Motorcycle & Powersports News March 2012 : Page 35
By Colleen Brousil A s a powersports dealer, you sell the American dream, but why not offer it up as a limited time opportunity through a rentals program? Adding rentals as a profit center of-fers you a unique opportunity to expand your dealership’s reach well beyond the city limits. The first thing to realize is that adding rentals to your business isn’t like picking up a new product line. You have to invest fully to make a profitable rental business a reality. “We’ve turned rentals into a business, not something else to consider,” says Tim Lach of Hawaii Harley-Davidson Rentals. “You have to be in the rental business, not say, ‘Oh yes, we also rent motorcycles.’ Rentals is one of those segments of your business that connects to the other seg-ments in a positive way or you shouldn't be doing it. Our service department bene-fits from our rental business hugely be-cause we keep our bikes well-maintained. When the customer damages our bike, that's a profit center, isn't it? We don’t get angry when some-body crashes our bike. We don't want anybody to get hurt, but people drop mo-torcycles, and that creates more profit.” In addition to service, smart fleet management can give a significant boost to your bottom line. “The dealer-ship has a great opportunity to turn new bikes into new-used bikes with low de-preciation and income opportunity,” says Jim Enenkel, general manager of Eaglerider Flagstaff/Sedona. Lach concurs: “We haven't made one dollar in the rental business until we've sold the vehicle we were using. That has to be on the forefront of anybody's prospective venture into the rental busi-ness. If I buy a vehicle for $10,000 and I bring in $5,000 renting it and sell it for $5,000, what have I done? I should've just stayed home. Now if I'm a dealer and I'm buying my vehicles at dealer in-voice and commit that vehicle to my rental fleet, let's say it's $10,000. And I rent that vehicle for $5,000 and then still sell it for $10,000, I'm probably on the right side of the equation to keep my ac-countant happy.” Beyond the bikes, a rental business can greatly expand your customer base. motorcyclepowersportsnews.com March 2012 35
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