Dealer Profit

[Oak Hill]

A Dealer is lucky to make a 10% to 15% profit, that is a small margin. Todays market is all about volume, large volume = profit to pay overhead. Service and parts pays the bills. Take care of your Dealer or loose them. Dealers today have to give away sleds for one reason and one reason only. Because everyone does and if you are going to be in the sled business you better be on the band wagon or be out of business. The same holds true with most retail business today. Like mentioned before, everyone should try to be a business owner and see what the real world is like! I know retail, I have been in retail for 34+ years! Just my 2 cents.

 

[Superman]

Nelson's Speed Shop in Greenville drives the Michigan market for all 4 brands of sled. Simply put Nobody beats them on advertised price, year after year. No hidden BS, Just write a check pricing. You don't have to be a rocket scientist to know he must Pi$$ off the whole state as far as dealers go. For Me I want the latest and greatest and I live on a budget, Once I see a 3-5 hundred dollar difference I gotta take it.

Its the same thing in My line of work. I have customers who will pass me by if they can save 20 bucks. Godfather qoute...."Its nothing personal its just business."

 

[blue er]

my dealer sold me my sled for 12200 plus taxes , they were one of the better priced dealers around at that time late nov/early dec 2005, and the sled has been great the service better, just got the sled back with new studs, bars and updated wheels great pricing on everything (to me anyways) 120 picks, sliders, handle bars, wheels 560 with taxes could i get it cheaper? maybe when i blow 30 bux in fuel running it all over. or just drive 5 min from my house.
The important thing is building a relationship with your dealer than at least they get to know the history on your sled.
the idea of bussiness is creating a customer at a profit, support your local dealer in the end it benefits everyone

 

[JJWickenhauser]

This is a very intreasting post as I am looking into becomming a dealer. I like all the coments made. However, I can't say that I shop at my local dealer. I will drive for an extra 45 minutes just to get to a dealer that I like. I guess that I've just had bad eperiences with my locals and won't do business with them. I do agree that starting and holding a good relationship with a dealer is imortant, but these guys have to back us also. I don't ask for the rock bottom price on my sleds, but understand that I'm not going to pay top dollar for them either. I need to feel that I came out alright, as does the same dealer if he were to go and buy a car. Another thought I've had is that dealers sometimes BS you to buy a sled, and that's their job. But like us on this site, we come a little loaded with information. Take this post, it's a great post and it puts another tool into our tool boxs. I think that dealers that are really making any serious money are the dealers that are pushing the mods and racing parts. But then again I think we'll see a 120HP Phazer in 08. Food for thought.

 

[Sled Dog]

Well I dont know guys but I think a dealer making $500 on a sled sale is better than him making none on a sale that is lost and lost forever. With the lost sale comes a potential lost customer as he may just prove to be faithful loyal customer to the guy who gave him a deal (go figure). Give this customer grief when he comes in for some warranty work and you wont see him again the next time he is going to buy. A dealer who holds out for top dollar will sell some but not as much if he were to deal a bit. He would also move more toys which relates to more sales in accessary's and the like. He would not end up at the end of the year having to make a sacrifice deal to someone or pay the interest on keeping the sled over summer. How does that make the customer who paid top dollar feel when his buddy got the same sled for 1500 less. $500 is better business than none the way I see it.

 

[MXD]

The business is so cut throat right now that I think you will see alot of your local dealers closing up shop. With the economy and market conditions the way they are, its impossible to make a substancial living at this. You will never be able to get the dealers to hold some gross for the good of everyone. You will always have that one dealer that will lose money on the sale to move a unit and sell some parts and that hurts everyone......right down to the consumer because it devalues the used market when you want to sell your 06 Apex. The manufacturers will have to step in at some point and set pricing nationwide to stop the bleeding. Too many dealers are treating their inventory as disposable pieces used just to get you in the door and not a valued asset.

my .02

 

[Sled Dog]

Cut throat business is the free enterprise system at its best working in a free democracy. It is always everyone out for their own and always will be. Thats the beauty of our system over communism. What some of you are suggesting is just that someone dictating to you what you will pay for a product. Here we let the market (the consumer) do the talking as to what they will buy and for how much. If a corporation is out of line and out of touch with the consumer and their competition they go under. Just ask GM, Ford or Dodge how cut throat the business is. In fact how would you like to be told you have to buy Ford or there will be no more Ford. Do you think Goodyear and Michelin are working together to keep prices high so the consumer can keep gettting tires? Yamaha is to blame for not leaving enough room for the dealer between what they must have for a reasonable profit and what the market will bear. You just have to look at the Canadian Market to see this. We pay $3400 US dollars more for a sled than anyone in the US does that is US dollars not Canadian. Now your telling me I should pay that high price just to have a dealer. Yamaha pockets the cash and not the dealers anyhow right so how is that supposed to work it is nuts?

