Like a lot of dealers, Matthew and Mark Jackson started off by buying, repairing and selling used bikes before they ever made their way into an OEM franchise as the owners of World of Powersports. and, as it was for many back in the day, getting spare OE parts was never easy.
Their local dealer didn’t want to supply parts to what he considered “the competition,” so the Jackson brothers lived with the hassle of buying wholesale from out of state. But necessity led to invention; and soon the Jacksons realized that there was a need for a wholesale parts business — where independent stores and repair shops could find parts for all the major brands under one roof.
Eventually, they bought a three-line dealership in Decatur, Ill. Remembering the problems they had as an independent shop, they launched a wholesale parts department at the back counter of the dealership. With the addition of several other OEM franchises the two — along with third brother Mike Jackson — started growing a business that would eventually place them on the forefront of the powersports business as a leading online retailer.
World of Powersports’ wholesale parts division serves more than 3,500 customers who account for more than $25 million in sales. The Web-based operation has enabled the owners to branch out well beyond their local market. (This is a good thing, the owners learned, given how transient a local customer base can be. It’s something they learned firsthand when a nearby Firestone tire plant closed in 2001, taking with it 1,400 local jobs.)
“With Internet sales, you’re not relying on the people who pass by your front door every day,” Matthew says. “Through the Internet you can pick up customers in areas outside your state and outside your immediate area. My personal opinion is lead, follow or get out of the way. I think if you’re one of those dealers who is not pushing outside your local market area for your parts and accessories sales, you’re going to get left behind.”
The Jacksons first realized the power of the online sales back when the store made the move from microfiche, mail order and phone orders to the early days of the World Wide Web. Improved access to information allowed more accurate parts orders and streamlined operations. It also made reaching new markets a whole lot easier. The wholesale division offers special pricing to qualified dealers and repair shops, while the retail website sells at full MSRP.
Matthew knows that a lot of dealers try to fight the Internet and the discount retailers it has spawned; their store faces the same problem. “We get customers who found a part, a helmet or a tire $3 cheaper online, and we lose the opportunity to sell them over our retail counter,” he says. “That’s why we try to keep our online presence as strong as our own face-to-face presence with our customers. We’d like to keep all of our local customers if we can and gain customers outside of our market.”
One such method for reaching these “lost” customers is to routinely send out mailers to inform them about open houses, sales or other events to draw them back into the dealership. The idea is to give customers a reminder that they can continue to buy over the counter in addition to ordering online.
For brother Mike, who works as World of Powersports’ Internet manager, it’s as simple as recognizing that the Internet is nothing different than the fax machine or telephone — it’s just another tool for reaching customers. The difference? “Instead of the Yellow Pages, which reach local customers, the Internet is a way to reach everybody,” he says.
“Since we already know who are our customers are locally,” he adds, “we can extrapolate on that nationally to see that it’s the same customers [all over] — they’re just in different locations.”
Parts sales have given World of Powersports much more than an international reach, they’ve also helped improve business inside the brick-and-mortar location in Decatur, a mid-sized city in east central Illinois, by helping the store expedite service work. The store places so many orders every day, Matthew explains, the service department gets its parts the next day on every single repair it schedules.
In addition to the Internet-based parts sales, the Jacksons have leveraged technology and automation to improve productivity. They use software programs like the V-SEPT CRM to measure customer interaction. They also use programs that track visitor click-through traffic for a Web-based affiliate service that awards customers and other vendors with a referral fee for sales generated from links or promotions on their sites. This particular program (in place for less than a year) has attracted more than 200 affiliate retailers and generated more than $1 million in online parts sales. Affiliates receive a commission of 3 percent to 12 percent depending on volume. The performance-based effort is much more effective than pay-per-click advertising, Mike says.
The idea is to measure every aspect of the business and improve on areas that show they need it. “If you don’t measure it, you don’t know where the breakdown was,” Mike says. “Did we not sell the customer a vehicle because he didn’t come in to buy one? Did we not sell the customer a vehicle because we didn’t have it? Or did we not sell the customer a vehicle because he didn’t like the salesman? If you don’t measure everything in between, you don’t know the answer.”
In the 2010 Top 100 competition, World of Powersports picked up the Best Employee Incentive Program merit award for its commitment to furthering employee education. The store pays half the college tuition for employees taking classes related to their job.
Co-owner Matthew Jackson says it’s important “to find a way to pay your employees what they would make outside this industry in order to keep them motivated. Working at a dealership is fun, but that only goes so far.”
Jackson says he wants his employees to better understand such things as cash flow and marketing, and encourages them to go pick up these skills while continuing to work at the dealership. For those looking to become mechanics, the store creates an incentive for them to get training and come back to work as entry-level techs. They then can hone their skills with on-the-job and OEM training.
The store also provides flexible hours for warehouse workers and office staff so they may attend college part-time, and offers sales spiffs to personnel for completing product knowledge training provided by the OEMs.
“We’re treating it like a career, not like a job,” he says. “People come and go from jobs, but when they have a career they stick around.”
This story originally appeared in the Dealernews April 2010 issue.