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Tomorrow’s Dealer

Otis doesn't think it's gonna be much harder to buy a motorcycle in today's economy, just that it's gonna be the best and most customer-oriented salesperson that will help the customer feel good about pulling the trigger.

They told us things were gonna change, but they lied; things have already changed. The doom-and-gloom merchants, masquerading as announcers on the evening news tell us that our economy is getting its butt kicked. All the while the Wizard of Oz, the advertisers behind the screen, are doing everything in their power, including spinning (pronounced “manipulating”) the news, hoping we’ll borrow more money from them than we can possibly pay back.

The good news is that things are always changing, and the people here in the real world know that. We’ve known things were changing while Harley dealers were still breathing the rare air of Neverland. For a while there were actually dealers devastated by the idea that they may be forced to accept offers as low as MSRP, while right across the street, there’s an import dealer who would have given the birthrights to his firstborn to get MSRP — a situation that isn’t improving today.

I don’t think it’s gonna be much harder to buy a motorcycle in today’s economy, I just think that it’s gonna be the best and most customer-oriented salesperson that will help the customer feel good about pulling the trigger.

For every dealer wringing his hands about the coming market trend, there’s another one licking his chops at the prospect of watching the competition go the way of the dodo bird for lack of the systems and processes to do things on purpose.

I’m actually excited to see who will emerge on the other side of whatever we’re going though as an industry. I don’t know all of their names, but I do know that they operate with purpose and the knowledge that good people equipped with good processes will produce extraordinary results during extraordinary times. And make no mistake — these are extraordinary times.

Don’t take my rant as some prediction that you can hold me accountable for; I have no idea what the coming economic odyssey will be, other than a dangerous and exciting journey — just like life itself.

Two of our clients were in the bicycle business before coming to the motorcycle business. They both told me that the big manufacturers promised they’d never sell their bikes through any other medium than retail bicycle shops — the independent guys with a profile similar to that of the average motorcycle dealer of today. Then the third-world brands started showing up everywhere from Wal-Mart to the local mower shop, and before you could sneeze, it was nearly over. Sound familiar?

Here are a few characteristics of the dealers that will survive the next phase of change and be positioned to capitalize:

1. They’ll be in the used bike business. We’ve always recommended that dealers strive to reach a two-to-one new-to-used ratio. In the future, you may need to rework that even further to control your inventory. Being in the used bike business keeps OEMs honest by helping you to control your inventory based on your agenda instead of blindly letting the OEMs push their agenda. The great dealers will have a healthy arms-length relationship with the OEMs. They don’t swallow everything out of the mouth of the manufacturer just because the factory rep said so. If the latest greatest program makes sound business sense, participate. If it doesn’t create a win/win for you and the OEM, don’t!

2. They’ll be in 20 groups. If you’re not comparing yourself to other dealers in the business, how can you possibly know how good “good” is? You can only know whether you’re doing better or worse than you’ve done before. It’s a great thing to have an internal yardstick, but it won’t tell you where you can improve your operation.

3. They’ll take sales training very seriously. Accommodating people don’t sell stuff. They merely accommodate people. You need to have a way to ask every single customer to buy. The more standardized your method for doing so, the more control you’ll have, and the more likely you’ll be to actually get it done.

4. They’ll have sales processes for every department in the dealership, with traffic logs at every retail counter in the dealership so they can measure all the elements of each sales process.

5. They’ll market differently. They’ll quit trying to reach people exclusively with traditional sources of advertising such as print, television and radio. They’ll reach people who’ve shown interest in powersports products — the people on their traffic logs. They’ll also use what we now see as unconventional methods like texting, blogging and other Internet-based marketing strategies — methods that will be considered quite conventional within another five years. Listen, my 23-year-old son, our target demographic by the way, doesn’t listen to the radio, he listens to his iPod. And newspaper? That’s the stuff you line the bird cage with, right? He’s never read one. With his TiVO, he skips all the commercials. And he’d rather have a text conversation with me than a phone conversation — we text each other for hours. In short, you can’t reach him using conventional means … period!

Get out in front of this economic downturn. It’s scarier than anything we’ve experienced since the late 1980s, and nobody knows what the world will look like on the other side of it. To borrow a surfing metaphor, you’re either in front of the wave, or you’re behind it. I can’t promise that if you paddle, you’ll catch this coming wave and ride it successfully to the beach. But I can promise you that if you don’t paddle, you ain’t gonna catch any wave. So paddle your butts off… I dare you.

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