Like the centerpiece dark carnival for Ray Bradbury’s novel, “Something Wicked this Way Comes,” for many motorcycle retailers, falling leaves, the first frost and putting out Halloween decorations are all perennial indicators that something simultaneously terrifying and appealing is in the offing. In the southern states, it’s the steel melting heat of July that seems to bring business to a standstill. But regardless of your locale, you’ll need adaptive and contingent actions if you want to thrive in a seasonal business.
If you’ve been in the motorcycle business for more than 20 minutes, you’ve probably heard the notion that we’re moving from the “busy” season to the “selling” season. There is a lot of truth in that idea, and mindsets are important.
Motorcycle retailing success is grounded in your mental disposition, which your language reflects. In fact, new research by one of the giants in the field of optimism, Martin Seligman shows that thriving organizations use more positive words than negative ones in a 2.9 to 1 ratio. Like Henry Ford’s oft-cited quote, “Whether you think you can or think you can’t, you’re probably right.”
Positive mindsets can help, but they are not enough. It takes solid strategies, pragmatic tactics and skill acquisition to be successful in the slow season.
June is for “Joes” and November is for “Pros”
Regardless of your department or your position, during the busy season, most people can find success. Didn’t respond to that Internet lead? Who cares? The phone is ringing off the hook. Didn’t get the prospects name? They’ll call back. You’d like performance work done? Sure, and the Cubs want a championship. I’m being facetious, of course, but sometimes in the height of the season, despite our best efforts, we fall short.
If you don’t measure up in the “selling” season, you’ll be able to watch your revenue, commissions and dealership net profit fall faster than the Road Runner’s Wile E. Coyote falls after another failed attempt at a cliff capture (You’d think he’d find a better spot?).
Want to be a “pro?” Now you have to do 90 percent right, 90 percent of the time. Incoming Internet inquiry? Now you better respond in a clear and compelling manner within a few hours. Customer calls or comes in, the first thing you do is introduce yourself and capture their name and contact information. Appointments (especially test rides) are treated as sacred events that only a natural disaster would prevent you from keeping. Your product mix is as important as breathing. Want performance work done? Let’s schedule a consult, and we’ll come to your house to get your precious motorcycle. Every marketing dollar is prized; every management conversation important.
Any average “Joe” can use the excitement of the busy season to achieve success. But as soon as that momentum is gone, “Joes” and “Pros” soon part ways. This article kicks off my “Six Pillars to Business Success” series. These ideas will help you be more “Pro” and less “Joe” during this time of year and help make your slow season fast.
Pillar Number 1: Increase Your Revenue
Raise your prices. Yes, you read that right. Consider raising your parts, accessories, service and riding gear prices by 1 percent. I know, I know, you’re dealing with cutthroat Internet competition, hard bargaining retailers across town and a struggling economy. I still think you should do it.
Why? You’re providing terrific value to your customers. They get to touch, see and feel the products before they buy them. Customers get to interact with your people who provide professional guidance and experience. That is important and worthwhile.
As my mentor told me long ago, the first sale you must make is to yourself. If you’re not sold on the value you provide, who else will be?
For example, let’s say you’re doing $150,000 a month in your parts and accessories department. Here, a 1 percent increase adds a modest $1,500 to your revenue stream. But with the power of multiplicity, run that through the course of a year, and now we’re at $18,000. In your riding gear and apparel categories, let’s say you’re doing $75,000 per month; here, your increase would be $750 per month, or $9,000 per year. Perhaps your service numbers would be similar. Add these three categories together, and now you’re talking a gross revenue increase of $36,000.
When a customer makes their purchase decision, whether it is $100 or $101 is more than likely inconsequential to them, but it could mean real improvement to you.
Raise your rates. Don’t forget your finance efforts as well (always, of course, adhering to federal, state, lender and underwriter guidelines). A 25 basis point increase in your rates will be minuscule in terms of customer impact, but could mean significant gains in terms of your F&I gross profit.
Mark Up Eligible Backend Products and Services
Are you providing something of additional value that would enable a reasonable mark-up of vehicle service contracts or maintenance plans? Here you don’t want to just mark up because you can, but you do want to provide a premium value and experience for premium pricing. Are you providing pick-up and delivery, priority scheduling, complimentary detailing, fluid top-off, records keeping? All of these add value to the customer’s experience, and you should charge more for that value. That’s the “good deal” exchange (the “bad deal” exchange is when you just charge more to charge more and can’t justify the increase).
Package or Pair Almost Unfair
A tongue-in-cheek comment for sure but there is a lot of truth in this statement. It’s been stated many times that when a customer purchases multiple items, they are much more satisfied than if they purchase individual items. Guess who else is happier? That’s right, your accountant!
The idea of selling multiples is as solid as it comes. On the showroom floor, it’s packaging motorcycles with various accessories, service or protection programs. In finance, selling multiples is menu selling. In accessories and gear, it’s creating package displays (one hot seller with three others that aren’t so active), featuring items on the counter (first aid kits, tool kits and maps can work) and the sales skill of finding complimentary items. The clichéd, belt with jeans, socks with boots, gloves with jacket, microfiber cleaning cloths and Rain-X with a helmet are clichés for a reason … they work. Learn to get great at making these sorts of pairings and then practice the language you’ll need to make the suggestions. I call these “complimentary conversations.”
“And of course, you’ll need Rain-X to go with that helmet.” Or, “You know what else goes great with a new pair of boots? These specially designed socks.”
Don’t miss next month’s installment, where we’ll cover key ways to contain costs, improve processes, develop talent, master your marketing and dramatically improve your management efforts.
An award-winning author, top-rated trainer and founder of Peak Dealership Performance, Mark Rodgers holds a master’s degree in adult education and the National Speakers Association Certified Speaking Professional designation — only 500 people in the world have this coveted recognition. Contact [email protected] to improve your performance.