INDIANAPOLIS — The surge in scooter popularity in the United States isn’t restricted to the new unit market.
It also extends to the rental market, says Bert Alanko, owner of MBA Insurance. The Scottsdale, Ariz.-based company helps powersports dealerships establish a rental program, a potential profit center addition to their business
“We got into this powersports side because we thought we were going to be big in the motorcycle rental business,” Alanko said. “Right from the get-go, scooters were the biggest part and ATVs were second and motorcycles third.”
MBA Insurance started in the powersports industry seven years ago, not only setting up insurance for dealers but also supplying various forms to ease the dealer’s transition into the rental market. That can include state-specific rental contracts that follow a state’s legal requirements as well as check-in and check-out forms for dealer staff to sign before and after renting the vehicles.
“All of those types of things to get the business going so they don’t have to reinvent the wheel,” Alanko said.
MBA Insurance sees two types of dealerships getting involved in the rental business: Those who reside in destination places that cater to tourists and those who use it as a demo-type program to encourage new unit sales. The vast majority of dealers represent the former, many of which partner with area hotels to drive business.
However, recent consumer data shows the dramatic impact that demo rides can have in selling new units. More than 62 percent of new bike buyers who took a demo said the ride had a “strong influence” on the model they ultimately purchased, according to the J.D. Power and Associates’ 2008 Motorcycle Competitive Information Study. Less than 10 percent of those riders said it had “no influence” on their purchase.
MBA Insurance has set up a “try before you buy” program with Hyosung so its dealers can easily set up such a program.
Either through a demo-type program or one that caters to tourists, scooters are likely to be a big draw. Alanko said of the
50-60 dealerships that expressed interest in their program at Dealer Expo, probably two-thirds of those were interested in the scooter side of it.
“The scooter rental market is just getting to be huge,” he said.
For dealers interested in starting a program, MBA Insurance advises starting with 6-10 vehicles for an initial rental fleet.
“It will come fast,” Alanko said of the rental business. “If you’re in the right area, the demand will push you up very quickly.”
— Neil Pascale
Copyright 2009 Powersports Business