How are Dealerships Surviving?

[nomad297]

The other day I went to my local dealer where everybody there knows me pretty well, and as I walked through the door, the manager greeted me with “Hey Bruce — I hope you’re here to buy antifreeze, because that’s just about all we have left now.”

They have just about nothing on their lot — maybe a few tired looking used RVs, but that’s just about it, and when you look at their website, everything they have listed has a note beside it saying either “Coming Soon” or “On Order”.

I didn’t want to get into making the manager feel any worse than he apparently already felt, so I didn’t ask him how they plan to survive this shortage of supply.

This is a small, yet reputable dealer who has always had a large stock with a great selection, but their future really seems grim to me, but maybe I’m wrong. Maybe they have a plan.

What is the general consensus of everybody here for how all of these dealerships are going to survive — pending orders? Used RV sales next year? Are we all going to be witness to all of the smaller dealers failing and only having dealers like Camping World to buy from in the near future?

Bruce

[Csbadvisor]

Originally Posted by nomad297

The other day I went to my local dealer where everybody there knows me pretty well, and as I walked through the door, the manager greeted me with “Hey Bruce — I hope you’re here to buy antifreeze, because that’s just about all we have left now.”

They have just about nothing on their lot — maybe a few tired looking used RVs, but that’s just about it, and when you look at their website, everything they have listed has a note beside it saying either “Coming Soon” or “On Order”.

I didn’t want to get into making the manager feel any worse than he apparently already felt, so I didn’t ask him how they plan to survive this shortage of supply.

This is a small, yet reputable dealer who has always had a large stock with a great selection, but their future really seems grim to me, but maybe I’m wrong. Maybe they have a plan.

What is the general consensus of everybody here for how all of these dealerships are going to survive — pending orders? Used RV sales next year? Are we all going to be witness to all of the smaller dealers failing and only having dealers like Camping World to buy from in the near future?

Bruce

If lot is generally full and now empty I would think they had a banner sales year and should be in a good financial situation. With new inventory on the way and what appears to be strong demand with low consumer borrowing rates should be another good season

[nomad297]

Originally Posted by Csbadvisor

If lot is generally full and now empty I would think they had a banner sales year and should be in a good financial situation. With new inventory on the way and what appears to be strong demand with low consumer borrowing rates should be another good season

I thought about this as well, and this is what I am hoping for.

Bruce

[youroo]

Originally Posted by nomad297

The other day I went to my local dealer where everybody there knows me pretty well, and as I walked through the door, the manager greeted me with “Hey Bruce — I hope you’re here to buy antifreeze, because that’s just about all we have left now.”

They have just about nothing on their lot — maybe a few tired looking used RVs, but that’s just about it, and when you look at their website, everything they have listed has a note beside it saying either “Coming Soon” or “On Order”.

I didn’t want to get into making the manager feel any worse than he apparently already felt, so I didn’t ask him how they plan to survive this shortage of supply.

This is a small, yet reputable dealer who has always had a large stock with a great selection, but their future really seems grim to me, but maybe I’m wrong. Maybe they have a plan.

What is the general consensus of everybody here for how all of these dealerships are going to survive — pending orders? Used RV sales next year? Are we all going to be witness to all of the smaller dealers failing and only having dealers like Camping World to buy from in the near future?

Bruce

Ideal situation for a Dealership in Pa to be in,Winter comming and the Lot Empty! Fresh RV supply come Spring,more room on lot for Repair units! The only drawback is all the New units delivered from In to Pa that will have "SALT" all over the unit! Youroo!!

[Oaklevel]

Originally Posted by Csbadvisor

If lot is generally full and now empty I would think they had a banner sales year and should be in a good financial situation. With new inventory on the way and what appears to be strong demand with low consumer borrowing rates should be another good season

I would have to disagree. My small dealer would have sold many more units if they had them. Same with used units but they have not had them either. The good news the lot has many older trailers in for service.

Whether they will survive is yet to be determined. I need to go by anyway to see if their one salesman is still there.

[eye95]

It is not just RVs. It is most consumer products. We have empty shelves all over the store, not because sales are up, but because supplies are down. Way down. We are buying whatever we can to make the shelves look full, but they are still relatively empty—and the product we have isn’t moving.

People are generally not buying non-essentials. Their personal economies have been trashed. Retailers will not be able to do the traditional Black Friday. First, they can’t accommodate the usual BF crowds due to restrictions. Second, they just can’t get the volume of product that makes a Black Friday sale a success.

Many retailers are gone—or going away soon. Mom and pops are dropping like flies, never to return.

Entire supply chains have been decimated, from raw materials, to manufacturing, to distribution. In my department, our inventory which is normally above 600 is under 250. Our product does sell well during the panic, but we generally can’t get resupply, and what we can get is not generally what folks are looking for. Our sales are way up (again, like RVs), and between us, alcohol, and tobacco, those products are the only things keeping the store in the black.

Also, like RVs, there will be a glut of our product (used) on the market, driving down our prices and sales. There will be a reckoning for dealers in products that are popular in a panic, but will fall out of favor quickly.

Our sister store across the parking lot is in the red—horribly. Hours for our associates in both stores have been cut back so horribly that many have quit. Positions are going unfilled, even in the departments that are making money, ironically causing a loss of some sales. Folks come from places like Cleveland to buy our products, find us closed early, not yet open, or closed for the day. Many don’t come back.

Folks, for the most part, don’t understand the fundamental damage that has been done to the economy. Over the next few decades, it may come back, but never like it was before the panic.

