Dealership sales, profits rising fast, research claims

Publish Date: 
Jun 28, 2012

SALES AT MOTORCYCLE and ATV dealerships have risen almost 16 percent in the past 12 months, and net profit margins for the stores have improved to 2.55 percent, according to a Forbes article citing Sageworks Inc., a financial information company.

Dealership profitability fell to just 0.64 percent in 2009, the article states.

Sageworks analyst Robb Granado told the magazine that rising sales for both OEMs and dealers indicates healthy inventory levels. “The fact that we see the retailers doing well shows it’s actual end-user demand,” he said. “That’s a positive story for both the future of both the retailers and the manufacturers.”

Granado noted that dealers posted 7.47 percent sales growth in 2010 after a 13.77 percent decline in 2009. “We see a nice growth number in 2010, which could be that snap back from the recession,” Granado said. “You’d expect that trend of growth coming off the contraction.”

Granado speculated that sales growth has continued partly because of high gas prices and this past winter’s mild temperatures.

According to Forbes, Sageworks collects financial statements for private companies from accounting firms, banks and credit unions. The firm adjusts the net profit margin to exclude taxes and include owner compensation in excess of their market-rate salaries.

Posted by Arlo Redwine



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