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u POP 101 u Peninsula Triumph’s Niche Appeal u EICMA Asian Expansion

March 2010 VOL.36 NO.3 WWW.MPNMAG.COM

What Now? Mark M ark rk R Rodgers odgerrss T Thinks hiin nk kss H He e Kn K Knows now ow wss

Charged Up Performance P erf rformance P Packed ack ke ed B Batteries att tteries & A Ac Accessories ccess ssories

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TABLE OF

Contents

March 2010 Volume 36 Number 3 – – – – – – – – – – – – – – – – –

www.mpnmag.com

Shop Talk k How To Hackett

......................................

30

A Dead Initiative Reborn: Pre-Paid Maintenance BY OTIS HACKETT

Best Operators Club . . . . . . . . . . . . . . . . . . . . . . . . . . 32 Dealership Year-End Data BY STEVE JONES

Lessons Learned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 The Entreprenurial Epiphany Photos courtesy of Moose Racing

BY ROD STUCKEY

Practice What You Preach . . . . . . . . . . . 36 The Simple Solution: Streamline Your Store BY WILLIAM DOUGLAS LITTLE

Departments The Road Ahead . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Destination Dealership. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Peninsula Triumph’s Got Niche Appeal BY PETER DU PRE

10 Top ATV Add-Ons

18

Essentials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 V-Twin Product . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

Motorcycle Business Myths

............

Pit Pass . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

14

Marketplace . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

Why They’re Wrong and What to do Next

Ad Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

BY MARK RODGERS

ATV Attraction

..................................................

18

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

Our Latest Sport ATV P&A Overview BY DOUG DALSING

Lessons From The Past

.......................

24

Vintage Bike Businesses Share Their Recipes for Success

24

BY MARGIE SIEGAL

Charged Up

...........................................................

26

u POP 101 u Peninsula Triumph’s Niche Appeal u EICMA Asian Expansion

Performance Packed Batteries and Accessories March 2010 VOL.36 NO.3 WWW.MPNMAG.COM

BY DOUG DALSING

MPN (ISSN 0164-8349) is published monthly and is distributed without charge to qualified motorcycle retail professionals by Athletic Business Publications Inc., 4130 Lien Rd., Madison, WI 53704-3602. Change of Address: In order to ensure uninterrupted delivery of MPN, notice should be made at least five weeks in advance. Direct all subscription mail to MPN, PO Box 47705, Plymouth MN 55447, call 800-869-6882 or fax 866-658-6156. For faster service, visit us online at mpnmag.com. Single copy price is $8 (Buyers Guide–$50). Subscription price is $55 for 12 issues in the U.S.A./Canada/Mexico. International subscription via air mail is $130. Periodicals postage paid at Madison, Wisconsin, and at additional mailing offices. Postmaster: Send address changes to MPN, PO Box 47705, Plymouth MN 55447. © Athletic Business Publications Inc., 2010 ALL RIGHTS RESERVED. Reproduction in whole or part is prohibited. MPN is a trademark of Athletic Business Publications Inc. Canadian Publications Agreement No. PM40063731. Canadian Mail Distribution Information: PB IMS, Station A, P.O. Box 54, Windsor, ON N9A 6J5.

ON THE COVER

– – – – – – – – –

Colleen Swartz snaps industry guru Mark Rodgers at the IronHorse Hotel (www.theironhorsehotel.com) in Milwaukee, WIs..

4 March 2010 www.MPNmag.com

What Now? Mark Rodgers Thinks He Knows

Charged Up Performance Packed Batteries & Accessories

ATV Attraction Up Close & Personal With 2010’s ATV P&A

follow MPN on

@MPNmag


• Serious all-weather one-piece riding suit • 600-denier Carbolex®® shell with tough 1680-denier ballistic polyester panels in the

shoulders, forearms and knees • Phoslite®® dark reflective piping, wide strips across the back and rear triangle increase nighttime visibility • Waterproof and breathable Rainguard®® barrier • Aqua-Barrier under-the-helmet hood eliminates rain seepage in collar area. Hood stows easily in a hidden collar pocket • Collar anchor tab eliminates flapping while collar is open • Carbolex®® accordion stretch material in back, knees and waist for increased flexibility • Removable neck gaiter seals the neck

area from wind and cold • Waterproof zippered shoulder, chest, sleeve, thigh and rear-exit vents • Pipeline Ventilation System provides cooling airflow • Convenient collar-to-knee-length main zipper closure with dual wind flap • Fleece-lined collar and cuffs • Adjustable sleeve take-up straps at forearm and bicep • Removable, CE-approved armor at elbows, shoulders and knees • Articulated triple-density back protector • Vertical zippered chest map pockets • Zippered hand-warmer pockets • Zippered

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For more information see your local dealer or visit tourmaster.com. Cortech and Tour Master are registered trademarks of Helmet House. ©Helmet House, Inc. 2010. Always maintain, inspect and wear protective motorcycle riding gear. No gear can offer complete protection from all situations. Obey all speed and safety laws. Riding and alcohol or other drugs don’t mix.


THE

RoadAHEAD

By Colleen Brousil

POINT OF PURCHASE PRIMER Make merchandising work for you

M

erchandising makes a difference. Even if you’re a neighborhood mom and pop, you need to invest the time and effort to professionally display your products. As a motorcycle dealer, you aren’t just competing with the Honda dealership across town, but every other retail outlet your customers frequent. If you want your customers to take you seriously, you’ve gotta show them by the way you present your products. Many manufactuers provide point of purchase materials (POP) to stocking dealers to help their products stand out, and I talked with a few such manufacturers to tap their POP wisdom. “In the exhaust world, seeing and hearing the product on a bike makes the sale,” says Vance & Hines’ John Potts. “I know many dealerships don’t have the space, but this is the year to make the time to display products. Make a display wall, setup a motorcycle, even bring 8 March 2010 www.MPNmag.com

your own motorcycle in as a display piece and make sure you have literature on display.” While everyone admires a chromed out aftermarket exhaust, some products present more of a merchandising challenge. “The line of site product placement and tactile advantage of a POP will more often than not increase sales substantially,” says David Zemla, director of marketing at Progressive Suspension. “Our products are largely hidden on a bike, and therefore are not on most consumers’ radar. Anything we can do to increase that awareness is to the dealer’s benefit. We actually take it one step further and supply many dealers with display shocks so they can let potential buyers handle the product without impacting their inventory. Our POP also includes a small poster that changes out every few months to keep the display fresh and the dealer continually involved.” When it comes to apparel sales, consumers will compare

your store apples-toapples with the mall giants. “A properly displayed piece of apparel, boot or helmet will always reap greater sales results than an item that is left in the box or otherwise not cleanly displayed,” says Motonation president Bill Berroth. “Customers are used to an easy shopping experience when they visit the mall and expect no less for their moto accessories, and as almost all distributors offer low- or no-cost merchandising displays, there really is no excuse for not doing it right.” Finally, marketing expert Rick Menapace, president and creative director of the Menapace Group, believes POP displays serve a higher purpose. “Consumers don’t see a product on a shelf, they see it on themselves or on their bikes! A display can either complete the emotional connection between the product and consumer, neuter it or kill it. We have to look at our displays in that way. ‘Am I making it easier for my customer to see themselves owning this?’” Ask yourself that question as you walk through your dealership today. If the answer is no, talk to your distributor’s and manufacturer’s reps to see how you can economically increase the appeal of your product displays. Think you’re knocking POP out of the park? Send me some snapshots of your showroom floor, and we might just make you the subject of MPN’s next Destination Dealership!t Colleen Brousil is the editor of Motorcycle Product News. Her monthly column, “The Road Ahead,” explores issues facing dealers across the country. Got a problem? Drop her a line at colleen@mpnmag.com.

Staff EDITORIAL Editor Colleen Brousil colleen@mpnmag.com Assistant Editor Doug Dalsing doug@mpnmag.com Columnists Otis Hackett, Steve Jones, William Douglas Little, Mark Rodgers, Rod Stuckey Contributors Peter Du Pre, Margie Siegal, Colleen Swartz ART Electronic Production Manager/ Art Director Marjorie Schultz marj@mpnmag.com Production Assistant Scott Packel ONLINE Online Producers Susan Bickler, Erika Reise Web Programmer Alex Malyutin ADVERTISING SALES Associate Publisher Dean Kelly dean@mpnmag.com (866) 616-1635 ext. 130

PUBLISHER MPN/Athletic Business Publications Inc. 4130 Lien Road, Madison, WI 53704 Phone: (866) 616-1635 • Fax: (608) 249-1153

CEO Gretchen Kelsey Brown President Peter Brown Group Publisher Shawn Gahagan Controller Kara Clark Administration Director Sharon Siewert Audience Development Director Jennifer Boyd Audience Development Coordinator Colleen Wenos Email Marketing Coordinator Lisa Popke


1-800-999-3388


SPARE

Photo courtesy of Jim Gianatsis, FastDates.com

Photo courtesy of Ray Wert, http://jalopnik.com

Parts

TIGER’S FAVORITE BIKER BABE Pinup girl Jamie Jungers in December told the New York Post she had an affair with Tiger Woods, the fourth on a list of … who knows? If you’re hoping to capitalize on this media phenomenon, click over to www.fastdates.com and pick up copies of the 2010 Fast Dates World Superbike Calendar, which features six photos of this blonde knockout. t

Photo by Kim Love

Ton-Up Tribute

AR Rocker’s k ’ H Holy l G Grail: il th the T Triton it —aT Triumph i hB Bonneville engine teamed with a Norton featherbed frame.

