, 2009 2:36 pm

    To end the drama … Eric was right. Slightly south of 6 percent.

    [Reply]

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