A COUPLE OF WEEKS ago I received an email from a metric dealer who said the Top 100 competition is “absolutely worthless without having a component that makes the dealerships turn in financials” or prove their profitability. He cited specifically the case of a 2012 Top 100 Dealer that recently closed its doors. “If you aren’t going to change the criteria, then at least change the name to something a little more reflective of what you are recognizing,” he wrote.
You know, we’ve received similar complaints over the years. Not many, mind you. But in each case the statement is made that the Top 100 does not reflect the top revenue-generating stores in the industry. It’s a fair question, and deserves a fair answer.
The Top 100 was started 22 years ago mainly as a merchandising/display contest. Dealers would provide a few facts about their stores (location, square feet, etc.) and submit photos. The judges would go over the photos and make their choices.
When we revised the Top 100 entry process in 2006, we developed a form that would provide dealers not only with a way to enter, but also to give them a business exercise — a team-building exercise, if they so desired — to determine, on an annual basis, whether the daily practices they were incorporating in their stores were eventually working out for the business they wanted to pursue.
If you read the entry form (access it online until Oct. 20 at www.dealernews.com/dealernews/top-100), it explains that each dealer is judged based on how well it achieves the goals outlined in its individual mission statement or unique selling proposition. The dealers do not compete against each other; they compete against the parameters they themselves establish. Given the vast range of dealership types out there, all of them privately held, it’s about the only way you can run a competition like this.
We weigh the factors of the Top 100 every year and have frequently considered incorporating financials as some suggest; however, to do that we would need to have independent verification of the numbers — i.e. we would have to have every dealer submitting an entry agree to be audited by a third party. That’s an immense, expensive cost that would require months of work by CPAs or 20 Group moderators. The costs would be passed on to entrants, and it would likely make the contest too expensive to enter.
It’s difficult to determine a Top 100 Dealer in terms of revenue or profits, given that most shops are owned by private parties, families, partnerships — all of whom are none-too-keen on opening their books for a competition. So the Top 100 becomes a competition of innovation and excellence as outlined by individual dealerships — showcasing the practices that help a dealer stay in business. Sharing those ideas among the 100 and then in the industry at large helps raise the bar in powersports retailing. And you witness that by reading the stories we report in Dealernews.
It’s interesting to see how the entries have changed over the years. During the market boom, we saw massive renovations, stunning displays, big events and extraordinary promotions. When the recession hit, the entries focused on the merits of going back to basics — inventory management, establishing ROI for every action, lean but well-trained staff, etc. The competition is alive; it changes from year to year, depending on market conditions.
What I like best about the Top 100 is that it’s not limited to size, to scale, to franchise, to product line. Dealers like Rec-Tech in Alberta, Canada, who is the subject of our October 2012 magazine cover story, have just as much a chance of winning as do the largest Harley-Davidson stores.
Sure, there are Top 100 dealers that have closed during the years. But I did a calculation not too long ago and found that more than 70 percent of dealerships who had made it to the Top 100 list since the competition’s inception back in 1992 were still in operation, and that’s quite remarkable for a small-business retail sector.
We hope you’ll consider going through the entry process, and then actually enter. You might be surprised. Oh, and that Top 100 Dealer which recently closed? It was immediately purchased — by another Top 100 Dealer.