Just slick back your hair, throw on your Levis and rub a little Castrol on the cuffs — it’s time to stay in and check out “Café Society,” a 60-minute documentary of the excitement, rebelliousness and engine grease that is café racing, one of the fastest subcultures of motorcycle living.

10 March 2010 www.MPNmag.com

This Ain’t Your Mother’s Light Cycle We’re sorry, but this is not a pirated photo of some concept motorcycle hidden deep inside some mountain in Japan. You’re actually looking at the redesigned light cycle for the upcoming sequel to 1982’s sci-fi arcade movie “Tron.” As you can see, the rigid geometry of yesteryear’s Tron is gone, and this light cycle for “Tron: Legacy” has curvaceous lines similar to some of the best one-off choppers around. (Hell, the white lines even evoke the famous “OCC” logo of Orange County Choppers!) But, the new light cycle’s handling is all sport! Check out some of the trailers for the new film and you’ll immediately notice today’s light cycles underwent a physics overhaul: they can lean hard, swerve fast and take jumps; and no longer does the cycle amazingly turn on a dime. To see for yourself, click over to http://disney.go.com/Tron to watch the movie trailers. t

Ride two-up with a film that chronicles tthe tumultuous evenings of the original café racers, young post-WWII British chaps who used to race you from café-to-café at speeds of more than 100 mph the curviest of rugged country roads. Stories of on th Ace Café, Ton Up Club, clip-on handlebars and the the A Triton racer abound. Created by the editors of Café Racer magazine and Chet Burk Productions, this film gives a magaz sincere and thorough overview of café racing culture; viewing is mandatory for anyone seriously interested in learning about the roots of British street racing. Plus, the film has a killer soundtrack with plenty of rockabilly jams, the preferred tunes of café racers. (Rockabilly affection, of course, gave rise to calling the lads “rockers.”) Dealers can order copies from info@cafesocietyfilm.com for $15, while the MSRP is $24.95. To learn more about this landmark film, visit www.cafesocietyfilm.com. Also, tune up your TiVo for Club Café Racers, a 13-episode series set to run on Discovery Channel throughout the winter and spring. t


#/.6%.4)/.!,6AND6h2EADYTO2IDEv"ATTERY+ITS s.OWINCLUDESACIDPACK s-EETSOREXCEEDS/%-SPECIlCATIONS s%XTREMELYSTRONGPOLYPROPYLENECASESTOWITHSTANDIMPACTSANDVIBRATION sYEARWARRANTYONALLBATTERIESIFPROPERLYPRE SERVICEDANDCHARGED s3HELF LIFEALMOSTINlNITEDUETODRY CHARGEDPLATES s$ESIGNEDFORHIGHERCOLDCRANKINGAMPCAPACITY

3%!,%$-!).4%.!.#%&2%%"!44%29 s3EALEDIMPACTRESISTANTPOLYPROPYLENECASE s!MUSTFORMOTORCYCLESAND!46STHATREQUIREASEALEDBATTERY sTHEPRICEOFAN/%-SEALEDBATTERY s#OMESWITHPRE MEASUREDACIDPACK

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DESTINATION

Dealership – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

By Peter D. Du Pre

APPEALING TO A NICHE MARKET Peninsula Triumph eninsula Triumph owners John and Melinda Dionas couldn’t have opened their Port Orchard, Wash., dealership at a worse time than November 2009. Not only is western Washington in a recession, but the region was already well into its winter rainy season by then. Plus, the Triumph brand, while it’s well-storied in motorcycle history, can only be considered a niche brand today alongside Harley-Davidson and the Japanese brands. None of this seems to bother John and Melinda, however, because when it comes to new vehicle sales, they are experienced niche marketers. The couple already owns well-established Subaru and Suzuki auto dealerships in Port Orchard, and dealership manager Steve Taylor is quick to point out that both of these brands attract buyers who are independent thinkers looking for a quality product. He feels sure that the experience the company has in selling specialty cars will translate into selling specialty motorcycles like Triumph’s.

P

12 March 2010 www.MPNmag.com

Plus, Taylor points out, the staff may be new to motorcycle sales, but they aren’t new to bikes. “Most of the staff already ride,” says Taylor, “ and the owner has always had a soft spot for the Triumph brand. His grandfather started riding them way back when.” With the Suzuki dealership already established, launching the Triumph side was much less financially daunting than if John and Melinda had began from scratch. “We had available space at the Suzuki store,” says Taylor, “and we were looking for an opportunity outside of the car business. The British-built Triumph just fits.” Another factor in helping them decide to go with the British manufacturer was that they would be the only Triumph dealer in the West Sound. All the other Triumph stores are in the Seattle metro area, more than an hour away by ferry boat. Additionally, the Port Orchard location is within 20 minutes of three navy bases and the populous city of Bremerton. There is heavy competition within the region for

motorcycle dollars — H-D, Honda, Kawasaki and Suzuki dealerships are all nearby — but Taylor feels Triumph’s unique appeal and performance will garner sales. He points out that within his store’s first six weeks of operation, it sold seven motorcycles — not bad considering the dismal weather. However, it is not just new bike sales that are being rung up at the register. Like other dealerships, Peninsula Triumph sells trade-ins, has a full service department (with three lifts and three mechanics), and has an active parts department. What’s more, it carries Triumph’s full line of clothing, gear, helmets and ride accessories. Taylor also points out that the parts department is already doing brisk over-thecounter sales to locals who no longer have to make the long journey across Puget Sound to buy P&A. He also says clothing and riding gear sales currently account for about 60 percent of the store’s revenue, and he expects that figure to remain high as the dealership matures;

in addition to two full-time motorcycle salespeople, Peninsula Triumph also has a dedicated accessory and clothing salesperson. Of course, attracting walkins to a motorcycle dealership during a rainy winter isn’t always that easy, but the store’s location on busy State Highway 16 assures plenty of visibility to passersby, and the fact that the new bike dealership shares lot space with the company’s existing Subaru and Suzuki car franchises also brings in customers. Bikers are already finding the new store to be a friendly place to congregate, with little sales pressure and lots of bike talk; there’s even a TV that was showing NFL playoffs when I visited. John and Melinda also host Motorcycle Safety Foundation classes at the dealership, after which eager future riders mull Triumph lore and freely dream of one day owning one of the iconic motorcycles. This may be a difficult time to open a new dealership, but as evident in Peninsula Triumph, if you do it right, success can be had in any financial climate. t


A compact showroom displays the full Triumph line, used bikes and accessories. Pictures on the wall are of the owner’s grandfather who is astride an early Triumph.

New Triumphs fill the showroom window.

Sales consultant Greg Chouinard shows off the separate clothing/ riding gear section.

Gregg Chouinard (right) discusses the fine points of the Triumph Thruxton with a customer. A vintage Triumph taken in on trade is also on display.

Parts/service are in a separate building, so a rack of bike accessories is also on display in the showroom. www.MPNmag.com March 2010 13


14 March 2010 www.MPNmag.com


W

hat if we are wrong? What if our most deeply held beliefs about managing dealerships are at best misguided and at worst a complete waste of time and money? What if: • More door swings didn’t lead to more sales? • Commissions didn’t really drive dealership performance? • Following up with customers made them like you less? • Dealer training programs would almost always fail? • The best dealerships didn’t have the best people? • “Every deal, every dollar” didn’t optimize profitability but rather encouraged customer resentment? What if for all these years the largest impediment to our success was actually our inability to discover what produces results? What if the obvious isn’t? Instead of using conventional wisdom and flawed models (“That’s how they do it in the car business”) resulting in hyper inter-dealer price competition (where the customer ultimately hates the dealership experience), what if we changed course? What if we looked honestly at what works, what doesn’t and what’s best for our business? Remember when people used to actually believe that you “Win on Sunday, sell on Monday”? There are risks in raising these issues. We can think of at least three dealer principals right now who would run us out of town for suggesting that racing may be a complete waste of money, but if we can dispassionately look at these issues might we just find aspects we can improve? You’ve worked hard. More hours and more effort isn’t the answer. What if we used available resources (right now, today) to work smarter?

