9½ Reasons Motorcycle Shops Are Closing That Have Nothing To Do With Sales

[adri]

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I know, I know, everyone is posting about motorcycle shops closing...

The boomer tubers blame the millennials for being too afraid to look up from their cell phones and get on a motorcycle.
The millennials blame the boomers for normalizing not paying people a living wage and driving up the cost of everything.

Both sides have valid points, but the only thing the two seem to be able to agree on, is if motorcycle shops are closing, it must be because sales and demand are down... right?

Be it ******* resolved that we in the industry know we are in a shrinking and cyclical industry, that we are not as stupid as people seem to think (clowns at KTM aside), that we are and have always been budgeting for decreasing sales, and that there are 9½ more important reasons motorcycle shops are closing, that have NOTHING to do with demand being down.

This isn't to downplay the impacts of having less sales, fewer customers with less disposable income, etc. That does hurt businesses. Good businesses, owned by, and creating employment for good people, doing good work. We need that.

This is to offer a response to all of the YouTube creators and forum discussers who seem to enjoy talking about what's happening in the motorcycle biz right now, without having ever worked a day in it. It's a reminder that any business owner, in any industry, would rather have $1 less overhead, than they would rather have $1 more income. It's also a little hint into where things are going, but that's a whole other essay.

 

[bigpoppa]

Didnt watch the video, but my 2c, in canada, or NA they maybe closing, but i have friends from other parts of the world, that dont know how to drive a car because their entire adult lives they rode motorcycles, its a thriving business everywhere, except in our little bubble of canada/northern united states.

 

[Glenn/RZ500]

I know, I know, everyone is posting about motorcycle shops closing...

The boomer tubers blame the millennials for being too afraid to look up from their cell phones and get on a motorcycle.
The millennials blame the boomers for normalizing not paying people a living wage and driving up the cost of everything.

Both sides have valid points, but the only thing the two seem to be able to agree on, is if motorcycle shops are closing, it must be because sales and demand are down... right?

Be it ******* resolved that we in the industry know we are in a shrinking and cyclical industry, that we are not as stupid as people seem to think (clowns at KTM aside), that we are and have always been budgeting for decreasing sales, and that there are 9½ more important reasons motorcycle shops are closing, that have NOTHING to do with demand being down.

This isn't to downplay the impacts of having less sales, fewer customers with less disposable income, etc. That does hurt businesses. Good businesses, owned by, and creating employment for good people, doing good work. We need that.

This is to offer a response to all of the YouTube creators and forum discussers who seem to enjoy talking about what's happening in the motorcycle biz right now, without having ever worked a day in it. It's a reminder that any business owner, in any industry, would rather have $1 less overhead, than they would rather have $1 more income. It's also a little hint into where things are going, but that's a whole other essay.

Lots of pieces in the puzzle for sure. After watching that it`s just like everything else, it`s always about the money from every angle you look at it.

 

[250R-ICE]

Interesing info. But one point you made with regards to shops having difficulties finding a place to open a business. I agree this may apply to the main city areas. But as soon as you go out of the Toronto boundaries for example. There is plenty of designated industrial land. Look at GP Bikes for example. They grew from a small strip mall operation to a major multi platform dealership, that provides service, apparel etc.
I think a lot of these smaller independent dealers just refuse to change with the times. They are stuck in operating the same way they did years ago.
Also the whole online shopping has most likely affected dealers that have lower selection of accessories, apparel, parts, supplies. Etc. I wouldn't be surprised if there is more money on that side of the business vs the actual sale of new bikes.

 

[Glenn/RZ500]

Didnt watch the video, but my 2c, in canada, or NA they maybe closing, but i have friends from other parts of the world, that dont know how to drive a car because their entire adult lives they rode motorcycles, its a thriving business everywhere, except in our little bubble of canada/northern united states.

That sure sounds like the decline we are witnessing with everything in disarray and decay. Everything must pass, I suppose.

 

[Glenn/RZ500]

Interesing info. But one point you made with regards to shops having difficulties finding a place to open a business. I agree this may apply to the main city areas. But as soon as you go out of the Toronto boundaries for example. There is plenty of designated industrial land. Look at GP Bikes for example. They grew from a small strip mall operation to a major multi platform dealership, that provides service, apparel etc.
I think a lot of these smaller independent dealers just refuse to change with the times. They are stuck in operating the same way they did years ago.
Also the whole online shopping has most likely affected dealers that have lower selection of accessories, apparel, parts, supplies. Etc. I wouldn't be surprised if there is more money on that side of the business vs the actual sale of new bikes.

