Being A Miser, Going Green

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I attended my first Dealer Expo in 2002. The country was coming off a short recession, but dealers at the show seemingly didn't notice. They were buying enough aftermarket items to satisfy the new customers they could expect in the spring. That year the Motorcycle Industry Council reported double-digit growth in motorcycle sales, as it had the previous four years (and growth in general since 1992).

Now I'm preparing to attend my eighth Dealer Expo. Because there could easily be a double-digit decline in motorcycle sales in 2009 (as there already has been in the off-road market), most dealers can't afford to experiment boldly and will instead buy cautiously. Exhibitors know this, so expect some great deals in prices and terms. There might even be room to haggle.

This buyer's market, which will be so great at the show, has already caused havoc at many of your stores. Customers, I hear, expect the 50 percent discounts they're enjoying at general retailers. See the letter to the editor for a first-hand account of this low-balling.

Rapid deflation could lead to another Great Depression, economists warn. But what can we do? Ideally, everybody would keep prices within reason. But no dealer wants to be the one idiot paying full wholesale.

At the retail level, a lot depends on location. Isolated dealers will fare better than those with discounters as neighbors. Then again, the Internet has become the ubiquitous discounter. More than ever, dealers will want to focus on customer retention through unexpectedly good service and fun activities.

But even excellent dealerships will see sales drops. Owners are figuring out how to minimize their effect on profits. Dealernews columnist Clark Vitulli offers suggestions on staffing levels ("Cutting To the Bone"). For other ways to cut costs, check out our "Going Green" special report starting ("High-Efficiency Retailing"). Directly preceding this section is a profile on eco-friendly Frieze Harley-Davidson, whose owner's feelings on the matter are made clear on the cover.

Whatever your thoughts on global warming, you've got to admit that less energy consumption leads to lower bills. And, yes, I know you have to factor in how much it cost to lower the consumption. Just do the math. Nobody, for example, would spend $3 million to save 30 percent on electricity. Lighting systems, of course, cost nothing approaching that, and efficient light bulbs are actually the easiest items to justify. But even then, there are countless options. It pays to do your research, especially when it comes to obscurities like odd insulation materials. See the end of the "Going Green Section" for a list of educational resources.

Another reason to go green could be for the promotional value. Jay Leno says good PR was a principle reason why he renovated his famous garage with things like solar panels. The Tonight Show host spoke with fellow editor Dennis Johnson, who provides details ("What's So Funny About Going Green?").

Harley dealer Dave Fischer, whose own green initiatives we also profile, says customers generally don't respond much to his efforts. I understand how this could be true, but this is the way the world is moving. Gen Y, you can be certain, does respond to all this stuff. And President Obama has made it clear that energy conservation will be a major part of his legacy. Someday you may be forced to do some of these things.

"Someday" may be the operative word. I feel like a jerk bringing up solar panels when some of you are struggling to survive. Remember that some green initiatives are as simple as recycling and light bulbs. As far as the bigger projects go, there's no harm in researching them. Perhaps you can keep this issue around for better times. Or just recycle this big, honking magazine and book mark the section online — go green already!

Arlo Redwine Senior Editor aredwine@dealernews.com