C

hallenge Even Your Most Basic Assumptions In 1987, moved by Tom Peters’ book “In Search of Excellence,” Southland, 7–Eleven’s parent company, launched a huge customer service initiative. The initiative was designed to get every clerk in every store in North America to offer a greeting, a smile, eye contact and a heartfelt “thanks” to every customer. After all, that has to have a positive impact on business, right? Good fun but was the effort worth it? Afterward, researchers tried to link courtesy to sales in 7–Eleven stores. In a 10–week experiment, greetings at a group of 7-Eleven stores increased from 33 percent to 58 percent, while smiles went from 32 percent to 49 percent. However, sales were actually higher at less courteous stores! Why? Convenience store customers don’t care about fake smiles or perfunctory greetings. Convenience store customers want to get out of the store fast. Had they taken the time to find and use evidence, Southland could have saved millions of dollars and untold effort. They could’ve taken the time to simply focus on what their customers actually wanted. This is just one of the cases cited in the book “Hard Facts, Dangerous Half-Truths and Total Nonsense: Profiting from Evidence-Based Management,” written by Stanford professors Jeffery Pfeffer and Robert Sutton. There are examples of this sort of conventional wisdom in the motorcycle industry. Take a metric dealership located in the mid–Atlantic region. The dealer spent untold dollars and effort for years producing direct mail campaigns to support their open house efforts. On the surface the efforts appear to have paid off. There were customers everywhere. Who wouldn’t think these efforts were worth it? Apparently, this analyticsdriven dealer principal didn’t, because one day he decided to evaluate the efforts. He discovered that on these event days, the dealership actually www.MPNmag.com March 2010 15


sold less! Sales of major units were down, high dollar accessory sales were off, and to top it all off, the store had to pay for food, entertainment and other event expenditures. But couldn’t the event have stimulated residual sales? Might customers have come back later as a result of their positive interaction at the promotional event and spent money? Of course, anything is possible, but you have to ask yourself: Is that correlation evidence enough to continue spending time, money and effort on these types of initiatives, or might there be a better return elsewhere?

T

he Solution It is time to smash conventional motorcycle business wisdom; it’s time for new business insights, it’s time to test our assumptions. It’s time to stop doing business by accident. We believe the path to Peak Dealership Performance can be found in the coordinated use of customer intelligence, business intelligence and evidence–based management.

D

ata and Diapers Wal–Mart is well known for their use of data. When analyzing purchases, managers noticed a correlation between those who purchased diapers and those who purchased pre–paid calling cards. They discovered young mothers have a strong maternal urge to stay in touch with friends and family during the earliest stages of their children’s lives. So the merchandisers put end cap displays of pre–paid phone cards to make it easier for these shoppers. They tested this in a few stores, received positive results and then rolled it out to other locations. This is our objective, using data correlations and your insight to do better business. Here’s how one dealer used this process: Harley–Davidson had switched from the cartridge format to a much lower priced computer calibration download, and the dealer had an inventory of cartridge calibration downloads for select models. The manager queried the customer database to pull a list of owners with units that were compatible with the inventory. They created a promotional offer that gave customers a free download with the purchase of a new set of Screamin’ Eagle slip on mufflers and a new Screamin’ Eagle Air Cleaner. The average age of the units was about five years, and the staff didn’t think the promotion would work — 35 customers took them up on the offer, however. This is a great example of how the process can work. The business intelligence here was the identification of the older, over–inventory position of the calibration cartridges. The performance insight was that they could: A) Throw out the cartridges and write off the inventory, or B) Take some action to recoup the investment. Using 16 March 2010 www.MPNmag.com

its customer intelligence (their customer database), the dealership was able to identify customers the cartridges could benefit. Next, marketing insight was used to come up with a logical promotional offer, and the dealer practiced evidence–based management and took a very reasonable risk and measured the results. In addition to the quantitative findings, he also used qualitative research (in calling 35 customers and asking about purchase motivation) to test if his marketing insight was on target or if something else was driving purchases. The business came away from this process better off financially, customers came out better with new exhaust systems, and this dealer and his staff became better and smarter business people. To replicate this in your store, the first thing you need is real–time business intelligence. The key to success is, of course, the immediacy and utility of the information.

R

eal-Time Data The team at Retail Systems Research believes actionable information from real–time business intelligence is critical to drive success. Retailers have come to understand this process is important and are moving from a “whatever it takes” mode to something more engineered: a process driven by actionable information. Closing the loop between operational systems and business intelligence is important because the “lag time to action” is getting shorter all the time. Retailers believe the potential of real–time or near–real–time business intelligence is enormous, but they recognize they have a long way to go in realizing that potential. Following are guidelines you can follow to gather and capitalize on this intelligence. Major Unit Data: Track all major-unit activity at your dealership, both new and used. Typically, you’ll want to view these sales in terms of month-to-date numbers and year-to-date numbers. Also, year-overyear comparisons are helpful. You’ll want to review unit sales, gross dollars and gross profit. Consider tracking dealer transfers, trade–ins and total number of retail deals, too. Breaking down the margin and dollar information into a per unit expression (for example, $1,811.89 or 10.99%) can be useful. Next, track the number of days major units spend on your floor. This is helpful in understanding your risk for flooring charges and markdowns. Knowing this can also guide attempts to accelerate sales. Finance & Insurance: If you’re looking for fun with numbers, look no further than your finance and insurance profit center. Typical measures include finance, ESP, wheel and tire, GAP, LAH and profit-perunit-retailed penetration. These numbers should be analyzed both month-to-date and year-to-date for a more complete understanding of the business.


Accessories and Riding Gear Metrics: It’s preferable to look at accessory and riding gear business separately and in total. Metrics for these areas could include such things as gross sales/net sales, total dollars discounted, total number of invoices, invoice dollars/profit dollars, number of daily invoices, average daily sales, and the percentages of Internet, wholesale, employee and dealer-to-dealer sales. Also, accessory and riding gear metrics can be compared month-to-date and year-to-date. Service Metrics: In many dealerships there are few departments as revered and vilified as service. Typical service metrics include both year-to-date and month-todate figures for labor hours, labor dollars and service parts revenue; also, year-todate repair order (RO), daily RO, daily labor hours, daily labor dollars and accessory dollars per RO are good metrics to track.

M OTORCYCLE BUSINESS MYTHS

Legendary Performance & Affordability Backed by 100+ years of trusted & proven tire technology

Comparison Composites: Most of the examples we’ve given to this point measure your dealership’s individual performance. A comparative composite can tell you how you are doing relative to other dealers (normative). Performance to Plan: The crown jewel of business metrics is performance to plan. This assumes A) You have a plan, and B) You are tracking your plan’s progress. If you can predict trends, you will be in an even more informed position. Unfortunately, tracking these metrics is not easy; designing this information using a DMS is tricky, running the reports is laborious and compiling the reports seems to require a very, very large conference table, and by the time you have it organized the information is old and out of date. Yet, any data is better than no data, and at the same time retailing is about immediacy. We need to understand our current performance today so we can take action tomorrow. The next piece of the puzzle is customer intelligence, and you’ll have to tune in next month for the second installment of this series. In the meantime, examine the motorcycle business myths you’ve bought into and start crunching numbers to see if they still make sense for your business. t

www.conti-moto.com

www.MPNmag.com March 2010 17


18 March 2010 www.MPNmag.com

Photo Courtesy of Moose Racing

W

hether your customer is searching for an exclusive exhaust kit to crank up his RPMs or just a new set of handle bar grips, he’s going to want parts and accessories for his ATV be it a 2010 model or an old school racing machine— that’s where you come in. Are you going to say, “Yeah, that’s a cool product,” or will you point out the technological differences between two shocks and make it clear why there’s a $100 price difference? Turn the page and become illuminated.


+

Just you, nature and the open road.

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Barnett Tool & Engineering Barnett’s Second Generation billet aluminum clutch baskets are CNC machined and feature stainless steel inserts to eliminate grooves caused by clutch plate tabs; the inserts ensure smooth, consistent performance, Barnett says. Precision-machined oil passage windows allow more oil flow to help plates run cooler and last longer. The baskets come with grade 8 fasteners, a backing plate and instructions. They retail for $250. www.barnettclutches.com

Duncan Racing International Duncan Racing’s chrome front bumpers are hand-fabricated from mild steel and heli-arc welded. They are then finished with polished triple-plated chrome. All hardware is included with each bumper, and Duncan says they’re available for most sport ATVs. www.duncanracing.com

Goki Manufacturing Co. Goki now provides a bolt-on electric start kit for Honda’s TRX450R. With this electric starter installed, riders will still be able to kick start their TRX450R, too. It features a built-in charging circuit, provided by the stock lighting system, so the battery stays charged. Also included in the kit is a main casting with 18 percent more oil capacity and a larger spin-on oil filter. All necessary hardware, wiring harnesses, specialty tools and photo instructions are included, and the kit retails for $599.99. www.gokimfg.com

20 March 2010 www.MPNmag.com


Moose Racing Moose Racing offers a pair of tiedowns that retails for $24.95. One end has a high-strength rubber-coated hook and the other a high-strength carabiner. The 1-inch-wide, 7-feetlong straps sport the Moose Racing logo. The strap’s working load limit is 425 pounds, and they’re available through Parts Unlimited. www.mooseracing.com

Motorsport Products Motorsport Products has released new ATV protection parts. Its frame glide plate is made of lightweight aluminum and sports a large hole for easy oil change access and recessed areas that protect bolts from impacts. Its swingarm skid plate protects the rear brake rotor, swingarm, sprocket and chain from debris. This aluminum plate has reinforced gussets and heliarc welds for increased durability, the company says. Both of these products will be available through Parts Unlimited in April, and they both carry a MSRP of $99.99. www.motorsportproducts.com

Race Tech Race Tech makes high-performance spring kits for Yamaha’s YZF450R. They provide personal spring rates for a rider’s weight and riding style. Kits are available for both front and rear suspension. The Sport Series suspension setup is preloaded and rider height is near stock, while the Race Series suspension allows riders to sit lower than stock height and is fully adjustable. The front Sport series shock retails for $229.99, and the rear Sport shock retails for $109.99. Gold valve kits are also available for custom damping. www.racetech.com

www.MPNmag.com March 2010 21


Ron Wood Enterprises Ron Wood Enterprises offers up its Stage III kit for Can-Am’s DS450. The kit includes a “race-proven” exhaust and air filter, along with billet cams, high-compression-forged pistons and fuel injection control unit. Ron and company says the kit yields a 27 percent peak power increase. What’s more, a Stage III-equipped ATV should start easier and run cleaner throughout the RPM range, all for $1,857. www.rotax.net

