Posts Tagged ‘aftermarket’

Feeding the buzz

October 27, 2011

It’s been a day since it was announced that Steve Jobs died and it’s hard to ignore the avalanche of accolades and odes to the Apple man appearing across the interwebs.

As was referenced in this space back in the June 2011 issue of Dealernews, I’m a diehard Apple acolyte, and I happen to agree with nearly everything that’s been written about Jobs and his impact on Life as We Know It. If you boiled down the many and various ways our lives intricately intertwine with technology, you’d end up with Jobs and his vision of what could be — which more than anything were dreams writ large by a man of unmatched vision.

Here was a guy with a drive to create products that excite people and worm their way into the everyday existence of their users. He took a once-floundering company and turned it into a cultural flashpoint.

So here we are, forever swirling around the bowl of the powersports market’s endless flushing. All this twirling around can leave a person dizzy and discombobulated: Dare we keep our eyes raised high to the light or cast down into the abyss? I choose to keep my sights set upward and onward. Never mind the glass half full, I’m looking at the toilet half flushed. We’re not down yet.

And we won’t be down. Motorcycles are way too fun to go away. Yes, it would be great for a moto-Jobs to come along and raise the entire industry out of the stink, but that’s not likely. And maybe not necessary.

Look around, there are two-wheel visionaries hard at work among us. Dreams are being wrought into reality everyday.

Take Roland Sands. For my money, he’s one of the most forward-looking and creative individuals working in the aftermarket. His eponymous company continues to devise, design and build products that quite simply are like nothing else out there — from their custom bikes to the new

Clarity Line of hard parts (see-through timing cover, anyone?) to its just-released lineup of high-end and stylish apparel. RSD seems to exist on a different plane.

And then there’s Tom Seymour and his team at Saddlemen, where nobody ever seems to sleep.

How else to explain the company’s release of 100 new seats for Harley-Davidson and metric applications? There’s also an expansive amount of new luggage and luggage accessories aimed at the popular touring market. A new overseas factory owned and managed directly by Saddlemen. Nobody at Saddlemen is hunkering down waiting for blue skies.

How about Brian Klock and his team at Klock Werks? Not only is the crew from South Dakota breaking records at Bonneville, it continues to design and develop new products and come up with killer retail solutions to help dealers sell said product. I had a good conversation with Klock at the recent Drag Specialties Rocky Mountain Run about his windshields, parts and dealer programs such as the “Try It Before You Buy It” demo ride offering. Seriously, contact these guys. Not only will Klock knock you down with his enthusiasm and good grace, you might even get a personal visit from one of the Klock Werks’ crew members.

Chris Carter and Motion Pro continually produce new gadgets, tools and equipment to help ease motorcycle operation and maintenance. Cobra Engineering. Icon. Spidi. Drayko. GoPro. Klim.

All have something to keep we riders enthusiastic about being enthusiasts.

And check out Victory Motorcycles, Ducati and Triumph. These OEMs, and a couple others, continue to build some of the best bikes in the history of motorcycling — that is until the next round of new models comes around.

It would be impossible to discuss forward-thinkers without mentioning Erik Buell. H-D? Who needs ‘em. Buell is well into the next chapter in his life and it involves a motorcycle that is as impressive looking in person as it is on paper. Saw and touched the 1190RS up close, and it was one of those moments where I thought, “Should I be getting this excited about a motorcycle?”

So while the industry has yet to find its singular Jobs, it has dozens — if not more — of inspiring innovators who keep us buzzing along on the strength of their creativity. Much like with Apple and its striving for something ever more cool, the world of motorcycling’s never ending search for better continues to astound. Onward and upward.

Dennis Johnson
Editor in Chief
dennis.johnson@dealernews.com

Fred Fox: Aftermarket Upturn Has Started

August 22, 2010

MADISON, Wis — The U.S. powersports aftermarket is past the bottom of the current recession, but it’s likely that there could be continued consolidation and contraction of dealers and aftermarket suppliers, says Fred Fox, chairman of LeMans Corp. The company owns Parts Unlimited and Drag Specialties, two of the country’s leading powersports distributors, and services more than 9,000 North American dealers. It also operates a European distribution operation based in Trier, Germany.