Personally, I am abdicating from the contribution side of the economy (a few years earlier than my originally planned retirement). I have what I need to do well without working (barring total societal collapse). I will be paying zero income tax (federal, State, city, or school), near zero sales taxes, and near zero property taxes.

I (and, I am sure, others who are no longer going to pull, but instead, are climbing into the wagon) wish those of you now stuck pulling the wagon the best of luck.

If nothing else good comes of the economic holocaust that is the panic, at least we have the greatest object lesson in history of “The Law of Unintended Consequences”.

[TitanMike]

RV Dealers, just like Car Dealers have a huge operating expense when their lots are full of new inventory. It's the Interest they have to pay every month to "floor" the inventory.

The ones that are hurt the worst are the commissioned sales staff. The Dealer has had his costs reduced to almost a bare minimum and if they were smart, banked the profits from selling out the inventory.

Service will help them pay the rent and used unit sales will supplement.

As for other businesses, each will have their unique challenges depending on their business model and expenses.

I have watched my Son's business and since the crisis began his suppliers have had difficulty in making timely deliveries. New Sales are down but Service Sales are UP. WAY UP.

Service, generally speaking, is far more profitable than the sale of something you have to purchase from a supplier.

[jd4010]

I bet many of these dealers are surviving on service. Where I go, service area is backed up for countless weeks. I suspect many of these new rigs are needing warranty work done and then add to it year end service (e.g. winterizing, etc).

[Bob2019]

Dealers are similar to people at the state fair - there they make as much in 12 days as they do the rest of the year. Considering all the poorly made RVs they have sold, they will be fixing, repairing and correcting their prior sales for the next year at plenty of profit. They have little interest due on RVs sitting in their lot and maybe even have time to ramp up service and train their staff. (lying would be a first ethics start). Also since the inventory on hand is down, they can and will raise prices, even on old dogs as people will probably buy anything now.

Reality for business in any category, until Covid get under control, our economy is in the toilet and will stay there. People will not attend events, shop little or go to restaurants. Small business are dropping like flies and will not be back ever. Many people with good, paying jobs are not going back to their jobs because they won't chance bringing the virus home or getting it themselves. I was told many of the dental cleaning staff have left recently at my dental clinic - who could blame them with spray flying at them cleaning teeth. Let all of us do are part and show consideration to everyone we come in contact with.

[AlaskaErik]

The dealership I drive by on a regular basis has a lot full of trailers.

[alicemerrill]

Here in New England Lee’s Ranch RV has some beautiful Fifth Wheels for sale. Hardly used used ones beautiful. They are in Ellington CT. Take a peek to their lot.

[upflying]

I bought a Whirlpool dryer 2 weeks ago, delivery might occur at the end of December. Durable goods is hard to find and sold out.
I would assume Elkhart was shut down for a while due to covid.

[TeachTexas]

I just drove by a few of the dealers in my area. The lots were full but not packed as they have been. Two of them are even running sales.

[D W]

My dealer sold his entire 2020 FR Allocation this year. Luckily, our Governor left camping/recreation as "essential", and never closed our State Parks. The Oregon plant was shut down for two months earlier this year due to that Governor's Proclamation. That caused a back-up of product. His 2021 allocation is due to arrive in April, but there's rumors that the Oregon Governor may shut things down again. With our short camping season, this could be devastating to his business.

[markb422]

Ditto to what Csbadvisor wrote. In Michigan, RV sales have had a huge year with help from very low interest rates. The State Parks here were shut down for a couple months but almost got back to what they normally would be. The parks everywhere in this state have been full with new RV's since restrictions got lifted.

[TitanMike]

Originally Posted by D W

My dealer sold his entire 2020 FR Allocation this year. Luckily, our Governor left camping/recreation as "essential", and never closed our State Parks. The Oregon plant was shut down for two months earlier this year due to that Governor's Proclamation. That caused a back-up of product. His 2021 allocation is due to arrive in April, but there's rumors that the Oregon Governor may shut things down again. With our short camping season, this could be devastating to his business.

Washington, Oregon, and California all got hit hard by the virus and Governors in these states took drastic measures to get a hold on the spread. As predicted the "spike" is here and will most likely trigger a return to mandated closures, reduced capacities, and MASKS.

Right now our local transit vehicles have their route signs flashing "Masks Mandatory".

The old signs saying "No Shirt, No Shoes, No Service" are adding "No Masks" to the list.

The prediction is that his second surge of infections could be worse than the original outbreak, especially if people refuse to take protective measures. Fall/Winter are the Virus Seasons on a non pandemic year and with the "super bug" tossed in I think they're right.

[SacRV]

I had a nice conversation with the owner of a dealership we have a trailer on special order from last week. She said normally they’d have about 250 RV’s on the lot. They have 6 now.

[Sharon455]

Our dealer has contacted us 3 times to see if we wanted to sell our 2010 SOB Class-C. So many people want to RV but wouldn't have a clue about tow vehicles so Class-A and Class-C are in high demand. Sometimes I wish we did sell, but if life goes back to any semblance of normal we prefer to drive cross country in the RV than to fly or use a hotel.

[craig111]

I think most RV dealers suck. They don't care about customer servive. I'm sure there's some are good ones but wish I knew who they were in Missouri.

[AlaskaErik]

Originally Posted by craig111

I think most RV dealers suck. They don't care about customer servive. I'm sure there's some are good ones but wish I knew who they were in Missouri.

Have you tried Wilder RV in Clinton, MO? Great to deal with and no surprises when I got there. Their "out the door" price quote they sent me is the price I paid when I showed up.