Are Yamaha Dealers Struggling?

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IWreckALot

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2/12/2015 2:13 PM

Just curious. There used to be 2 Yamaha shops within 10 minutes of Fort Worth. Both have closed their doors in the past couple of years. The closest dealer is now about 30-45 minutes away which is odd considering I'm in a major metropolitan area. Is it just this area that they're closing up shop or is it more of a nation wide thing? And are other brands struggling? I'm not just speaking about MX only but the motorcycle/UTV/ATV sales as a whole. I get that there isn't much of a margin in MX sales.

lostboy819

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2/12/2015 2:18 PM

Unless you are a Harley dealer its better to carry several brands and be a multi-line dealer or times can get tough. Yamaha has a strong lineup with all the markets like sport bike, atv, boat , snowmobile etc etc so I don't think the problem was the brand.

Ed Johnson

jeffro503

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2/12/2015 2:24 PM

I dunno......but I sure seem to see quite a few Yamaha's around the tracks as of the last year or two. I think a lot of the bad rap was unjustified to be honest. There are plenty of guys out there that love their Yami's !

And there goes Jeffro. One of God's own prototypes. A super high-powered mutant of some kind never even considered for mass production. Too weird to live, and too rare to die.

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Sir Roostsalot

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2/12/2015 2:28 PM
Edited Date/Time: 2/12/2015 2:30 PM

A lot of dealer owners have just decided to get out of the business. Just too much frustration to deal with down economy, too much competition from internet, manufacturers stuffing product down their necks, etc. Since the economic downturn in 2008, about half of the dealers in my state (Connecticut) have closed. Seriously, from well over 20 to about 12. This includes all brands, not just Yamaha. Kawasaki has definitely had the most dealers close with over 150 nationwide in the last few years.

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KTMShane699

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2/12/2015 2:40 PM

Times are tough and dealers have a hard time "weathering the storm." Powersports customers are unique people. Most people have no idea about the true cost of parts. Everyone assumes that the dealers are marking up parts and making a killing. The truth is that if a shop can make a 30-35% gross profit margin they are doing well. Out of the profit, they have to pay their employees, keep stock in the shop, pay the employees, etc. All told, the dealership isn't making much profit.

Now if you couple that with who the comsumer is. Most riders feel entitled to the "I ride a motorcycle" discount, and then they do the "I can buy it at acmebikeparts.com for $XX.XX. You need to beat that or I'm out of here." Powersports customers are rarely loyal to their shop. It's unfortunate. It all ties back to why shops don't "sponsor" riders with bikes and parts deals any more. There's no return. You used to see fast guys and want to at least check out a shop assuming they had it together. Not these days, a few clicks and its delivered in a few days at a price a local shop can't touch.

And let's toss the economy in. Yes, it's coming back. But it tanked. And it scared a lot of people with discretionary income (motorcycles aren't vital to everyone). People who used to buy two bikes a year to race on are now on one bike for two or three years.

The loss of local shops can be blamed on ourselves. Our quest to put price over service. Our lack of loyalty. And our lack of understanding how a business really works.

It's a sad cycle. Hopefully it comes back.

Shane

hvaughn88

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2/12/2015 2:46 PM

I haven't seen a Yamaha motocross bike on a showroom around here in years. Kawi, KTM and Honda seem to be around (although not at the rate they once were). The Suzuki dealer in the town I live in went out of business. The Yamaha dealer in the town close to here was bought out by the Polaris/Suzuki dealer. Around here, the UTV and utility quad market seems be growing strong, which I assume is the result of the hunting prominence but I don't know that for sure.



jasonv43

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2/12/2015 2:48 PM

An extremely slow start to this year is not helping either.

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lostboy819

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2/12/2015 2:58 PM

Motocross bike sales are such a small part of overall sales that it does not make much difference if they sell them or not, of course if you don't stock them you cant sell them but I have never seen a dealer who's main focus was MX bikes. Honda and Yamaha do very well because of all the different lines they offer and even Kawasaki has some strong sport bike sales. I have not seen a stand alone Suzuki dealer in years

Ed Johnson

lostboy819

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2/12/2015 3:00 PM

jasonv43 wrote:

An extremely slow start to this year is not helping either.

Colorado economy is booming right now, not sure if its the dope sales or the fracking but everyone is hiring in Colorado and hard to find people to hire.