Tire Ball Company Tire Ball Company’s MX-Pro Version is for competitive riders and retails for $169.95. Riders can run their ATVs with lower tire pressure, thus increasing their contact patch to improve traction. It’s made of lighter material than the company’s OffRoad Pro Version product for less rotational mass. All of this company’s tire ball kits include lubricants, rim identification sticker, mounting instructions and a round-tipped inflation needle. www.tireballs.com

TCB Brake Systems T TC Brake Systems has primarily TCB been courting the cruiser market be with its brake fluid “shock absorber,” wit however, it’s now pushing into the ATV how market with this braking safety device. ma Inside, a rubber diaphragm and air Ins chamber absorbs excess brake fluid, cha thus diverting the fluid from one’s thu brakes, during emergency stops. This bra helps prevent ATV brake lock-up. The he company says this product can reduce com panic stopping distances by as much pa as 20 percent at speeds of 35 to 55 mph, and it’s easy to install. mp www.tcbbrakesystems.com ww 22 March 2010 www.MPNmag.com


Works Performance Products Inc. Worksâ&#x20AC;&#x2122; Pro Series Black Widow Piggyback front shocks are re ďŹ tted with adjustable rebound, high and low speed compression, large-capacity ge-capacity capacity reservoirs, 5/8-inch induction/8-inch induc ctionhardened high steel h tensile ste eel shafts, four-stage compression mpression damping d and a threaded preload. d spring pre eload. Works says the e damper ttubes ubes are treaded with a military sp spec pec coating that dissipates heat bette better er than bare metal. Fitments are avail available lable for Can-Am, Honda, Kawasa Kawasaki, ki, Suzuki and Yamage ATVs, the s, and th he shocks begin retailing at $795 pe per er pair. www.worksperformance.com rmance e.com

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www.MPNmag.com March 2010 23


I

s the classic bike business as durable as a vintage bike? It’s beginning to look that way. People on the vintage end of the motorcycle world, while not getting rich quickly, seem to be less affected by the current turbulence in the economy than other people in the industry. In an informal survey of the old bike scene, most classic bike businesses have not been doing badly financially over the past year. Remember Aermacchis, the little Italian bikes imported by Harley-Davidson during the Sixties? Sonny’s Motorcycle Repair, an Aermacchi specialist, has a shop full of them waiting to be repaired or restored. Ross Puleo, the owner,

24 March 2010 www.MPNmag.com

explains that, although the downturn has not affected his volume, his customers want less cosmetic and more mechanical work. “They are more interested in safety, comfort and reliability. They want to maintain the original patina,” he says. Classic bike auctions are moving as many bikes as they ever have, although, according to auction promoter Glenn Bator, prices are down 15 percent. Also, old bike parts are selling at a premium on eBay. “There’s good activity in used parts,” says Bator, who also does restorations of American motorcycles. “Prices are not going down. I just paid $350 for a generator that used to go for fifty dollars.” Many non-vintage motorcycle businesses want to use the cachet of vintage motorcycles to draw customers in the door. However, although a nicely restored classic on the floor or in the window undeniably draws attention, there is more that can be gained from the vintage bike movement than window dressing. In discussions with classic bike businesses, owners cite the same four factors that have led to their success. These same factors, possibly with a little different spin, can also be used to improve your own business. The themes that come up time and time again for


classic bike entrepreneurs are passion, expertise, community and added value. These themes, along with intelligent Internet use, are what gives the vintage market staying power, in good times and bad. While you probably don’t sell (or work on) vintage motorcycles, you can take a leaf from the vintage book and emphasize these themes at your dealership.

Passion

People are passionate about vintage motorcycles. A lot of the players on today’s vintage scene started out as hobbyists and later realized that they could make a living doing what they were happy to do for free. Puleo, for example, started by restoring his own Aermacchi motorcycles, becoming an expert on the little Harleys from Italy in the process. Bator, the auction promoter, got his start after a museum director saw his restoration of a KHK Harley and offered him a job. “Nostalgia does not go away,” observes Laurie Reichert of Purple Haze Racing, a distributor of Kawasaki two-stroke parts. “That is the thing that people always want to go back to. That is what keeps businesses like ours safe.” Think about it: Few people have to own a motorcycle — they have to want to own a motorcycle. The customers that come in your door are often as enthusiastic and passionate about their bikes as classic and vintage bike owners. Do you and your employees share that passion for motorcycles and motorcycling? Do you convey your deep emotional link to motorcycles and motorcycling to your customers?

Expertise

Many vintage bike businesses could be located in a cave or down a dirt road. Customers learn about these businesses from word of mouth and through seeing the finished results at concours competitions. They seek them out because they believe the owners have unique expertise or skills that are necessary to restore or maintain their own classic. “People come to me because I have done a lot of research, I have years of practice and my bikes are judged at AMCA meets,” Puleo explains. “My customers come to me from all over the world. I have customers in France, the Netherlands and Japan, as well as all of the United States. They see bikes I have restored on eBay and YouTube. They come to me because they believe I have the knowledge and skill to restore their bikes correctly and make them run great.” You may not be the only person on the East Coast who knows how to correctly rebuild a 1913 racing magneto, but your customers come to you because they have confidence in the expertise of your parts department and your service department. Do you foster and nurture that confidence? Does your shop’s name get passed around as the go-to place in your area? Word of mouth advertising is the cheapest and the best kind of advertising.

Community

The vintage movement is in large part a social movement, built around swap meets, shows, vintage races and owner’s clubs. Enthusiasts

know each other, help each other and support each other. “I believe that community strengthens in times of stress,” says Motorcycle Classics editor Richard Backus. “This aspect of the classic bike scene is huge.” Purple Haze’s Reichert concurs. “We have a good customer base,” she says. “Our loyal customers support us in good times and bad.” “It’s the coming home of the swallows,” Bator says. “When I was running swap meets, a lot of vendors wanted to make sure they were next to the same guy they were next to the last year. People really enjoy the social aspect.” Encouraging community around your shop is rarely expensive in terms of dollars, and it has potentials for huge payoffs. This is one area where you can easily intersect with the classic bike movement. Instead of just putting a vintage bike in your showroom on a pedestal, invite the local old bike clubs to hold a swap and show in your parking lot. This can be a fun event for your new bike customers and the community at large. Have the local Lions Club or Boy Scouts set up a refreshment booth. Remember that old bike owners need tires, chains, oil, helmets, jackets, boots and rain gear. You may be able to order parts for classic bikes from your OEM, fostering much goodwill. Bator points out that most classic bike owners also have a modern bike for transportation. Encouraging the classic bike community gives you added opportunities for parts sales and service.

Added Value

The price in dollars of a vintage motorcycle is rarely its true value to its owner. A vintage bike

has emotional value in many different dimensions. In addition, a vintage motorcycle rarely depreciates. It can be seen as a friend, a reminder of one’s own youth or of a departed loved one, a source of pride, a stress reducer and as an investment, all at the same time. “In a time when it is unclear where many people’s next dollar is coming from,” says Backus, “a vintage bike is money in the bank. People see an old bike as a protected investment, something they can enjoy, but that will keep its value and possibly appreciate.” There is no reason why a new motorcycle cannot be many of these things as well. You can encourage your customers to see their motorcycle as a source of pride, a vehicle for stress reduction and a basis for community. Hosting an owner’s group at the shop, leading group rides and holding social events will help with integrating motorcycles and motorcycling into your customers’ lives. You can also help your customers get the best out of the bike they now have. Seminars on motorcycle maintenance, spring tune up specials and information posted on your website keep customers connected to your shop so, when they do get the money for a new bike, they will think of you. “We love these bikes,” Bator says. “They have a soul, and you have to learn your way around them. Sometimes, it takes months to figure them out. We are tinkerers at heart, it’s our passion.” Go back to your roots and learn from the themes of the vintage bike community. It will help you grow more green in the year ahead.  www.MPNmag.com March 2010 25


Argus Analyzers Argus Analzers offers its Battery Bug, which helps prolong battery life and warns a rider of a battery failure before the battery dies, the company says. The Battery Bug has audible alarms and visible display icons indicating an undercharged battery and prompts the user to charge the battery. Through its display screen, it provides information on percentage of remaining battery power, lost capacity, battery voltage and charging voltage. The display can be mounted up to six feet from the battery. The Battery Bug installs in minutes using easy tools and retails for $49.95 www.batterybug.com

BikeMaster BikeMaster’s new TruGel battery uses a unique electrolyte gel that the company says provides higher cranking amps, lasts twice as long a conventional batteries, resists vibration, doesn’t spill — even if the battery is cracked — and operates in any position. The BikeMaster TruGel battery is only available through Tucker Rocky, comes with a two-year warranty and carries a suggested retail price of $25.95 to $196.95. www.bikemaster.com

