Custom baggers, tourers and bolt-on customs take shape – and this time, it’s about riding, not posing.
A Dealernews Industry Roundtable hosted by Dennis Johnson
It’s not your father’s V-twin business. Actually, it’s not even your older brother’s.
Today is a shadow of the market monster that sucked in popular culture, customers, manufacturers, inventors and lots of dollars — all of which it spit back out when the economy collapsed. But it’s still thriving, in a less bloated existence still peopled with the passionate riders, builders, dealers and artists who built it.
To understand today’s V-twin market you need to reach a wide swath of those intimately involved. Our roundtable participants:
- Matt Flintrop, GM of Milwaukee Harley-Davidson and has worked in Harley dealerships for 14 years,
- Paul Yaffe, the man behind Paul Yaffe Originals who made the prescient decision to launch Bagger Nation -- a business focused on custom H-D touring models,
- Dealernews columnist, premier trainer and industry consultant Dave Koshollek,
- Terry Rymer, co-owner and GM of Black Hills Harley-Davidson in Rapid City, S.D.
- Dealernews columnist Rick Fairless presides over the Strokers Dallas empire, including the new RF Custom Parts,
- Buzz Kanter, who launched Old Bike Journal in 1989 and currently publishes American Iron Magazine, Motorcycle Bagger and RoadBike,
- And then drivetrain guru Bert Baker, who we prefer to tell his own story: “Lisa and I started Baker Drivetrain in 1998 after we got tired of eating poop sandwiches at General Motors. We have four kids and managed to get two of them through college. Two down, two to go.”
Dealernews: So here we are in 2013. How has the market changed?
Baker: Small OEMs like Big Dog and American IronHorse have died off. Scratch-built customs have declined a little but are still strong among the faithful. Scumbags that had no business in the V-twin market are gone and are off selling Amway and contriving Ponzi schemes. Foreign markets like Europe and Australia are much stronger these days.
Yaffe: Our industry was extremely fat from overwhelming demand and popularity of choppers and customs from a booming economy and television exposure. When that dried up, the flood of companies and builders that flocked to our industry hoping to get a piece of our pie thinned out dramatically. Couple that with a major national recession and we’ve seen a huge cleansing.
Koshollek: The best in the business are still in business, and that's good. There were many in the market primarily for the money. Some of them, actually a good number of them, did not possess the professional skills needed for the market to blossom. If there's one good thing about the recession, it's that it got rid of a lot of dispassionate, self-centered individuals.
Kanter: The smart manufacturer and dealer will do fine in the short and long run as the motorcycle business redefines itself on a smaller scale. Many of us in the industry predicted a bubble years ago, when the motorcycle TV shows took off. Some believed it would last forever and built their business plans on that assumption. Others saw it as a short-term cash injection into the industry, and planned accordingly. The former is in trouble and the latter should be OK and thankful for the extra business and money while it lasted.
Dealernews: What about at the retail end?
AT RISK: DEALER CUTBACKS PUT CUSTOMER SERVICE IN PERIL
If you’re a dealership in business today, likely you’re operating with a staff that’s a fraction of the size it was six years ago. And while cutbacks have been necessary, they put future growth in peril.
“When the American V-Twin market really took a hit in 2008, owners cut staffing in an effort to curb one of their biggest expenses – a move that may come back to bite them as we continue to rebound,” says Matt Flintrop, general manager at Milwaukee Harley-Davidson. “There was a real exodus of skilled employees who left our industry, which has created a lack of skilled and seasoned managerial candidates.
“My concern is that as the market continues to strengthen and as the industry rebounds, we will be back where we were in 2003, with backlogs in service, less than fully trained sales staffs, with lots of customers happy to spend their hard-earned dollars and an industry without the management bench strength to meet their expectations.”
Rymer: There has been a significant swing towards touring or bagger models and less attention towards choppers. Financing (although loosening up some now) has been a challenge for getting additional accessory or customization funding.
Flintrop: The last few years have been humbling to our industry. There is nothing like an economic downturn to show you your strengths and weaknesses. We were flying high at end of the 110th Anniversary in 2008, and about two weeks after the event it was like you turned a faucet off and there were no more customers. It was a real lesson in budgeting, expense control, and survival. During all of that upheaval, you had to keep people positive, and mix reality with an optimistic perspective to keep people going. Having been through the worst of it, I know that it has changed me and our business for the better, and I feel that we have had experiences that give us a competitive advantage against people who were not exposed to them. In terms of competition, the downturn seemed to hit the local aftermarket and metric dealerships exceptionally hard. We have lost perhaps 75 percent of our competition.
Fairless: It seems to be getting better, albeit ever so slowly.
Flintrop: I think that the dealers that stayed in business and stayed healthy have started to figure out that unit sales are not the measure of a dealership, but profitability. It seems like prices have started to level out, but there are still some dealers with pricing that makes you wonder how they can stay in business. Although I don't advocate the $2,500 over retail pricing strategies of 10 years ago, it would be great to have dealers sell value rather than price so that we can all end up around retail on major units, parts and merchandise. They won't pay us retail until we have the confidence to ask for it. (continued)