American Motorcycle Dealer AMD 224 March 2018 - Page 18

funded and shaping its forward business plan. It is doing so in advance of emergence from the legal process this spring - expected in early April - at which point the new owners (Blue Mountain Capital Management, Monomoy Capital Partners and Contrarian Capital Management) will have acquired 100 percent ownership. Meanwhile, Biker’s Choice management and their sales team are doing an excellent job of producing an environment in which that third and most difficult of expo intangibles can play out - “community”, as Kenan Ikels termed it succinctly. In an era that appears likely to be characterized by the absence of independent trade shows (as far as the spring buying and selling season is concerned), the danger is that the biggest loss, especially with the demise of the V-Twin Expo at Cincinnati, was likely to be the opportunity for relationships and friendships to be forged, reinforced and renewed – simple good old fashioned face-to-face contact making. ‘most difficult of expo intangibles’ However, while Tucker Rocky and Biker’s Choice, their sales teams and the dealers who visited, quite rightly kept their “eye on the prize” in Texas as far as the buy and sell of the show was concerned, the company managed to create an ambiance in which the offbalance sheet values of trade shows was able to prosper. Kudos to all for being able to achieve that at this most difficult of times. We met with Tucker Rocky President Eric Cagle and VP Sales & Marketing Kenan Ikels, and rather than talking too much about the recent past, we focused on the present and the future. That said, Cagle is of the view that the company has emerged stronger from the process, and better placed to continue the progress that the all new management team has been making in the prior 18 months. “From an operations perspective, much has already been done,” explained Cagle. “We haven’t lost a single person as a direct result of the filing - our staff attrition rate has remained the same before and after. “Neither have we lost any customers. Sure, there have had to be some conversations in which we have sought to reassure customers, but our Kenan Ikels, VP Sales & Marketing: “We trialed a new Team Sales plan last year, we have been able to refine the concept, and implement it nationally” transparency has made sure that everyone, customers, staff and vendors, understood that the biggest long-term impact is the shedding of some $350m of term debt, resulting in debt service payments reduced by $20 m or twothirds - giving us the financial resources to continue with planned operational improvements and a 700% improvement in our capital maintenance budget. “It is all about continuing to provide our vendors and our customers with ever improving service levels right across the board. We understand that competition is vital and we are focused and determined on being the best competitor and business partner in the powersports market. “Essentially this is a simple business. We are an intermediary. We bring skill sets and scale that vendors and dealers can’t achieve without an effective logistics partner. We work with our vendors, and dealers to support their businesses and help them grow. That is our job, and that is what we are 100 Eric Cagle, Tucker Rocky President percent focused on. “Moving forward our job is to do that even better, and what the market has seen from us in the past 18 months is a series of tactical moves to provide the platform for continuous improvement. We have staffed key positions, many of which hadn’t previously existed and there will be more appointments in the future, but the biggest thing has been to address the service levels we provide for our partners - vendors and dealers. “We have made huge improvements in our inventory management for example. We are becoming more disciplined and we are certainly managing inventory smarter. The ‘Facing Fill’ that we have been providing our dealers, that’s the service level from their local Distribution Center (DC), improved by 7 percent last year to a level that is significantly above anything that Tucker Rocky had operated at previously. “The filing in November created a ‘blip’ in that progress, but we are already very nearly back to that level now and for 2018 we will implement further improvements that will generate an additional 2 to 3 percent improvement. Additionally, our order to delivery timeframe has improved by 10 percent and 99.5 percent of our orders are leaving our warehouses same day. Cagle says he sees nothing on the horizon that suggests the five DC network will change. He describes their locations as providing as near to optimum domestic U.S. logistics as is possible according to all the “center of gravity” studies they’ve seen, with the head office DC at Fort Worth, Texas, and others at Bolingbrooke, Illinois (near Chicago), Olyphant, eastern Pennsylvania, Jacksonville, Florida, and Visalia in central California. As to the inventory in DCs, “we are managing better and smarter through “better