Editor’s Note: The following is a letter sent to Recreation Vehicle Dealers Association (RVDA) members concerning action by the Consumer Financial Protection Bureau (CFPB) on dealer-assisted financing.
Twenty-two U.S. Senators — 11 Republicans and 11 Democrats — are asking the Consumer Financial Protection Bureau (CFPB) for greater transparency to justify its effort to eliminate motor vehicle dealers’ ability to discount a customer’s loan interest rate. This is a potentially significant development toward CFPB transparency since a Senate bipartisan letter signals to the CFPB that this is not a partisan issue, and emphasizes the need for greater clarity in its decision making.
The letter, led by Sens. Rob Portman (R-Ohio) and Jeanne Shaheen (D-N.H.), comes after several prior congressional inquiries by House democrats and republicans asking whether the bureau had studied the impact on consumers if the extraordinary competitive benefits of in-dealership financing are eliminated.
RVDA supports efforts by these U.S. Senators and others in Congress for more agency transparency. For more on RVDA’s position on the CFPB guidance click here.
In March, the CFPB — without public comment or formal rulemaking — issued fair lending “compliance guidance” that pushes lenders to eliminate the ability that dealers currently have to “meet or beat” a competitor’s rate, and suggests a flat rate paid to dealers as a preferred solution over the current system of dealer participation.
The CFPB refuses to explain to Congress or the public the need to restructure a highly competitive and efficient marketplace that saves car, truck, and RV buyers enormous amounts of money every year.
The Portman-Shaheen letter follows two separate letters sent to the bureau this spring by Rep. Terri Sewell (D-Ala.) and 12 House Financial Services Committee democrats and former House Financial Services Committee Chair Spencer Bachus (R-Ala.) and 34 House republicans.
The bipartisan group of 22 senators is pressing the CFPB for additional information, because “unfortunately, the bureau has not provided complete responses to several of the questions presented to it by our House colleagues,” according to the letter.
For the full text of the letter, including the full list of senators who support the effort, click here.
The Recreation Vehicle Dealers Association (RVDA) is inviting retailers to “extend the value of this year’s convention” with workshop CDs and CD-ROMs.
According to a press release, the offerings include the most popular sessions and speakers, including the general session panel discussion, “Managing Inventory with Logic, Not Emotion,” plus seminars on benchmarking, increasing F&I revenue, creative merchandising that sells more product and digital advertising.
Most of the 2013 convention’s workshops are available for purchase. Buy multiple sessions, grouped by RVDA track, on one CD-ROM, or select individual sessions on audio CDs.
CD-ROMs play in computers only. Some sessions may require multiple audio CDs due to session length and may appear in multiple tracks. To view a list of the available CDs and order, click here.
The Recreation Vehicle Dealers Association (RVDA) will honor RV brands built by 18 manufacturers with its Quality Circle Award in Louisville, Ky., on Dec. 2, just prior to the opening of the National RV Trade Show. RVDA will present the recognition awards at the Crowne Plaza Hotel at 5 p.m., followed by the RVDA Dealer Reception.
These brands/manufacturers received at least 15 dealer responses and scored 80% or above in overall dealer satisfaction in the association’s 20th Annual Dealer Satisfaction Index (DSI) survey.
“The DSI Quality Circle Award recognizes the high level of success these manufacturers have had in working with their dealer business partners,” says RVDA Chairman Jeff Hirsch of Kingston, N.H.-based Campers Inn. “Their commitment to continuously improving products and services ultimately helps dealers serve customers better and preserves our industry’s share of consumers’ discretionary dollars.”
