The American Motorcycle Classics (AMC) Harley-Davidson dealer in Albany, OR., is going out of business at the end of the month. They’ve called it quits.
Years ago the business was run by John Lewis, Sr. He retired, moved to Las Vegas and sold the business to his son, John, Jr. The G.M. was Joe Saltarello. Was it the poor economy? Sure didn’t help. Were other H-D dealers complaining how Albany was cannibalizing their business which is only good for the consumer? Did they invest in the business? Depends on your definition of “invest.” Maybe John, Jr. was having problems making the payments to Sr., who may have held on to the real estate and now decided to liquidate the assets, cut his losses, sell the real estate and call it a day? Or, maybe they were FORCED out by the H-D motor company?
Hey, now that is an interesting question. Maybe it’s a combination of all of the above. Who knows? If you do know send me a note. I’m discreet.
Here is what we do know. Over the last two years H-D is trying to consolidate its dealerships one way or another. H-D may have just sent a letter of retirement to Albany/John Jr. In essence it withdraws approval for the H-D franchise. I called and spoke to the finance manager at AMC earlier in the month and he indicated that H-D was “forcing them out.” Similar to the Chevrolet and Chrysler dealership forced closings. Maybe it was sour grapes, but his statement went something like “HD was demanding they expand the store” and while they had committed a half-million $$ in infrastructure investment to H-D in what could be viewed as mini “Super Store” … they just didn’t have the sales revenue for such an investment, essentially being forced out by the manufacturer. It’s not clear if AMC was selling a reasonable volume of licensed products, but I think it’s unlikely given the location. The finance manager also stated they were doing about half the motorcycle sales volume they once garnered 4 years ago so clearly the economy has had a relevant impact.
Businesses fail all the time so what’s the point of this post?
Well, AMC H-D is well known in the northwest for being the cheapest H-D dealer in Oregon. If I had interest in a new motorcycle I would always call or drive down and get pricing whether it be a motorcycle or parts. That then became my new starting price to leverage any deal at a local dealer closer to the Portland metro area. I never did purchase a motorcycle there, but I have 4 buddies who all purchased motorcycles during the last 2-4 years from Albany. They obtained below MSRP on every purchase, including additional discounts on aftermarket parts and walked away saving $1000’s and big smiles!
And even though they saved all those $$’s… cheapest does not always work. You can’t always make it up on volume and it now seems that little was dropping to the bottom line to keep the doors open and make the payments. We’ve seen this behavior in other type businesses. A person will throw an “open sign” up in a strip mall and offer cheap prices — way below the current market — but in less than 24 months they disappear. It means they were not making enough money, and just screwed up the market for everyone else.
AMC H-D had a “No pancakes, No S*****t, no rock band, no bull” slogan which was essentially an anti-social slam toward other dealers who subscribe the post-sales mantra. But you know what? That doesn’t work for some folks. Yeah saving a few bucks is important (always!), but many of us are motorcycle enthusiasts and are looking for a dealer that will be in business (long-term), one that’s like a social “club” to hang out, talk shop, talk custom modifications and they are willing pay a little extra $$ to have that option. Personally I like the fact that Paradise personnel (Mike(2)) know who I am and will call me by name when I walk into the dealer. We’re not BFF’s, but I know, that they know, that I over paid a few hundred $$ for that privilege on my last motorcycle purchase, and for me it’s more than just a money transaction – its genuine relationship building – AFTER the sale.
Maybe this is what happened at Albany? They had “A Beautiful Mind” moment. Did you see the movie? In the movie Russell Crowe plays John Nash, a mathematician who won the Nobel Prize for developing the concept of non-cooperative game theory. In case you’re not familiar with the theory, it roughly means that to make the best decisions, you have to consider the actions of your competitors.
This may sound harsh, but in my view, the AMC H-D building was “lipstick on a pig.” Functional, but not a place you’d socialize or hang-out long. I’ve been there in the early morning and remember how they didn’t even have coffee for customers?! Call me Mr. shallow. From an outside-looking-in viewpoint, the company didn’t have much of a Facebook presence, didn’t do any blogging or customer outreach, the email system announcing sales totally sucked and defied any reasonable logic from a marketing viewpoint, and did I say the web site was dated? At the end of the day it just didn’t look like they were putting a lot into promoting the business or appealing to those who were looking for more of a social gathering atmosphere at their local dealer. Yeah they could “splain” that all off as low overhead giving YOU the customer the best price, but when every other dealer around you is struggling and willing to lower/match prices to compete and your shop has no amenities… you’ve cast your destiny
There are consequences other than it’s “Christmas in July” for Paradise H-D, Salem H-D and Team Latus! There is the loss of 10-19 people who are no longer gainfully employed – and I’m not trivializing this because the folks there are hard working people and deserve better – but, PowerSports Network (powered the website) loses a customer and AMC H-D also sponsored the Pioneer H.O.G .Chapter (newsletter PDF HERE). It was the first northwest chartered H.O.G. chapter (#4085), and it now has no home.
I’m sorry to see the dealership close and I’m sure for many of you it feels like losing an old friend. I’m just glad I don’t have any pre-paid expensive special parts on order!
Photo courtesy of American Motorcycle Classics.