Among the most popular recreational vehicles Wisconsin consumers purchase are motor boats, ATVs and motorhomes. But sales were in the doldrums until recently, according to Mike Prosser of Prosser RV on Milwaukee’s far south side. He even plowed his own salary into the business in order to retain his employees and keep the company operating, according to a report from WUWM Public Radio, Milwaukee.
“When people aren’t working they don’t buy our stuff, and when people are afraid of losing their jobs, they’re not going to buy stuff. But as people begin to see there’s light at the end of the tunnel, their pent up demand for products like we sell comes to market and our sales increase,” Prosser says.
And Prosser says he has noticed a dramatic jump in sales of his mothomes and campers over the past five months. In fact, he’s had customers purchase $50,000 to $80,000 RVs. The secret, according to Prosser, is to be consumer-friendly. He’s increased his credit line with a few banks in order to purchase and keep more vehicles on the lot, so buyers can drive away in them and he’s reduced the traditional 30% markup on motorhomes.
“Those of us that are more aggressive in the market have aligned our margin expectations to the reality of the current situation and we’re actually selling stuff. (We’re) not making as much money on that perhaps, but we’re moving products and keeping the doors open and keeping customers happy,” Prosser says.
Prosser says at the present time, it’s often possible to purchase a new motorhome as cheaply as a used one. But he expects that trend to be short term. There are good deals out there, at least for now, according to Daniel Burdett. He’s general manager of Action Sports in Waukesha. It sells ATVs and dirt bikes. Burdett says there’s now a surplus of some bikes, so prices are dropping.
“You might be able to buy a new ATV, a really nice ATV for $4,500 to $5,500, and in a lot of cases, that’s what a used one is costing. It might not be first choice as far as features or equipment, that type of thing, but definitely in the area of what the customer is looking for,” Burdett says.
Burdett has noticed fewer customers entering his shop these days, but those who do, are serious about buying.
“And many times, the customers will just tell you what it takes to do business with them,” Burdett says.
Burdett describes his business as brisk, not stellar, but brisk. However, sales are still about 40% lower than before the recession hit. John Kukuk is in the same boat. He owns Nestage Marine in Marinette, Wisconsin. Kukuk says business is improving in 2010 but still down considerably from five years ago. In order to survive the downturn, his company has cut back on inventory. It used to have several large boats on hand, but now has only one or two. Kukuk says he’s also begun pursuing potential customers, because there are still people out there, able to buy.
“We’re using new methodologies associated with the internet, more direct contact. We’re still using the old boat show methodology, but waiting for the walk-in customer, that’s a thing of the past and it’s not going to work,” Kukuk says.
Kukuk says he’s trying to be optimistic, knowing the marina industry is slower to rebound than others. His latest worry is that the oil spill in the Gulf could slow boating use and sales there and eventually have a ripple effect on companies like his.