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The 50-member Recreational Vehicle Dealers Exchange Co. (REDEX), which bills itself in advertisements as the industry’s “most exclusive dealer network,” intends to get a little more inclusive during the next year.
“We have been careful to control the size,” said REDEX founder and President Paul Skogebo, president of Robert Crist & Company RV, Mesa, Ariz. “We have matured. Now, we’d like to grow the group by 50% from where it is in the next year. We don’t think that will be very difficult at all, based on the interest we’ve had.”
REDEX, he adds, also intends to associate its name with a growing number of branded services and products.
“We are going to give dealers a lot of the proprietary opportunities that they are looking for,” Skogebo said. “And at the same time, we are going to bring the might of the group to a new level.”
REDEX, whose members must have $15 million in retail RV sales to join the buying group, was founded in 1997 and is managed by Wheeler Advertising Inc., Arlington, Texas. REDEX 50 members – with 89 locations – are given an exclusive territory within a 100-mile radius, and receive discounts on services such as floor and retail financing, parts, insurance and training.
REDEX General Manager Ron Wheeler reports that in 2005 REDEX saved dealers “in excess of $4 million” in rebates and incentives. “We had a record year for rebates,” Wheeler said.
While the buying group reported record savings for its members, eight dealers dropped out of the group. “We added some more – 11 or 12,” Skogebo said. “But we only had a net gain of three or four. We made a lot of progress in 2005, particularly since marketing conditions were changing with the hurricanes and higher gas prices.”
Skogebo said, in turn, that a national reciprocal service program among REDEX dealers “has been very successful.” Consumer purchasing RVs from REDEX dealers receive cards identifying them as REDEX customers. “They get priority service,” Skogebo said. “Rather than being told they have to wait two months, within reason they will go to the head of the line.”
Skogebo also reported that REDEX intends to continue to pursue marketing a private label towable despite last year’s bankruptcy of the company REDEX initially chose to manufacture a mid- to high-line fifth-wheel, Potomac RV LLC, Elkhart, Ind.
“Fortunately, no dollars were invested,” Skogebo said. “We were still in the screening stage when they went bankrupt.”
After Potomac’s shutdown, Skogebo said, REDEX put the plan on hold while U.S. towable manufacturers dealt with general demand from private sources and orders from the Federal Emergency Management Agency (FEMA) following Hurricane Katrina.
Skogebo said he expects REDEX to designate another manufacturer sometime late this year or early next year. “The manufacturers are going to be able to be more accommodating because the FEMA orders are pretty much wrapped up,” he said.
REDEX branding won’t be restricted to RVs but will extend to services as well. Last August REDEX replaced a third-party extended warranty plan with one bearing the REDEX brand name for member-dealers only.
“The difference is that in each dealer’s case, it’s his own insurance company that is offering the warranty,” Skogebo said.