Despite tough 2011, enthusiasts expected to continue spending
With Labor Day still weeks away, most people aren’t ready to give up their summer, but snowmobile enthusiasts have already begun their countdown to riding season, and dealers are appealing to that excitement by starting to change over their showrooms and promote their snow product.
The rough season experienced last year in terms of sales for most dealerships has had an effect on dealers in terms of leftover inventory and smaller orders this spring, but many are hoping for a better season this coming year and are preparing accordingly.
Despite a lag in sales last year, Allan Byers Equipment Ltd. in Orillia, Ontario, has already begun pushing sleds.
“For the month of July, I just threw it on our website. I threw a banner ad on,” principal Rob Byers said.
The dealership’s first shipment of 2013 sleds was set to arrive in early August, but Byers wanted to get a head start on sales.
“Previously in the past, we get a few people starting to look in August, but I thought if I could just go ahead and get some things sold before everyone else does, that’s good,” Byers added.
Sled sales at Pro Cycle & Snowmobile in Sauk Rapids, Minn., usually start in July or August, but this year, a rush of early-season purchases was not expected.
“It’s going to be October, November, December before things start rolling this year since we had such a bad winter last year,” manager Kevin Gans said.
Others are waiting until later this month or mid-September to begin their push. This season will be different for most dealers than the past few years as many dealerships have found themselves stuck with an overstock of non-current inventory.
Byers has about a dozen non-current units that he plans to move through a fall open house and Internet trading site Kijiji.
“The ones that concern me the most is I’ve got a couple 2010s left over still, and I’ve got a couple 2011s,” he said.
Canyon Motorsports in Gaines, Pa., has only a slight amount of leftover non-currents because the dealership ordered small last year. To prevent paying more interest on flooring, owner John McCarthy said, “[I] pretty much have to discount everything way down, and sometimes we take a loss having to sell it.”
Irv Fosaaen of Waukon Powersports in Waukon, Iowa, said his dealership took a hit on snowmobiles last year, so flooring wouldn’t have to be paid throughout the off-season. Because of that, his dealership is sitting better this year, with only a few non-currents left for a fall sale.
“We took very aggressive action really early when we could see what was happening, and we priced all our vehicles basically with taking every incentive out of them,” he said.
Apparel carryover has also been an issue for some snowmobile dealers. Luckily for Fosaaen, his gear sales fared well early in the year last year.
“We got an early start on that, and we didn’t carry very much over, mainly because when we order our apparel we have a pretty good idea, and we’re pretty aggressive with it,” he said. “We sell a lot in December, and we sell a lot around Christmas, and we consider that after Christmas, we don’t order anything. Our goal is to be in the clearance mode the first week of January.
Gans didn’t have as much success. Snowmobile apparel sales for his dealership were somewhat slow before they basically stopped in mid-December. Despite attempts to get rid of some of the inventory, he will carry some of it over to this year, including about 100 helmets.
“I tried to clear it out, but I’m still sitting with some of it, especially helmets,” Gans said. “I’m sitting heavy with helmets. I don’t think I sold a helmet after Christmas.”
Last year’s rough season has changed how dealers order both apparel and sleds this year.
Gans ordered less clothing this year and no helmets. McCarthy said he’s learned to order less gear in general because of price shoppers.
“People are basically coming in, they’re using their smartphone, they’re trying it on, they’re scanning the codes, and they’re going on the Internet to see wherever they can find it the cheapest,” he said.
As far as machines go, Fosaaen took the manufacturers’ minimum orders this year, so he has enough sleds to represent the OEMs well, while still ensuring that he doesn’t have too much inventory.
“We just feel when you come off a year when there hasn’t been great riding that you’re not going to have the preseason that you did in previous years,” he said.
Byers, however, ordered about 10 more sleds than he was comfortable with.
“Two reasons — one was I needed the flooring for what I had on hand, and I want to get the best products that I could because I wanted to make what I had more attractive and what I have coming in more attractive,” he said.
However, Byers changed what he ordered this year. He plans on catering to enthusiasts who want the biggest and the best. For example, he ordered a line of Pro R Switchbacks instead of the standard Switchback because he knows his customers are willing to spend more for additional options. He also didn’t order family sleds in the hopes of clearing more of his non-current sleds.
“Even though we’re not in a mountain area at all — it doesn’t get any flatter than where we are — we will sell some mountain sleds, and the crossovers will do well,” he added.
Each of these dealers is hoping for snow this year, so they can sell more sleds, apparel, parts and service. McCarthy believes it will take either a few years or one great snow season for the snowmobile segment to recover. Gans, on the other hand, has already had one customer call in looking for a sled, and he believes a little snowfall will go a long way this year.
“I’m hoping we get at least a decent winter,” he said. “It doesn’t have to be a banner winter; it can be a decent winter.”
Fosaaen is hopeful that the excitement of the upcoming season will drive purchases by enthusiasts and a little ground cover will lure in the more casual riders.
“The real enthusiasts, yeah, they’re really excited about it because whether there’s local snow or not, they find snow somewhere,” he said. “I think the average person who buys a mid-size who doesn’t pre-order, who orders a mid-sized Polaris or Ski-Doo, I think there’s a little hesitation right now; he’s going to wait it out.”