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Aug. 9, 2010 – Dealer questions on an increasingly important market

August 9, 2010
Filed under Features

The preowned market has its own set of issues, challenges and strategies. Like should a V-twin store sell used metric product? Or European-brand bikes? If so, what would be the advantages?

How about effective ways of marketing these used units through online sources?

Those questions and others on the preowned market were asked during a recent Webinar that was hosted by Powersports Business and Cycle Trader. More than 250 members of the industry registered for the Webinar.

Webinar panelists included Sam Dantzler of Sam Dantzler Powersports Consulting, a 20 group moderator for Harley-Davidson Motor Co.; Paige Bouma, sales development manager for CycleTrader.com; and Jim Maslyn, president of Motoprimo, a Minnesota multi-brand dealership.

Here are some questions that were asked during the Q&A portion of the Webinar, some of which were answered and some of which were not due to time limitations.

Webinar Attendee: Do you recommend we have the service department charge full shop labor rate on recon work?

Dantzler: “Absolutely. 100 percent. Every single statistic we have over the last decade shows that if that work is done at a discount for the sales department, the discount ultimately ends up in the hands of the buyer out on the floor. So, yes. And I think you take that into consideration when you’re penciling the deal before you take the bike in.”

Maslyn: “We’re not so hard-lined about that. We would take a look at every situation and make a judgment on it. So I understand from the profitability point of view, but sometimes you do want to move a unit and there are interdepartmental charges that go on so we charge them a rate, sometimes less for retail. So I’d say we’re a little bit more flexible on it.”

Webinar Attendee: Can someone touch on the importance of utilizing Cycle Trader and other online sources to increase traffic levels?

Bouma: “The best way is to make sure you have all of your units online in front of consumers that are looking. We always tell dealers if they’re going to have something that’s sitting on your floor, and we’ve got somebody on our side or looking anywhere on the Internet for what you might have sitting on your floor, that when they’re looking for it, they don’t see it online so they just assume it’s not there. And we see a lot of dealers that are not putting up all of their inventory, maybe not managing it very quickly… Make sure as soon as you get it (the used product), you are automatically going in and putting it in your online inventory.”

Webinar Attendee: We have an American motorcycle-only consignment dealership. I get the draw of having metric bikes, but if you don’t service them, wouldn’t that be a negative for the dealership?

Dantzler: “The idea is you’re carrying late-model used products, so the chance of an actual mechanical breakdown is very minimal. Your techs should be able to do a basic tire change or oil change on most models. If, however, there is a problem, outsource it to a local metric dealer and simply take the hit for the ‘payment’ out of the profit of selling the bike. Creating new foot traffic and incremental bike sales should more than outweigh the chance of running into a mechanical problem on your used product. Lastly, make sure the bikes are being run through the service department prior to allowing them on your floor. This will minimize the risk even more. At the end of the day, it’s not if a problem happens, but how you handle it that aids in customer retention.”

Reminder:?Next Webinar is set for Wednesday, Sept. 1, on ways dealers can grow their

e-commerce revenue. PSB

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