Thursday, November 11, 2010

What Powesports Dealers Need to do in 2011

What Powesports Dealers Need to do in 2011

I was asked to speak recently on the State of the Powersports Panel at the SEMA Show and one of the most striking figures was the surge in repairs and used sales. The total was an 18.85% increase. Most of the dealers I spoke to after the show told me it was parts and service keeping them open and I probably upset some of the financial companies in the audience like GE for telling the dealers to look for alternative financing, but let's face it I was asked to tell people how to stay in business not how to make the banks rich. So my main argument is two points first we must shift the dealer paradigm and second we have to leave our comfort zone.

That's the thing in 2011 you have to evolve and sometimes that means being on the offensive. Our industry got lazy, you didn't care if your scooter importer or distributor dropped the ball because we were order takers. So many people qualified for loans and came into shops with cash that we didn't have to be smart. We didn't have to be aggressive or care who was doing what to who. This is where the paradigm changes and the dealers have to evolve. Many of the smaller scooter and ATV dealers buy from what I call the "bottom feeders" low end Chinese parts and scooter importers that have no qualms about screwing the small guy. They are faster, bigger, and stronger than you will ever be online. Especially a busy dealer who more than likely will just buy a PSN website and not check on it. That distributor will sell direct to the public and tell you to your face they are a wholesale business because the truth is the moment you register that scooter the consumer will get a catalog and a discount coupon in the mail and become their client. You will never ever be able to beat them at their game So keep in mind you will always know who your friends are in this market.

So what's my advice? If you can't beat them evolve. Let me quote my favorite American general who in my dreams looks a lot like George C Scott.

"Nobody ever defended anything successfully, there is only attack and attack and attack some more."
George S. Patton

2011 could end up being a bust for many distributors barely hanging on. It could be a bust for your competition across the street so attack! Be aggressive, make cooler displays, make bigger promotions. Follow the generals advice and make the coolest showcase of scooter product you can imagine. When people walk in to the store let them never want to leave. Have a couch that says "sit on me and wait for an oil change," buy a pinball machine on Craigs list, get some Armadillo Scooter Wear and put it on a hot mannequin.

Now your hesitant because your competitor is out of the game. He closed. This is an opportunity! Well don't just stand there hire him or work with him. Reach out and say you know what we were competition, but let's team up. I've done this and so can you, again follow the Generals advice your defeated enemy can be your friend. If we had listened to him we would have avoided the cold war and grabbed the German army and headed into Moscow. Your competition is defeated but his client list is valuable, his store had a reputation, and he had some cashflow. If you don't get them someone else will.

It’s a delicate situation. Believe me I know, we have grown more in volume and in the last two years because others continue to leave the market. At SEMA I saw panel speakers almost fall out of their chair when I announced we purchased United Motors a company that had been around for 15 years, but guess what if we didn't do it someone else would have. You don't want to look greedy, you don't want to be mean, but at the same time be grateful and give thanks to the higher power, but this is an opportunity. I have dealers who are doing better because they did the same thing and and this just means "CONSOLIDATION." Our industry was too big and unsustainable and those who don't consolidate now will suffer later.

Fortune favors the bold and now is the time to take it. 2011 can be a great year no matter who is president and no matter what the price of gasoline is. When the guy down the street closes lots of things can happen, but you have to move fast because if not his distributors will set someone else up. So be proactive go after those clients, build yourself the best scooter, gokart, buggy, atv store there is.

Prepare for the unknown by studying how others in the past have coped with the unforeseeable and the unpredictable.
George S. Patton

When buying a competitor be it a distributor or another store you benefit. You can offer more variety, you can reach out to new people, and you know what nobody else knows. Be that guy. Now is the time to expand. Just imagine a world where America had finished the cold war before it started. Think like Patton! He had vision so can you. Look around you and see what you want from your market. You have to be able to almost taste it, and have to be convinced that it's going to work. If you have doubts you might as well have just stated back in America and let someone else handle the invasion.

So now you got the passion, you got the vision awesome what are you to do? SIMPLE


Build a better shop, take your former competitors clients, and then you have to do it on a daily basis. Never give up. Make the store better everyday. This week new Scooter riding videos, next week call a dealer that knows what he's doing and team up. Go to the races together. The next month hold a BBQ or a rally. You cannot stop the machine once its going the store will take a life of it's own.

So no matter what happens you have parts, accessories, and service. Who cares if new unit sales continues to slide, you have built a community! You have built an army that will follow you into Berlin.

Leaving the comfort zone means trying new things. This is a complicated job not for the weak of heart, you have thousands of items, employees, opening the store day in day out, but you also have that passion. Push it to the limit. Step out of the shop and take those scooters or motorcycles to the mall, take them to the local college, leave the castle. Be seen, be heard, be loud. Tell people in your town I OWN A SCOOTER STORE AND WE ARE HERE TO STAY! They will come.

The next rally, the next BBQ, make sure you have that Ms. Pacman machine and sell some sodas because the rally will be over and you will know you have done your job when people don't want to leave, they want to hang out. They want to be your friend and buy a T-Shirt. They create a community.

Each time you expand outside the dealership outside the comfort zone your dealership will do better. You shift the dealer paradigm and you expand what the dealership is about. In the Scooter Maven articles in Motorcycle Product News I often talk about building more than just a location. The goal should always be to build a destination point. Each time you do this and socialize outside the dealership with new clients you expand your sphere of influence, each time you host an event someone who has never been inside a scooter store will sit down and say "why dont I test drive one?" this is the end goal this is the victory to expand, to grow, to shift someone elses viewpoint in life.

In the end I think the message I tried to give at the SEMA show and in my articles is that by changing strategies you can survive, that by taking advantage of closing companies you can grow, and that despite your competition being broke or closing you can take advantage of that and gain customers. This is the way Patton would have wanted it.

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