Fred Fox

Fox made his comments here Saturday, at the company’s annual National Vendor Presentation (NVP). More than 150 suppliers and an estimated 400 dealers are expected to participate in the five-day event, up from last year.

Fox touched on a number of topics in his state-of-the-industry address and in private comments with me during the show, including:

  • LOW POINT ECONOMICALLY. “I think we’re past the low part of the (recession) curve, as far as the aftermarket is concerned. Most of our sales reps are reporting positive attitudes and encouraging comments in their dealer stores,” he said. When people don’t buy new, they tend to fix up the old, he added.
  • SALES ACTIVITY. Fox said that sales at LeMans were “good” in July and sales “look good” for August, too. He didn’t provide numbers, however, and declined to provide sales figures for the year, which ends in September. He told the audience that dealers in the Sturgis, SD, area and vendors that displayed at the recent rally reported strong attendance and excellent sales.
  • EUROPEAN BUSINESS. The company distributes about 100 brands in Europe and expects to increase this to about 150 brands by next spring. Parts opened its $38 million warehouse in Trier last August. The four-tier facility  covers 177,600 square feet and has inventory worth about $10 million.
  • SUPPLIER CONSOLIDATIONS. A number of suppliers are re-evaluating their future now that the important summer season is winding down and they are facing the slow fall season. Weak cash flow and tightened bank credit are causing some problems, he said. “A few are going to be quitting,” Fox told an audience of suppliers and media representatives.  But he told the audience that he is prepared to assist selected companies when possible. For more than 40 years, Fox has developed a history of fostering mergers among suppliers and of providing individual companies with flexible purchasing programs during slow periods. “If anybody here says,  “The bank is about to call my note one of these days,’ and you need help with that, don’t be afraid to call,” he told the vendor audience.
  • DISTRIBUTORS. Fox said that some competing distributors are using price-cutting business models aimed at cash-strapped dealers. “The thing that scares us,” he said, “is that these distributors, who are selling only on price, aren’t helping the dealers and they aren’t helping you,” he told the suppliers. “More pins in the map doesn’t mean more sales for your product,” he told them, suggesting that loyalty and quality service is more important than adding additional outlets.
  • DISTRIBUTOR CONSIGNMENT PROGRAMS. Fox vehemently denied rumors that Parts/Drag is testing consignment programs in selected dealerships.  “No, absolutely not,” he said, regarding consignment programs at LeMans. “It’s not in our playbook. Consignment is for product that is selling poorly or for stuff you can’t sell. It’s a mistake. We don’t have one nickel’s worth (of product) out there (on consignment). It will not happen in this company.“ Fox said there’s a simple reason for the no-consignment policy at LeMans: “We want the guy to have first class product and have an investment in his business. If you offer consignment, you’re betting on defeat. If a guy has one helmet over here that he’s paid for, and one over there that’s on consignment, guess which one he wants to sell.”  Also, he said, the tactic tends to prop up weak dealers and keeps them going against the good dealers in the area. “If you fill up your store with obsolete product that doesn’t move and then give it back and get some more obsolete stuff that doesn’t move, that’s a bad idea.”

The show ends today. “Attendance has been up from last year,” said Fox, “and the mood among dealers and suppliers I’ve talked with has been excellent.”  JD

Contact me with story ideas and news tips at
jdelmont@dealernews.com or 952/893-6876.

Checking in with Tucker Rocky’s Steve Johnson

August 15, 2010

I didn’t have a chance to participate in Tucker Rocky’s national sales meeting in Texas last month, so I tracked down TR”s chief Steve Johnson to get his reaction to the five-day event and to see what he had going at the big Fort Worth-based national distributor.

Steve Johnson

The show was different this year, by design. More aimed at training and business improvement than entertainment and relationship-building. “This show was a lot more about product and selling product,” said Johnson. “It was less about fun and more about dealer training and how to run a good dealership.”

In Johnson’s view, the participating vendors and dealers “were more than positive, they were engaged” in what was going on. “A lot of people are still excited to be in this industry. But there’s a realization that there’s a new norm; it may come back a bit, but it’s going to be at a slower pace. You can’t expect 10%-15% compound growth. You have to hunker down and run your business as best you can. People were fully engaged; more so than ever before.”

