Random thoughts, ideas, and suggestions for a profitable motorcycle shop

Discussion in 'Alaska' started by JagLite, Nov 15, 2014.

  1. JagLite

    JagLite Long timer Supporter

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    I'm outside visiting family and it is pouring rain so I have a couple hours to start a thread on what we would like in a motorcycle shop.
    My thoughts below, what are yours?

    The first rule of business is that you have to make a profit.
    The first rule of a motorcycle dealer is there is very little profit selling new bikes.
    How many new bikes are sold each week (averaged over 12 months)?
    Not near enough to pay the bills.

    The profit comes from the service department and parts department.
    But, most riders order parts online now, it is cheaper and fast delivery.

    So, how to make a profit, turn customers into repeat customers, and then into friends, and have money coming in EVERY… SINGLE... DAY?

    Look at it from the riders view, what do we want in a bike shop?

    Friends
    People who know our name
    A favorite place to sit to talk with old friends and make new ones


    Cheers?

    Exactly! Well, no, not a bar. :cry


    Any limited clientele business (like a bike shop) needs to be a central meeting place and organizer of events to keep people interested, involved, and coming in.
    And needs them to spend money to keep the meeting place going… :deal




    What is necessary to make that happen and bring money in each day?











    FOOD











    Look at the profitable shops you see on the web, they usually (if not always) have tables and chairs, sell coffee and sandwiches (at the least) and they are a place for people to hang out with like minded people.





    What is missing in most bike shops?

    Comfortable places to sit and pass the time.
    (Actually, ANY place to sit down)

    You make the drive over to the bike shop because you want to see if they have the part you need, even though you are pretty sure they won't.
    You check at the parts counter, they look it up and say they can order it for you.
    You ask the price (you already looked online and know what you can get it for shipped to your door).
    Of course the shop price is higher so you pass.
    Then you spend a couple minutes looking at the new bikes with the sky high prices, talk with the sales guy/gal and then you leave.

    Typical for you? It is for me.
    The shop is paying a person to be at the parts counter.
    For sales people to try to talk you into a new ride.
    And the daily overhead to keep the doors open.
    What money did they make from that visit?
    Nada. Zip. Zilch.
    Are they happy? Are you happy?
    Everyone loses in that typical situation. :ddog


    Bookstores know the value of having a place where customers can sit down, have coffee and a bite to eat while looking through books and magazines.
    Sure, they know some people will just show up and read and never, or rarely, buy a book.
    But, if they are buying coffee and/or food, they are bringing in cash each time they walk in the door.

    In many places, the bookstore is THE meeting place where everyone goes to see, and be seen.

    Now, picture this motorcycle shop in your imagination…

    You get the idea?

    Sure, what we would really like at a bike shop is that they have IN STOCK every part we need for our old bikes no matter how many thousands of parts that would require.
    As well as all the aftermarket custom parts we want, every size and color of every piece of motorcycle clothing we see, and all at the same price as the online stores.
    NEWS FLASH!!!
    It ain't gunna happen. Never will.

    Bike shops have to adapt to the new world of online retail and make it work for them.
    And for us! If the bike shops go out of business, the whole sport suffers.

    Now I know that some of our local shops are doing some of the things I wrote about and they are to be commended, and supported.

    Barb and Alaska Leather rate at the top of my list. :jive :clap :freaky

    I have enjoyed Alaska Harley the two times I have been in, even though I don't have an interest in HD's.
    I believe they do an excellent job of arranging events to keep their customers involved and happy all year long. :clap
    Maybe someday I will go to one of their affairs. :huh

    I am fairly regular at the other shops and all of them are nice, friendly, and helpful so please don't think I intend to put anyone down.

    These are just some* of my thoughts about the shop I would like to spend my time and money at.

    *Oh, yeah, I have a LOT more ideas to help make a shop better and more profitable.
    These are just the free teasers :D


    (pm for my consulting fees)
    #1
  2. PistonPants

    PistonPants Crankcase Scavenger

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    While visiting Salt Lake a few years ago, the entourrage had a gray rainy afternoon to kill, so we went in search of bikes. We popped into the BMW & Triumph dealer there. 15 minutes before closing time. The salesman on the floor was super cool. We didn't spend a dime. However, when I told the man that my dad was a Trimuph dealer back in the '60's in PA, he took us into the 'back' to show off a bunch of classic bikes assembled there for a photo shoot. OLD Brit iron, Duc's, Japanese classics. Nice stuff. A highlight of my time in SLC.

