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Kegel Motorcycle Co.

September 14, 2004
Filed under Features

CONTACT
7125 Harrison Avenue
Rockford, IL 61112
815/332-7125
www.kegelmotorcycles.com

OWNERS
Karl and Mark Kegel

BUSINESS PROFILE
“My brother and I are the third generation to be involved in our dealership,” says Karl Kegel. “It was founded by our grandfather as a bicycle business in 1909, then he took on motorcycles in 1910 and the Harley-Davidson franchise shortly after that. We are the world’s oldest Harley-Davidson dealership that’s still in the same family. We started out in Freeport, Ill., then moved to Rockford in 1923. This is our third location in Rockford.” Carries Harley-Davidson and Buell. Kegel is also the president of the Illinois Motorcycle Dealer Association. “I’m involved in a lot of different aspects of motorcycling, from insurance regulations to motorcycle laws to licensing, from streetbikes to off-road bikes. One could devote all his time to that volunteer job. I can’t, but I give it an awful lot of my time.” 54 employees.

GREATEST CONCERN
“Insurance — at all levels — is a real consideration for me,” notes Kegel. “Garage liability insurance, which we all must have in order to get a dealer’s license, is a concern because of the premiums. I try to provide my employees with health insurance, and that’s been skyrocketing. We’d like to see something done about that. I think customers are going to start seeing a rise in premiums, because the insurance companies are taking it on the chin a bit.”

WHAT’S HOT?
Touring bikes are hot at Kegel, including the Road King, Electra Glide Classic, and Ultra models. “We used to sell more aftermarket parts a few years ago, but the trend has been toward Harley-Davidson Genuine parts and accessories,” says Kegel. “Harley-Davidson is making more items now than ever — and many that the aftermarket companies make. Customers like to keep their Harley-Davidsons as ‘genuine Harley’ as they can, especially since Harley-Davidson makes pretty doggone good stuff. The quality and the fitment are always right.”

CUSTOMER BUYING TRENDS
Kegel believes that his average customer is “47 to 48 years of age, with some college, making right around $60,000 per year.”

PARTS AND SERVICE
“We have six people in the parts department, and about a dozen in service,” says Kegel. “We put an addition onto our building a year-and-a-half ago, and soon we are adding a second story in our warehouse for more storage. We’re also contemplating putting in a dyno room for better customer service. The trend right now is toward fuel-injected motorcycles, so you almost must have a dyno. Customers are asking for more performance items, so you have to get on a laptop to tune them, then you also need a dyno to make sure everything is running the way it should be. Customers’ expectations are high these days.”
PROMOTIONAL HOME RUNS
“Our dealership is one of the few that has a diner right inside,” explains Kegel. “Initially — eight years ago — we opened it many hours each day, but we’re not in a mainstream location, so people were coming more often when the dealership was open. Breakfast and lunch on weekdays are probably our busiest times, and all the time on weekends.” Kegel is not yet offering the Rider’s Edge education program. “We are ready — we’ve been through training — but have not found a parking lot that a business is willing to let us use on the weekend. Again, everybody’s concerned about liability insurance. We just purchased some property, and once we absorb that cost we’ll put a parking lot on it so we can have our own Rider’s Edge course on the premises.” The dealership is active in the community, including holding a Muscular Dystrophy Association run, events that benefit the local children’s home, and Blues and Barbecues — “the local fire department will be the recipient of funds from that. At least once a week somebody wants a donation for a benefit. They’re all good causes; we always give them something, if only a T-shirt or a jacket. But we have to be a little selective.” The local HOG chapter —which used to meet at Kegel — has grown from 100 to 375 members. A nearby club has a room that accommodates the 150 to 175 attendees.

WORDS OF ADVICE
“Beware of the insurance problems out there,” advises Kegel. “Also, watch your expenses, because that’s the easiest thing to control, and also the easiest thing to get out of hand. The motorcycle industry anymore is so complicated. It’s really a challenging industry these days. All that we face — from customers’ expectations, to the latest business practices, to what legislators are trying to do to us — it’s a challenge just to keep on top of it all. It’s not for somebody who just wants to jump in and see if he can make a lot of money in a short time, then go. You really have to be a dedicated motorcycle enthusiast to stay involved.” psb

—Julie Filatoff

If you would like to share your story with the readers of Powersports Business, please contact Julie Filatoff at filatoff@cybermesa.com.

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