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Dealers see positive signs as buyers return

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Liz Hochstedler, Associate Editor
February 13, 2012
Filed under Features, Top Stories

Nearly half of surveyed dealers saw increase in new unit sales

For many dealers, 2011 was an interesting year. Nearly half of the respondents of Powersports Business’ annual Dealer Game Plan Survey said they saw increases in new unit sales in 2011, and yet a few report that the improvement came as a surprise to them. More than 325 dealer principals and managers participated in the annual survey, with results available exclusively to Powersports Business readers.

“It’s retail; it’s the way of the crystal ball,” Eric Osner, owner of Crossroad Powersports in Upper Darby, Pa., said in late January. “We’re very fortunate because a lot of dealers around us actually closed up, and we just lost another one a couple weeks ago.”

Despite some rough times in the dealership’s region over the past few years, Osner saw a sizable increase in his new unit sales in 2011.

“2011 actually was a good year, knock on wood,” he said. “It wasn’t our best year, but I think it was our third- or fourth-best year in 15 years. The weather affected us most. If we didn’t really have all the rain from April to June, we probably would have sold a lot more, but it rained almost every day.”

Osner said his dealership didn’t do anything noticeably different in 2011 to attract traffic. It simply relied on its mostly Internet-based marketing, offered consistent customer service and depended upon its word-of-month marketing for a successful year. Osner suspects increases in lending approvals from banks and a slight uptick in the local economy also played a role in the year’s sales.

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“The economy affects everyone,” he said. “I feel that the economy is picking up better. I know talking to other dealers at dealer meetings that other parts of the country aren’t doing as well, but we’re very fortunate that people are walking in the door.”

Richard Meltz, owner of Centaur Cycles and Scooters in Santa Fe, N.M., also attributes some of his 30 percent new unit sales growth to the
recession’s aftereffects.

“The market changed. The consumers’ attitude changed,” he said. “I think people just got tired of being depressed or being in a depression, and people were ready to start spending money again.”

Meltz also didn’t do anything different or special in 2011. Instead, he relied on the processes he’s always had in place.

“I would have to say the thing we did most is be consistent. We’re doing the same things that we’ve always done, offering high-quality products,” he said. “We offer what we think is the best customer service in town, good service and repairs and whatnot.”

His wife, Meg Meltz, vice president of the dealership, said to her surprise, the customers who were coming in weren’t just looking for the value models either.

“A lot of the bikes were the bigger bikes — they weren’t just the cheap ones. They were the more expensive ones, which is funny,” she said.

Bob Ellis, owner of Empire Cycle and Powersports in Spokane, Wash., said he was just lucky his customers returned.

“I wish I could say I took credit for it,” he said of his 20 percent new unit sales increase, “but again, the European buyers have come back, and they’re usually a little more affluent.”

Ellis did make some changes at his dealership, including adding Husqvarna, Vespa and KYMCO lines, increasing his showroom space and boosting his inventory, but he suspects a slight improvement in the economy played a bigger role in his success.

Mark Engel, owner of Motorcycles of Charlotte, attributes his 20 percent growth in new unit sales to a concerted push made at his dealership.

“We beefed up our sales force, participated in training sessions, did all that kind of stuff for our people,” he said.

Engel also hired an additional sales person and an F&I employee to help boost his sales in 2011, and the investment paid off.

“I know [darn] well that if you’re not properly staffed, you’re never going to meet your goals, so we worked it backwards. If we want to sell X number of units per month, then we need X number of people to do it,” he said.

Richard Meltz, owner of Centaur Cycles & Scooters in Santa Fe, N.M., saw a 30 percent increase in new unit sales in 2011.

With more of an investment in his staff and stock in 2012, Engel is hopeful for another 20-25 percent sales increase this year.

“We actually had a stock problem last year. We ran out of inventory a couple of times, so this year, yes, we’ve got more inventory on the floor than we did last year, so we’re expecting that that will also help,” he said. “We’re bullish on 2012. We expect it to definitely be up from 2011, and we had a pretty good 2011.”

Ellis hopes an increase in open houses and event participation, along with the draw of his new brands, will bring a successful 2012. And Osner and Meltz are hoping their early season numbers are a sign of what’s to come this year.

Osner has already seen “ungodly” increases for January, and he hopes that the weather will hold out for the riding season, so he’ll continue to see success.
“I feel very positive,” he said. “The only thing that may be negative is weather. It’s a very weather-driven industry, and it even got worse during the bad economic times. If weather is nice to us this year, I think we’ll do pretty good.”

Meltz will continue to rely on the same service he’s always given to customers and also hopes that 2012 will continue on the same path that winter sales have provided.

“So far we’ve been encouraged by December and January sales levels,” he said. “I don’t have numbers to quote, but very often, December and January don’t sell anything; I mean like zero anything, and we’ve sold a steady trickle of new bikes and used ones too, and if that is indicative of things to come, that’s good.”

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