    This has no profitability. A lot of my favorite 'bike shops' are my friends' shops and garages. Not profitable.

    I live 150 miles from my nearest cycle dealer. A common phrase in Fairbanks is 'I can order that for you'. Great. So can I. I would be hesitant to ever drop a bike off at a 'profitable' dealer for service. I buy new snowmachines and used motorcycles.

    Entrepreneurs/small businesses struggle to keep up their ideals and turn a profit.

    Peace
    Piston
    #2
  3. Andrewmc

    Andrewmc Been here awhile

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    At the risk of over-hyping it, all I can say is that you're going to like our new shop.
    #3
  4. Beezer

    Beezer Long timer Supporter

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    I'd say number 1 is to try not to suck. I go into a shop that sucks.... I ain't going back.

    Number 2 is don't try to wring every nickle out of the customer every time they come in... especially if I'm a regular face in your shop.

    Number 3... if you make a deal.... stick to it.

    Number 4... I don't want to hear "I can order it" on a simple part.... I can order it too... I came in to this shop so I don't have to order it. I'm talking about fork seals, filters, cables, gaskets & such things that are part of regular maintenance. you are the dealer for a brand.... keep the support up to date

    and try not to suck
    #4
  5. PistonPants

    PistonPants Crankcase Scavenger

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    I'm sure that BMW USA had no small role in determining the size, look, layout, services and amenities of the new shop.

    Piston
    #5
  6. JagLite

    JagLite Long timer Supporter

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    Perfect!

    That is the kind of experience most of us want every time we go in a shop.
    We love looking at bikes and classic bikes really appeal to us older riders. :clap

    If you had found something there that you wanted to buy (food, drink, tee shirt, coffee mug, a classic poster, etc.) you would have that to add to the highlight of your trip, and the shop would have made a dollar or two towards staying in business.
    #6
  7. JagLite

    JagLite Long timer Supporter

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    Agreed 100% :freaky
    All of my favorite shops are friends places.
    Good thing they aren't trying to stay in business!
    #7
  8. AKDuc

    AKDuc Alaska Born Ducatisti

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    Big +1 I concur. :D

    I just hope the youngsters can bring happiness, joy, and a welcome feeling back into the new shop. Some of us even go so far at to LOOK for ways to spend more money at shops we get those feelings from. I do the best I can to always shop local especially at those shops that give back to our community and contribute to it's well being.

    Happy happy joy joy, Mark H. :lol3
    #8
  9. PistonPants

    PistonPants Crankcase Scavenger

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    I should make it a point to visit your shop when I'm in the big city. Looking forward to seeing your new digs. As a rider who lives out in the boonies, online parts fiche and willingness to send stuff to a PO box are a must for spending money.

    Piston
    #9
  10. JagLite

    JagLite Long timer Supporter

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    Please explain #1
    The shops need to know what you feel they are doing wrong :huh

    #2
    ABSOLUTELY! All of us know the feeling of that!
    The old saying of being "Penny wise and Pound foolish" applies.
    They made us pay $1 more for something this time, so we buy our stuff somewhere else from now on.

    #3
    One of the foundation stones of a successful business is to charge LESS than your estimate.
    Yet very few businesses understand why that is so important.

    Example "A"
    "The estimate is $100 total"
    .
    .
    .

    "OK, all ready, the total comes to $114"
    :becca



    Example "B"
    "The estimate is $100 total"
    .
    .
    .

    "OK, all ready, the total comes to $98"
    :wings

    Which situation will have the customer telling everyone about the great deal?
    Which one will be giving personal recommendations and referrals? (Priceless advertising)

    Even if you don't make a profit on this deal, or even if you LOSE MONEY on this deal, you make it up many times over with more business.

    Of course, you have to be good at estimating and have reasonable prices.
    Those are two of the next most important parts of running a successful business.