 

[kia303]

This was very informative for me, I bought my first ever sled last Saturday(pick it up tomorrow). I bought from a local mom, pop, and son dealer about 15 minutes from my house. I got a fair price and walked away with a good feeling, to me that is important. I could have driven around my area looking for the best price but I was told by several sledders that the shop I bought from is the one I want for service.

I walked out owning a leftover '06 Attak for $8500, and I ordered some gear from them as well, I got a handshake and a sincere thank you from the son. I found cheaper prices for the gear online but I wanted to support my dealer. I shopped one other dealership that day, a large SkiDoo dealer and I did not get the same feeling.

Let it snow!

 

[Yammerhead]

Cut throat business is the free enterprise system at its best working in a free democracy. It is always everyone out for their own and always will be. Thats the beauty of our system over communism. What some of you are suggesting is just that someone dictating to you what you will pay for a product. Here we let the market (the consumer) do the talking as to what they will buy and for how much. If a corporation is out of line and out of touch with the consumer and their competition they go under. Just ask GM, Ford or Dodge how cut throat the business is. In fact how would you like to be told you have to buy Ford or there will be no more Ford. Do you think Goodyear and Michelin are working together to keep prices high so the consumer can keep gettting tires? Yamaha is to blame for not leaving enough room for the dealer between what they must have for a reasonable profit and what the market will bear. You just have to look at the Canadian Market to see this. We pay $3400 US dollars more for a sled than anyone in the US does that is US dollars not Canadian. Now your telling me I should pay that high price just to have a dealer. Yamaha pockets the cash and not the dealers anyhow right so how is that supposed to work it is nuts?

What defines reasonable profit?? There is no such thing in the free enterprise system. As far as corporations are concerned, there is never enough profit and if you don't make more profit than you did last year, you had better have a darn good reason for it. The big difference in US and Canadian prices by Yammie (and others) is there because they are getting away with it. The difference on each sled is pure profit that goes right to the bottom line. You can bet Yamaha isn't going to slash their margins when their share is climbing and Canadain sled sales are stable. Only way I can see anything changing is if enough Canadian dealers make a case that they are going out of business or considering dropping Yamaha. If Yamaha gets worried their dealer channel to market is in jeopardy, then they will make price adjustments. It really sucks for the dealers big time.

I'm in sales and the customers who shop you are the same ones will screw you on every other issue as well. You can treat them like gold but they will nickle and dime you on every transaction. You just have to be resigned to the fact that they are a low margin customer and therefore you can only justify a low amount of time to service them. If they have issues arise, they have to pay and that's the reality of the relationship. Other customers who expect a fair price and fair treament are a different story. You may have to be low priced some of the time, but not always. You have to service the heck out of them because they expect something for the premium they paid for you. I have guys who will sometimes give me more than I am asking and sometimes I charge less than what they expect. Guess who I like dealing with the best??

Bottom line is, if you shop 15 places and grind the dealer to his last nickle, don't expect the five star treament from him. If he feels like you put value (ie:$$) in the service he provides, you might be surpised how much money he will save you down the road.

 

[Superman]

Well put Yammerhead.

 

[Sled Dog]

The price rip off between our two countries is why I have not bought the wife her phazer. I am importing from the US or buying used that simple. Buy new from US pain to get it here and no warranty. Makes it pretty easy to see what I will be doing but buying a new sled will not happen until they smarten up with their prices. All Canadians must do this or they wont change. Will we lose some dealerships? Yes you bet we will but it is not our fault it is greed on a corporate level. They are making more off Canadians per sale than they are off anyone in the US. Who gets the great 0-0-0 offers the US we get nothing. Yamaha USA has better warranty policy than Yamaha Canada in my opinion also. Canada dont buy new unless it is from the US.

 

[BlgsRX-1mtn]

I know my dealer quite well (used to race motocross with the owners kids in the '80s) and I allways snow-check them in addition to paying full retail on my sleds. I will continue to do this knowing he will take care of me (win/win for both of us).

