Dec. 1, 2008 – Three absolutes for powersports dealerships in this tough time
December 1, 2008
Filed under Columns
At the end of October I conducted a conference for my partners and their sales managers and invited a number of dealers who had also implemented “Next Level” controls.
In total, 30 Next Level operators attended the conference in Hartford, Conn. Most were Harley dealers, and a few standout metric dealers. Every dealer there had a good 2008 season and was determined not to give any of it back this winter and be in a position to make 2009 even better. We started by accepting three Next Level absolutes that we had established were, regardless of what the economy dealt us, proven to be true in our dealerships:
These were the only absolutes. For everything else we started with a plain white sheet of paper. The Next Level procedure had been proven to work, but many issues and questions needed to be addressed: What was the correct staffing level? What was the ratio of floor managers to sales personnel? What was the payroll budget? How much did we need to pay salespeople and floor managers?
Before getting to these issues, we clearly established that motorcycle sales levels were not a given. Market conditions had made things tougher for everyone, and metric dealers had a real issue with retail financing. But we have recognized there was such an incremental opportunity in what had previously been spilled that the market downturn could be overcome.
A full summary of the meeting would take far more ink than Editor Neil allows. Everything from the conference plus any developments between now and February will be covered at the Dealer Expo in Indianapolis. As previously announced, there will be no charge to franchised dealers, but space limitation will require you reserve a spot for the meetings that will be presented twice a day during the Indy Expo. Be sure to make reservations with the show’s promoters, and e-mail Daughter Laura at firstname.lastname@example.org and let us know which day you prefer and whether it is morning or afternoon. We will try to accommodate all requests.
Not so tough
A major “given” out there today is that so many dealers have given up. By doing so, they are defaulting business to the dealers too busy focusing on driving more people through the front door that they have no time to cry about how bad things are. Staff and operate to drive sales, not just react to what the market gives you. I keep saying that I know it is not easy, I have been at it for 38 years and I know that it is tougher out there than it ever was.
The difference today is we have new resources and tough dealers have learned more about how to be in control and be tough in tough times. Hibernate and the best you can hope for is to survive.
Eliminate the dealers?
A recent show on MSNBC centered on the ills of the automobile business. One of the “problems” identified was the redundancy of dealers. Speakers on the show, which included someone from the U.S. Department of Commerce, contended that dealers had outlived their usefulness and that consumers would be better off without them. Auto dealers have strong dealer associations in every state to defend their franchise laws. They have heard this before and will be ready for any fight that comes their way.
The Motorcycle Industry Council has tried, and succeeded in a few states, including in Pennsylvania and Missouri within the past two years, to get motorcycle dealers out of the automobile franchise laws. Auto dealers and their associations will have plenty of their own problems to deal with and will not likely be too worried about the problems facing motorcycle dealers. So, don’t count on auto dealers to look out for your interests. Tough times do not lessen the need to have a strong state dealer association. Make sure your state is represented at this year’s annual meeting of the National Council of State Dealers Associations, to be held the day before the Expo opens in Indy. Best way to be sure you are represented is to be there yourself.
Hope to see you in Indy.
Cheers, Ed. psb
Ed Lemco has been involved with the powersports industry for more than 30 years. Lemco, the former owner of Lemco Management Group, is the founder and executive director of the National Council of Motorcycle Dealer Associations. Lemco currently operates a call center for dealers in St Croix.