Materne: Our problems aren’t that special

By Max Materne

This article originally appeared in the August issue of Powersports Business.

A company outside our industry came to me because of the Turn Around Project.

They’d followed the whole thing on LinkedIn. They wanted the same work in their own shop. The catch: they aren’t a dealership. They’re a company that does concepting, engineering, technical design, fabrication, carpentry, finishing, and trucking. About a hundred people. Bigger and more tangled than any store I’ve run.

I said yes, and not just for the challenge. I said yes because I’ve started to believe our industry has been learning in an echo chamber. Same processes. Same tools. Same twenty group tables. Same speakers, same vendors, same handful of people reselling each other’s ideas back to us. We’ve leaned on the same everything for so long that we’ve stopped hearing anything new.

So let me ask an uncomfortable question. Why are we surprised when an auto group walks in, buys up the mom-and-pop store, and runs it more profitably than it ever ran before?

It isn’t just their cash. It’s their openness to evolution. Their willingness to try something different. Their ability to say, “Maybe the thing I’ve done for decades isn’t going to suddenly start working just because I told my staff one more time.”

None of us will grow in this business by refusing to change what we’re doing. None of us will evolve by staying comfortable… So I stepped out of my comfort zone.

Same study, but different

I took the exact diagnostic I run in dealerships and pointed it at a business that has nothing in common with a dealership on paper. No units. No service drive. No F&I office.

I pulled the historicals first; the way I pull financial, inventory, and sales penetration history before I form a single opinion. From there I built a departmental composite, then a full DELV analysis, studying all of those components and how different areas of the business quietly push and pull on each other. The analysis surprised the owners, exactly the way it surprises most dealers the first time they see a real one. They couldn’t name which department was actually paying the rent.

Then I stopped looking at numbers and started talking to people. One on one, from the C-suite to the shop floor. Same questions for everyone, so I could lay the answers side by side. 

Numbers tell you where. People tell you why. And when I laid the two on top of each other, the picture wasn’t blurry. It was a diagnosis I’d written a hundred times before.

The parallels

Change the nouns and the illness is the same. The quote-to-profit gap. Our writer overpromises to keep the customer smiling, and the shop eats it. Their sales team pushes scope to close, and production overdelivers to make the promise true. Same gap. What the front of the house promises, the back of the house pays for.

Margin dies in the handoffs, not on the individuals. Those handoffs happen between departments and inside them. We lose deals in the seam between sales and F&I, and we lose them again inside service when the writer, the tech, and the parts counter aren’t working off the same page. 

Nobody loses money standing still inside their own lane. We lose it in the space between, where information doesn’t get tracked, doesn’t get shared, and doesn’t reach the next person in time to matter. Not because people won’t talk, but because nobody built the process to move it. The seam isn’t a personality problem. It’s a handoff nobody owns.

Absorption. One department was quietly carrying the whole building, and leadership couldn’t name which one until the math was in front of them. Sound familiar?

The bench. Their best builder got promoted to lead and started to drown. We do the identical thing. We take our best tech, hand him a manager title, and act shocked when the thing that made him great has nothing to do with the job we just gave him.

I could keep going: seasonality, bottlenecks, turnover, comp plans. None of it is purely a powersports problem. It’s an operating problem in a powersports costume.

The floor knew

One more thing, because every dealer should sit with it. I asked everyone my favorite question. A pre-mortem. Imagine it’s 12 months from now and this company went out of business. What caused it? I asked it independently, one person at a time, no comparing notes.

A large majority pointed at the same handful of risks. And the financials had already flagged the top one. The floor already knew. Nobody had ever asked them.

Walk your own service drive tomorrow and ask your worst-treated advisor what’s going to bite you in six months. He’ll tell you. He’s been waiting for someone to ask.

What surprised me

Finding the same problems in another industry was humbling. But it isn’t the interesting part. The interesting part is that they’re willing to solve them differently than we do.

That fabrication world gates scope creep with change orders. It prices hard against a deadline. It runs post-mortems as a matter of habit, not as some consultant’s exercise. Any dealer reading this could use all three of those ideas on Tuesday morning. We’ve been regurgitating the same answers to ourselves for thirty years. Out there, the problems rhymed, but the solutions were brand new to me.

That’s the whole prize. Not new problems. New answers to the old ones.

Why can’t we see it

Here’s the picture I can’t shake. Go back a few hundred years to the royal houses of Europe. The tiny sliver at the top only married inside its own tiny sliver. Same handful of families, generation after generation, guarding the bloodline. And you know how it ended. A gene pool so shallow it bred a weakness they couldn’t breed their way out of.

That’s us. We, as powersports enthusiasts, are a few percent of the population, and the people who run our stores almost all come from inside that same few percent. We learned it from the person before us, who learned it from the person before them. Then we all go stand at the same tables and tell each other the same things.

When every store runs the same playbook, the playbook stops being an edge. It’s the same shallow pool we’ve all been splashing around in. The only way out is deeper water. New blood, new ideas, from somewhere outside the pool.

The challenge

So here it is, operator to operator. Name one operating idea you’ve brought into your store in the last year from outside powersports. Not a DMS feature. Not a vendor pitch. A real idea about how to run a business, learned from someone who has never set foot on a showroom floor.

If you can’t name one, that isn’t a small thing. That’s the whole problem. Our problems aren’t special. That should be the best news you’ve heard all year. Because a problem that isn’t unique is a problem somebody outside our lane has already solved. Go find them.

If you need me, I’ll be taking a breather from this industry as I continue to learn how to fix it.