Mid-Sized Dealers Face Unique Challenges

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DO YOU OWN OR MANAGE a Tweener dealership? No, it's not one of those new scooter franchises from China. It's a dealership that's just in between a big one and a little one. A Tweener dealership is one that's constantly grappling with whether to add a sales manager, a marketing manager, an ad agency, a used bike manager, or a chrome specialist — or a host of other niceties the big boys have that it isn't sure it can afford.

If there ever was a strategic management topic, this is a central one.

Here are the five key steps you must take when making your decision to proceed (or not) with a project:


What are you ultimately trying to accomplish? Is long-term growth your objective? Or is it short-term growth in order to sell your dealership? Are you trying to get through this financially difficult industry period, or did you just pick up this bright idea at your latest 20 group meeting from a fellow dealer? Remember, with any significant change of plan that you have in mind, your strategic objective must come first.


That stands for Strengths, Weaknesses, Opportunities and Threats. I've discussed this concept in this space before — it's where you list several items in each category in an effort to determine the best course of action among several alternatives.

It's where solid strategic management begins. If you don't look at all sides of an issue, you'll tend to be either too positive about the concept or too negative. Your SWOT homework will pay big dividends in the end and help you decide from a more objective perspective whether to go forward.


In short, can you afford to do it? Just as importantly, can you afford not to do it? And are you in a financial position (profits, cash flow, financial stability) so that if this idea fails, it won't sink your ship? At first, back-of–the-envelope financial doodling can be sufficient.

But before you make that crucial final decision, be certain you've studied the hard metrics (positive and negative) and are comfortable in proceeding. If it's hiring that additional staff member, will the person pay for himself in good times and bad? If it's adding an alternate retail outlet to a Harley-Davidson dealership, do you have the investment needed? What will be your return on investment, and how long before your investment is paid back to you?


Whether it's your business partner, your CPA, your lawyer, a trusted fellow dealer, a business consultant or another person who's more experienced or smarter than you, it's wise to share your full concept and all of your analysis with another informed party — after you've completed the above three steps. If you can't share it with that person in an intelligent, articulate manner, then you may not have done all of your homework. If you can, but he or she doesn't agree with your conclusions, then maybe it's not the right conclusion after all.

Either way, when you make your final decision to proceed or halt, you'll have made that decision with confidence. Then, after proper implementation, your chance for success is significantly higher.


You've made the call to proceed. Now what? If you've plowed through each of the above steps, and they all lead to "Let's proceed," then it's time to just announce it formally to your employees and get started, right?

Well, there's one more step to ensure that the implementation of your strategy will be successful. And that is to quietly share the concept with someone on your team who either will have some responsibility for implementing your plan or will be significantly impacted by it. Unfortunately, too many dealers skip this step. And that's where many ideas are rushed to judgment because the big picture, SWOT, financial analysis and consultative steps haven't been fully developed.

Now, this is not the same step as No. 4 — it's not a full-blown analytical review of your concept. It's more of a "what if" casual conversation over coffee. "What if we hired a sales manager?" or "What if we opened an ARO?" and so on. That way, after all the other steps have been successfully explored, this final step will identify any minor flaws or additional positives that will (a) fine-tune your project and (b) hopefully give the project important buy-in from the troops.

Being a Tweener dealer is not enviable. It's risky — if you grow too fast and build your infrastructure prematurely, you'll severely hamper your long-term success or worse. But if you stand still and fail to grow, ultimate success will be even more elusive. Perform these five steps and you will have managed through your best opportunity to make the right call.

Clark Vitulli is a Harley-Davidson dealer in St. Augustine, Fla. Contact him via editors@dealernews.com.