Right sizing is inevitable for those who may have jumped in to make a quick buck when the economy was fat. If a business has a good model and a solid base they should be able to survive in tough times as well. Right now we are going to find out who the contenders are and who the pretenders are.

 

Or, as Warren Buffett says, 'When the tide goes out you see who's left swimming without a suit".

 

Just my opinion, but I think the herd needs to be thinned a bit anyway.

 

Only the smart ones with deep pockets will survive !!!

 

A recent article with HD's report on their loss for 09 mad mention that 19 dealers would go out of business soon and some more by spring.

 

My thoughts exactly...just got back from Vegas and they have at least 3 dealers if you count the one in Henderson...Red Rock Harley even sold HD leather furniture and golf bags..wtf...We have 2 in our town of 600,000 people with 5 month of ride weather so I bet the writing is on the wall for one of these as well.

 

Gump - It was 1 mil in cash and 2 mil in credit. But I don't think that HD wants to have any more open. I think they want fewer dealers to match the demand. This way they don't have to buy any franchise's back. Just let them fail.

 

The one in Yorkton pop15,000 is doing pretty good.

 

I recently had the opportunity to speak with managers of two different Harley dealers and came away with some interesting insights.
Dealer #1 said that Harley was the toughest company to please because they put tremendous pressure on their dealers to expand their showrooms and expected them to hire overtrained staff, and stock all kinds of extra stuff that they felt was unnecessary,etc. He said that all this pressure cut into profits and created lots of stress, economic and otherwise for the dealer.
Dealer #2 said that Harley was the greatest company to deal with. They reward dealers for building the kind of showrooms that attract customers. Those so called boutique dealerships have places for customers to congregate and feel welcome. They are able to service bikes while you wait with no appointments. The selection of bikes is always great because Harley rewards these dealerships with more access to inventory. Their parts departments have deeper inventories. Their demand for higher level mechanics is also met with better access to bikes and parts. Training programs for every department are continuous. These guys have been enjoying a very good year while other dealers and the industry as a whole have suffered.
Is there any company better at marketing their products than Harley? They know what kind of dealership works and what doesn't. Ask Prestige Harley why they're closing while Bergen Harley thrives. I'm sure they'll blame anyone but themselves. I know there is room for small dealerships in certain places but without the ability to display and access more than ten bikes you're not going to make it in a challenging economy. JMHO