In nearly 20 years of business, Holiday World RV Supercenters has gone from two small dealerships to five Texas locations in three key markets including Dallas, El Paso and Houston, anchored by its flagship store, Holiday World of Houston-West, in Katy.
Holiday RV Supercenters President Michael Peay reported to RVBUSINESS.com that a sixth store is planned on a 15-acre lot about 25 miles south of Fort Worth in Alvarado, Texas, which should open later this year.
According to Peay, each expansion was for reasons of necessity and opportunity. The two original Houston locations, at about two acres each, were simply too small and operations were relocated to the two current facilities on much larger properties. In 2002, Peay purchased Sunland RV in Las Cruces from Marcus Lemonis, chairman and CEO of Camping World and Good Sam Enterprises LLC.
In 2010, another opportunity surfaced when an RV manufacturer approached Peay and asked if he would consider acquiring a dealership in Mesquite that fell victim to the Great Recession. Finally, to shore up the northern part of the 6.3 million-population Houston market, Peay opened a location in Willis late last year.
Each time, Peay said expansion came about only after three questions were answered satisfactorily: Is there sufficient market potential? Are quality product lines available? And, are enough skilled people available to staff the new location?
Peay added that Holiday World would consider further expansion but only if the same three criteria are met and, if it were to be the acquisition of an existing dealership, the business would need to have at least $10 million in annual sales.
“In a very strong market, you can have good people and a good location and just okay product and you can survive,” he reasoned. “But when things turn down, if you don’t have great product that core RVers keep coming back for, you’re not going to do well. That’s where a lot of people suffered during the downturn – they didn’t have great product.”
A benefit of having multiple locations, Peay said, is all five stores carry essentially the same product, which includes a lengthy list of towable and motorized RVs from several dozen manufacturers. Peay said this provides improved buying power and a “depth of inventory.”
“There are very few products we only have at one store,” he said. “So, if one product or one floorplan is really hot and the factory can’t get one to you, we might have one at another location. So we can justify stocking deeper, but they’re spread out over different markets and we can transfer from other markets to the store that’s selling it.”
Holiday World, which currently has 225 employees and 80 service bays, is a member of the Priority RV Network, a co-op association of 74 dealerships with105 locations nationwide. Members enjoy exclusive products such as retail financing, parts and accessories, finance and insurance and other services that give them a competitive advantage, Peay said, who serves as president for the network.
That advantage comes into play daily especially since the dealership has several nearby competitors, including Camping World of Houston less than a mile from Holiday World’s location in Katy.
“As most dealerships are today, they manage their business very well. They’re a formidable competitor in most markets and you never underestimate your competition,” he said.