Feb. 8, 2010: Dealer Q&A: Preowned sales figure to be key

Powersports Business: What are you budgeting for in terms of new unit sales for 2010? Do you believe will it increase or decrease vs. 2009?

Jim Booth, owner of Independence Harley-Davidson in College Station, Texas, believes new sales will continue to decrease because of the slow economic recovery and The Motor Company’s lower production plans. Booth does believe used motorcycle sales will increase and be profitable “if your ACV (trade value) is accurate with your market values. I believe that the preowned department is one of our biggest opportunities for success.”

In your opinion, what department in your dealership stands the best chance to make sales gains in 2010 over 2009?

Booth believes the store’s service department sales will continue to grow. “Customers are keeping their bikes and fixing them,”?he said. “We have increased our labor sales by 10.1 percent and P&A sales through this department in 2009 by 11.9 percent.”

As you enter the spring and summer selling season, what is your plan for staffing levels in comparison to last year?

Booth said his staffing level strategy is to go lean as long as possible with the current offseason employee level. “This does not include the motorcycle sales department,”?he said. “We will continue to overstaff this department daily to insure we are taking the sales customer through a proper and courteous sales process. Although we will take advantage of what the economic situation presents to us, we realize that the primary focus is to move the ‘metal.’ Nothing happens until this is consistently done!”

If the economy picks up, what area are you likely to add staff to first?

“When new bike sales fell off in our area, we shrunk the sales showroom down, pushing more units outside to display and moved in its place accessories and MotorClothes,” Booth said. “The sales floor was reduced by one-third so my first priority would be to increase this area along with the appropriate staffing levels. For us, 5-7 good customer ‘greets’ per salesman per day is our barometer. Obviously, measuring door swing is the key to reacting quickly to staffing up, training and success in the sales department.”

If the economy picks up, what would be the first action you would do outside of adjusting your staffing levels?

“When the economy slowed and we made adjustments, we looked at the three areas that could affect expense savings the most. They were:?employee levels, advertising and purchasing. Budgeting these areas was critical and if the economy picks up so will the budget for advertising and purchasing.”


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