    This is true for selling anything from new bikes, service, parts, special orders, and everything else.
    (Every business is selling: Products or services)
    The exception is government and they don't care about customer satisfaction.

    Another important sales tool is that everyone wants to get a deal.
    Paying retail prices doesn't make people happy which is why stores are always having "On Sale" signs.
    Duh? Isn't everything in the store for sale?

    A simple technique (there are many) is to have the retail price posted and a sign that says 5% off every day!
    Remember there is ZERO profit if nothing is sold!

    We know what the retail prices are, the MSRP, the online prices and shipping charges.
    Give us a good reason to give you our money!
    We want to keep you in business but we won't be ripped off.


    Now the really tough one…
    #4
    In a perfect world that would be true and we all wish it could be.
    I am sure every shop tries to carry the most parts possible.
    The commonly asked for replacement parts for the bikes they sell.

    However, have you thought about how many parts that is?

    Take a shop that only sells one brand: "X".
    Brand "X" currently has 17 models for sale and most come in at least 3 colors.
    How many different oil filters are used on the various models that are currently sold?
    How many different oil filters on "X" models not in current production but are no more than 10 years old?
    Now carry the air filters for all of those bikes, and spark plugs, and wheel bearings and seals, gaskets, brake and clutch levers, cables, handle bars, batteries, tires…
    :eek1
    It is simply impossible.

    Almost every shop is a dealer for several brands so multiply those common parts by the number of brands and by the number of models, and by the number of years they try to support.

    Bikes are not like cars where so many parts are standardized.

    Bikes have so many unique parts that are only used on a couple models for a few years and some are one year only parts.

    I wonder if any of the manufacturers offer tours of their parts supply warehouses in the US?
    That would be awesome to see the millions of storage shelves full of boxes of small parts for all the different models they manufacture currently and for older models.
    And they keep everything in inventory to ship out every day.

    Unfortunately, for the shops, and for us customers, the parts we need are probably not on hand.
    What can the shops do to best handle that reality?

    Educate the customers is one important step.
    Too many riders think they should be able to walk in and buy that shifter cover gasket for the '89 Honda CBWhatever they are restoring.
    Or, the new BMW they bought 6 months ago that tipped over and broke off the right side mirror.

    Yes, in a perfect world we would.
    But the chances are the dealer will have to order the parts you need.
    How can they get our business instead of us ordering it ourselves?

    There is a new business field opening up that recognizes this situation.
    The dealers/manufacturer makes a deal to ship the parts/products directly to the customer (or the shop, customer choice) for the online discount price with NO shipping charge, and it is 3 day or less shipping.
    They do this by volume ordering of all the affiliated shops placing all these orders every day.
    The distributors pay a percentage to the shops so the shop is making a little money on every deal even though the customer is not paying a penny more, and is getting free shipping.

    Amazon is the pioneer and is showing the world how to run a profitable business where everyone wins.

    You have a small shop, a customer orders through you from mcsuperdooper store.
    Mcsuperdooperstore ships direct to your customer and every month your shop gets a check from mcsuperdooper store for a few percent of the total sales from them, through your shop.
    Mcsuper… has made a sale and your shop has made a few dollars with zero investment.

    it is a brave new world of online super stores and the small local shops must work with them to survive.
    #10
    AKSapper300 likes this.
  11. nuttynu

    nuttynu NuttyNu Rider

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    Don't have shitty service department. .ahem ak cycle
    #11
  12. Ullr

    Ullr C+ Racing

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    I'm happy the motorcycle shops treat me like shit and have no interest in selling me a motorcycle. The new airplane I bought with the new motorcycles fund is far more entertaining.

    Barb kicks ass and I will continue to buy things I don't need because she's always treated me like a rock star for no good reason.
    #12
  13. PistonPants

    PistonPants Crankcase Scavenger

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    While not a 'cycle' shop, I gotta give big kudos to my man Nick at McKinley Polaris/ Healy Car Quest. Stuff like tires that NOBODY wants to ship to Alaska let alone to a PO box, he is more than happy to order. They got a lot of stuff under one roof: auto parts, tools, hardware, powersports accessories. I don't mind them telling me 'I can order that'. It's local, and despite being the only game in town they adhere to rule #1. Even thought they are a sled/atv dealer, they play a big role in keeping my bikes rolling.