forecasting and Purchase Order management. “We will spend more time and attention to detail on our vendor relationships and vendor performance management. Historically we have not done as good a job on that as we should and could be doing. We started in 2017 ‘7 percent improvement in Facing Fill’ by giving a selected group of our vendors a better forecast of demand. We now plan to roll that out to as many of our vendors as possible through 2018. The beneficial impact of that may not be evident until into 2019, but it certainly will have a positive impact.” Kenan Ikels went on to explain the changes that have taken place in their sales organization. Previously either inside or outside sales would “own” an account, and if it was dealt with by inside sales, then that dealer would rarely be visited by an outside sales representative. Conversely, the outside sales force was restricted in terms of the back-up, support and resources they were able to call up on to better serve their customer.” Ikels said that: “We tried a new Team Sales model last year, with 10 selected markets, and learned from that, finding out what worked and what was needed. We have been able to refine the concept, so we have been able to implement it nationally. “Now, the outside sales representative is the primary but not sole dealer-facing resource our customers have to support their business with us. “The outside sales representative can now call on an array of support, from 18 AMERICAN MOTORCYCLE DEALER - MARCH 2018 www.AMDchampionship.com funded and shaping its forward business plan. It is doing so in advance of emergence from the legal process this spring - expected in early April - at which point the new owners (Blue Mountain Capital Management, Monomoy Capital Partners and Contrarian Capital Management) will have acquired 100 percent ownership. Meanwhile, Biker’s Choice management and their sales team are doing an excellent job of producing an environment in which that third and most difficult of expo intangibles can play out - “community”, as Kenan Ikels termed it succinctly. In an era that appears likely to be characterized by the absence of independent trade shows (as far as the spring buying and selling season is concerned), the danger is that the biggest loss, especially with the demise of the V-Twin Expo at Cincinnati, was likely to be the opportunity for relationships and friendships to be forged, reinforced and renewed – simple good old fashioned face-to-face contact making. ‘most difficult of expo intangibles’ However, while Tucker Rocky and Biker’s Choice, their sales teams and the dealers who visited, quite rightly kept their “eye on the prize” in Texas as far as the buy and sell of the show was concerned, the company managed to create an ambiance in which the off- balance sheet values of trade shows was able to prosper. Kudos to all for being able to achieve that at this most difficult of times. We met with Tucker Rocky President Eric Cagle and VP Sales & Marketing Kenan Ikels, and rather than talking too much about the recent past, we focused on the present and the future. That said, Cagle is of the view that the company has emerged stronger from the process, and better placed to continue the progress that the all new management team has been making in the prior 18 months. “From an operations perspective, much has already been done,” explained Cagle. “We haven’t lost a single person as a direct result of the filing - our staff attrition rate has remained the same before and after. “Neither have we lost any customers. Sure, there have had to be some conversations in which we have sought to reassure customers, but our 18 Kenan Ikels, VP Sales & Marketing: “We trialed a new Team Sales plan last year, we have been able to refine the concept, and implement it nationally” transparency has made sure that everyone, customers, staff and vendors, understood that the biggest long-term impact is the shedding of some $350m of term debt, resulting in debt service payments reduced by $20 m or two- thirds - giving us the financial resources to continue with planned operational improvements and a 700% improvement in our capital maintenance budget. “It is all about continuing to provide our vendors and our customers with ever improving service levels right across the board. We understand that competition is vital and we are focused and determined on being the best competitor and business partner in the powersports market. “Essentially this is a simple business. We are an intermediary. We bring skill sets and scale that vendors and dealers can’t achieve without an effective logistics partner. We work with our vendors, and dealers to support their businesses and help them grow. That is our job, and that is what we are 100 AMERICAN MOTORCYCLE DEALER - MARCH 2018 percent focused on. “Moving forward our job is to do that even better, and what the market has seen from us in the past 18 months is a series of tactical moves to provide the platform for continuous improvement. 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