Kawasaki to focus on product growth, inventory management

Publish Date: 
Nov 5, 2013
By Mike Vaughan

THIS YEAR'S KAWASAKI dealer meeting, held in August in San Diego, was short on new product but long on strategy. Richard Beattie, newly hired chief marketing and sales officer, made his dealer debut stating Kawasaki's primary goal to elevate its brand -- to make it aspirational and separate from other Japanese brands. It's a process that will take time, but one Kawasaki hopes to accomplish within the next 24 months, he said.

Beattie stressed that Kawasaki will continue to be a major player in powersports, will attain critical mass in all participating segments and will achieve year-to-year profitable growth not just for corporate, but also for dealers. He laid out a three-point plan to do this.

  • Focus on product by protecting the brand's strengths and fighting back "with urgency" where is being left behind. He put to rest a rumor that Kawasaki would be leaving the personal watercraft business, stating, “we are committed to the Jet-Ski; we invented it and we plan to remain.” He acknowledged Kawasaki's gaps in its four-wheel lineup but said KHI engineers were working hard to fill them. He then announced that all 2014 side-by-sides will have a three-year warranty.
  • Promote "confident communications," which Beattie described this as communicating the pride KMC has in what it makes and sells, conveying its legacy and communicating it effectively. The details are left to Director of Marketing Chris Brull.
  • Monitor inventory management. “We have to be more disciplined in what we produce. Tying up cash in inventory of noncurrent models flies in face of profitable growth. We must reduce aging inventory,” Beattie said. Balancing inventory will take time, but once this happens Beattie said Kawasaki will no longer be “an 'always on sale' brand, but an aspirational one." If this goal is realized, OEM and dealership profitability will improve, and an improved sales situation will allow Kawasaki to invest more in product development and communications, he noted.

Expect a new focus on communication, especially in product categories that have affinity for one another (KX and Teryx, Jet Ski and Ninja), Beattie said. Kawasaki intends to strive for “digital superiority and You Tube supremacy,” he added.

To reinforce dealer relations Beattie announced the re-establishment of the Kawasaki Dealer Communication Council which will meet three times a year to discuss problems and solutions. Kawasaki was the first Japanese OE to establish a dealer council back in the ‘70s.

Kawasaki has enjoyed small growth over the past few years, going from a 9.5 percent market share in 2012 to 10.1 percent currently, and a forecast of an 11.2 percent share in 2014. Executive VP of Sales BIll Jenkins said Kawasaki plans to work more closely with dealers to become more in tune with regional and local market situations. A market down by half but dealer numbers only down by 20 percent creates an unsustainable situation, so future dealer selection will be based on quality of candidate and not necessarily by potential volume, he told dealers.

To reduce dealer inventory, Kawasaki has put in place a bi-monthly ordering policy. This, Jenkins said, has resulted in a 12 percent reduction in motorcycle inventory and a 14 percent reduction in ATV inventory at the dealership level. Jet-Ski inventories, however, have grown by 6 percent. Kawasaki is instituting an off-season stocking and interest support program for dealers with excess inventory, Jenkins noted.