FOCUS – AIH Set to Expand Dealer Network

Wil Garland is looking for a few good dealers, but they have to be the right dealers in the right locations. Garland took over as CEO of American IronHorse Motorcycle Company (AIH), Fort Worth, Texas, last July and, among other things, he’s working at upgrading the company’s dealer network.
That’s one of the things that he’ll be discussing with dealers during the upcoming Dealer Expo at Indianapolis.
Coming off his first industry event at Cincinnati last month where he met with dealers and suppliers, Garland expects to have some serious talks with new dealers at Indy.
While Garland doesn’t expect to grow the total number of dealers much beyond the current level of 100, he does want to improve the network by filling important holes in his reach.
“I’m looking to fill spots in several key cities, in more than a dozen cities,” he said during a recent interview with Powersports Business. These include areas such as Spokane, Wash. and New Orleans, but especially in the West.
“IronHorse just has never tried to develop the West,” he said. “We’re strong in the South and the East Coast, but I see a lot of open space in the West.”
As AIH continues to mature, the dealer selection criteria are tightening up, as well. New dealers have to qualify for a floor plan credit line of $500,000, and they’ll have to have a store that is “in sync with our brand image,” says Garland.
“My focus really is on dealers and vendors,” he says, “because (production) capacity was constrained by vendor supply, not by my ability to build here. If we want to continue to grow, we have to have a more fleshed out dealer network.”
Since arriving last summer, Garland has visited some three dozen IronHorse dealers. “I let them tell me what we’re doing right and what we’re doing wrong.”

IMPROVING VENDOR SUPPORT
Other than cranking up the retail system, Garland is spending a lot of time with vendors to improve supply capacity. Vendor capacity is a substantial issue for the company, he said.
“We’ve had vendors who are ‘capacity constrained,’” said Garland, “and we’ve had to go out and sign up second and third suppliers, in come cases.”
One serious problem for the company was a shortage of frames. “The frames were choking us, as a company,” he says.
Daytec is the long-time frame supplier for IronHorse and Garland has since added Bourget’s Bike Works. “Roger (Bourget) is making frames and doing a great job,” says Garland. “We’re still taking as many, maybe more, frames from Daytec.” Bourget began shipping frames in late September.
“Some vendors are only Mom and Pop companies and they don’t say they can’t deliver an order because they don’t want to lose the business,” says Garland. But it’s tough, he says, to receive only 50 items when 100 were promised.
Improved sourcing has helped IronHorse pump out more bikes this year than last. Although Garland won’t say publicly what the IronHorse build is, he notes that the first quarter will be a record and YTD sales at the end of June are expected to be up 55% over last year.

AFTERMARKET PARTS
IronHorse manufactures about 300 parts for its bikes, but isn’t in a position yet to make a major push in the accessories business.
The company produces pegs and mirrors and sissy bars to meet the basic needs of its riders. IronHorse hasn’t made a concerted effort recently to market them, but it has modernized its packaging for the three items.
While the company’s Gunslinger accessory line doesn’t have a strong position in the market, that could come later. “We’ll see,” says Garland.
The company could announce organizational changes in the parts operation as soon as the second quarter of this year and there could be some action from the company later this year.

OTHER NEWS
In other IronHorse news, Garland reported:
– The Warranty System was upgraded with extended hours and on-line capability. Warranty needs included being able to diagnose problems and do the paperwork. Dealers now enter data online, providing much better accounting and tracking of problems.
Technical personnel now are available 7 am to 7 pm. “One of the biggest problems,” says Garland, “was that dealers had questions about how to fix the bike. Now, we get back to everyone within two hours.” That’s “much better” than previously, but Garland didn’t want to talk about those so-called horror stories.
– The build for 2004 models ran into the 2005 season because of supply issues, but the company “is working hard” on 2006 and Garland expects to begin producing 2006 models this August. “We’ll have a very short model year in 2005,” he says.The 2005 lineup carries MSRP from $25,900 to $33,500. The Stalker was dropped.