The towable RV manufacturers/brands receiving awards are (in alphabetical order by manufacturer): Airstream Inc.; Coachmen RV (Clipper/Viking travel trailers); Forest River Inc. (Palomino travel trailers and fifth-wheels, Rockwood/Roo expandables, Sierra/Sandpiper); Grand Design RV Co. (Solitude); Heartland RV LLC (Big Country/Elk Ridge, Bighorn/Landmark, Cyclone/Road Warrior/Torque, Gateway, North Trail/Wilderness, Prowler, Sundance, Trail Runner/Fairfield); Jayco Inc. (Camping Trailers, Eagle/Eagle Premier/HT, Jay Feather, Jay Flight/Swift/SLX/DST/Bungalow, Pinnacle, White Hawk); Keystone RV Co. (Cougar/X-lite, Hornet/Hideout/Energy, Laredo, Montana/Big Sky/High Country/Mountaineer, Outback/Sydney, Raptor, Sprinter/Copper Canyon); KZRV LP (Sportsmen/Sportsmen Classic, Spree/Spree Escape); Lance Camper Manufacturing Corp. (travel trailers and truck campers); Lifestyle Luxury RV/Bay Hill fifth-wheels; Open Range RV Co. and Prime Time Manufacturing Inc. (Avenger, LaCrosse/Tracer, Crusader/Sanibel).
The 10 motorized RV brands/manufacturers receiving awards are (in alphabetical order): Airstream; Coachmen (Class C’s), Forest River; Jayco (Class A’s and C’s); Leisure Travel Vans/Triple E; Newmar Corp.; Pleasure-Way Industries Ltd.; Tiffin Motorhomes Inc.; Thor Motor Coach and Winnebago/Itasca.
When rating their brands/manufacturers, RVDA asks dealers to express, confidentially, their level of satisfaction on eight core issues:
• Sales support
• Sales territory
• Vehicle design
• Vehicle reliability/quality
• Competitive price/value
• Parts support
• Dealership warranty support
• Overall dealer communications
The 20th Annual DSI survey was conducted between April and July 2013. RVDA reported that 469 dealers responded to the DSI this year and provided 2,501 brand ratings, an average of more than five per dealer. A summary of the DSI survey aggregate results will appear in the November issue of RV Executive Today.
Editor’s Note: Robert W. Baird & Co. recently partnered with the Recreation Vehicle Dealers Association (RVDA) to contact 133 RV dealers regarding demand and sentiment during the third quarter. The following is a summary of the results.
RV momentum continues. Demand remains strong and inventory appears lean-to-balanced. We maintain a bullish fundamental outlook and would look to be more aggressive on weakness. We believe improved asset values (homes and investments) are fueling a wealth effect for RV buyers, releasing pent-up demand. With lean-to-balanced dealer inventory, it is a good environment for manufacturers. Meanwhile, we are losing confidence that a better opportunity will present itself.
Retail remains healthy. Dealers reported robust growth in motorhomes (+18-20%) and towables (+11-13%) in the third quarter. Baird believes better used values combined with a better housing market and higher stock prices have helped reduce the negative equity that had prevented consumers from purchasing new RVs.
Inventory is lean-to-balanced. Dealer inventory appears lean in motorhomes and balanced in towables. Measured in days, inventory appears flat versus last year – but motorhome dealers want more while towable dealers want less. A limited supply of Class A chassis has exacerbated the inventory shortage.
Discounting has abated. Dealers report a less promotional environment, suggesting better margins for manufacturers. In motorhomes, 30% of dealers report fewer OEM discounts versus 7% that report more. The same trend holds for towables, where 26% of dealers report fewer OEM discounts versus just 8% that report more.
Sentiment near record highs. The Baird/RVDA dealer sentiment index remains near record levels. Dealers are concerned that an ineffective government and the Affordable Care Act could throw a wrench in the engine – but overall, optimism reigns.
Please contact your Baird representative for a complete copy of the dealer survey.
Editor’s Note: The following story, appearing in the latest digital issue of RV Executive Today, reports on results from the Recreation Vehicle Dealers Association’s (RVDA) latest RV Business Survey.
RV dealers were a little more cautious in their outlook as of midsummer compared with the same time last year, according to the latest RVDA survey, which was conducted in late July and early August.
