The decisions by five high-profile dealers to become regional presidents of Holiday Holdings LLC were crucial to Holiday Holdings’ acquisitions of their businesses, according to Marcus Lemonis, president of Holiday Holdings.
The dealers who sold their businesses, but not the associated real estate, and who now are Holiday Holdings regional presidents are: Craig Jensen; Al Binford; Kent Lester; Randy Thompson and Mike Stier.
The real business of Holiday Holdings will be conducted from the offices of the regional presidents, not from Holiday Holdings’ corporate office in Lincolnshire, Ill., north of Chicago, Lemonis said. The regional presidents have “complete, 100% autonomy over the day-to-day operation of their businesses.
“They have autonomy over what they sell, how much of it they stock, what they sell it for, who services it, how many techs they have, what their health insurance benefits are, what their pay plans are, who they bank with, who they floorplan with, who their health insurance is with – the way the business was running when we bought it,” Lemonis said.
Because the regional presidents continue to own the real estate where their stores are located, they now are getting lease payments from Holiday Holdings, Lemonis added. The amount Holiday Holdings paid for each business was based on each dealership’s earnings plus a premium based on the markets in which each is located, the store’s tenure in business and the individuals who will continue running those operations.
“We were adamant about buying dealerships and businesses that were the most respected in the business,” he said. “Even if we had to pay a premium that was outside our comfort level, the credibility and viability of this business is going to be founded on the first wave of dealers who make up what the company looks likes.
“Our company (Holiday Holdings) was not formed to provide exit strategies, to cash people out so they could go home,” Lemonis continued. “It was to build partnerships and a consortium of great dealers to streamline, improve and stabilize processes.”
The goal of Holiday Holdings, moreover, is not to create an organization to replace the national Recreational Vehicle Dealers Association (RVDA) or the 87-member Recreational Vehicle Dealer Exchange (REDEX) buying group, said Lemonis, who was a regional president for multi-location car dealership company AutoNation before entering the RV industry.
Nor is the mission of Holiday Holdings, which functions much like a 20 Group, to reach a specific revenue target. “We are not going to buy revenue streams just to buy the revenue base,” he said. “We’re buying the management teams or potential management teams who can come aboard and buy into our philosophy.
“The industry is not prepared nor are we prepared to put all those businesses together in order to exert pressure on the manufacturers,” Lemonis said.
Furthermore, the alliance of dealers under the Holiday Holdings nameplate has no plans to enter into private-label agreements with any RV manufacturer, to manufacture products themselves or to embark upon a national branding strategy – although the consortium’s locations might eventually have co-branded names such as “Emerald Coast RV, a Holiday Holdings company.”