Jul. 13, 2009 – Bold Idea No. 9: Focus on traffic log, increased preowned margins and PUS

As Big Sky Harley-Davidson felt the pressures of the economy, it focused on the basics, including setting traffic log standards, expanding the number of F&I products and taking more time detailing bikes.
All the changes have created increased numbers over prior years, including 25 percent more customers year-to-date in the traffic log, an increase of used bike margins to an average margin of 19 percent and the expanded F&I menu increased the PUS from $1,100 to $1,565 year-to-date. Dealer Principal Brian Moen says year-to-date, they’ve sold more bikes than they did last year, and all the changes have put them on track for another record year.
Out of all three changes, Moen says the finance products had the biggest impact immediately. Along with more products, Big Sky Harley-Davidson added another F&I staff member.
“The finance department has become a profit center that is no longer an option,” Moen noted, “and has become very profitable.”

Traffic log
Looking at other areas to improve, Moen implemented a mandatory traffic log. Salespeople are now required to enter on average four logs per day. Moen says he measures it on a weekly basis because a majority of the dealership’s customers come in on Friday and Saturday.
With the amount of traffic the dealership gets, Moen believes a salesman should work up to doing 40-50 logs a week. “I think that should be an absolute minimum,” he said. “(Four logs) is a number I picked that I thought was very realistic through all times that anyone could meet. I think that number is low by today’s standards.”
At first, many resisted the new processes with the traffic logs, but Moen says it’s not an option. “If you don’t believe in the system,” he noted, “please find life elsewhere.”

Increased used bike margins
Along with the finance products and traffic log, Moen says he was able to increase the dealership’s used bike margins by doing a more thorough job detailing the motorcycles and spending more time on the appraisal process.
“We added Simonize paint and chrome protection,” he said. “The new paint protection is getting 45 percent penetration.
“We started cleaning and detailing the bikes better and pricing them accordingly. The plan was that if we were to sell fewer bikes due to economic issues, they would be more profitable.”
In addition to spending more time detailing the bikes, Moen says he spends more time on the appraisal process by attending online auctions nationwide to see what used motorcycles are selling for.
“Supplying my used sales demand with the right model mix at the right time has been a huge challenge,” he said. “I’d attribute (part of) my used margins going way up to doing a better job buying.”
The combination of better buying and concentrating more on detailing has boosted his used sales more than 50 percent over last year. “My used sales will outnumber my new unit sales this year,” Moen said. “I’m probably up
20 units year-to-date from 2008.”
Including all the modifications in the dealership this past year, Moen says he wouldn’t change a thing if he had the chance to do it all over again.
“I rolled the dice last winter and made my plan and stuck to it. I’ve been lucky,” he said. Along with good luck, Moen attributes his dealership’s success to his 20 group. “The masterminds of these dealers help me learn the proper system to drive sales.”
— Karin Gelschus