26 March 2010 www.MPNmag.com


Drag Specialties Drag Specialties says its batteries are specifically designed for high-performance engines that need extra cranking power. These power sources feature superior engineering and include a radial grid design for maximum cranking amps and high vibration resistance. The spill-proof, pre-filled, pre-charged, maintenance-free sealed design includes brass spacers, stainless steel nuts, bolts and star washers, and they’re made in the U.S. The batteries carry a MSRP of $85.95 to $137.95. www.dragspecialties.com

Durabatt Batteries Durabatt says its product line is a “low cost alternative to OEM battery replacements.” Durabatt makes both 6-volt and 12-volt batteries, available in standard or sealed versions. These batteries are available through NHJ Powersports. www.NHJpowersports.com

Odyssey Batteries by EnerSys EnerSys offers the PC-545 Odyssey battery, which offers 185 CCA, 300 HCA and 155 MCA for $143.89. EnerSys says this battery is ideal for H-D FXDs (‘99 to ‘05), but can be modified to fit other H-D, Honda, Moto Guzzi and Polaris applications. The PC-545 is a 12-volt AGM battery with a storage life of two years and a service life of three to ten years. It has an acid containment feature that prevents spills. Odyssey batteries sport densely packed flat plates that EnerSys says result in greater power and less weight. www.odysseybattery.com

Power-Sonic Power-Sonic offers a complete line of powersport batteries that it says is “high quality, yet competitively priced.” Retailing for some of its most popular products begins at $31.95 and run up to $93.95. Its manufacturing facility is ISO-certified, and its batteries sport attractive ORM-D packaging, which it says looks good on shelves and saves dealers money through negating Haz-Mat fees when transporting batteries that come with an acid pack. www.power-sonic.com

www.MPNmag.com March 2010 27


TecMate North America TecMate calls its Optimate Pro-S a “must have” for dealers. With it, you can initialize new sealed and filler cap batteries in less than one hour, plus it de-sulfates and helps recover neglected batteries. What’s more, the Optimate Pro-S uses a microprocessor that ensures the battery is receiving optimal current. Automatic safety features include quick identification of a severely shorted battery, a maximum 12-hour program for used batteries and electronic reverse polarity protection. Wall mounts are integrated for easy and convenient wall placement, and there is a 115 volt to 230 volt power input selection. MSRP for the Optimate Pro-S is $184.90. www.tecmate.com

Ultima Products Ultima Products offers the Juice Pack electrical system, which it says makes bike upgrades a snap. Ultima’s Thunderfire high-performance starter, ranging from 1.4 KW to 2.4 KW, retails for $328.15. Its Thundervolt, the highest CCA AGM battery available, retails for $98.24. And Ultima also offers multi-stranded super flex battery cables, which retail for $29.20. Ultima products are sold exclusively through Midwest Motorcycle Supply. www.ultimaproducts.com

Xtreme Charge The pocket-sized XC822-TEST Quick Battery Tester can quickly assess a 12-Volt battery and alternator’s health. LEDs indicate the battery’s state of charge from 25 percent to 100 percent, while an alternator’s health is determined “good” or “bad.” The tester includes a positive fixed probe and removable negative probe. It could be useful around your shop or sold to customers who want a quick answer on a battery’s life. Xtreme Charge products are available through several prominent powersports distributors. www.xtremecharge.com 28 March 2010 www.MPNmag.com


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HOW TO

Hackett

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

BY OTIS HACKETT

A DEAD INITIATIVE REBORN Pre-paid maintenance has a second coming

L

ast month we were just breathing some life back into a failed initiative, the implementation of a pre-paid maintenance program. After being gone for about ten days, I returned and analyzed the Daily Operational Control spreadsheet (DOC) we wrote to see if anything happened while I was home. We didn’t sell as many prepaid maintenance programs as I would’ve liked, but we did sell four. According to the DOC, that’s about 8 percent penetration on 49 units for the month, which is still a long way from the 40 percent penetration that I know we can reach. We’ve reached as high as 40 percent with other dealerships, so I know it can be done. All four sold in the last half of the month of December were for snowmobiles. We sold just over 25 of the 49 units in the last half of the month, so rough math tells me that we ran at about a 16 percent pace once we got the thing off the ground. Not a bad start for a program 30 March 2010 www.MPNmag.com

that nobody believed in at the beginning of the month. None of the things the team had planned to do in support of the program have been implemented yet; we’re just doing this from the sales floor without the help and support of the rest of the dealership. Once those kick in, I’m expecting that 16 percent to climb pretty steadily. When we get into the spring season, motorcycle riders are traditionally far more open to a good maintenance program than snowmobile buyers, so, again, I expect some more incremental growth at that time. So what does 40 percent penetration mean in terms of money? The back end profit per unit sold was just under $250 at the beginning of December, but it went up in the second half of the month to a more respectable $302. This number does not include a documentation fee, because with the huge disparity in what you can charge for a DOC fee, we never found it a viable factor

for comparison to other stores. A Also, in this particular state, y can’t sell GAP or credit life you and disability insurance, so $302 is pretty decent. The increase in service department work is obviously to be determined, but we’re already able to schedule more buyers’ first services right at the time of delivery. That’s certainly going to help the service team predict their w workload as time passes. My hope is that we’ll have our PG&A team up to speed with how they can serve the prepaid maintenance customers by the time those first services begin to roll in. The pre-paid maintenance program is a self-insured product. Your state may not allow selling a self-insured product, so check into it first. If not, there are a few fairly decent insured and/ or underwritten products out there which may have an impact on your profitability. We set our cost at 60 percent of the retail price. The average profit so far is $391. Most 20-groups suggest 50 percent cost, but I’d rather be safe than sorry. We’re tracking another client who began selling prepaid maintenance about a year ago with the same 60 percent cost structure, and they’re pretty consistently at about 90 percent redemption of that 60 percent, so we feel pretty safe setting our cost at 60 percent. And remember, that’s billing the account at full retail. Then we set up an actual bank account to hold the money. Again, in some states that money must not only be accounted for, but it must also be put into an escrow account and relieved under very specific conditions. We urge

you to do your due diligence and to be fully informed of what your laws are before you try to implement a pre-paid maintenance program. So, we’re barely up and running, therefore it’s a little tough to forecast what the actual dollar impact will be. At this point, with broad stroke measurements, we’re hoping for 25 percent or more penetration for 2010. Counting the 40 percent profit recognized as F&I profit alone, with 1,000 units projected, 25 percent penetration should show about a $100,000 increase in the dealerships gross profit, and none of the incremental service department income is in that equation. I have to admit that the initiative has become very taxing mentally. I thought the program was dead, along with my credibility and confidence. I was really down on myself. Last month, the editors even had to remove some of what they called “self loathing” comments. I just need you all to know beyond a shadow of a doubt that I know what you’re going through — as the owner of my own business, I fight, win and lose many of the same battles you do. And as a manager of dealership managers, I can relate very directly to the battles you’re fighting. t Otis Hackett is the founder of Otis Hackett Group. OHG provides general management services for powersports dealers across the US. The OHG team brings realworld experience having all been motorcycle dealership employees working on the front lines of the industry every day. Click on www.otishackett.com or e-mail otis@otishackett.com. Join us on Facebook or follow us on Twitter!


North Dakota

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UP Michigan Maine

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South Dakota

VT

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Boise

Michigan

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Mass.

Iowa Nebraska

Conn.

Pennsylvania

Elizabethtown

Nevada Illinois

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RI

Ohio

NJ

Utah MD

Colorado West Virginia

Kansas

Fresno

DEL DC Virginia

Missouri Kentucky California

Memphis

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Tennessee Arizona

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Alabama

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Miss. Georgia Louisiana Texas

Florida

Boise, ID / Fresno, CA / Memphis, TN Elizabethtown, PA / www.wps-inc.com

BRINGING YOU THE BEST SERVICE, PRODUCT, DELIVERY!

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BEST

Operators CLUB Table 1

Total Dealership Gross Profit Net

2008 24.68% 4.27%

23.63%

2009

HD 2008 HD 2009 27.65% 26.42% 0.12% 5.84% 2.20%

’08 YTD Margin 15.40% 13.48% 10.87% 10.78%

’09 YTD Margin 12.98% 11.69% 10.34% 8.91%

’08 HD ’09 HD Margin Margin 18.95% 17.39% NA NA NA NA NA NA

’08 YTD Margin 39.00% 34.01% 31.47% 37.19%

’09 YTD Margin 37.70% 32.82% 32.78% 34.71%

’08 HD ’09 HD Margin Margin 36.85% 36.71% 30.41% 29.79% 32.92% 32.66% 42.58% 41.57%

Table 2

New Unit Sales New Cycles ATVs – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

PWCs

BY STEVE JONES

Snowmobiles

DEALERSHIP YEAR-END DATA

Table 3

P&A Sales Parts

T

he following compares the year-end 2008 and 2009 National Norms data compiled and averaged from multiple GSA groups. We have included the H-D National Norms as well. In Table 1 we see just how tough this year has been for both metric and H-D dealers. That said, H-D dealers still hold much better profits than metric dealers. Table 2 shows why H-D dealers are pulling more profit: better new-unit margins. Also, although not shown, they are now pulling used margins similar to the metric dealers. This has not always been the case in the past. P&A sales margins are mostly higher for metric dealers with the exception of apparel. The H-D apparel permits both higher volume and margins based on the strength of their branding. As we have stated in the past, the goal for service is to hold tech compensation (not including benefits) to 30% of 32 March 2010 www.MPNmag.com

revenue in order to achieve the 70% gross profit necessary to pay the bills. Metric dealers did a slightly better job here. Moving on, the traffic log data in Table 5 reveals the huge difference in floor traffic between metric and H-D dealers. It should be noted that there are significantly fewer H-D dealers. However, metric dealers do a much better job of closing the deals. Please use this data to help you in the coming year. Our goal is to provide you with the road signs to guide you. It is vital that you begin to track these numbers so you can take control of them. Survivors are proactive, not reactive. t Steve Jones, general manager of GSA, outlines dealership best business practices to boost margins, increase profitability and retain employees. His monthly column recaps critical measurements used by the leading 20-group dealers. GSA is recognized as the industry’s #1 authority on dealer profitability.

