Issue link: https://read.dmtmag.com/i/499779
32 • May 4, 2015 • Powersports Business www.PowersportsBusiness.com It's beginning to happen in the smallest, most rural pockets of our industry, and it's won- derfully good news. I'm referring to a change that Internet- based business sys- tems are bringing to retail opera- tions, including our dealerships. I've seen it first-hand just in the past few weeks. What's terrific about this change is it impacts a challenging area for our industry — the effectiveness of our smallest dealerships. Many refer to these shops as "mom-and-pops," family-run operations with just a handful of staff. These shops provide critical customer service in the smallest rural areas but often do so with sub-par business systems and extremely limited bottom lines. The latter is difficult to fix when you simply don't have a system or platform that outlines your current business predicament. In the past, such a system would have cost thousands upon thousands of dollars to set up, something most small shops just could not afford. It's why a market share report on dealer management systems in the powers- ports industry was practically unheard of a few years ago. So many dealers just did not have a management platform. The big change is thanks to the Internet, which is being used to store, transmit and update business data without the need of an expensive server in the dealership. These so- called "cloud-based" systems are revolution- ary. They let the smallest shops afford the most current business management technology. Very recently, I visited a business that made this change, and I want to pass along their story to those of you who may not realize the beneficial impact this will have on small retail operations and our industry as a whole. Three generations later…. Deerwood, Minn. — For more than 70 years, a Hansen has owned and operated a business on the shores of Bay Lake in cen- tral Minnesota. Even the route of the state highway snaking around this business has changed more than the name hanging on a pair of metal poles. Hansen Sports is now in its third genera- tion under owner Dean, whose grandfather Art first bought a collection of lakeside build- ings in 1944. Today, the business has a Polaris snowmobile franchise, an Evinrude outboard motor franchise, a rental boat business and a convenience store to support a highly migra- tory population. Fewer than 600 people call Deerwood home year-round, accord- ing to a 2010 census, but the mean- dering Bay Lake with its 19 miles of shoreline draws visitors from across the state and region. Hansen Sports undertook one of its largest business changes in its 70-year history late last year when it purchased a deal- ership management platform. Previously, all of Hansen's accounting and business manage- ment was completed with pen and paper. If a customer came in with a question about a past service repair, Dean, his girlfriend Nancy or his sister Lynn would have to rifle through dozens of paper invoices to find that specific customer record. Today, using the dealership manage- ment platform DX1, the Hansens can call up that invoice on a computer within seconds. More importantly, the dealer management platform provides them with an instant analy- sis of their business. "I knew we needed more accountability," Dean said. "We didn't know what was losing money and what was making money." The Hansens certainly had an idea of what was profitable. Now, the dealership manage- ment platform has shown them where they were making a smaller profit margin than they expected or, in some cases, actually los- ing money. Take working with local business partners, for example. Dean will provide parts at wholesale prices to local business operators with whom he trades work. What he didn't realize — until he started using the dealer management platform — was that in some cases he was discounting the parts too much. He was actually losing money at times, a fact that became evident when he used the dealer management platform to immediately identify what he paid for a part. "They're really easy to look at," Dean said of the business reports he now views in the digital platform, "and I'm not a numbers guy." In fact, Dean feels more comfortable in the service department. That led him to look seriously at adopting a dealer management platform vs. the traditional pen-and-paper accounting style. A number of years ago, Dean started using an electronic parts lookup system. This allowed him to identify parts but more importantly identify where the parts he received were located in his shop. When Dean Smallest dealers encountering big changes THE DEALERSHIP OF TOMORROW It's beginning to happen in the smallest, most rural pockets of our industry, and it's won- derfully good news. I'm referring to a change that Internet- Smallest dealers encountering big changes NEIL PASCALE Dean Hansen, his girlfriend Nancy, his sister Lynn and mother Ruth are shown at Hansen Sports on Bay Lake in central Minnesota. The Hansens have taken advantage of the Internet to improve their business management plat- form and bring more accountability to their retail operation. See Pascale, Page 47 SOLUTIONS