I worked with a guy who must have had, seriously, over 100 Harley T shirts from dealers all over N. America. And he had never owned a motorcycle or even ridden one.

 

[sburns]

Didn't watch either, it's due to short riding season, high insurance, high cost of living, and out of wack real estate and taxes.

All of this gives way to the rise of electric scooters. Inexpensive to own and operate.

 

[Bobo]

It use to be that when someone bought a bike they would be back every couple of weeks to buy gear, accessories, tires etc. Now everyone buys the bike and gets everything else on line. Dealerships have lost a huge portion of that business. Rising insurance costs have also contributed to dealerships closing down. The more someone spends on insurance the less they will have to spend on a bike and accessories or maybe decide to not buy a bike at all. In the late 80’s yearly motorcycle sales plummeted from an all time high of about 123,000 units to about 26,000 units. High insurance costs were to blame. It’s a coincidence that this thread came up, two days ago I had to stop by Scarborough Subaru on Eglinton to pick something up. That building use to be a very successful motorcycle dealership called Sonic Motorcycles, owned by the Sharpless family. I bought my first new motorcycle there 45 years ago, a beautiful 1980 Suzuki GS750. Walking into that building brought back a lot of memories, I hadn’t been in it since about 1983.

 

[Bobo]

Interesing info. But one point you made with regards to shops having difficulties finding a place to open a business. I agree this may apply to the main city areas. But as soon as you go out of the Toronto boundaries for example. There is plenty of designated industrial land. Look at GP Bikes for example. They grew from a small strip mall operation to a major multi platform dealership, that provides service, apparel etc.
I think a lot of these smaller independent dealers just refuse to change with the times. They are stuck in operating the same way they did years ago.
Also the whole online shopping has most likely affected dealers that have lower selection of accessories, apparel, parts, supplies. Etc. I wouldn't be surprised if there is more money on that side of the business vs the actual sale of new bikes.

I use to go to GP Bikes when they were just a small shop on Harwood Ave. in Ajax. I dealt with Jerry, the owner many times. Real nice straight up guy that knew how to treat his customers. Good to see that he’s become so successful.

 

[Glenn/RZ500]

It use to be that when someone bought a bike they would be back every couple of weeks to buy gear, accessories, tires etc. Now everyone buys the bike and gets everything else on line. Dealerships have lost a huge portion of that business. Rising insurance costs have also contributed to dealerships closing down. The more someone spends on insurance the less they will have to spend on a bike and accessories or maybe decide to not buy a bike at all. In the late 80’s yearly motorcycle sales plummeted from an all time high of about 123,000 units to about 26,000 units. High insurance costs were to blame. It’s a coincidence that this thread came up, two days ago I had to stop by Scarborough Subaru on Eglinton to pick something up. That building use to be a very successful motorcycle dealership called Sonic Motorcycles, owned by the Sharpless family. I bought my first new motorcycle there 45 years ago, a beautiful 1980 Suzuki GS750. Walking into that building brought back a lot of memories, I hadn’t been in it since about 1983.

I was around there a lot about the time you bought your 750, I got parts there for my `78 GS1000. Earlier this week I was in Lindsay Cycle speaking with the parts guy Gary. He worked at Sonic too, knows the biz inside out. The kinda` guy the video mentions, not a lot left in the business.

 

[Bobo]

I was around there a lot about the time you bought your 750, I got parts there for my `78 GS1000. Earlier this week I was in Lindsay Cycle speaking with the parts guy Gary. He worked at Sonic too, knows the biz inside out. The kinda` guy the video mentions, not a lot left in the business.

Where exactly did you live? I was just off Mcowan Rd. near Kingston Rd.

 

[Glenn/RZ500]

Where exactly did you live? I was just off Mcowan Rd. near Kingston Rd.

Back then I lived around Don Mills/401. Did you ever deal with Pitshop Cycle? They were a small Suzuki/Ducati shop on the N side of Kingston Rd. east of Morningside? I recall.. that`s long ago. They were family run too, man so many memories. I`ve always kept moving north and east, well out of the chaos of the GTA, now in Kawartha Lakes, likely where I make my final stand.