Access Counter Access Vehicle Apparel

Table 4

Service Department Tech Compensation Gross Profit

’08 YTD ’09 YTD ’08 HD ’09 HD Margin Margin Margin Margin 30.56% 30.98% 32.67% 33.15% 69.44% 69.02% 67.33% 66.85%

Table 5

Traffic Log

’08 Total / % Greets

’09 Total / % Greets

Swings

62,888

Greets

4,897

47,540 3,559

Sit-Downs

2,634 / 53.79%

1,680 / 47.20%

Write-Ups

1,858 / 37.95%

1,182 / 33.21%

Closes

1,319 / 26.93%

809 / 22.74%

Deliveries

867 / 17.70%

543 / 15.27%

HD ’08 HD ’09 Total / Total / % Greets % Greets 90,981 124,121 4,023 3,788 1,782 / 1,603 / 44.29% 42.33% 1,129 / 1,023 / 28.07% 27.00% 669 / 595 / 16.62% 15.70% 549 453 / /13.65% 11.97%

Note: Our Voyager 4 data reporting and analysis system is available for any dealership to use for a very nominal fee. For more information on our data reporting system, dealer 20-groups, on-site consulting or training, drop me an email at steve@gartsutton.com or visit www.gartsutton.com.


Go all access with MPNâ&#x20AC;Ś

Now you can get Motorcycle Product News anytime and anywhere you want with our all-new digital edition.

log on now. mpnmag.com/site/ digitalissue/ www.MPNmag.com March 2010 33


Lessons LEARNED

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

BY ROD STUCKEY

THE ENTREPRENEURIAL EPIPHANY

B

ack in 1998 we were pursuing a second location just outside of Atlanta. It was a new open point which had become available for three metric OEMs due to several local dealers recently going out of business. After a thorough market analysis, we felt this was a great opportunity and decided to aggressively move forward. Against my better judgment, we hired a former employee as lead project manager and empowered him to do much of the hiring and vendor set up, and we gave him other responsibilities required for the launch of the new location. During his previous employ, he had always exuded an “I’ve forgotten more about this business than you know” additude — very condescending. However, this time around, he seemed humbled by his negative experience after leaving the first time and assured us he was very appreciative of his latest 34 March 2010 www.MPNmag.com

opportunity. This time, he said he was in it for the long haul, and if given the opportunity he would prove it to us. Little did we know that, instead, he was just studying our every move during the startup. He proceeded to document our vendor contacts and study our blue print on starting a dealership. Apparently, he had some financial horsepower and, in a very clever move, bought out our local competitor. I’ll never forget the cocky smirk on his face when he notified us of his new venture: “Well, we’re now peers,” he said. Quicker than you can say conflict of interest, this guy had spent his time on our dime learning the whole enchilada, everything there was to know about a start up, from our employee comp plans to how much we paid for monthly alarm service to where to go to get a good deal on merchandising fixtures. Heck, he even knew roughly how many units he could expect to

sell on a monthly basis if he did the right things. It’s too bad non-competes aren’t worth the paper they’re printed on. Slowly but surely he began picking off our key employees by offering them wages above and beyond what he knew they were making with us. Unwilling to negotiate their pay, I stubbornly let them go. Although this did inflict pain upon my business, I knew my numbers well enough to understand that the model could never prosper if I overpaid for labor, just as it could never work if I sold every unit at cost with the intentions of making it up on volume. As a business owner you can never allow your business to be completely people-dependent. Your business must be run by the systems, and the people run those systems. People come and people go, it’s not personal, it’s just business and you’d better be prepared to handle it. I look back on this situation with great gratitude and harbor no ill will towards this former employee. He was just doing what was best for him and his family, and the fact he was a bit pompous in the process was just his nature. It was because of these circumstances, a splash of alcohol and a good book on the beach that I had what I now refer to as the epiphany. I’ll get back to the epiphany in a minute, but first a quick story. In 1952 a 52-year-old feet on the street milkshake salesman walked into a local hamburger stand in San Bernardino California to make his regular pitch. What he witnessed was not just your regular hamburger joint; it was a welloiled money making machine. Burgers were being produced systematically, efficiently,

consistently and, best of all, nearly anyone with a pulse could do it! After observing system on top of interdependent system consistently satisfying the long lines of customers, Ray Kroc persuaded Mac and Jim McDonald to allow him to franchise his model. 12 years and several million burgers later Ray bought out the brothers after having created “the most successful small business in the world.” What Ray Kroc did was not only profound for his industry, it was profound for business in general. Kroc proved that to build a truly great business you had to go to work not just in your business, but more importantly on your business to build systems and process that produced consistent, profitable results without complete dependence on highly paid personnel. After originally reading this story on the beach years ago it hit me: The difference between building a business versus just owning a job was systems! (The word system is a great acronym which stands for Save Yourself Time, Energy and Money.) In the end, my former employee would eventually sell out to the same consolidator who bought our stores, and the consolidator moved the entire operation under one roof with all major metric OEs. Eventually it was a win-win for all. t Having owned and operated four dealerships in the Atlanta market, Rod Stuckey knows firsthand how hard it can be to get targeted dealer information, so he founded Dealership University. His monthly column gives dealers the lessons they need to learn to be more successful.


Rock On Keep rocking with MPN enews. Get in the know, and stay there with weekly updates. It’s fast, it’s free, it’s digital. Log onto mpnmag.com today and register.

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5(*,67(512: Get a FREE Test Ride

.COM www.MPNmag.com March 2010 35


Practice Lessons WHAT YOU PREACH

LEARNED

– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –

BY ROD WILLIAM STUCKEY DOUGLAS LITTLE

THE SIMPLE SOLUTION Streamline your store

W

hile I’ve mentioned my favorite story a time or two before, its worth repeating: During the Space Race, NASA spent more than a million dollars designing a pen for astronauts that can write in weightlessness, while the Ruskies simply took pencils. The reason I’m so taken with this story is that it explains so much about life and, more importantly, our current economy. I call it the simple solution. What likely took our scientists and engineers months or even years to create probably took the Russians all of a few seconds to figure out: “Pens won’t write in space,” one said. “Take pencils,” came the reply. The problem you are most likely facing is that your customer base is shrinking. What’s the simple solution for your situation? The spectacular guy goes out and hires a killer agency, spends his reserves to come up with a sure-fire marketing plan to create top-

36 March 2010 www.MPNmag.com

of-mind awareness, launches back-to-back ad campaigns featuring various sales and promotions, diverts his kid’s college funds to cover a deep product buy for lower costs and, in the end? He files bankruptcy. I don’t want this to be you. The simple solution is to make your business not need customers. Huh? That’s right. Sure, you’ll always need some customers, that’s a given. But you can greatly reduce the need by lowering your costs. Yes, the decisions are hard, but in the end survival is key, and the wise old businessmen will tell you that those who survive these things come out stronger than they went in. In my efforts to trim the bacon I have taken one company from a high of 26 employees to just four full-timers and a scattering of part-time workers. I’ve taken another from 122 down to just 57. These are huge reductions, but we’re still getting the job done. The worst part is that many of those people didn’t deserve to be cut.

Like you, I’ve spent hours upon hours looking at vendor contracts. Why are we paying so much for this? Should we clean our own windows? Why do we need such a big dumpster when the cheaper one will work? T These are all things that are key to your business’s health, but when times are good, they easily slip through the cracks. A And, if you’re not personally signing every check your dealership writes, you should be. Watch those expenses like a hawk! Get your parts manager, service manager and office supplies buyer to do the same. It’s amazing how many thousands of dollars you’ll save just by keeping your eye on the checkbook. How did I cut out so many jobs? Well, it wasn’t easy, but the key is cross-training. Can your parts counter do with one less guy? What if your service writer pulls double duty? Should your service writer actually be your service manager? Are your bikes boldly tagged with prices to make shopping without sales assistance easy? Are all of your managers actually working managers or are they there solely to manage? Nobody likes firing people, but when it comes down to saving the jobs of many over the few, sometimes this is a necessity. Furthermore, you’ll keep a company going that can produce more jobs again later. That, my friends, is the key. There is very little else on your P&L that can kill you faster than inventory. I sometimes drive by those big motorhome dealers and wonder how they do it. Let’s face it, floorplan interest kills! Fortunately for us, we saw this thing coming early on and started reducing inventory. We’ve still had a hard time getting the numbers down, but we’ve been luckier than some. I drive by fellow dealers and see 50+ side-by-sides in their

lot and just wonder, “How long before those actually move?” Believe me, reducing inventory is hard. Many of the manufacturer reps will hit you with everything from “You won’t get incentives unless you order X number of units,” to, “My grandma needs an operation, and if you don’t buy X number.” Just remember, it’s your money. You can get machines from other dealers or even from the warehouse if you need them. As for the lost incentives, add up the total of all incentives you’d earn and then compare that to a $10,000 per month interest bill for six or 12 months. I bet you’ll realize that the incentives aren’t worth that much. And finally, don’t order under pressure ... ever! Take that order sheet that your DSM gives you and write the dollar value of each machine next to its model number on the left. Then, using your calculator, figure out the total for the number of units that you want to order on the right. When you look at bikes in terms of dollars spent, not numbers of units, I think you’ll find it a lot easier to stand up to the DSM. It’s all part of the simple solution. Someday, the customers will return, and you can rebuild to the size needed to handle the flow of traffic then. The goal is to still have a door for them to walk through when they do stumble back into your store. t Columnist William Douglas Little writes from experience, having built a multi-line dealership from the ground up. His store, Unique Powersports, has earned accolades for excellence in retail sales, community involvement and customer satisfaction. Little’s debut book, Mexican Bowl Fishing, was released in 2008 and is available at www.WilliamDouglasLittle.com.


