Triumph dealers seeing margins grow in 2014
Triumph North America CEO Greg Heichelbech adds 1 point for dealers
Tyler Florence served up some culinary gems as the celebrity chef during the Triumph North America dealer meeting last month at Barber Motorsports Park in Birmingham, Ala.
But even The Food Network star couldn’t have cooked up the recipe for success that Greg Heichelbech had brewing for 2014. The Triumph North America CEO announced that Triumph has offered dealers another 1 percent increase to their profit margin. That means that Triumph dealers will earn about 23.5 percent margin on sales of new Triumph product next year.
“Our strategic plan for dealers over the last few years has been to increase their profitability, and we’ve done that both in base margin and marketing reinvestment opportunities,” Heichelbech said in a phone interview with Powersports Business. “With the additional 1 percent we’re offering, our margin is now second to Harley-Davidson.”
Heichelbech, who departed Harley-Davidson in 2010 after holding several senior leadership positions to take over Triumph’s North America operations, believes that the time is right for Triumph dealers to take the next step in providing customers with a superior sales experience. The margin increase will help in that area.
“We’re adding the point so that the dealer can be profitable by investing in his staff, systems, inventory and facilities and the ways to handle the consumer, because the consumer is changing in the way he needs to be dealt with,” he said. “We need to be on the forefront of that. Quite honestly, Harley has been a great example of that over the years. Dealers can look at a nice profit and can reinvest it back into the business.
“Right now we want our dealers to focus on Triumph and rehiring sales staff. That’s the biggest weakness right now in our industry, in particular for Triumph. We see consumers that are not being addressed in our stores, and if they are, it’s taking too long for them to be addressed or acknowledged. We have processes that are not as strong as they should be, for various reasons. Some dealers are just too busy and don’t have enough staff and they can’t do the proper follow-up.”
Consultant Sam Dantzler, who moderates four 20 Groups for Triumph dealers, spoke to dealers in Birmingham about properly and profitably adding to their sales staff. With Triumph now having beaten the industry’s sales performance for 27 consecutive months, according to Heichelbech, the table is set for more success in 2014.
“Together with the dealers, we’ve done a good job. We’re not perfect and have plenty of things to work on, but I’m happy with where we’re going,” he said.
Largest turnout ever
Dealers must have known there was going to be good news to share at the dealer meeting. Attendance topped 410, the largest turnout ever for a Triumph North America dealer meeting.
“The big message is that we’re up 60 percent in sales over the last three years, and that’s a result of dealers focusing on the Triumph brand,” Heichelbech said. “We’ve had big increases in market share also. We place our dealers into quartiles, and the top 50 percent are averaging between 7-15 percent market share. That’s a great performance compared to where they were three years ago. A number of dealers have broken through the threshold of selling 100 new units in the year. Some grew 20-30 percent in a tough, wet spring, and that was outstanding for them.”
The Triumph dealer network continues to grow, with the brand adding 50 dealers in 2013. The dealer count sits at 230, with a goal of 300 dealers by the end of 2014, Heichelbech said.
“We want the number one or two dealer operator in the market,” he said. “We’re looking for the individual more than anything else, because the individual in this business, as we all know, can make a tremendous impact.”
Dealers in attendance also welcomed the chance to speak 1-on-1 with Triumph Motorcycles Ltd CEO Nick Bloor. In the second year of the company’s turnaround strategy in North America, the dealer networked helped it to back-to-back 25 percent sales increases, Heichelbech said.
“So they’re a little more profitable, can take a little more time and could show their support by joining us,” Heichelbech said. “The dealer meeting is for business, yes, but also for relationship building and camaraderie and getting back to the roots of motorcycling. That’s why we have it at Barber. We want them to ride and mostly just experience the motorcycles that they love. The dealers are always working and don’t get to ride on the weekends. We spent a lot of time doing that versus grinding out presentations, which is different for them.”