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Business Management

F&I: Turning Inventory with Repeat Customers

The key to success is turning the inventory as often as possible and to not let the units age.


Restauranteurs have a term called “turning a table,” which is used to describe how many seatings each table can have per lunch or dinner serving. Sometimes you are surprised to hear that a restaurant closes its doors when it seemed to be really busy and doing good business. It may be due to not turning the tables enough times per day. Because they have a set amount of tables, the more people they can sit at those tables, the more revenue potential they have.

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One thing that helps with this challenge more than anything is the repeat customer. If they are happy with the food and service, they come again and their repeat business usually brings the profitability.
It is not much different for dealerships. There is only a certain amount of showroom space and a certain number of units in inventory at any given time.

The key to success is turning the inventory as often as possible and to not let the units age. Aging inventory not only eats up the margins — especially if you are using floor plans like most dealerships — but it also discourages your customers from visiting your dealership frequently since there isn’t much of a new inventory to get them excited.


Our market size is smaller than most other markets. Everybody has to eat, but everybody doesn’t have to ride a motorcycle. So if you want to turn the inventory quickly, it is most critical to focus on repeat business. It is always surprising to me that so many dealerships spend their marketing dollars to attract new customers without realizing that they are sitting on a gold mine called “customer list.”

Your previous customers have more potential to buy new units than anyone without a motorcycle. A rider has a motivation to either trade-up or add a new unit to their garage more than any other vehicle shopper. Almost always, people ride because they love to ride; not because they have to. When it is motorcycles that you are passionate about, you can always benefit from a sports-bike for track days or a cruiser for casual weekend group rides or an off-road bike for some fun mountain time. So there is one justification or another to have multiple units in a customer’s garage.


If they are not motivated to add a new unit to their garage, they may still be interested in a trade-up. When an automobile driver is happy with their car, they may want to keep it for a very long time. However motorcycle riders have more motivation to switch units more frequently. Most riders are encouraged to start riding with small size and move up when they get some experience. When they are really seasoned riders, they may be in the market for a new unit every couple years, even if they are happy with what they have. If your customer purchased their previous unit from your dealership, you should be their point of choice for their next one. It is more about what you do than what your customer does that defines how many units they will purchase from you.


Here are some ideas that help with repeat business:

Build a List: Use every opportunity to collect email and other contact information from everyone who visits your showroom or website. Have small cards to fill out at your register counter and email forms on your dealership website. Encourage consumers to complete the forms by offering special offers or small discounts, or a free giveaway to a randomly selected participant.

E-newsletters: Your Dealer Management System may already have this functionally or there are inexpensive e-newsletter solutions that you can easily obtain online by a quick web search. Upload your growing list to the e-newsletter solution and send periodic newsletters weekly (or monthly if you have trouble coming up with enough quality content every week). Make sure that your newsletter not only pushes sales pitches but includes as much useful information as possible.


Print Newsletters: Have the print copy of your most recent newsletters available for your visitors to have a take-away, which may give them another reason to come back.

Bike Specials: Aged bikes with promotional financing offers are great to promote as the special of the week or month. When your customers are benefiting from a great deal, you will be happy to sell an aging bike that eats up the margins, which creates a win-win for both parties.

Equity Report: Some dealer platforms make it easy to track how much equity your customers have in their units. You can also create a simple electronic spreadsheet to track it. In the spreadsheet, include the customer contact information, their current unit details and the basic financing details such as the financing amount, the monthly payment and the repayment term. This would show you how much equity is built in their unit to help you decide when the best time would be to reach out to them to get a new unit.


I would encourage you to review your internal equity report on a weekly basis and identify the customers to reach out to by phone/email/snail-mail who have the most potential to trade-up to a new unit.

If you continue with this process in a disciplined way every week, you will be pleasantly surprised to close many more incremental business deals every year. Keep in mind that your previous customers have the most potential to be your current and future customers as well.

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