Brothers Greg Blackwell and Mark Blackwell are at the top of the game in their respective corners of the industry. We asked them to quiz one another on the ins and outs of dealer financing, aftermarket products, and in-store marketing and events.
Greg Blackwell: The biggest hurdle for franchised dealers seems to be getting financing for the people who want to buy a new unit. Do you see this changing in the next 12 months?
Mark Blackwell: I believe the biggest hurdle is still a combination of high unemployment and low consumer confidence, compounded by the uncertainty of legislation and policy coming out of Washington. There are some signs of improvement, with the latest consumer confidence figures moving up to around 50 percent and the latest jobs data showing very slight improvement.
Most dealers that I speak to say their biggest problem is traffic — fewer people coming in the stores, and those who do are still cautious. But you’re right; the ones who are interested in buying a new or used bike find it relatively harder to get approved, and if they do, they’re surprised by how high interest rates are, since most rates are at historically low levels. But many of the lenders have to cover the losses on the back of their portfolios (older loans that went bad during the recession). I believe we’ll see very gradual improvement in traffic, loan availability and approval rates during 2010. But right now, it’s still very tough.
GB: What advice would you give dealers looking to find more lenient lenders for financing?
MB: The most successful dealers seem to be constantly building and working multiple sources — not just relying on their OEs or the major lenders. Good relationships with local banks, credit unions and regional lenders, in addition to the big guys. I believe this may be more important in this environment that ever before.
GB: What can a dealer do to draw more buyers than their competitors? How can they draw in new buyers?
MB: Getting back to traffic; the most successful dealers seem to have lots of things going on in and around their dealerships that give potential buyers lots of reasons to visit the store. Many are using very cost-effective ways of communicating their activities and events, not just traditional advertising. The Web has become an increasingly powerful marketing tool. People seem to be looking for value more than ever before. But how a dealer can set themselves apart in their market in ways other than simply discounting, is the key challenge and opportunity.
Activities that welcome riders to bring family and friends — open houses, rides that start and/or end at the dealership, special events — seem to be pretty effective. I was at a dealership last Saturday and it was cold, windy and nasty out. But the dealer had a bunch of things going on inside the store and there were more than 100 people inside shopping and having a good time. I visited a few very successful dealers in the U.K. recently, and I noticed they were quite successful at attracting new riders through rider training programs. (continued)