Chris Eady, Dealer Principal,
22nd October 2020 | 5 minute read
- Online sales are vital for Powered Two Wheeler (PTW) dealerships to weather the storm
- Delays of two-to-three months on new bikes and parts
- Demand is up for smaller commuter bikes, down for luxury machines
- The local biker community have lost the dealership as a social hub
- A post-lockdown surge in sales is expected to fall away by Q4
Having worked with dealers throughout the pandemic we’re committed to sharing their valuable firsthand experiences of the impact of COVID-19, both on their businesses and the industry as a whole. We hope these insights will put your own situation in context and provide food for thought to help you continue adapting to the new normal.
In the first of a series of conversations with PTW dealers, we spoke to Chris Eady, Dealer Principal at M&P Direct in Swansea, a multi-franchise dealership specialising in new and used bikes as well as clothing, parts and accessories. We interviewed him in late July 2020 about how the business has been faring both during and after lockdown.
How did you adapt your operations during lockdown?
We were lucky in already having an established online presence. We’ve put a strong focus on online used bike and parts sales, mostly on eBay and AutoTrader Bikes. We were very focused going into lockdown on the need to liquidate the stock to reduce our liability and we’ve managed to do that through our online shop and call and collect services. I reckon the crisis has accelerated the online market by five years - even the old guys who never dreamed of not buying a part in person have learned how to buy online.
"I reckon the crisis has accelerated the online market by five years - even the old guys who never dreamed of not buying a part in person have learned how to buy online."
In terms of staffing, we have quite an extensive operation including dealerships, parts warehouses, café, workshop and admin teams. Initially we furloughed 60% of staff and worked with a skeleton team, but we’ve been gradually bringing employees back to work. One of our key goals for the crisis was to bring back 100% of our employees - our café staff are still on furlough for now, but we’re up at around 75% overall.
How is working in the dealership different post-lockdown?
The biggest change is that the biking community used to gather in person on the site and spend time at our diner and around our workshop. It’s really sad we’re unable to provide that physical space at the moment. But community is so engrained into the biking world I can’t see how they wouldn’t come back. I suppose it depends on how confident and safe people feel in groups as to when they will return. It will take time.
“The biking community used to gather in person on the site and spend time at our diner and around our workshop. It’s really sad we’re unable to provide that physical space at the moment.”
How are you operating now lockdown has ended?
We’ve changed how we work, with one-way systems in the warehouses, appointments only in the dealerships and much more online activity. All counters have shields and employees have face shields. Hand sanitiser and face masks are available for customers as well as disposable balaclavas if they want to try anything on.
Any stock such as helmets which are tried on are disinfected and taken off the dealership floor for 24hours where possible. We also ask customers to minimise touching the stock, but it’s hard because people should be able to touch the material and feel the weight of a jacket, for example.
We’re keeping test rides to an absolute minimum, which is a reversal of our usual policy - normally we’d encourage test rides because often people don’t think a bike is right for them until they feel it on the road. Unfortunately, additional resource is needed to make sure they’re fully cleaned down so it’s not practical to offer rides to anyone who just wants to give a bike a try at the moment.
What are the main challenges your business is facing post-lockdown?
Accessing new motorcycle stock is proving to be a massive industry-wide problem because the manufacturers’ factories were closed during lockdown. Everyone is currently looking at a two-to-three month delay in getting new stock. Some items such as oils are also taking longer, and suppliers are struggling to fulfil their orders, although that’s more due to the increase in demand from the general public who are servicing their bikes themselves than actual stock shortages.
How has COVID-19 affected sales?
We’re currently experiencing an increase in sales due to pent-up demand, but we think this will be gone by Q4. There’s definitely been an increase in the 125cc market - these bikes only require a CBT test and so are good for commuters who don’t want to take public transport anymore. In contrast, with the European road trips all having been cancelled this year, the sales of larger, luxury machines generated from this group have disappeared.
“There’s definitely been an increase in the 125cc market - these bikes only require a CBT test and so are good for commuters who don’t want to take public transport anymore.”
In general, there hasn’t been a major shift in the wider market; the people who’ve bought are the ones who would have bought regardless, they’ve just done so online and taken advantage of the drop in prices. But as the recession bites people will re-evaluate their finances and not buy a new bike, and I think that decline will probably not reverse until people feel more financially secure.
How have Black Horse supported you through lockdown and beyond?
We rate our Black Horse Account Manager very, very highly. We understand why he had to be redeployed elsewhere in the Group to work with customers needing extra support and he is still responsive in the evenings. Even so, the sooner we get him back full-time the better! Black Horse have been supportive in other ways - for example, we requested a 0% campaign which was approved and so now we can communicate around affordability messages.
What advice would you give other dealerships in your sector?
My advice to other dealers would be to look carefully at stock control and liquidity to make sure you can get through the winter months.
We hope Chris’s insights offer some inspiration as you work with your team to take your own dealership further down the road to recovery. Look out for future Dealer Conversations, and in the meantime explore our Dealer Resource Hub for other useful articles.