The recreational vehicle industry took it on the chin in the recent downturn. Dee Corum, owner of Dee’s RV on Naegele Road off of U.S. Highway 24, in Colorado Springs, Colo., has been in the business since 1973 and, he told the Colorado Springs Gazette, this was the worst recession he’s seen by far.
So what did Corum and new partner Joe Stefanec do? Expand to a second location.
Stefanec, who owns a life insurance agency, acquired the old Phil Long heavy-duty-truck facility on Sinton Road, planning to turn it into an RV-storage yard. After talking to Corum, though, he was sold on the property’s potential for sales and service, along with storage. They spent much of 2010 giving the facility a makeover and opened the doors late in the year. The facility employs five people now and they plan to add five more by April.
Corum and Stefanec spoke with The Gazette about the state of the RV industry, making a bet on a new location and a new business.
Question: Is the RV industry a leading or lagging indicator of the economy?
Corum: It’s usually a leading indicator. It’s usually on the front edge, but it’s a small industry — it’s a $2 billion industry (RVBUSINESS.com believes the correct number is closer to $12 billion.)
Q: How big of a bite did the downturn take out of your sales?
Corum: It was the worst that I’ve seen in the last 35 years. All those (recessions) have been nothing compared with this one. We went from doing $12 million (a year) to doing $4 million. That’s usually bankruptcy right there. It was devastating.
Q: So why invest in a new location now?
Corum: It looks like we’ve turned the corner. I started in 1973. I started at the bottom. Joe and I looked at it, and it looks like we’re at the bottom again. Our sales, from February (of 2010) to now are 60% better (than in 2009). 2008 and 2009 were horrible. We are now at the sales level of 2006. The 9.4% unemployment is not pretty, but the people who are working today are pretty certain they’re going to keep working. They’ve worked their whole lives and now they want to see the country. (Analysts) expect as little as an 8% growth (in the RV industry) to as much as a 22% growth and to keep that up for the next 10 years.
Q: Joe, why did you want to get into this business?
Stefanec: I’ve been in personal and corporate life insurance for 37 years. I wanted to do something that was fun — buying life insurance is not a joyful experience for people. I wanted to do RV storage here. I was telling Dee what I was doing and that started the conversations. I started off being a landlord and ended up being a partner. He’s got the right contracts, he’s got the right partnerships.
My dad told me one time, “You’re a lot like a turtle, Joe: You don’t move unless you stick your neck out.” Our competition thinks we’re crazy. Our wives say we’re crazy. But our passion says we’ll do it.
Q: Could rising gas prices put a crimp in the industry’s recovery?
Corum: When diesel fuel went to $4.50 a gallon (in 2008), it was very sensitive. I think if it gets up to $3, $3.25, it won’t affect it.
Stefanec: The new Ford truck is like 20% more (fuel) efficient than the previous year’s. And because RVs are getting lighter, you can use smaller vehicles. You don’t need a semi truck to pull some of these — half-ton trucks are now equipped with the horsepower and the brakes to pull 80% of what we sell.
Q: Do you own an RV yourself?
Stefanec: I have a 35-foot “Raptor.” It’s a toy hauler (an RV with a large space for ATVs or other gear). I love it; getting there is as much fun as being there. I throw my (fishing) pole and my Harley in and go.