Some 56% of the dealers surveyed said their inventory levels were “just right,” the same percentage who felt that way a year earlier. However, 25% of respondents said their inventory levels were too high while a year earlier only 16% had the same response. Nineteen percent of dealers said inventories were too low compared to 28% last year.
As far as ordering plans are concerned, 25% of the dealers who responded said they planned to order more RVs during the second half of 2013 than they did during the second half of 2012. Last year, 36% of dealers said they planned to order more during the second half of 2012 than they did during the same portion of 2011.
An even 50% of dealers who responded to the midsummer 2013 survey planned to order “about the same” number of RVs during the second half of 2013 as they did during the second half of 2012. A year ago, 20% planned to order the same number as they did during the second half of 2011. The percentage planning to order fewer units stayed about the same – 19% in 2013 and 20% in 2012. Six percent of dealers were undecided as of midsummer 2013, while 24% were undecided a year earlier.
Towable market still in good shape
A slight majority of midsummer survey respondents – 53% – said the retail market for towable RVs was better than it was a year ago. Another 40% of respondents said their towable sales were about the same as a year earlier, and only 7% said they were worse.
During the midsummer of 2012, 72% of dealers said their towable sales were better than they were a year earlier, 20% believed they were the same, and 8% said they were worse.
Although still not as robust as the towable sector, the motorhome business showed significant improvement during the past year. Twenty-nine percent of dealers said it was better as of midsummer 2013, while only 14% said it was better in midsummer of 2012. Another 29% said the motorhome business was worse as of midsummer 2013, a slight increase over the 24% who believed the same as of midsummer 2012.
Forty-three percent of dealers said their motorhome sales as of midsummer 2013 were about the same as a year earlier; a year earlier, 62% said motorhome sales were about the same as the prior year.
Retail Financing Availability Improves
There was a slight improvement in the availability of retail credit between 2013 and 2012, according to the dealers responding to the survey. Eighty percent of dealers who responded in midsummer 2013 said the right amount of retail credit was available for their customers, compared with 72% a year earlier.
Almost all dealers – 94% – said in the latest survey that there was an adequate amount of wholesale financing available, compared with 96% who felt that way the year prior.
All things considered, it’s not that often that an individual who works in the daily trenches of an RV dealership becomes a published author. But Marco A. Martinez, you will find, is not a regular guy by any stretch of the imagination.
Martinez currently lives a double life as a business consultant to RV and marine dealerships and as founder and owner of Florida dealership RVCR of Ocala Inc. that specializes in used and consignment RV sales, and extensive service repairs to the general public and insurance companies.
An Air Force vet with a masters in divinity whose resume includes stints at California’s Rexhall Industries Inc. and Florida’s Turning Wheel RV Center Inc., Martinez is now the proud author of “How To Run a RV Dealership: 22 Best Kept Secrets to Help You Run Your Dealership,” a 120-page compilation of short articles he’s written over the past 10 years as a consultant and website blogger that’s now available on Amazon.com as well as his own website and at industry trade events.
Developed as a resource dealers and managers can keep on their desks and use as a lifeline when they need help figuring things out, Martinez’s book includes easy-to-follow checklists he prepared to help managers of all ages establish fruitful routines so that specific tasks are performed on certain days to ensure that nothing really falls through the cracks. The whole thrust, he says, is in helping dealers and especially new managers master the basics of dealership business management – beyond sales and F&I – an area he feels is often sorely overlooked within the industry.
“As the RV industry comes back to life, I am sensing that many dealers and general managers really don’t have a clue as to how to effectively manage the day-to-day operations,” said Martinez, who spent a brief stint in 2000 with Holiday RV Superstores Inc. (Recreation USA) after it acquired his employer at the time, County Line RV. “If they look for help online, they will find a lot of information about running car dealerships, but nothing pertaining to the RV industry.”
