Manufacturer discounting is causing concern among some dealers, who fear the practice hampers profit retention, damages the customer base and encourages buyers to hold off for a better deal. Rocketing business rates and extortionate insurance premiums are also seen as a problem, according to dealers interviewed for Trade Talk, BDN’s quarterly update on news from dealerships across the UK, which will appear in the July magazine.
Phillip McCallen of the eponymous dealership in Lisburn, Northern Ireland, is maintaining new sales year to date but says: “It’s a very competitive market, with plenty of manufacturer promotions and not all of them creating an orderly market. A potential customer waits and develops the “no rush to buy” thinking. It can test natural brand loyalty, custom retention and confidence. The manufacturers are all doing it in different ways to get bikes sold, but ongoing 0% finance, for example, can be damaging over the long-term.”
“KTM’s blatant advertising of 20% discounts on new bikes is hitting us very hard,” said Oliver Hammond, sales manager at off-road specialist MATT POPE MOTORCYCLES in Fakenham, Norfolk, which sells Beta and Sherco. “It’s watering down the customer base we have tried years to build. This is not normal inter-dealer and brand competition. It’s destructive of machine values in the long term and is impacting on the excellent brands we have and making sales very difficult in the off-road market.”
Read more from these two dealership and scores of others in July’s Trade Talk.
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