Essentials Gear Tech 8 Boots

Palm Protectors

Alpinestars The Tech 8 off-road boot features the latest development and material technology to enhance its performance, including a multi-compound poly urethane calf and shin articulation system with a vertical dual sliding blade mechanism, designed to improve control, flex and safety performance.

Risk Racing Palm Protectors are a very thin, protective layer offering full coverage protection of the palm against blisters.

–––––––––––––– Sure Sellers: • Extended flex panels in the instep and achilles to further promote natural movement, control and comfort. • Asymmetrical gel inserts for ankle comfort and prote protection and a removable anatomicall ffoot bed easy-to-operate • Four easy-to-operate w aluminum buckles with quick release/ memory and a quick h selflocking system with ea e aligning design for easy, precise closure

––––––––––––––––––––––––––– Sure Sellers: • Grip flange protection between the thumb and forefinger • Ultra-thin armor worn underneath gloves • Absorbs vibration transferred through handlebars ––––––––––––––––––––––––––– Retail Price: $7.99

–––––––––––––– Retail Price: $429.95 –––––––––––––– For More Info: Alpinestars 2780 W. 237th St. 5 Torrance, CA 90505 (800) 438-2577 www.alpinestta www.alpinestars.com

Ranier Jacket Firstgear The TPG Ranier jacket offers a lighter, less bulky, more comfortable, flexible fit plus superb protection with shock absorption in the shoulders and elbows. The Hypertex Plus waterproof and breathable outer shell keeps rain out but allows inside humidity to escape. –––––––––––––– Sure Sellers: • Outer shell material is 100% 600 denier nylon for abrasion resistance • Kevlar reinforced Teramid underlay at the crucial first point of contact on the shoulders and elbows to keep your skin safe from the road • Six vents, ten pockets and an under the helmet rain hood –––––––––––––– Retail Price: $499.95 –––––––––––––– For More Info: Firstgear 4900 Alliance Gateway Freeway Fort Worth, TX 76177 (866) 302-5676 www.firstgear-usa.com

38 March 2010 www.MPNmag.com

––––––––– Inf For More Info: Risk Racing LLC Road Suite B 200 Overhill Road, 2 Mooresville, NC 28117 (704) 658-9332 www.riskracing.com www.riskracing


Fury Jacket Scorpion Sports The XDR Fury Jacket features a weather resistant design with a high density 600D outer shell, a fully-sleeved Everheat thermal liner, and a removable vable waterproof/windproof liner. The jacket is available in black and neon.. –––––––––––––– Sure Sellers: • Exo-Tec CE approved ventilated armor for elbows and shoulders • Back protector compartment with temper foam included • Water-resistant vents and adjustable back vent to control air-flow –––––––––––––– Retail Price: $299.95 / $309.95 (XL) –––––––––––––– For More Info: Scorpion Sports Inc. 25921 Atlantic Ocean Drive Lake Forest, CA 92630 (888) 672-6774 www.scorpionusa.com

Glasses sses Spy y Optic Continuing a tradition immersed in the culture of action and motorsports, Spy has released its new 2010 line of sunglasses, including the Cooper XL. ––––––––––––– Sure Su Sellers: • Custom-built from high quality C propionate p • 8-base ARC lenses 8enses • 100% UV protection 10 te ection

–––––––––––––– Retail Price: $104.95 / $144.95 (Polarized) –––––––––––––– For More Info: Spy Optic Inc. 2070 Las Palmas Drive Carlsbad, CA 92011 (800) 779-3937 www.spyoptic.com

Flight Vest Ogio The Ogio Flight Vest offers tons of storage and disperses weight evenly around ound the torso. The multifunctional storage pockets will match the demand of any rider. ider. –––––––––––––– Sure Sellers: • 70 oz. (2.0L) hydration reservoir located on the ventilated back with an insulated hose • Dual side expansion buckles • Multiple adjustment points for a custom fit –––––––––––––– Retail Price: $129.99 –––––––––––––– For More Info: Ogio International 14926 S. Pony Express Road Bluffdale, UT 84065 (800) 922-1944 www.ogio.com

www.MPNmag.com March 2010 39


Essentials P&A &A Clutch Basket Barnett The Billet clutch basket for the ‘09-’10 Yamaha YZ250F is CNC machined from aerospace quality aluminum and features a stainless steel insert for extreme wear resistance ce and to ensure smooth, consistent engagement shift after shift. –––––––––––––– Sure Sellers: • Precision machined oil passage windows create more oil flow to help plates run cooler and last longer • Center driven gear comes installed • Backing plate, grade 8 fasteners and installation instructions included –––––––––––––– Retail Price: $250 –––––––––––––– For More Info: Barnett Tool & Engineering 2238 Palma Drive Ventura, CA 93003-5733 (805) 642-9435 www.barnettclutches.com

Large Fuel Tank California Cycleworks Owners of the popular Ducati Hypermotard HM1100 are able to double the operating range via the Hyper Tank, a larger 6.4 gallon fuel tank. –––––––––––––– Sure Sellers: • The added fuel capacity along the bottom of the tank minimizes impact on the center of gravity • Kit K includes a replacement starter cable, custom air filters, h hardware and instructions In • Installs in three to four hours without any permanent m modifi cations of the motorcycle –––––––––––––– Ret Price: $799 Retail –––––––––––––– For More Info: California Cycleworks Inc. Cal 663 33rd Street, Suite D San Diego, CA 92102 (619) (619 501-2466 www.ca-cycleworks.com ww

Dual Slip-on System Dua Two Brothers Racing conjunction with a major redesign by Kawasaki of its In co Z1000, Two Brothers Racing took advantage of the aggressive Z100 styling to improve upon the midrange torque power characteristic of the 1000cc inline four with a dual slip-on system that boosts power across the range. –––––––––––––– Sure Sellers: • Peak increase of 5 horsepower at 7,000 rpm • Nearly 10 pounds lighter than the stock exhaust • Available with aluminum, titanium or filament wound carob fiber canisters –––––––––––––– For More Info: Two Brothers Racing 401 S. Grand Ave. Santa Ana, CA 92705-4102 (800) 211-2767 www.twobros.com

40 March 2010 www.MPNmag.com


Tires Excel The Blackwidow tires have expanded to include UTVs and popular side-by-sides. es. The deep lug design should keep any vehicle crawling through the worst conditions. s. –––––––––––––– Sure Sellers: •27x11R14 version weighs under 33 pounds • Despite the overly aggressive tread pattern, the overlapping centerline bar wo works rks to provide a smoother ride and improved handling on the hardpack ud • Aggressive lugs provide excellent self-cleaning characteristics and keep mud from packing up, offering ultimate traction –––––––––––––– For More Info: Excel Tire and Wheel 15205 E. Stafford St. Industry, CA 91744 (714) 343-2270 www.exceltireandwheel.com

Transmission Rebuild Kit Jims Jims has just released two new time saver transmission rebuild kits for both the H-D 6-Speed Cruise Drive and Screamin’ Eagle 6-Speed. ––––––––––––––

Sure-Sellers: S • Includes Jims’ Jims complete gasket set with all necessary O-rings, oil pan gaskets and seals • Also includes all necessary required bearings, retainers, main shaft and counter shaft nuts • Jims is one of the first to offer a transmission rebuild kit for any of the Twin Cam Cruise Drive models –––––––––––––– For More Info: Jims 555 Dawson Drive Camarillo, CA 93012 (805) 482-6913 www.jimsusa.com

