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Mar. 10, 2008 – New entry vs. traditional

March 10, 2008
Filed under Features

McNally Cycle

DeForest, Ill.
Steve McNally, owner
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs, go-carts
Were your 2007 sales an increase or decrease over 2006? 10 percent increase
New unit sales breakdown: 50 percent motorcycle, 30 percent ATV, 15 percent scooter, 5 percent go-cart
Breakdown of sales in your dealership: 30 percent new unit sales, 40 percent service, 10 percent F&I and the rest between preowned and PG&A.
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy or customers leery over Chinese reliability)? By far it’s customers wary about buying Chinese products. There’s still a very big stigma out there for Chinese units, and so many of our customers have heard horror stories regarding parts availability, etc., that it’s a constant struggle to show them how much things have improved.


Burns Powersports

Columbus, Ohio
Jeremy Abrahms, co-owner
Types of vehicles being sold in 2007: Motorcycles, scooters
Were your 2007 sales an increase or decrease over 2006? 40 percent increase
New unit sales breakdown: 70 percent scooter, 30 percent motorcycle.
Breakdown of sales in your entire dealership: 80 percent new unit sales, 10 percent service, 10 percent preowned
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy or customers leery over Chinese reliability)? For us it’s been the economy. We’re located in an area that’s mostly comprised of college students, so money is always a concern there. But for the rest of our customer base, as well, the downward trends in other markets are hitting us, as well.


Big River Motorsports

St. Louis
Seth and Christie Mosley, owners
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs, UTVs, go-carts
Were your 2007 sales an increase or decrease over 2006? 8 percent decrease
New unit sales breakdown:
60 percent ATV/UTV, 30 percent motorcycle/scooter, 10 percent go-cart
Breakdown of sales in your entire dealership: 60 percent new unit sales, 20 percent service, 20 percent preowned.
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? No question customers are still very concerned about Chinese reliability, but we don’t carry any products that we can’t guarantee. But it still is our biggest obstacle.


Lubbock Cycle and ATV

Lubbock, Texas
Martin Walsh, owner
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs, UTVs
Were your 2007 sales an increase or decrease over 2006? 5 percent increase
New unit sales breakdown: 60 percent motorcycle, 20 percent UTV, 15 percent ATV, 5 percent scooter
Breakdown of sales in your entire dealership: 75 percent new unit sales, 15 percent service, 5 percent F&I, 5 percent preowned
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? I think there’s still a concern regarding customer brand awareness. Although there is growing stability in the Chinese market, you still see customers coming in asking whether a particular brand can be trusted or will it be around in six months or so. So yeah, that’s a problem we’ll continue to face this year.


Simmons Powersports

Chattanooga, Tenn.
Michael Gruber, owner
Types of vehicles being sold in 2007: ATVs, UTVs, motorcycles
Were your 2007 sales an increase or decrease over 2006? 12 percent increase
New unit sales breakdown: 85 percent ATV/UTV, 15 percent motorcycles
Breakdown of sales in your entire dealership: 80 percent new unit sales, 15 percent service, 5 percent preowned
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? The economy is a big worry for me. Sales were up for us last year, but if it wasn’t for a strong first-half showing, we would have lost money. Sales are down around 30 percent this year compared to last January, so I’m hoping that the government programs being put into place, like the rebate checks, will encourage people to come to the dealership and buy.


Bruiser’s Cycles and Trailers

Harrisburg, Penn.
Pat and Joanne Stanton, owners
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs, UTVs, go-carts
Were your 2007 sales an increase or decrease over 2006? 40 percent increase
New unit sales breakdown: 40 percent motorcycle, 30 percent UTV, 15 ATV, 10 percent scooter, 5 percent go-cart
Breakdown of sales in your entire dealership: 50 percent new unit sales, 25 percent service, 10 percent F&I, 10 percent PG&A, 5 percent preowned
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? It’s always been customers being wary over Chinese reliability, and will continue to be. We have worked with three Chinese companies since 2005, and we have the utmost faith in their production processes, quality control, etc., and it’s becoming so much easier to see the legit manufacturers over those that you know won’t be around this time next year. But there’s too much negative press regarding Chinese products in general that it’s hard to break stereotypes that potential customers have.


Murray Motorsports

Elm Creek, Ala.
David Murray, owner
Types of vehicles being sold in 2007: Motorcycles, UTVs, ATVs
Were your 2007 sales an increase or decrease over 2006? 15 percent decrease
New unit sales breakdown: 70 percent ATV, 25 percent UTV, 5 percent motorcycle
Breakdown of sales in your entire dealership: 90 percent new unit sales, 5 percent service, 5 percent F&I and PG&A
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? Even though we sell very affordable, quality vehicles, sales have been terrible for us in the past year. When it comes down to it these are toys, and they are far down on the list of customers’ priorities when it comes to their budgets.