    Piston
    #13
  14. Beezer

    Beezer Long timer Supporter

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    ok.... so what sucks you ask?

    I buy a brand new bike & go to get it.... heres the keys, ready to go, thanks.... I make about 10 miles & plastic is falling off because the screws are loose & fell out ($5 each to replace them and they have the balls to ask me to pay). I get home and check the oil.... it needs a quart (2,5 is the total), later I check the fork oil.... needs 100cc each leg. sooooooo....... 500 mile check is due... I decide to take it in just for warrantee purposes (turns out it doesn't matter.... good, 1 time is enough). I pick the bike up & I can tell the valves weren't checked (it's on the OEM checklist), so I ask... "they're never out so we don't check them". fine, I'm a pro mechanic, I'll check.... yes, they are out. I paid for something I didn't get.

    couple years later, bought another bike brand new. I'm talking to the salesman & no, no price break at all.... gotta sell at msrp +. well hell, I want it anyway but at least put in a sealed battery.... no reason to ever use a wet cell in this day & age. yes, we can do that... ok. it gets prepped, etc, I pick it up & after a short drive.... hey, whats that smell? I pull off the side cover & it's the battery drain line melting on the exhaust.... pukin' acid too. and guess what.... at 500 miles when I checked the valves there are 2 exhaust valves with ZERO clearance.

    a different dealer.... I want to buy one of your xxxx. the guy looks back at me and says.... "duuuuuuuuuuuh, we only ordered one, they sell quick, we don't got any more." are there more coming? duuuuuuuuuuh, not this year", really? it's only the end of May. "duuuuuuuuuuuuuh, gime $6000 an I'll try an order you one, but it probably won't get here till next year"

    how about standing in line at the counter... it's kinda busy but the parts guy is more interested in yapping at his friend & only half into do what he's supposed to be doing. I'm waiting my turn some guy wanders in and the parts guy turns to him and says "can I help you".... I've been standing there 10 minutes, but I'm invisible. (variations of this scene, more than once)

    or, I need fork seals for my fairly common (European) touring motorcycle (that you see by the hundreds in AK, coming from all over the world).... the guy roots around & finds what might be one.... no way to tell because it isn't in a bag & it isn't marked. don't know how old it is, & only got one.

    ya sure, I can understand (barely) that you don't stock carb jets, and maybe there was a run on fork seals. but its a pretty regular experience I seem to have.... that is to say, the dealer not having simple seals & gaskets for common bikes they sell. maybe thats diffrent in the last few years.... I don't know because I quit buying from the dealers. I ORDER IT MYSELF and even pay the shipping because then I have it, and I know eventually someone will need it. and besides... it cracks me up when MotoQuest calls me for a part they need to get a bike back on the road

    you know there's more, but thats enough to get the picture
    #14
  15. JagLite

    JagLite Long timer Supporter

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    I have had the same and similar experiences at several of our local shops.
    Other than buying a new bike problems that is...
    New bikes are out of reach for me.

    However, those are the exact sort of problems and complaints far too many of us have, not just in Alaska, but EVERYWHERE.

    Do the shop owners wonder why we aren't happy to support them?

    I have only tried the service department of two local dealers since I do everything I can myself.
    Both times were used bikes I had just bought and wanted the dealer, who should know their brand, to do the full service the mileage recommended.

    I won't take any bike back to either of them.
    Like you I was charged for work NOT done each place.
    One I just did it myself and counted the wasted money a lesson.
    The other one I hauled my bike back on the trailer to have them do the job right since I would have had to buy the special tool.

    I have NO desire to take a bike to the other dealers because I expect the results to be just as maddening.

    One common reason for shoddy service is training new mechanics by giving them simple jobs, like changing oil and filters, changing spark plugs, and so on.
    Then these "kids" strip the drain plug threads (but don't tell the boss of course) don't realize they need to put the o-ring on the oil filter, install the wrong spark plugs, and on and on.

    Yeah, I had two friends in high school who got those jobs and told me about many foul ups at the bike owners expense.

