Winches, wheel kits favored by ATV buyers
Dave McMahon, Senior Editor
April 30, 2012
Filed under Features
Tennessee ranks highest in rate of accessories sold with ATV deals
A study performed by ADP Lightspeed for the year 2011 finds that of 49 states, the state of Tennessee has the highest rate of accessories sold on ATV deals. Florida ranks last. The study, provided exclusively to Powersports Business, also finds that winches and wheel kits provide the highest volume of sales in most states.
The study is derived from the sale of 84,000 new units and the parts associated with those sales. The units totaled $536 million, and the parts totaled $13.3 million. That ratio is 2.5 percent, but the individual states ranged from a high of 5.4 percent, to a low of 0.8 percent. A total of 49 states were represented in the study, with Rhode Island not included.
The percentage of accessories was obtained by dividing the total accessory sales on major unit sales deals by the total selling price of the units, then grouped by state to yield the sales of both units and parts by state. The resulting ratios fell into several logical groups with similar characteristics.
Tennessee, Louisiana and Maine are substantially above all others in terms of accessories sold on new ATV deals.
“Without additional study, we may only speculate that the type of use for ATVs in these states requires equipment above that which is used in other states,” said ADP Lightspeed senior analyst Hal Ethington, who conducted the study. “Winches, special wheels, tires and axles are frequently found on the machines sold in these states, and those items are at the high end of accessory costs. Riders in these three states are engaged in activities that require a greater outfitting effort than in normal recreational or work-related uses.”
The next three states (Minnesota, North Dakota and Alaska) range from 4.09 percent to 3.89 percent in accessory penetration. This would translate to between $3.89 and $4.09 per $100 in major unit costs.
“Again, we can suppose that the type of riding done in these states warrants substantial investment in additions to the base machine,” Ethington said. “All are northern states, where snow-handling may be one of the driving forces in the addition of accessories to the machines.”
A somewhat larger group of states falls into a similar range: Montana, Colorado, Arkansas, Iowa and Michigan. This group ranges from a 3.64 percent to a 3.09 percent rate of accessories sold with new ATV sales.
Sixteen states emerge in the 2 percent area, and Ethington says it’s difficult to see the similarities among them.
Florida falls dead last with only 76 cents per $100 of unit sales.
“While the typical Tennessee dealer is getting $323 dollars for each unit he sells, the Florida dealer is getting only $46,” Ethington said. “That difference of $277 per unit will add up over the course of the year to tens of thousands of dollars lost in the sales process.”
The study also found the actual part numbers at the top end of the volume scale. Tennessee dealers, with their sale of a Swamplite Wheel and Tire kit, have produced more than $59,000 from that one part number alone. Two Warn winches, one in Tennessee and the other in West Virginia, have each produced $49,000 and $57,000, respectively.
Dropping to the $20,000-$30,000 range, two Warn winches and one wheel and tire kit are at the top. At the $10,000-$20,000 range, the emergence of snow plows is apparent, along with winches in Pennsylvania, Minnesota and West Virginia. The same pattern continues with plows and winches down to the $1,000 range, but one model of helmet does make the list in Arizona with $2,000 in sales in that state.
Tennessee has the highest ratio of accessories to units, and it has the two highest-priced part numbers.
“Hopefully, this study will bring to light first, the upper ranges that accessory sales have achieved in certain states,” Ethington said. “And second, perhaps dealers in states that have lower penetration rates will see what is possible when product is available and can be deployed in their sales area. Except for snow handling equipment, it is hard to imagine that with the range of accessories available today, higher rates of accessory sales cannot be obtained.”