East Shore Cycle

Asheville, N.C.
Jody Kropp, owner
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs, UTVs, go-carts
Were your 2007 sales an increase or decrease over 2006? 35 percent decrease
New unit sales breakdown: 50 percent UTV, 20 percent ATV, 15 percent go-cart, 10 percent motorcycle, 5 percent scooter
Can you provide a breakdown of sales in your entire dealership: 50 percent service, 40 percent new unit sales, 10 percent PG&A.
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? I’d have to say the economy, just because I don’t see us pulling out of this downturn for some time, and because of that sales are going to suffer, which they did tremendously for us in 2007. I think customers are gaining more trust in Chinese powersports products, but you need to either have discretionary income or a work-related reason to buy right now, and we’re finding they’re extremely cautious with their money now.


Cycles Plus

Paducah, Ken.
Adam Pickett, owner
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs
Were your 2007 sales an increase or decrease over 2006? 5 percent increase
New unit sales breakdown: 60 percent motorcycle, 30 percent ATV, 10 percent scooter
Breakdown of sales in your entire dealership: 70 percent new unit sales, 10 percent service, 10 percent preowned, 10 percent PG&A/F&I
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? Customer brand awareness is always a challenge. People walk in, see a name on the machines they don’t recognize, and immediately think the item is unreliable and basically a throwaway. We only work with two Chinese manufacturers, who have been doing business with us for several years, and we try to ease customers’ concerns by giving them a chance to test the product at the dealership. We back them with a lifetime guarantee on parts availability, and we also have a 10-day, no questions-asked return policy.


Premium Powersports

Chewelah, Wash.
Jerry Sanderson, owner
Types of vehicles being sold in 2007: Motorcycles, ATVs, UTVs
Were your 2007 sales an increase or decrease over 2006? 10 percent increase
New unit sales breakdown: 60 percent UTV, 30 percent motorcycle, 10 percent ATV
Breakdown of sales in your entire dealership: 40 percent new unit sales, 30 percent service, 20 percent PG&A, 10 percent F&I
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? We’re based in a relatively poor area of Washington state, so any pinch on the economy is going to hurt sales. UTV sales have really carried us, so if those slip, we’re headed for a down 2008.


Tri-Valley Powersports

Cochran, Nev.
Troy Emery, owner
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs
Were your 2007 sales an increase or decrease over 2006? about even
New unit sales breakdown: 50 percent motorcycle, 45 percent ATV, 5 percent scooter
Breakdown of sales in your entire dealership: 60 percent new unit sales, 20 percent PG&A, 20 percent service
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? Reliability is a question we get from nearly every customer who comes into our store. You just have to make sure you back up your products with excellent service support. A lot of the products I’ve seen at the show this year are the best I’ve ever seen.


McMahon Cycle and Trailer

Omaha, Neb.
Jonathon McMahon, owner
Types of vehicles being sold in 2007: ATVs, UTVs, go-carts.
Were your 2007 sales an increase or decrease over 2006? 5 percent decrease
New unit sales breakdown: 70 percent ATV, 29 percent ATV, 1 percent go-cart.
Breakdown of sales in your entire dealership: 80 percent new unit sales, 10 percent service, 10 percent PG&A.
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? I don’t see how there can be a bigger concern for 2008 than the economy. I carry Chinese products, and I’m well aware that if customers are going to spend money on a powersport vehicle in a down market, they tend to go with a brand they know and trust like a Polaris or Yamaha. As the economy goes, so do my sales.


Kelly Motorsports

Buffalo, N.Y.
Alex Conners, owner
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs, UTVs, snowmobiles
Were your 2007 sales an increase or decrease over 2006? 20 percent increase
New unit sales breakdown: 50 percent ATV/UTV, 30 percent snowmobile, 20 percent motorcycles/scooters
Breakdown of sales in your entire dealership: 60 percent new unit sales, 30 percent service, 10 percent PG&A
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? I think every dealer at this show should be concerned about the economy because we aren’t dealing with a need item. People are losing their homes, trying to make their car payments, put food on the table. Getting a new bike or ATV is the last thing on their minds.


