From where I sit, it’s hard to believe that fall is here. Luckily, financial forecasting is not weather dependent. Regardless of the temperatures in your area, the fact remains that new bikes will be arriving at your dealership and you need to manage your current inventory. A few other fourth quarter tasks include calculating your break-even and profitability numbers and preparing for 2019. As powersports dealers cast an eye toward 2019, a sharp pencil and ready calculator can mean the difference between a year in the black or a disappointing year in the red.
2018 is shaping up to be another flat year for on-road powersports products with off-road vehicle sales such as 4x4s up slightly. This is reflective of a demographic transition from Baby Boomers to Millennials. While Millennials still like motorcycles, they are flocking to those off-road vehicles that can hold a family or group of friends. Now that Millennials represent the largest working demographic in the U.S., this generation has the power to “make the market.”
Regardless of the numbers, there are some factors outside of a dealer’s control. Rising tariffs and higher OEM prices for certain bikes can put these products out of reach for some consumers. When planning your inventory for 2019, take a close look at what sold this year. Are you still trying to move those high-end luxury models? Have your Baby Boomer customers decided not to upgrade this year? Are off-road products moving faster than traditional motorcycles? This may be reflective of a growing Millennial buyer base. Rising interest rates and rising costs this year give you a glimpse into next year. Plan accordingly and consider resetting your inventory mix. Continue reading