RV dealerships and service centers need more than ever to focus on marketing parts and accessories to bolster their bottom lines during these tough economic times. That was the message transmitted to about 225 dealers attending NTP Distribution’s Annual Conference Feb. 17-20 in Texas at the Austin Convention Center.
In public and private comments, NTP executives made the point that with soft sales of new towable and motorized RVs, owners are likely to keep their units longer and, thus, to need more aftermarket parts and accessories.
“We are seeing dealers who are identifying parts and service as an independent component of their business,” NTP CEO Bob Morter told RVBusiness. “Those dealerships are experiencing growth and being very successful in that part of their business.”
In remarks to dealers during the opening-day dinner at the nearby Hilton Austin hotel, Mark Jenson, vice president of marketing and sales for the Wilsonville, Ore., distributor, acknowledged the nation’s and the industry’s difficult economic condition.
“We’ve seen some significant changes in our industry,” Jenson said. “All of us are being challenged to adapt our business to a downcycle deeper than anything our industry has experienced in almost 30 years.
“But with these challenges and opportunities, parts and accessories must be a primary focus for all dealerships along with your service department. While unit sales are challenged, existing RV owners continue to enjoy the lifestyle, and choose to accessorize and maintain their units, and resupply for their next outing.”
NTP Distribution provides parts and accessories to about 2,500 active customers – primarily RV dealerships, although the company has identified 22 different markets in which it participates, including campgrounds, recreation-associated businesses as well as general retailers. While President Greg Boyd, Morter and COO Steve Whitrock are the primary owners, 12 1/2% of NTP is owned by about 175 employees through an Employee Stock Ownership Plan (ESOP).
NTP Distribution maintains distribution centers in Wilsonville, Elkhart, Ind., Redlands, Calif. and the Dallas area. The company also operates Link Towing, a subsidiary serving the utility trailer market.
The three-day conference was scheduled for the second year in a row in Austin near NTP’s distribution center that opened in April 2008 in the Dallas suburb of Grand Prairie.
“We’ve penetrated this market very rapidly, and we’ve actually been very successful in the last few months penetrating the East Coast,” said Boyd. “So, we have a very high percentage this year of dealers who have never been to our conference before.”
Employee participation has long been a point of emphasis for NTP Distribution, a low-profile company that operates weekly and monthly company meetings aimed at reaching goals set at the beginning of the year, according to Boyd.
“About seven years ago we set the stage for an ESOP by establishing an open-book management culture in our company,” Boyd said. “All of our employees are financially literate and trained to deal with reading the financials and participating and understanding what their role is in the company. We have a very forward way of managing our business. That has allowed us to be very successful by involving all of our employees in the decision-making and behaviors of an owner.”
With regard to the company’s core aftermarket, Morter told RVBusiness that NTP anticipates 2009 will be a good year, and to meet expected demand, NTP recently has added about 50 parts to its inventory of more than 15,000 SKUs. “That goes back to the fact that more people are going to be maintaining and working on their vehicle rather than purchasing a new vehicle,” Morter said.
“In 2008, there was a lot of uncertainty, but this year dealers are positioning themselves to actually have a great year and take advantage of those consumers that otherwise would switch vehicles,” he added. “It’s all a matter of having a positive attitude and being ready in the parks and accessories department.
“Being positive is very important right now,” he continued, “because it’s easy to watch the news and get sucked into how terrible things are. The rest of the economy may be suffering, but an RV is a perfect way to get away from that suffering and experience the freedoms that we have in this country face to face rather than sitting around and wallowing in the misery that the news is producing every night.”
Morter said that although the RV industry is in the midst of a shakeout, it will be more dynamic when the economy recovers. “In some cases, we are losing friends (dealer clients) that we’ve had for 20 or 30 years,” Morter said. “Because of their location or because of a financial situation they’ve had to modify their business or they are no longer there. It’s been difficult going through, but the industry is still strong.”
Jenson told RVBusiness that NTP Distribution is preparing for the time when the recession is over.
“We’ve obviously seen a lot of changes in the last year,” Jenson said. “There was that opportunity to sit back and say that we are victims of the economy. But Bob (Morter) has said that we specifically have to choose not to participate in the recession. That’s the kind of attitude that we’ve taken. Our whole strategy this year has been to maintain market share and prepare ourselves for when this industry turns around.”
Reiterating a consistent theme that surfaced during NTP’s conference, Boyd stressed that during a distressed economy it is still important for dealers to practice inventory control.
“The thing that we have preached year-in and year-out is inventory management,” Boyd said. “A dealer needs a strong breadth of inventory but not necessarily too deep. There’s never been a better time than today to put that practice to work.”
Platinum awards presented during the conference included: Adventure RV Center, Sevierville, Tenn.; Allied Trailer Supplies, Sacramento, Calif.; Cousin Gary’s RV Service, Shasta Lake, Calif.; El Toro RV Service Center, Irvine, Calif.; Family RV Center II, New Port Richey, Fla.; Mobile Trailer Supply, Anchorage, Alaska; Pierce Homes and RV, Billings, Mont.; PPL Motorhomes, Houston, Texas; R&R Holiday RV, Liberty Lake, Wash.; Seventh Heaven RV and Marine Superstore, Napa, Idaho; and Village RV, Roseville, Calif.
Diamond award winners were: Brett’s RV and Marine, Missoula, Mont.; Capital RV Center, Bismark/Minot, N.D.; Durnell’s Indian Hollow RV, Lakeview, Ohio; and Holiday World of Houston, Houston, Texas.