Dec. 24, 2007 – 5 bold ideas

The difference between succeeding and failing in a challenging economy can be as simple as having the initiative to take an idea and transform it into something special. This year, Powersports Business chose five unique dealer initiatives that take center stage when it comes to ingenuity and profit potential.
Driving store traffic
Las Vegas Harley-Davidson

The goal: The dealership has worked with a transportation company to provide a bus shuttle system to its Las Vegas dealership. The aim of the program is not only to increase floor traffic but also to make customer transportation that much easier in a city where consumers often have to rely on costly cab rides.

About the initiative: Part owner Tim Cashman said the program was started out of a desire to have consumers spend their money in the store rather than on cab fare. Consumers often spent $20-25 each way to get to the Las Vegas dealership. Now, the store provides free bus rides to the dealership. The bus system, which runs daily from 9 a.m.-6 p.m., also drops consumers off at select hotel-casinos along the Vegas strip. A Las Vegas transportation company provides both the bus and the driver. The shuttle also acts as a moving billboard for the dealership, which places signage on the bus. The dealership advertises the shuttle system both on its Web site and at the airport. “It does work,” Cashman said of the shuttle system. “I would stress it wouldn’t work only in Las Vegas. It’s not for everyone, but there are other places where you have large concentrations of people where you pick up and haul from,” he said, noting those places could include “the major convention towns in our country or any place with a large tourist or hotel concentration.”

The result: The dealership has run the shuttle system for several years, so it makes financial sense to continue it, despite the fact that its expensive. Cashman jokingly says that not many dealers would consider it if they knew how much it cost. However, the store tracks both the floor traffic it generates plus the amount of money bus consumers spend to ensure the shuttle system is worth the large expense.

What have been the difficulties?
Cashman notes mainly the expenses, including the rising cost of diesel fuel. The only other difficulty was the initial communication of reaching enough consumers with the advertising of when the shuttle would be available and where. Otherwise, he said, “it’s really very effortless.”

If you were to start this project today, is there anything you would change?
Cashman could not think of anything he would change. However he notes the program would probably only work for dealerships that sell a “lifestyle” brand, like Harley-Davidson. Cashman noted consumers who ride the shuttle system often buy collectibles, apparel or other tourist items and are not really shopping for new bikes.
-Neil Pascale

Focusing on female riders

Powersports East, Bear, Del.

The goal: Make a concerted effort to place more focus from the sales staff on female customers.

About the initiative: Lynn Nathan and Joel Samick know female ridership has been increasing in recent years, and felt their dealership wasn’t capitalizing on the potential revenue boost female customers could provide. They understood, however, that attracting female customers and making them feel comfortable in their dealership meant more than placing a few racks of female-designed apparel on the showroom. “We knew we had to change the mindset of our entire staff, from sales to service,” Nathan said. Powersports East began by creating a “She Rides” section, where all female apparel and other riding gear are showcased. They also created several additional dressing rooms for increased privacy and comfort. Most important, however, the dealership conducted a training course for its employees on how to cater to female customers, especially those who come in with a husband or boyfriend. “Often what you see in that situation is a salesperson completely ignoring the woman while they discuss a bike or accessories with the husband,” Nathan said. “We’ve trained our staff to approach a woman first, which we’ve found immediately makes them more comfortable and willing to participate in the sales process.”

The result: Since starting its female friendly dealer services, Powersports East has seen increased customer traffic, not only from couples, but from many first-time female customers, as well. “It’s exciting to see them first walk through the doors, and to know part of the reason they’re at our dealership is the fact that we’ll make sure they’re comfortable throughout the entire sales process; regardless of whether it’s their first bike, finding an accessory or apparel item or getting their vehicle serviced.” Nathan can’t put an exact number on how much new business their service has garnered, but guesses it has increased it by 5-7 percent. That might seem like a small number, but Nathan says the program will only continue to grow. “This is certainly new to us, and there’s no question it will take time to grow,” she said. “And even if that number doesn’t go up in the future, we’re providing a service that very few dealerships across the country offer. That in itself makes this a successful venture.”