Wild Ways Powersports

Kenosha, Wis.
Ted and Maria Marleta, owners
Types of vehicles being sold in 2007:Motorcycles, ATVs, UTVs
Were your 2007 sales an increase or decrease over 2006? 15 percent decrease
New unit sales breakdown: 50 percent motorcycle, 50 percent ATV/UTV
Breakdown of sales in your entire dealership: 40 percent new unit sales, 40 percent service, 10 percent F&I, 10 percent preowned
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? For us it’s the combination of brand awareness and distrust in Chinese product. Those are hard to sell, but generally the customers who come into our store are aware we’re not a franchise dealer, and have a more open mind when it comes to some of these company names and expectations about the products we sell.


Comfort Cycles and Powersports

Redwood, Ga.
Nate Porter, owner
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs, UTVs, go-carts
Were your 2007 sales an increase or decrease over 2006?25 percent increase
New unit sales breakdown: 50 percent motorcycle, 25 percent ATV/UTV, 15 percent scooter, 10 percent go-cart
Breakdown of sales in your entire dealership: 60 percent new unit sales, 30 preowned, 10 percent F&I/PG&A
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? I think it’s a combination of all three to be honest with you. People already have bad notions in regards to Chinese product, and a down economy just makes selling harder. I can’t really pick one out that I think is more important than the other.


Sargents Motor Sports

Portland, Ore.
Gary Sargent Sr., owner
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs
Were your 2007 sales an increase or decrease over 2006? 10 percent increase
New unit sales breakdown: 50 percent ATVs, 35 percent scooters, 15 percent motorcycles
Breakdown of sales in your dealership: 75 percent new units, 15 percent service, 5 percent preowned, 5 percent parts and accessories
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy or customers leery over Chinese reliability)? Brand awareness. People are receiving those (the new entry OEMs) very well as long as they are explained correctly to the consumer. (New entry OEMs are) striving closer and closer and they closed the gap significantly in 2007.


KMS Kingery Motorsports

Kentucky
Sean Kingery
Types of vehicles being sold in 2007: ATVs, dirt bikes and dune buggies
Were your 2007 sales an increase or decrease over 2006? 20-30 percent increase
New unit sales breakdown: 80 percent ATVs, 15 percent dirt bikes and 5 percent dunebuggies
Breakdown of sales in your entire dealership: 99 percent new, 1 percent used
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? Leary of Chinese products. It’s really hard to convince people in Kentucky that Chinese product can be reliable. We advertise a lot in newspapers, TV, etc., but we still have a hard time getting people to cross over into the Chinese market. When you have names you can’t say, people are instantly leery. You can just look at them and tell they don’t look like what they’re supposed to look like.


Two Wheels and More

Beech Grove, Ind.
Bill and Jason, owners
Types of vehicles being sold in 2007: New and used parts for dirt bikes, three and four wheel ATVs, scooters, mopeds.
Were your 2007 sales an increase or decrease over 2006? Not available
New unit sales breakdown: Mostly scooters but most of sales are parts.
Breakdown of sales in your entire dealership: We do mostly parts. Parts on eBay are our biggest seller. Our counter business fell off because of the Internet. We still do repair and sell parts, but it’s mostly on the Internet.
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? The economy of course.


Mystic Pig Cycle

Eerie, Penn.
Ken and Tim Engles, owners
Types of vehicles being sold in 2007: Motorcycles, scooters, ATVs
Were your 2007 sales an increase or decrease over 2006? 20 percent decrease
New unit sales breakdown: 80 percent ATVs, 20 percent scooters
Breakdown of sales in your entire dealership: 60 percent vehicles, 40 percent parts
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? It’s the economy. People don’t have the money to spend on toys.


Barefoot Racing

Robert Baumgart, sales
Rochester, N.Y.
Types of vehicles being sold in 2007: Motorcycles
Were your 2007 sales an increase or decrease over 2006? Not available
New unit sales breakdown: 100 percent motorcycles
Breakdown of sales in your entire dealership: Ninety percent of my stuff is new units. The other 10 percent is mostly trade-ins for new bikes.
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customers leery over Chinese reliability)? People are leery of Chinese products.


Cycle Powers West

Ft. Wayne, Ind.
Donald Graf, owner
Types of vehicles being sold in 2007: ATVs, UTVs, motorcycles, scooters
Were your 2007 sales an increase or decrease over 2006? 35 percent increase
New unit sales breakdown: ATVs/UTVs 60 percent, motorcycles 30 percent, scooters 10 percent
Breakdown of sales in your entire dealership: 70 percent new unit, 20 percent service, 10 percent PG&A/F&I
For 2008, what’s your biggest concern (lack of customer brand awareness, the economy, or customer leery over Chinese reliability)? It has to be the economy, but I’m hopeful that as the economy slows, people might look closer at my lower priced units, and maybe it will actually help sales in the long term.

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