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Survey: Rising Counter Sales in Down Market

Editor’s Note: Following are excerpts from an article by Hal Ethington and distributed by ADP Lightspeed. The story refers to a study of 800 dealers that included powersports, RV and marine products. The majority of the info came from the powersports industry. The firms reported $2.3 billion in counter sales in the period 2009-2010.

The study shows that both sales and ticket count overall decreased significantly in 2010. Contributing to this decline was a drop in ticket count from 17.2 million to 16.5 million, or 750,000 counter tickets. Average ticket actually increased by 40 cents during this same time period.

While the collective industry decreased, other dealers actually increased in sales (the “Up Group”). Some 300 dealers were up over 2009.

Isolating the 300 dealers who grew in 2010, we find they added $40.6 million in sales over 2009. How did they do it? Two factors: First, these dealers wrote 360,000 more counter tickets in 2010, and second, they added $2.48 in sales to their average ticket. The Up Group increased their average ticket so much that it compensated for a decrease from other dealers making the average positive.

While the top producers above were adding millions in sales, 500 dealers were experiencing significant decreases in their Parts Counter Sales (the “Down Group”). These dealers dropped a collective 1,106,000 counter tickets, and lost an additional $.97 on each ticket when compared to 2009. These two factors resulted in a revenue drop for them of $85 million.

The following chart illustrates the difference in performance between these two groups:


This chart shows the principal differences between the Up Group and the Down Group. Those that were Up added 360,000 customers to their traffic count. The Down Group lost 746,000 . The Up Group added $2.48 to each ticket, and the Down Group gave up 97 cents.

Even more significant is when you look at the top 100 of the Up Group. These 100 up-dealers did $88 million in parts sales in 2009. For 2010, they jacked that up to $112 million. 27% increase in revenue during one of the toughest years we have ever seen. And we wanted to know more.

So we tore it apart and checked out rate and volume separately. On the rate side, we found that while the 500 dealers who were down in 2010 had lost about $1 per ticket in sales, the 100 up-dealers had tacked on $3.62 per ticket in sales. For their 1.6 million counter tickets, that earned them and additional $6 million in sales.

I don’t know exactly how they did it, but they found ways to get people to buy more every time they visited while others wondered if the doors were unlocked. They faced the same changes and the same environment as everyone else, but they discovered ways to overcome.

Yes, on average 2010 was actually worse than 2009 for parts. Overall traffic was down and parts were hard to come by at times, but in the midst of all that was 2010, 38% of dealers found a way to rise above. Look for them next time you start talking about 2010. They probably won’t be loud about their success, but you’ll recognize the smiles.

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