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Taking a Holistic Approach

We’ve all heard the phrase, “take the holistic approach.” But, what does that mean from a dealer perspective? From the first point of contact, through the sales process, and throughout the life of the unit, your goal is to build a relationship that supports the whole customer journey. It’s as much a mindset as it is a functional way of running your business.

But what happens if you don’t take a holistic approach? Say for example, your parts and service departments are viewed as cost centers rather than profit centers. While you provide needed functions that are critical to the life of the powersports product, the departments are not viewed as a component of supporting the whole customer journey. Instead, those departments may be managed as an expense that is monitored and managed based on their impact to the dealership – not as a benefit to the customer. Or maybe inventories are kept as low as possible, employee training is written off as too expensive, and service employees are not encouraged to evaluate the entire customer experience with the unit.

What might happen if you changed your approach to one portion of your dealership? Let’s consider a scenario where you adopt a holistic approach to the service department.

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Staff for Success in 2022

While we wait for the year-end numbers to come in, we can make some educated estimates that sales will continue to be strong, inventory issues will continue to unwind, and service will remain an opportunity for generating profit. But one of the biggest questions looming in 2022 is staffing and labor. Will you have enough employees to support your sales and service opportunities? And, if you have sufficient staff now – will they stay?

Labor is becoming a serious issue across all areas of the economy, impacting both large and small businesses. While the unemployment rate has improved since the height of the pandemic – falling from 6.3 percent in January 2021 to 3.9 percent in December – the rate of those leaving their jobs has escalated. Employers are having to play offense and defense at the same time, struggling to fill a near-record 11 million openings while also holding on to existing workers.

As dealers look to re-staff in 2022, some are finding themselves competing in a very tight labor market. Some economists are starting to believe the pandemic has changed the behavior of the job market in ways that could have a lasting impact, including resetting the relationship between workers and their employers.

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Stay Flexible This Fall

Fall is in full swing and the powersports market should be experiencing its annual turnover of moving inventory out so that new units can be showcased on the sales floor. However, inventory challenges continue to plague 2021 sales, with many analysts forecasting continued issues into 2022. In a recent article in the Wall Street Journal, companies such as Polaris offer a glimpse into the numerous issues facing a powersports OEM, which has trickle-down impact on dealers and ultimately customers.

Flexibility should be the mantra this fall as supply chain issues continue to work their way through the industry. For example, Polaris is changing its manufacturing and sales strategies on the fly to cope with shortages of materials and parts. The company said it is juggling approximately 30 + supply-chain constraints for its units, sometimes changing its plans daily for what it produces.

This story has played out in the retail sales numbers across manufacturers. Coming off an historical 2020, the August major unit sales declined 1.4 percent overall in the US. This is not reflective of demand, which remains high. It speaks to inventory, or the lack thereof.  Where dealers are usually offering sales ‘blow-outs,’ many are now scrounging for units.