Dennis Johnson, editor-in-chief of Dealernews magazine visited the show and did a nice job of reporting on the event in the August issue of the magazine. I’m not going to duplicate his efforts here, but Steve covered some interesting points in our conversation, many focusing on dealer training and customer service.

Big Push On Customer Service

As we chatted, Steve told me a story about customer service that came from his previous experience in the foodservice business. To paraphrase his story: There once was a large bakery that produced custom products for a high-end local grocery store. The big thing was fresh birthday cakes, made the same day and featuring custom greetings. It was an important item for the retailer and produced nice margins for both the bakery and the retailer. The cakes were always delivered on time, the names were spelled correctly, and everyone was happy. But one day, there was a mistake; a cake didn’t get produced for a birthday party that day. The customer went crazy, of course; what was she going to do for the party that afternoon?

(more…)

Funding Crisis Follows Cerberus

January 2, 2009

Chrysler LLC received its $4 billion low-interest federal government loan Friday to help the auto company continue funding its operations and pay its suppliers for parts.

Those in the powersports industry will recall Chrysler’s owner, Cerberus Capital Management LP, went through a similar problem – paying off suppliers for parts – when it owned Global Motorsports Group, Inc., the parent company of PG&A distributors Motorcycle Stuff and Custom Chrome.

Global Motorsports Group, Inc. was acquired by Cerberus Capital Management in 2005.

Following the takeover, Cerberus executives placed tight controls on Global’s operations, putting decision-making authority into the hands of its on-site representatives. According to some observers, those non-powersports managers subsequently made some mistakes in dealing with vendors and dealers because they didn’t understand the industry.

Three years later, on Jan. 31, 2008, Global filed a Chapter 11 bankruptcy petition for reorganization just a few days after the company was sold to Dae-Li USA Inc. for $16 million plus assumption of a long list of liabilities to more than 350 unsecured suppliers.

Cerberus’ website states, “We succeed when our companies succeed, to the benefit of our portfolio companies’ employees, customers, suppliers and the communities in which they operate.

“Cerberus believes that strong corporate governance is the cornerstone of our business.”

Motorcycle Stuff closed its doors in 2008, after 37 of business. How long, do you think, Chrysler will survive?

Aftermarket Industry — Strength in Numbers

December 31, 2008

Other than my pure, ridiculous love for most two-wheeled vehicles, the thing that gets me most about the motorcycle (powersports) industry is the insanely high level of ingenuity and creativity. While there is no shortage of somewhat useless gadgetry (you know it when you see) making it to market, the vast majority of products out there are nothing short of genius.

dealer08585

Just take a look at the stuff that’ll be on display at Dealer Expo (also, here and here) and at the V-Twin Expo in February. The parts and bikes built by Steve Storz? Roland Sands and his dad, Perry? Bert Baker? Look at what small companies like Nash Motorcycle Co. and Biltwell Inc. are doing. How about FMF‘s long storied history? Phil Davy has turned ICON into, well, an icon. The stuff coming out of Robert Fisher’s and Nick Anglada’s garages? Crazy. Honestly, the list is mind-blowing crosses across all market niches and extends as far back as does motorcycling. My own personal favorite is Chopper Dave. His work kills me.

So considering all these aftermarket players, what happens when the economy takes a dump? Well, it looks like a bunch of them are looking to band together under the auspices of automotive industry heavyweight SEMA to protect their interests. Bikernet.com‘s Keith Ball is calling together the troops for a meeting at the V-Twin Show in Cincy. His goal is to give the aftermarket — and the attendant bodies such as vendors, dealers, clubs, etc. — a strong, unified voice in these shaky times. By banding together under SEMA, the motorcycle aftermarket industry would be able to access the advocacy group’s massive list of services. These run the gamut from business resources to market research to OEM relation services to SEMA’s massive trade show.

If you’re at all interested, the Cincy meeting happens Sunday, Feb. 8 2009 at 9 a.m. For more info contact Ball at 310-830-0630 or bandit@bikernet.com. You can also contact Ken Conte at Rise Above Consulting at  970-227-3588 or ken@riseaboveconsulting.com