Martinez says the book includes segments targeted at F&I, sales, accounting, product and parts managers. “This is operating stuff,” said Martinez, an El Salvador native who has also penned religious books. “It’s not just how to have a successful sales program. One chapter talks about the importance of job descriptions for everybody in your organization. The RV industry is so disorganized. All the dealerships that I consulted for, there wasn’t a single one when I stepped in there that had a job description.
“That’s part of the problem,” he added. “Most RV people have trouble with operations because there are six people assigned to sell parts and five people in charge of various related details. It’s an endless nightmare of disorganization.”
Among the book’s key chapters:
• Get Organized
• Dealership Operations Checklist
• Inventory Turns
• Managing Used Inventory
• Dealership Profit Margins
• Understanding Cash Flow
• Capitalizing On Consignment
• Month End Accounting Issues
• Managing Warranty Claims
Another chapter addresses computerization, Martinez explained, adding that a lot of people think getting a computer system is a good thing, but computer systems only improve the processes that are already in place. They don’t create processes. “It is absolutely essential that RV dealers have these basic steps firmly in place at their businesses,” Martinez told RVBUSINESS.com. “Too many dealers are overly dependent upon software to run their companies. Here’s a tip: software doesn’t help fix broken firms.”
The bottom line, says Martinez, is that there just aren’t enough places to turn to in a business sector like the RV industry for road-tested advice. But he’s got plenty of that in addition to an extensive sales training program plus hundreds of dealership forms available on his website that could bring a semblance of organization to a sloppy shop.
“There will be some old owners who have been there for 50 years, and they’ll tell you everything about it,” added Martinez, who can be contacted at the email address (firstname.lastname@example.org) of his consultancy. “And they’ll know because of trial and error and experience. But a lot of these guys went bankrupt or are dead. Now you’ve got a new breed of people wanting to get into the business. And if they ask how to run a dealership, there’s nothing out there.
Some RV dealers in Florida and the Midwest have lost tens and sometimes hundreds of thousands of dollars over the past two years by using auction companies that appeared to promise them a guaranteed price for their units.
According to an article in RV Executive Today Online, dealers have filed complaints with the Better Business Bureau and state attorneys general about small pop-up auction houses that offered “invoice protection plans” that supposedly guaranteed how much the dealers would receive for their units, regardless of how much the units actually sold for at auction.
The dealers say they were told the auctioneers would put reserves on their units and that they wouldn’t be sold unless the reserves were met. Instead, the units were sold in “absolute” auctions in which they simply went to the highest bidder, frequently at prices far below their agreed-upon value. And, under the formulas used in the “invoice protection plan,” the so-called cash protection was less than the amount the dealers lost.
One dealer recently stood to lose almost $100,000. The dealer had supplied the auction with four units whose combined invoices were given a value of $200,000. The contract stated that “If the seller’s NET check fails to meet or exceed 100% of the TOTAL VALUE of $200,000 … the auction agrees to provide an incentive of up to $60,000 for protection per its Asset Assurance Plan’s terms of service.”
The units failed to reach their total value at auction, selling for only 45% of their value, or $90,000. And under the asset assurance plan’s formula, the dealer was entitled to only $5,000, not the expected $60,000. With an attorney’s help, the dealer was able to unwind the transaction, but it cost $25,000 in legal fees and shipping to get the units back.
The dealer, an RVDA member who asked not to be named, says the company never explained what it meant by “absolute” selling terms, or that the asset protection money was based on selling price, not value. “They’re very good at persuading you,” he says. “They talk in dealer lingo. They sound like dealers. Part of the temptation is that they approve units you didn’t expect them to approve. The icing on the cake is the asset assurance.”
He’s spoken with two other dealers who had similar experiences; one of them had lost close to $100,000 “and it turned out to be the same people operating under a different name.”
In fact, several small popup auction companies offering similar “asset security plans” have been taken to court during the past two years in Tennessee, Missouri, Georgia, and Kentucky. It appears that some of the owners may be involved in more than one operation. When their business goes bankrupt or is taken to court, they pull up stakes and move to another location.