What have been the difficulties?
Although Powersports East has had positive responses from its female customers, Nathan says the biggest issue is to get female riders in the dealership’s doors. “We do our best to advertise our female-oriented services, but we know there are many women out there who are still too intimidated to walk into a dealership on their own, or don’t feel they know enough about bikes, so they think we’re out there to take advantage of them.” To help ease potential customers’ worries, Powersports East holds open houses four times a year, and also a casino night where the money raised benefits the Pediatric Brain Tumor Foundation. The dealership also is considering holding women-only workshops and bike nights to help promote its female-friendly environment.

If you were to start this project today, is there anything you would change?
“I think this has been a very successful venture for us,” Nathan said, “but in hindsight we could have done a better job of promoting our services externally.” Nathan notes, however, that in their case, word of mouth has been almost as effective. “Once you can get the initial ball rolling via positive feedback from one customer to another, that can be the best advertising tool,” she said.
— Steve Bauer

Secret shoppers

Rexburg Motorsports, Rexburg, Idaho

The goal: Rexburg Motorsports co-owner Jared Burt wanted to do a better job with the dealership’s floor traffic, ensuring as many customers as possible were engaged in the dealership’s sales process. To do this, his store developed its own secret shopper program.

About the initiative: The dealership contacts past customers and shoppers who they have received contact information from. Either a dealer principal or accounting staff member calls these consumers, explains the secret shopper program and asks if they’d be interested in being an one-time shopper. As an incentive, the dealership gives a gift certificate of $25, $50 or even $75 depending on the difficulty of getting secret shoppers at the time. The dealership then will mail or personally drop off a form with a pre-addressed, stamped envelope. After the shopper visits the store again, he or she can fill out and mail the form in at his or her convenience. The survey asks the day and time the secret shopper visited, areas shopped, items sought, along with an area to describe their overall shopping experience and suggestions, which is where Burt says they tend to find the most helpful information. He adds they purposely leave the questions open ended to obtain more information. Based on the shoppers’ feedback, the dealership will adjust its sales techniques, if necessary, by coaching staff on what went well and what could be improved. Part of the reason behind this new program was the realization that a number of customers were not purchasing at Rexburg but deciding to do so elsewhere. “We wanted to figure out why and get control of our customer floor traffic,” Burt said. “It’s a whole new system for selling. It’s everything that drives customer service.”

The result: After having a few secret shoppers, the dealership was able to see where its salesmen were lacking and where they were doing well. The results allow Rexburg Motorsports to adjust its sales system to improve it. Overall, Burt says the system has had a positive outcome since both the dealership’s margins and morale have increased.

What have been the difficulties?
Burt says it can be time-consuming contacting consumers and explaining the program since about only one in three people will go through with the process. Rexburg Motorsports’ goal is to get six people per month, although he notes that goal hasn’t always been attained.

If you were to start this project today, is there anything you would change?
Burt says the dealership might start doing exit interviews. He adds exit interviews could be conducted more frequently than the secret shoppers, and the dealership would have more immediate results.
— Karin Gelschus

Abandoned coal to riding gold
Rock Run Inc., Patton, Pa.

The goal: Purchase an abandoned coal mine on 6,000 acres of land and turn it into an environmentally sustainable off-road recreational park and a source of revenue for local businesses in the area. It’s an ambitious goal, but one that’s become a reality thanks to the leadership and teamwork of powersports dealers, industry members and government officials.