Ed Johnson

dehner47

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2/12/2015 3:00 PM

DHY (Deptford Honda Yamaha) is our local powersports powerhouse around here. Seems like business is doing pretty well over there. Did a MASSIVE rebuild few years ago, carry a bunch of different off road toys, snow blowers, jet skis ect. Nice selection of Fox n Shift too. They recently picked up a KTM dealership so sure that will kick things up a notch even more.

Even though, I prefer going to the lil shop up the street in my town. Eric and his wife are good people and I prefer to support the lil shop over the cash cow that is a powersports powerhouse.

Tpog496

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2/12/2015 3:04 PM
Edited Date/Time: 2/12/2015 3:07 PM

KTMShane699 wrote:

Times are tough and dealers have a hard time "weathering the storm." Powersports customers are unique people. Most people have no idea about the true cost of parts. Everyone assumes that the dealers are marking up parts and making a killing. The truth is that if a shop can make a 30-35% gross profit margin they are doing well. Out of the profit, they have to pay their employees, keep stock in the shop, pay the employees, etc. All told, the dealership isn't making much profit.

Now if you couple that with who the comsumer is. Most riders feel entitled to the "I ride a motorcycle" discount, and then they do the "I can buy it at acmebikeparts.com for $XX.XX. You need to beat that or I'm out of here." Powersports customers are rarely loyal to their shop. It's unfortunate. It all ties back to why shops don't "sponsor" riders with bikes and parts deals any more. There's no return. You used to see fast guys and want to at least check out a shop assuming they had it together. Not these days, a few clicks and its delivered in a few days at a price a local shop can't touch.

And let's toss the economy in. Yes, it's coming back. But it tanked. And it scared a lot of people with discretionary income (motorcycles aren't vital to everyone). People who used to buy two bikes a year to race on are now on one bike for two or three years.

The loss of local shops can be blamed on ourselves. Our quest to put price over service. Our lack of loyalty. And our lack of understanding how a business really works.

It's a sad cycle. Hopefully it comes back.

Shane

Can't really blame people for buying stuff online though either. Why would I buy SG12's at retail when they are online for 200$ off? I want to support the local shop but It's not my fault that they can't compete with that price and the selection is dog shit. I will add though I do check with both places and prefer to get things through them.

newmann

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2/12/2015 3:14 PM

I will gladly pay a little more to shop locally as long as I get good service. But good service is getting increasingly more difficult to find.

Deal Brothers Trailers

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2/12/2015 3:21 PM

I believe a lot of the urban "street" riders are switching to Harleys....definitely hurt the Hayabusa/Jap street bike sales

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newmann

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2/12/2015 3:25 PM

Our local Yamaha shop sold out a few years ago. The guy that bought it also bought out the local Kawasaki / Suzuki dealer and combined them all under one roof in a big shiny new building right about the time the economy took a shit. He had other more profitable business ventures and knew little to nothing about the motorcycle business. But he was a successful business man and still is. Selling the three bike lines to the local Harley/ Polaris/Honda dealer was a great day for him. Everything is now located in a couple huge buildings on Interstate frontage next to each other. These buildings make any of the local car dealerships look junky. Not a real friendly motorcycle environment any more. I miss that.

UpTiTe

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2/12/2015 3:34 PM

The secret to a successful dealership these days is a great sevice department.

zehn

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2/12/2015 3:43 PM

The Yamaha dealer here in town is one of the healthiest around.

three9zero

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2/12/2015 3:47 PM
Edited Date/Time: 2/12/2015 3:48 PM

As a sales manager at a motocycle dealership here is what is see.

Brands Kicking ass are
KTM, Husky, Harley, BMW, Triumph, Ducati, Aprilia, Moto Guzzi, Victory, BRP(ski doo, sea doo, Can Am) Polaris.

Brands not doing too bad
Honda, Kawi

Brands not selling well.
Yamaha, Suzuki.

The brands kicking ass are brands that are make something that is a bit different than the comp(Europe/Domestic, the brands that all make the same shit with different labeling are falling behind(Japanese).

jtiger12

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2/12/2015 3:59 PM
Edited Date/Time: 2/12/2015 4:00 PM

Around here, I think it comes down to how smart you are with your business. The local shop here I am pretty tight with. I've worked the counter on a couple Saturdays, and I know what they pay and what they make on a lot of parts, specifically, good boots. The markup isn't what you think. If you find sg12s online for 200$ off retail, those guys are basically giving them away. What local guy in their right mind is going to stock multiple sizes in several colors, for several top quality brands. Tpog496 I used to feel like you, but once I learned a little more about their business, it changed my mind. If your local guy is an unthusiast and treats you well, give them a chance to match or come close to the deal. If he doesn't want to negotiate, by all means buy online

The Rock

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2/12/2015 4:08 PM

UpTiTe wrote:

The secret to a successful dealership these days is a great sevice department.