Dealers should be wary of any auction house that offers a guaranteed payment and should read the contract closely before signing.
“It’s embarrassing,” says the dealer. “We just totally got hosed. Every single dealer I talked with cannot believe they allowed this to happen, because they’re smart enough to know better. I really wouldn’t want to see any other dealer go through this.”
Parts and service professionals attending the 2013 RV Dealers International Convention/Expo will find more education offerings at this year’s gathering, according to a press release.
The convention, running Sept. 30–Oct. 3 in Las Vegas, will offer nearly a dozen learning opportunities each for parts and service professionals with the addition of sessions on Monday and Tuesday.
These sessions add value to the convention experience by giving dealers a bigger ROI for staff education. Vendor Training +plus allows longer, more in-depth training, and this year’s proprietary workshops span two days, covering critical skills and topics presented by industry leaders. Fixed operations leaders attending the Convention/Expo can earn continuing education credits toward professional certification through their participation in educational workshops.
Beyond the numerous proprietary workshops and Vendor Training +plus on Monday and Tuesday there is a slate of targeted education track workshops in every time slot on Wednesday and Thursday, many of which feature new presenters. These were designed to meet the challenges faced by parts and service managers who need to keep up on the very latest trends and technologies while increasing profits by employing new tactics and strategies.
Parts track workshops include the following topics and an asterisk denotes a new presenter:
• Discover Hidden Profits in Your Parts Department, presented by Mark De Lucia*
• Growing a Dealership with Parts, Accessories & Service, presented by Gary McGugan*
• The Art of Successful Selling in the Parts Department, presented by Michael Doyle*
• Creating a Winning Display: Turn Your Parts Display into a Visual Experience, presented by Barry Siskind*
• “Rooftop” Measurements for Effective and Profitable Fixed Operations, presented by Mike Nicholes*
• Stock the Right Part at the Right Time, presented by Chuck Marzahn
• A Day in the Life of a Successful Parts Manager, presented by Mike Nicholes*
• Let’s Get Visual: Merchandising’s Secret Weapons, presented by Linda Cahan
Service track workshops are as follows:
• Inspection Processes & Tools, presented by David Foco
• Let’s Put the “P” Back in Service, presented by Jim Carr
• Crucial Accountability: Tools for Resolving Broken Promises and Violated Expectations, presented by David Nelson*
• “Rooftop” Measurements for Effective and Profitable Fixed Operations, presented by Mike Nicholes*
• How to Utilize Email Marketing to Increase Your Fixed Ops Revenue, presented by Peter Martin*
• Boomer Power: Meet the Best Buyers on the Planet, presented by Linda Cahan
• Customer Service or “Am I Selling?” presented by Paul Webb*
• New Hires with a Customer Service Mindset, presented by Ricardo Roman
For details about these workshops, and the variety of proprietary and Vendor Training +plus sessions pertinent to your staff, consult the RVDA website. For more information about continuing education credits and professional certification available through the RV Learning Center, contact Liz Shoemaker at email@example.com or stop by the RVDA Booth during the convention.
A series of track workshops has been tagged for young RV executives attending the RV Dealers International Convention/Expo, Sept. 30 – Oct. 4 in Las Vegas.
According to a press release, the Convention/Expo Committee also developed two special workshops designed to appeal to the needs and professional development goals of these younger members.
A special session on Wednesday (Oct. 2) features new presenter David Nelson of VitalSmarts, and Thursday’s special session will be presented by Jim Rogers, chairman and CEO of Kampgrounds of America Inc. (KOA).
A new logo added to the convention matrix of events will note workshops that have been recommended for young RV executives.
Results from a spring survey of young RV executives and input from volunteer members were the basis for the content of the workshops chosen. This emphasis on younger members is part of an outreach effort initiated by RVDA Chairman Jeff Hirsch earlier this year.
The goal is to meet the needs of younger members and to support future leadership for the organization.