Top Case Shad USA The new SH 49 top case is technically similar to the SH 50, offering maximum safety. The mechanical system guarantees n ntees a vibration-free ride. –––––––––––– Sure- Sellers: • Two full helmets can fit into the spacious acious and reinforced interior • A backrest can be attached as an accessory • SHAD’s patented light system can be mounted directly to the universal mounting plate –––––––––––– Retail Price: $299 –––––––––––– For More Info: Shad USA 19096 NE 4th Court Miami, FL 33179 (877) 545-7423 www.shadusa.com

www.MPNmag.com March 2010 41


Essentials EssentialsStaff StaffPicks Pick icks s Z990 Defender Zoan With a plethora of less expensive helmets on the market, how do you choose something you and your customer can feel good about? Zoan’s Z990 is one answer. This a no compromise model, it fit much better than I anticipated, all functions worked as claimed and the real kicker is the MSRP: $149.95. DOT and ECE 22.05 approved, the Thermoplastic Composite lid (pictured here with the “Wildness”

graphic) has advanced EPS and more than adequate ventilation. In addition to the clear shield, the helmet includes a dark sun shield that is easy to adjust, even with bulky winter gloves. ves. — Dean Kelly ly MPN Associate Publisher For More Info: Marshall Distributing 4162 Doerr Road Cass City, MI 48726 (800) 248-0136 www.marshalldistributing.com

Casual Casual Ladie es’ Tops Ladies’ VaVaV VaVaVroom Vroo VaVaVroom VaVaV Vroo wants to know if you’re one of those girls. I say heck ya! This ttrio of tops let’s me pledge allegiance to the sport without losing femininity. The black “I Heart Motorcycles” ladies fitted my fe em thermal tee is $57.99. The baby pink “Ride” ladies relaxed the e fitt tee retails for $21.99 and the “Talk Dirty To Me” ladies fi rrelaxed fit burnout tee in Nude rings in at 29.99. With more ladies in the saddle than ever, this growing line of m apparel is definitely worth checking into. ap p — Marj Schultz MPN Art Director ––––––––––––––––– For More e Info: VaVaVroom VaVaVro oo 1141 W. Washington Blvd., Suite 236 W Chicago, Chicag go IL 60607 (312) 823-6709 82 8 www.vavavroomonline.com www..v

Technical T h i lU Underwear d Alpinestars My final ride of 2009 was a frigid Thanksgiving Day journey to Potosi, Wis.; afterward came the warm meal and family visits. Luckily, I had on Alpinestars’ new technical performance underwear that day. I had worn them on a few trips before this one, but today they would be put to the ultimate test. If I said I stayed completely warm, I’d be lying — but that’s pretty much impossible to do on a motorcycle when it’s 45 degrees outside. However, the gear did its job wonderfully. The Dryarn fabric let me move around underneath layers

42 March 2010 www.MPNmag.com

of warm clothing, unlike grabbyy rt cotton underwear. And the sport ort fit of both pieces provides comfort in the riding position. Also, it’s ed seamless construction prevented re, cold drafts from piercing my core, ent arms and legs — it was a different story for my hands, though! 5 The bottom retails for $99.95 while the top goes for $109.95, and nd frigid spring riding is just around g the corner ... —Doug Dalsing MPN Assistant Editorr ––––––––––––– For More Info: Alpinestars 2780 W. 237th St. Torrance, CA 90505 (800) 438-2577 www.alpinestars.com


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Fender Manufactured in the USA, Paughco’s “old school” bobbed fenders offer a nostalgic look for your ride. Sure Sellers: Front • Fron nt fenders designed for use with Paughco and early OEM springers with brackets repositioned for correct clearance and bobbed look hb • Rearr ffenders come pre-cut with that early style rounded design for an unmistakable bobbed appearance unm mi Rear • Re earr ffender struts includes an integrated chain guard mount and chain ch hain splash shield Retail Price: $159.95 (Front), R eta e $157.95 (Rear) $ 15 For More Info: Paughco Inc., P.O. Box 21390 F Carson City, NV 89721-1390; (800) 423-2621; C www.paughco.com w

Mechanic’s c’ss Shirt The new Hard Chrome mee line of gear from Sapphire iree Lounge Inc. features es a mechanic’s shirt. The he shirt offers a high thr thread read count and deep color or embroidery, as welll ass a base material that hass a softer touch than a normal off the rack k mechanic m shirt. shirt Sure Sellers: • Available in 15 different color and design combinations • Snap down collar for riding • Chain collar hook and heavy duty snap buttons For More Info: Sapphire Lounge Inc., 1275 N. Patt, Anaheim, CA 92801; (714) 447-0047; www.sapphireloungeinc.com

Replacement Air Cleaner Rep Wimme Custom Cycle introduces a new S&S replacement Wimmer air cleane cleaner with an old school look. Simply remove the teardrop cover and place filter adapter and new oversized teardro filter in along with the new cover and you can transform the look of your bike. Sure Sellers: S • CNC machined billet intake fits all S&S carburetors • Available in satin and wrinkle black along with satin nickel finishes Rain protection available •R Retail Reta Price: $225.00 More Info: Wimmer Custom Cycle, 11670 Highway 17 For Mor Bypass, Mu Murrells Inlet, SC 29576; (866) 468-2925; www.wimmermachine.com www.wimmer

44 March 2010 www.MPNmag.com


Billet Transmission Top Cover This RSD di direct bolt-on replacement for OEM cover is machined ffrom billet aluminum. Matching Nostalgia derby, and rockerbox covers are also available separately. ignition an Sellers: Sure Selle hardware is included • All hardw • Available in i chrome or black the U.S.A. • Made in th Retail Price: $229.95

Ultima Belt Drive

For More Info: Drag Specialties, P.O. Box 5222, Janesville, WI 53547; (800) 222-3400; www.dragspecialties.com

Ultima’s newest Evo and Twin Cam Dyna Primary Belt Drive to join its lineup is this 2-inch Old School model. The 3.35-inch Open Belt Drives are available in Street or Drag Race style with outboard supports. Sure Sellers: • Fits both Evo and Twin Cam 1991-2005 Dynas with no modifications needed • Billet 6061-T6 aluminum backing plate • Front grill guards and side covers are available For More Info: Midwest Motorcycle Supply, 2100 Hwy. Z, P.O. Box 669, Pevely, MO 63070; (800) 325-3914; www.ultimaproducts.com

Aviator Sunglasses with Foam Aviator sunglasses are a smokin’ fashion trend, and Global keeps riders hip with this Aviator Style Glass with a curved frame and lens, and added vented EVA foam. Features include ultra soft optical nose pads, spring hinges and black rubber tips.

Sure Sellers: • Available in gold, silver and gunmetal frames with mirrored, driving-mirrored and flash-mirrored lenses. • Shatterproof polycarbonate lenses lens are de-centered with scratch-resistant coatings scra UV400 filter provides maximum • UV4 ultraviolet light protection ultr

Retail Price: $25 Reta For M More Info: Global Vision, 7381 Ardith Court, Suite D Byron Center, MI 49315-8151; Cente (800) 927-2801; www.globalvision.us/ www

www.MPNmag.com March 2010 45 www.M


ICMA o organizers feared the sagging global economy would

negatively a affect their Milan expo Nov. 10-15; however, their fears were assuaged as nearly 450,000 assua people packed pack the halls this year. The most interesting number in was the imp impressive increase in international internationa visitors: There were 29.9% more international trade and public visito visitors this year, with trade visitors coming from 127 different com countries. T There was an increase of 30% from France and Germany because because of the cancellation of the Paris show. “We’re particularly pleased with wit the increase in the number of tthe international visitors because it rrepays our hard work to make the show more globally attractive,” EICMA and ANCMA director Cos Costantino Ruggiero said. “During the show we presented the joint ven venture to create EICMA CHINA, to e export the Milan show to Canton. The T success of Green Planet has lead us to reposition Bike Asia that th we launched two years a ago to Singapore, transforming transformin it into a specialist show with a clear objective: to become the number one show for every kind o of green vehicle. That’s the future, but first of all we want to share this year’s success with Fiera y Milano and the Lombardy region, who supported the EICMA show.” suppor

46 Ma March rch h 220 2010 10 www.MPNmag.com

photos by Joel Martin

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www.MPNmag.com March 2010 47


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SEEKING DEALERS

877-752-7835

powerlet.net

New & Used Parts for Japanese Streetbikes

A & J CYCLE SALVAGE 10 INDUSTRIAL HIGHWAY, LESTER, PA 19113 (610) 521-6700 FAX (610) 521-6868 www.ajcyclesalvage.com UPS SHIPMENTS DAILY

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Ad INDEX

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Quickly locate an advertiser in this issue with the list below: A&J Cycle Salvage .............................. 49

Helmet House Inc. .............................6-7

Thermo Tec ......................................... 49

Barnett Tool & Engineering ................ 49

J&D Walter Distributors Inc. .............. 48

Tucker Rocky......................................... 5

Clarke Manufacturing Co.................... 48

K&L Supply Co. ................................... 52

Unique Powersports ........................... 37

Colony Machine & Tool ....................... 28

McCarthy Distributors LLC ................. 48

Continental Tire .................................. 17

Mustang Motorcycle Products Inc. ..... 49

Dealership University.......................... 35

Parts Unlimited ..................................... 3

Exceed International/Hot Products .... 48

Powerlet .............................................. 49

Exide Technologies/ Champion Batteries ........................ 19

Ron Ayers Motorsports/Wholesale Division ............................................ 49

Yuasa Battery Inc. ............................... 29

Gart Sutton & Assoc............................ 33

Sudco International Corp. ................... 51

“Z1 Enterprises, Inc” .......................... 49

Vee Rubber America ........................... 23 Western Power Sports Inc. ................... 2 Western Power Sports Inc. ................... 9 Western Power Sports Inc. ................. 11 Western Power Sports Inc. ................. 31

Check the

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