When it come's to buying parts; I also pay his 50% mark up on acc. and parts without making a fuss. Because of this, when I need work done on my sleds, they are often rushed through ahead of the guys who buy else where and then expect him to work on them.

He also goes to bat for me on warranty claims that are not Yamaha's fault. I put a rip in my seat due to hooks on my street shoes right at a seam. He was aware of the fact and told me he would sell me a BOSS Seat discounted the amount of a new Yamaha seat or he would turn it in to Yamaha for warranty. A week later my 700 mile sled had a brand new seat cover. After paying $500 for a BOSS seat bought directly from BOSS a year after that; I wish I would have taken the offer to get it discounted from him.

Jim

 

[CaptianC]

Crazy Logic

I know my dealer quite well (used to race motocross with the owners kids in the '80s) and I allways snow-check them in addition to paying full retail on my sleds. I will continue to do this knowing he will take care of me (win/win for both of us).

When it come's to buying parts; I also pay his 50% mark up on acc. and parts without making a fuss. Because of this, when I need work done on my sleds, they are often rushed through ahead of the guys who buy else where and then expect him to work on them.

He also goes to bat for me on warranty claims that are not Yamaha's fault. I put a rip in my seat due to hooks on my street shoes right at a seam. He was aware of the fact and told me he would sell me a BOSS Seat discounted the amount of a new Yamaha seat or he would turn it in to Yamaha for warranty. A week later my 700 mile sled had a brand new seat cover. After paying $500 for a BOSS seat bought directly from BOSS a year after that; I wish I would have taken the offer to get it discounted from him.

Jim

This post is exactly the reason for this site, so lets look at why this logic sucks. Let me give an example. You buy your last sled at MSRP, $2-3k over the prevailing rate. Now, the dealer has that in his pocket and your waiting for a freebee. Now, we both go to the same dealer in the spring with the same problem with our sleds, except mine I bought on eBay. You explain you need it in 5 days as do I. In your logic, your first and I am second. Well, your wrong on a couple accounts. The dealer knows your loyal and for an extra day that you wait he might land me as a loyal minion as you and he will service me first in hopes I pay MSRP for my new sled in the future with him. Second, lets say this is not true and he is loyal to you and we both walk in and drop off our sleds. You leave with an expectation your sled will be done in 5 days, and I ask to pay a premium, lets say $250 more than going rate to "rush" my job. He will gladly do my work first again, and guess what, I saved $2500 still over what your out of pocket on the MSRP you paid for your sled, thats loyalty....

 

[BlgsRX-1mtn]

Re: Crazy Logic

This post is exactly the reason for this site, so lets look at why this logic sucks. Let me give an example. You buy your last sled at MSRP, $2-3k over the prevailing rate. Now, the dealer has that in his pocket and your waiting for a freebee. Now, we both go to the same dealer in the spring with the same problem with our sleds, except mine I bought on eBay. You explain you need it in 5 days as do I. In your logic, your first and I am second. Well, your wrong on a couple accounts. The dealer knows your loyal and for an extra day that you wait he might land me as a loyal minion as you and he will service me first in hopes I pay MSRP for my new sled in the future with him. Second, lets say this is not true and he is loyal to you and we both walk in and drop off our sleds. You leave with an expectation your sled will be done in 5 days, and I ask to pay a premium, lets say $250 more than going rate to "rush" my job. He will gladly do my work first again, and guess what, I saved $2500 still over what your out of pocket on the MSRP you paid for your sled, thats loyalty....

I doubt you would even take a sled to him knowing full well he charges a 50% mark up on parts so your argument is moot.

Gunder (the owner) pays his techs well due to the extra profit. Therefor, his employee loyalty is very high. Because of this and his well known reputation reputation for going to bat for warranty items the average high volume/low cost dealer won't even consider due to the hassle with Yamaha; he has maintained a loyal customer base that has kept him in business for 20 + years who are willing to pay full MSRP plus his 50% mark up.

As for the $250 premium for a rapid turn around; he has sent guys packing who have thrown cash down on the counter expecting him to bow at your feet and give rapid turn around on a repair over a loyal customer.

The prior dealer used to be the "under cutting on a sale" type of business with a reputation for poor service because their techs were low payed due to no profit and came and went as if the place had a rvolving door . They managed to last 6 years before the doors shut.