David Nelson of VitalSmarts will present a session created especially to appeal to young RV executives on Wednesday afternoon. “Influencer: The New Science of Personal Success” will give attendees powerful strategies to create rapid, dramatic and permanent change in others.
Nelson will share the six sources of influence that make organizational change inevitable and identify high-leverage behaviors that lead to swift change.
Immediately following this session, a brief networking reception for young executives will take place.
The final session in the program will feature the Rogers as he shares his premise that “Luck is When Preparation Meets Opportunity.” Rogers, noted most recently for his television appearance on “Undercover Boss,” began at KOA as a management trainee in 1972, and following a successful career with Harrah’s returned to his roots at KOA as chairman and CEO. Young executives attending his session will learn his theory of how businesses need to build their own future.
Below is the full listing of education events carrying the young RV executives tag. A full description and schedule appears online. There is at least one session in every time slot.
Wednesday, Oct. 2
• “Nobody Moved Your Cheese!” Presented by Ross Shafer.
• “Crucial Conversations: Tools for Talking When Stakes are High.” Presented by David Nelson.
• “Crucial Accountability: Tools for Resolving Broken Promises and Violated Expectations.” Presented by David Nelson.
• “Still Surprised by Why People Do What They Do?” Presented by David Spader of Spader Business Management.
• Special Session: “Influencer: The New Science of Personal Success.” Presented by David Nelson.
Thursday, Oct. 3
• “Grow Your Leadership & Management Skills.” Presented by Paul Webb of Paul Webb Training/WebbVT.
• “Dealership Culture – The Ultimate Differentiator.” Presented by Gary McGugan of NEEDS Selling Solutions.
• “A Day in the Life of a Successful Sales Manager.” Presented by Michael Rees.
• Special Session: “Luck is When Preparation Meets Opportunity.” Presented by Jim Rogers.
For more information about the young RV executives program, contact Julianne Ryder at RVDA by email at firstname.lastname@example.org or phone at (703) 591-7130, ext. 111.
A free app from Guidebook.com is available for registrants, featuring a complete agenda, expo map, and the ability to create and save a personal schedule. The app gives users regular updates, allows information sharing within social networks, and works on any mobile device.
Camping World Inc. and Good Sam Enterprises LLC announced their forecast for expansion and future development to “meet customer needs for product and service in new markets,” according to a press release.
The new markets will raise the total number of supercenters, just shy of 115 nationwide. Additionally, the company is in discussions with land owners and existing dealerships actively pursuing new markets and acquisitions that will be announced over the next six months.
Plans are under way to expand the company footprint with additional locations in high traffic, outdoor-centric markets within the following timeframe and markets:
• August 2013: Panama City, Fla.
• September 2013: Ocala, Fla., relocation; Tucson, Ariz., relocation; Cedar Falls, Iowa.
• November 2013: Berkeley (Boston area), Mass.
• January 2014: Coburg (Junction City area), Ore.; Fresno, Calif.; Harrisburg, Pa., retail store expansion; Lake Park, Ga.; February 2014 – Saukville (Milwaukee area), Wis.; Olive Branch (Memphis area), Miss.
• April 2014: Rossford (Toledo area), Ohio; Rapid City, S.D.; Pittsburgh, Pa.; Jackson, Miss.
“We are proud to continue our commitment to the U.S. market with the opening of these new supercenters and look forward to having customers in these regions visit their new one-stop location for everything outdoor and RV,” said Marcus Lemonis, chairman and CEO of Camping World. “As part of Camping World and Good Sam’s growth strategy, the brand is making major investments in the quality of its dealer network. From facility upgrades to new store openings, the company’s network will continue to expand and evolve while serving our customers’ outdoor, RV and camping needs.”
He continued, “These recent acquisitions increase our presence in existing markets and new territories and are in alignment with the strategic growth plans we have for the company. We are constantly reviewing our footprint and evaluating where we can strengthen our position within each of our markets.”