Neil Pascale
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The 20 club difference: A vastly improved Q1 bottom line despite a drop in unit sales

West End Sports is part of a new 20 club Garage Composites has created with its partner Yamaha Canada

West End Sports owner Guy Hache finished his first quarter with two facts no owner wants to confront: his unit sales and transactions were down compared to the previous-year period.

In fact, unit sales at his New Brunswick dealership fell 17 percent.

Still Hache finished his first quarter with a 26 percent improvement in net profit vs. last year’s first quarter.

How did he do it?

Hache credits the net profit increase to his experiences working with Yamaha Canada’s dealer 20 club. The club is moderated and led by Garage Composites, the powersports industry’s leading provider of dealership training and 20 clubs.

“I’ll more than stand behind that statement,” Hache says of the impact the 20 club had on his net profit increase.

Hache sees the industry as filled with “overworked, underpaid” dealership owners that fail to spend enough time on improving their business rather than working in their business, acting exclusively as a customer-facing employee. Hache had to step away from the latter role at times last year to institute changes that led to the store’s net profit increase.

To identify the needed changes, Hache attends a Yamaha 20 club with close to a dozen of his noncompeting peers. At the meetings, he looks at and compares the retail results of his group members to his own. Through this process, he has identified and implemented a series of changes that led to the net profit increase, including:

* Making tremendous strides in his F&I per-unit-sales, which are tracked along with other, key department revenues and expenses in the 20 club reports;

* Increasing the management and tracking of unit sales leads, which impact the effectiveness of follow-up and will improve profit margins going forward;

* More closely monitoring margins in parts and accessories to have a better understanding of where revenue growth opportunities exist.

Before working with the Garage Composites’ 20 club, Hache wasn’t sure what was possible within the parts department or any other department. He knew what his dealership had done in the past but not what margin or percentage was attainable.

“We didn’t know where we should be,” he said. “When you surround yourself with your peers in a 20 club, then you can concentrate on understanding the numbers, fixing them and then maintaining them. That’s what we’ve been doing. Slowly, but surely.”