Garrett Honda – Covington, La. – Jan. 17, 2011

PowersportsBusinessJanuary 17, 2011

BUSINESS PROFILE: GARRETT HONDA

This southeast Louisiana dealership has a deep history, dating back to 1946. By the early 1950s, the first generation to own the Garrett family dealership had obtained its Honda franchise. “Because others were saying no, all he had to do is say yes and buy a crate (of vehicles),” Manager Ray Salvaggio said. Now, more than 60 years later, the third generation of Garretts is leading the dealership, with owner Robert Garrett, and the fourth is working its way up the ranks. The dealership exclusively sells Hondas. “At one time, we had four stores. We’re back down to one,” Salvaggio reported. Within the past year, the last of the additional stores was closed because of sluggish sales, but the original is surviving. Its success, Salvaggio said, has a lot to do with its history as a family run and trustworthy business.

GREATEST CONCERN

As a manager, Salvaggio worries most if the dealership will be able to survive with slow sales numbers, especially if they continue. “We’ve been in (the business) long enough. We’ve gone feast to famine a number of times. It always seems to come back, but this is the worst we’ve ever seen it,” he explained. His hope is if the economy and employment bounce back, sales will return. “It’s obvious it’s all based on the economy,” Salvaggio said. “If the economy improves, I’m sure (the business) will do better.”

WHAT’S HOT

“In this location, the bread and butter is the ATVs,” Salvaggio said. The four-wheelers are by far Garrett Honda’s biggest seller. “We do very little with scooters and street bikes,” he said. The reason behind the higher ATV sales numbers has largely to do with the jobs and hobbies of the local people. “This location we’re in now, it’s suburban, agriculture, hunting, fishing. It’s a good area for ATVs,” Salvaggio explained. “More in the South a lot of people have acreage and small farms, so they’re useful.”

CUSTOMER BUYING TRENDS

Unfortunately, the biggest change Salvaggio has seen in customers is they’re unwilling to buy. “They’re not spending. They’re not coming though the door,” he said. Despite a push to advertise on the dealership’s website and in other areas, traffic is still down. “This is a toy industry. People don’t need us,” he said. Luckily the dealership sells items that have practical daily use as well as for sport. “I thank God ATVs are useful, and we have a pretty good generator business,” Salvaggio said, “but everything else is just toys, and they’re not buying.”

PARTS AND SERVICE

To improve sales in parts and service as well as in the sales department, the dealership is now open six days a week as opposed to five. “We did start opening on Mondays after being closed for probably 20 years on Mondays,” Salvaggio said. The change began in April 2009. The store is now open 9 a.m-5:30 p.m. each Monday, as it is the following weekdays. “I think it’s helped,” Salvaggio reported. Despite opening one more day per week, the staffing remained unchanged. “Because the business is off, we can get by with less personnel a couple days a week,” he said. For example, on Mondays, the parts department usually only has one employee on duty. Other days of the week there may be one or two people on staff. “We can spread it around and accommodate the customer better by being here six days a week,” Salvaggio explained. The parts department and service department are doing well despite the economy. “I think actually a lot of people, instead of buying new, have stepped up their maintenance and rebuilding instead of new purchases,” Salvaggio said.

PROMOTIONAL HOME RUNS

Promotional events at Garrett Honda revolve around seasonal activities, especially those that directly involve their products. One of the biggest events the dealership participates in is an annual gathering for hunters held on a Saturday in September. “We have a pre-hunting season event, and it’s combined with a number of businesses that cater to the deer hunters and the farmers,” Salvaggio explained. The area feed store hosts the festival-like event and invites other hunting-related retailers to participate. “It seems to work for the customers that are attracted to the ATVs,” Salvaggio said. Another event is a yearly sale hosted at the dealership itself. “We have a generator blowout … because we’re very concerned with hurricane season here. That usually coincides with hurricane season around here, around June 1,” he said. The dealership is also seen around the area, marketing to all ages at neighborhood events. “We get involved in a number of parades. People in New Orleans love parades,” Salvaggio said. The events are geared at getting people in the store and hopefully buying.

WORDS OF ADVICE

Salvaggio says if other dealerships want to stay in business for as many decades as Garrett Honda has been around, the staff has to be devoted to helping the store thrive. “When you’re in this particular business, unlike a corporation looking to make a profit, we got into it as a family and have dedication to it,” he said. “Where a lot of corporations and investors jumped into dealerships to make a buck, this is our life.” PSB