Right on but let me take this one step further. A great service department can be an extension of sales. TOSHIBA just screwed me over so now after 8-9 years of being a loyal user (bought four machines) is pao and my next machine will be an Apple. Smart companies know how to leverage sticky repair situations into new sales opportunities.

"My philosophy is to have a really good time and never to let anything stop me from doing what I want to do.

Michel Petrucciani

Tpog496

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2/12/2015 4:11 PM

jtiger12 wrote:

Around here, I think it comes down to how smart you are with your business. The local shop here I am pretty tight with. I've worked the counter on a couple Saturdays, and I know what they pay and what they make on a lot of parts, specifically, good boots. The markup isn't what you think. If you find sg12s online for 200$ off retail, those guys are basically giving them away. What local guy in their right mind is going to stock multiple sizes in several colors, for several top quality brands. Tpog496 I used to feel like you, but once I learned a little more about their business, it changed my mind. If your local guy is an unthusiast and treats you well, give them a chance to match or come close to the deal. If he doesn't want to negotiate, by all means buy online

Yea I said I check both places.

Jarid332

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2/12/2015 4:11 PM

Customer Service is everything.

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rcannon

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2/12/2015 4:15 PM
Edited Date/Time: 2/12/2015 4:27 PM

I worked at the local shop back in the 80's. The building was big, but we needed offsite storage for bikes in the crate. Now, half the building is shared by the Yamaha golf cart dealer.

I have a thought as to why. If you have a chance, stop by a department store on Saturday. It doesn't have to be Wal Mart, but that will be fine. Sit out front, on the bench, and watch people go by. Give it 15 minutes. After you do, answer this question...

How many are small enough to actually fit on a motorcycle? OK, so there goes half the population.

The good news is this. As the sport gets smaller, its very nice for those of us that participate. Most buy into the "grow the sport" nonsense just because we HAVE to have EVERYONE doing "IT" to feel good about ourselves. Be secure in your own choices.

True, we not see as many new bikes, or as many innovations. We might lose a magazine , or two. We might even lose a brand. So what?

We also lose crowded tracks, and crowded riding areas. We lose government involvement due to the number of accidents. Noise complaints. The list goes on. Be careful what you wish for, you just might get it.

Unless you work for a motorcycle company, you have .as much to lose, or more, than you'll gain if every family has a motorcycle.

Go back to 2006 and think about how the super fast motorcycles were under fire. As sales fell, that issue disappeared. Meanwhile, BMW slid in a 200hp superbike that will come close to 200mph in bone stock trim. Back in 06, our local track cam e close to getting shut down for noise and dust issues. Our governor rode there, at the time, and thats half the reason wit stayed open. As fewer used the facility, that issue went away.


And poor old Suzuki...they are dying. Between Jan to sept 2014, they only managed to produce 76,000 machines over 50'cc. during the same time, Yamaha made 150,000. If they work up tomorrow and their sales were like KTM's, you'd have a bunch of Japanese guys killing themselves.


GeorgiePorgie

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2/12/2015 4:16 PM
Edited Date/Time: 2/12/2015 4:17 PM

My local yamaha shop does just fine. Selling 14 thousand dollar sleds like Colorado is selling dope.

GP740
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KTMShane699

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2/12/2015 5:01 PM

Tpog496 wrote:

Can't really blame people for buying stuff online though either. Why would I buy SG12's at retail when they are online for 200$ off? I want to support the local shop but It's not my fault that they can't compete with that price and the selection is dog shit. I will add though I do check with both places and prefer to get things through them.

And you my friend have hit on exactly why it's difficuly to stock a size run of SG12 boots in the shop. Let's say we stock the size run from 8-12 (five pairs total). We front that money in order to let you get the size you need. Now we have to turn that inventory to justify doing it. An item like that, turning it twice is so-so and three is good. So we have to sell 15 pairs of SG12 boots to justify having the product in the shop. If we can sell twenty, we are doing great.

