Tanana Adventure Sports – Delta Junction, AK – March 9, 2009
March 9, 2009
Filed under Power Profiles
Tanana Adventure Sports
Mile 275 Richardson Highway HCR 60
Delta Junction, Alaska 99737
In a town of 3,000 people with the next closest town about 100 miles away, many wouldn’t think a powersports dealership could survive, much less grow nearly every year since it opened in 1998. Owner Josh Lawhorne says he wasn’t concerned about the small population because he understands Alaska. “I’ve been living here a long time. One hundred miles is not a big deal,” he noted. “We’re actually located where most people want to go riding. We’re more of a destination-type place. We’re the closest dealer to where the Arctic Man takes place (Summit Lake, Alaska), so we get a lot of business on the weekends, people swinging in to pick up oil and belts and anything else they forgot.” Lawhorne says Summit Lake has the largest snowmobile mountains in Alaska. Also drawing in a lot of customers, Lawhorne adds, is the gas station the dealership has attached to it as well as the three military bases nearby. “We get a lot of military people coming and going,” he said. “It definitely is a big part of keeping us going, new sales come in every 2-3 years.” Tanana Adventure Sports sells Ski-Doo, Honda ATVs and motorcycles as well as Honda marine and power equipment. Its currently adding Honda’s UTV line, which it’ll have in the spring. Despite Alaska’s long winters, Lawhorne says the summers are much bigger in terms of sales compared to snowmobiles.
“Whether the manufacturers are able to weather this economic crisis,” Lawhorne said of his greatest concern. “We’re with some strong manufacturers with Honda and BRP though.” Fortunately for Tanana Adventure Sports, Lawhorne adds the dealership isn’t as affected by the economy as dealerships in the lower 48 states. “We’re not seeing that economic crisis here in Alaska at this point,” he said. “We have a lot of stable resources in Alaska. We had our best year last year. We increased about 10 percent over ’07.”
The Skandic snowmobiles, Ski-Doo’s utility line, are typically about half of the dealership’s total snowmobile sales with the other half being mountain sleds, says Lawhorne. This year, however, about 70 percent of the dealership’s sled sales have been utility snowmobiles.
CUSTOMER BUYING TRENDS
With financial institutions clamping down on loans, Lawhorne says they’re seeing more cash sales. “It’s getting harder and harder to get financing,” he said. “Up here in Alaska, we’re a little different from the rest of the U.S. as far as cash because we sell a lot to villages that are out several hundred miles that don’t have dealers. A lot of those people pay cash rather than going into debt with financing, but the percent of people paying cash has gone up. We still do some financing, but it’s definitely dropped off since about November of last year.”
PARTS AND SERVICE
Tanana Adventure Sports’ parts department makes up about 20 percent of its total business. Lawhorne says they do a fare amount because of all the villages they ship to. The service department also does well, making up about 10 percent of the dealership’s total business. Much of the credit can be attributed to the service manager, who has been with the dealership since nearly the beginning. “When he started with us, he probably had a 20-25-year history of mechanics and small engine repair experience,” Lawhorne said, “so he’s really been the backbone of the service department.” The dealership also has a service writer and two techs.
PROMOTIONAL HOME RUNS
The dealership works with an advertising agency to find its best marketing avenues. During the years, Lawhorne says they’ve found radio is the most useful, being that the dealership is rather remote. About 80 percent of Tanana Adventure Sports’ advertising is done over the radio.
WORDS OF ADVICE
“Treat your customers honestly and up front,” Lawhorne said. “You have to be willing to stay in it and hold the honest line long enough to show your customers you’re in it for the long hall. We noticed over time, we lost some customers because they thought they weren’t getting the best deal. But since we’ve been in business 11 years, we’ve seen them come back because they realize what we were telling them was up front and honest. Stay in the business and keep it honest. It’ll pay off.”
— Karin Gelschus