About the initiative: Pennsylvania state representative and avid ATV rider Gary Haluska used state funds to purchase land formerly owned by K & J Coal Co., which was then transferred to the Cambria County Conservation and Recreation Authority (CCRA). The funds came from the state’s Project Rider program, which aims to convert former surface mine sites into riding areas. “It’s a fantastic program, and one that more states are considering adopting, including Ohio, Virginia and New York, among others,” Haluska said.
After purchasing the land, Haluska formed a nonprofit advisory committee, Red Rock Inc., consisting of riders, local powersports dealers and other industry members to develop and manage the facility. “Not only were the members of the committee instrumental in helping mold the foundation of the riding area, they also suggested putting aside land for commercial development, all of which will cater to powersports enthusiasts,” Haluska said. Among those who quickly took advantage of the commercial site was Jeff Cernic, owner of Cernic’s Powersports, which is located on one end of the riding area. “We knew this would be a perfect location for a dealership, but so far it has exceeded our expectations,” Cernic said. Cernic says rental sales account for nearly one-quarter of the dealership’s business, and he’s optimistic about solid winter sales. “We already have snow on the ground here, and we’re renting out between 5-15 vehicles a day,” he said. “I know there are other dealerships that are coming in on other sides of the riding area, along with a hotel, restaurant and other businesses. This project has been great for both riders and retailers.”

The result: Haluska says ridership at Rock Run Recreation Area has been on a steady rise since it opened in May. “Our rider numbers have increased 100-fold over what they were in spring, and we’re just starting to see snowmobilers now,” he said. On a typical day, Haluska says the riding area has 50-100 ATVs and other OHVs on it. “Our trail system is still in its beginning stages, and once it’s finished we hope to have somewhere in the neighborhood of 180 miles of trails here, not to mention four practice tracks, a hill climb area, mud bogs and 250 campsites,” he said. “I’ve said this before, but I truly believe that Rock Run is going to become a national riding destination in the next two-three years.”

What have been the difficulties? Haluska says the biggest obstacles for the riding area has been getting the funding to help build and maintain the area and its trails. “We work completely off grants, so it’s a slow process because we only can do a little bit at a time,” he said. “Our original design was estimated to cost $21 million, so it’s been a slow process, and we’ve broken down the building of our visitor’s center, trails, etc., into stages.”

If you were to start this project today, is there anything you would change?
Without question, Haluska says he would have built his coalition of powersports dealers and industry members before purchasing the land, allowing more time for planning and development, not to mention fundraising. “For those who wish to attempt this in their own state, you’ll be able to act quicker and be more efficient if you create some sort of association or coalition before jumping in to buy the land,” he said. “Although Pennsylvania certainly supports what we’re doing, they didn’t want ownership of the site, and therefore it wasn’t their responsibility to build and maintain it.” With that being said, however, Haluska says Rock Run Inc. is currently looking into other possible locations in the state to create more riding areas.
— Steve Bauer

Opening an online parts store

Colorado Springs Harley-Davidson, Colorado Springs, Colo.

The goal: Provide an outlet for slow-moving inventory plus boost e-commerce sales by “opening” an eBay parts store.

About the initiative: Colorado Springs Harley-Davidson has a couple of different e-commerce options, with the eBay site selling not only aged inventory, but take-off items, stock parts and accessories that are replaced by aftermarket items at the time of a new bike sale. Plus, the dealership also sells new items that are exclusive to its store. “We try not to sell what everybody else sells, so the focus is items unique to the store,” said co-owner Rob Brooks. That could include T-shirts, coffee mugs or shot glasses with Colorado Springs Harley-Davidson’s name on it. Brooks has one full-time e-commerce administrator run the entire eBay operation, from taking photos of the product, getting the product information online to answering any questions at the time of sale to eventually shipping the product.

The result: Brooks says the eBay parts store has helped the dealership improve its e-commerce sales by 20 percent each year. “I pay my e-commerce guy pretty generously because the return has been pretty good,” he said

What have been the difficulties? “The one key area in eBay that you always have to watch and be concerned about is feedback,” Brooks said. “And we didn’t quite understand how feedback worked when we got started right away with eBay, and you just have to be very careful. If you get one negative feedback early on, people look at that stuff, and they get a little leery.
“The feedback rating is very important. But the planning of it was very simple. It’s very easy to do. “

If you were to start this project today, is there anything you would change?
Brooks would have started selling take-off stock parts and accessories from day one, something the dealership did not initially do. “That’s our meat and potatoes,” he said of the store’s eBay sales. “All of that stuff just sat on the service shelves because we previously didn’t know what to do with it. We’ve cleared all of our take-off stock parts inventory and made a lot of room for the service department to be able to use that for other things.”
— Neil Pascale