The benefit of paying more for your boots at the shop is that we have them in stock. You can try before you buy so you aren't shipping the wrong size back and forth (I had to go up a size when I wore SG12's). And if you have a warranty, we can probably make it right quickly. Instead, you come in and try on the boots we've paid to stock and go order online. You've taken advantage of our stock, and not provided anything in return. It happens frequently and is frustrating.

People assume we must pay about $250-275 for a pair of SG12's and are trying to double our money when we sell them. The other assumption is we are greedy when we can't discount as deep as an online retailer. Truth is, we only make about 35 percentage points if we sell at full price. Less as we discount it to a customer.

When comparing a retail shop to an online shop, they're really two different business models. If you do a warehouse style business (online), you could accomplish with one employee what we do with about three in the shop. That alone is a much cheaper alternative for business. Second is that warehouse space is cheaper and easier to maintain than retail store front. There aren't any displays, people at the counter, etc. Just a dude, a phone and computer and a bunch of parts. Most orders come online without customer interaction. Print. Pull. Ship. Makes it easier to get off of trying to make a profit margin to keep the shop open.

Shops can sell on discount and volume. But it's not a sustainable business model for a brick and mortar establishment. You train your customers to always buy the least expensive item.

I know there's other guys here who work at shops. I'd love to hear their thoughts.

Shane

reded

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2/12/2015 5:23 PM
Edited Date/Time: 2/12/2015 5:47 PM

I'd love to have a relationship with my local guys like my dad did back in the 70s and 80s but it's just not possible. Most of them act like I should throw $20 in a jar just for walking in the door, then they try to sell me parts and gear at double what I can get them for online and won't budge a dime on their bikes. Last month I drove 500 miles round trip to save $1k on a new bike. I would have been happy saving $600-$700 and buying local but they wouldn't have it so fuck em.
It's already an expensive sport and more so if I have to pay retail. I don't even care if they stock the parts as long as they would order them and price match the online guys. Either way I'm gonna have to wait a few days to get my goods so I don't care where I get them. When I ask for a little discount off of retail they act like I just fucked their wife in the restroom. To hell with them, if they're so strict with the pricing that I can't afford to buy from them then I apparently don't need them around.

Adapt or die, small guy. I'd rather make $10 off of 11 guys who might be back next week rather than $100 off of one guy who won't be back for a year.

rcannon

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2/12/2015 5:28 PM

Shane, theres an easy solution to that....dont bother with sg12's. Sell cheap junk at a price point where peopel dont notice you sell it for 129.00 vs 99 mail order.

I know HJC helmets are pretty much the same price, online, as they are in the shops. I'd deal in the brands that price fix. Like the Akrapovic exhausts..same price online as as a dealer. Why reward Gaerne by letting them use your store, and your money, as a sizing chart? The company set the rules in a way that you cant compete, so why do it? You wont really lose the sg12 sale as you never had it in the first place.

Brad460

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2/12/2015 5:29 PM

You all are probably jealous I live 15 minutes from Rock River Yamaha.. I don't ride a Yamaha but always stop in for oils and other random stuff. They are always very friendly and helpful!

GeorgiePorgie

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2/12/2015 6:23 PM

Hard for local shops to keep with online retailers who don't charge tax.

I try to spend all my money at my local shop and gather their blessing before they can't beat something. Most of the time if it's within 35-50 bucks for a large purchase I'll buy it from the shop.

GP740
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machine

Vital MX member machine
25020 machine https://p.vitalmx.com/photos/users/25020/avatar/c50_webb_1435602546.jpg?1435601819 https://www.vitalmx.com/community/machine,25020/all 01/05/11 5 15 185 6136 1

Posts: 6321

Joined: 1/5/2011

Location: Collettsville, NC USA

2/12/2015 6:30 PM

jasonv43 wrote:

An extremely slow start to this year is not helping either.

lostboy819 wrote:

Colorado economy is booming right now, not sure if its the dope sales or the fracking but everyone is hiring in Colorado and hard to find people to hire.

Nothing worse than a baked fracker...

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machine

Vital MX member machine
25020 machine https://p.vitalmx.com/photos/users/25020/avatar/c50_webb_1435602546.jpg?1435601819 https://www.vitalmx.com/community/machine,25020/all 01/05/11 5 15 185 6136 1

Posts: 6321

Joined: 1/5/2011

Location: Collettsville, NC USA

2/12/2015 6:32 PM

UpTiTe wrote:

The secret to a successful dealership these days is a great sevice department.

Good observation...hard to find...

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