 

[Bobo]

Back then I lived around Don Mills/401. Did you ever deal with Pitshop Cycle? They were a small Suzuki/Ducati shop on the N side of Kingston Rd. east of Morningside? I recall.. that`s long ago. They were family run too, man so many memories. I`ve always kept moving north and east, well out of the chaos of the GTA, now in Kawartha Lakes, likely where I make my final stand.

Yes, I remember the PitShop, an old cranky Czech guy and his wife ran it. I’ll tell you a funny story about that guy A little later.

 

[Bobo]

Yes, I remember the PitShop, an old cranky Czech guy and his wife ran it. I’ll tell you a funny story about that guy A little later.

So back in the early 90’s Cycle Canada Magazine sent a guy over to Europe to cover a few races. He’s walking through a parking lot at a race in the Czech Republic when he sees a car with an Ontario licence plate and thinks that’s odd. He walks over and starts talking to the driver, turns out that he’s the guy that use to own The Pitshop. He said that he had sold it or shut it down and moved back to the Czech Republic. The Cycle Canada reporter asks him what’s up with the Ontario plate. The guy says he had his car shipped over 2 years ago and that the government was so dumb/incompetent that he didn’t bother changing the plate and no one had ever questioned him about it.

 

[Dirty Frank]

There are other barriers like the difficulty of securing business insurance for a independent motorcycle shop without a brand franchise.
Near impossible in Ontario FWIW.

 

[MCT]

This isn't to downplay the impacts of having less sales, fewer customers with less disposable income, etc. That does hurt businesses. Good businesses, owned by, and creating employment for good people, doing good work. We need that.

In my case it has nothing to do with less disposable income, but the fact that I want the job done right the first time and since I have the skills, that is not an issue doing everything myself, be it vehicle maintenance and repair, construction, HVAC, electrical, plumbing, concrete pouring...and the list goes on. There is nothing I hate more than seeing a shoddy job done that I paid top dollar for....not going to happen.

 

[Jampy00]

For many businesses at times the operational costs can take too large of a chunk out of the bottom line. Toss in all the other factors and its easy to see what many places shut down.

 

[Klaatu]

In my case it has nothing to do with less disposable income, but the fact that I want the job done right the first time and since I have the skills, that is not an issue doing everything myself, be it vehicle maintenance and repair, construction, HVAC, electrical, plumbing, concrete pouring...and the list goes on. There is nothing I hate more than seeing a shoddy job done that I paid top dollar for....not going to happen.

I guess being a motorcycle mechanic does not pay enough? In the Durham area, if you want anything done. be prepared to wait a couple weeks at least. A number of shops have closed here in the last few years. If you need your bike worked on, be prepared to wait.

 

[xrljoel]

Changing consumer tastes, increased cost and complexity of MC's, difficulty finding sales staff and shortage of licensed MC mechanics, and high operating costs in relation to potential profit makes it tough for any business. Add to that the demands by some brands to create a specific look or feel in the dealership, as well as demands to purchase specific types and levels of inventory.

I talked to a former KTM dealer who told me he dropped the brand(s) as he was expected to take a handful of the 400cc Husqvarna street bikes, the Vitpilen/Svartpilen. He resented having to tie up equity and sales space for a model that didn't fit with his dealership so he dropped them. Service and accessory sales were his more profitable segments anyway and sustained the dealer until he took on some other brands.

For long-time dealers that actually own their property, there's also the matter that the value of the property has increased so much that perhaps the value of the land has exceeded the value of the business. Often, cashing out and closing the business makes the most sense.

 

[crankcall]

Staff costs are way up , running a shop where your employes would like basic dental /medical coverage , and workmans comp all adds up , then add rent, business insurance which is costed out based on risk (motorcycle) and everything else related to running the business and it becomes a very low return proposition. If you get a good tech on staff , if you dont pay them quite well and they are remotely presentable they will take a municipal job servicing lawn equipment for the city, with a pension.
Many of these industries are really struggling , motorcycle, marine, RV techs , simply because if you have any talent there are better jobs all over. The old addage , how do you end up with a million in the motorcycle trade? well you start with two million and work back certainly rings true.

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