    I gave two of the shops here a try, they both failed miserably in the service department.
    Can't afford to pay for good mechanics they say?
    Darn right! Since many of us won't trust them with our bikes!!!

    Rudely ignoring customers at the parts counter?
    Yep, been there too. In EVERY shop except Alaska Leather.
    Talking with fellow workers, with their friends just hanging out, on their phones...

    Partly that is lack of training, partly that is poor management.
    And a lot of it is hiring the wrong people.
    I can (almost) train a monkey to do a better job of customer service than some dealers employees.
    It is all about attitude.
    A person with a good customer service attitude can be taught about any type of product.
    A person with great motorcycle knowledge might never learn how to be a good customer service representative of the shop.

    Similar to being a good teacher.
    A person can be the very best at something and be a terrible teacher.
    A person can know everything about bikes, and be a lousy person working for a dealer.

    Sales staff?
    A friend went to a local dealer to buy a new bike but was completely ignored for the 15 minutes she was looking at the one she wanted to buy.
    She felt it was because she was a woman, who knows the real reason.
    She went to another dealer down the street and bought her new bike there that day.

    A motorcycle shop is a customer service business and most don't get that.
    Do they have daily meetings at the beginning of the day to discuss these problems and how they should be handled?
    Once a week? Once a month? Not very likely, eh?
    Have any of the shop managers attended customer service training?
    If they don't know, how will they train those working for them?

    There is huge room for improvement and I would really like to see a motorcycle shop where we WANT to spend some of our time and money.
    #15
  16. Beezer

    Beezer Long timer Supporter

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    one more thing.....

    there aren't a lot of woman riders but I hear similar stories from them... the nut of which is the bike shops have a condescending attitude. you need to be aware that these ladies are fairly astute... they spent the money, bought the bike, the gear.... they know how to ride. they cover the miles & they know what they want. they don't really want any special treatment and they damn sure don't want to be pandered to.... they just want to be treated like a rider. and maybe a thumbs up for riding to Inuvic in a three day long thunder storm.... same as you would have done if it were one of your bro's.

    just sayin'
    #16
  17. AK650

    AK650 Long timer

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    Some really great points made, and issues aired out, but jeez isn't kinda early in the winter for a thread like this?:D Hell, there isn't even any snow on the ground, though daylight is getting in short supply.

    Jeff
    #17
  18. ThatGuy

    ThatGuy Brownie

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    Don't mistreat customers just because they didn't buy a bike from you because one day they may. By treating them poorly means they never will
    #18
  19. UncleRandy

    UncleRandy Been here awhile

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    How about this one? Do offer to mount a tire, regardless of where it was purchased, AND at a competitive price! $45 to mount a tire (off the bike) or $60 if you didn't buy it there is not doing your "potential" customer a service. If I can save $25 dollars doing business with you-I will likely find someway to spend it with you!!! $20 to mount a tire? Yep-I know of at least one commercial business that will do that and smile and say "Thank You" when you leave.
    #19
  20. Andrewmc

    Andrewmc Been here awhile

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    Not just BMW, but Triumph, Ducati, KTM, Husqvarna and Kawasaki as well. It's been a lot of fun keeping everyone happy while keeping things from getting too un-Alaskan.

    Our goal is to have a shop that encourages community and caters to any rider; not just the brands we sell. We want it to be a place that anyone is welcome to visit and grab a cup of coffee (yes, there will be coffee, and maybe some food depending on demand) and just hang out.

    One thing that is really frustrating for me personally is hearing stories about anyone feeling neglected when they visit a shop. I try really hard to make sure every single person that walks in feels welcome and can get assistance if they need it.

    That said, we have 13 full-time, year-round(!) employees that we need to support as well. What we need to figure out is: if someone comes into the shop once or twice a week, has coffee and shoots the shit, should I always treat him like he's going to buy a bike today? If I have 10 people in the shop all ready to buy motorcycles, and I only say hi to this person and don't talk to them for an hour, should they be offended or mad?

    On the day that person finally decides to buy a bike after two or three years, should they then be offended because I just thought they were getting their coffee?

    What do you guys think? How can I provide the best service to someone that is a regular visitor?
    #20