Considering the ongoing drumbeat of positive industry news — with record-breaking shipments and gate-busting retail show crowds from coast to coast — the annual RVB/Wells Fargo Dealer Survey seemed to confirm the premise that these are the best of times for the North American RV industry.
Looking back at last year, 94.7% of the 77 responding dealers indicated that they were profitable in 2016, with 13.5% posting growth in excess of 20%, 18.9% gaining 15% to 20%, 21.6% picking up 10% to 15%, 21.6% expanding 5% to 10% and 24.30% growing less than 5%.
Looking ahead at their prospects for the rest of 2017, fully 84% of the polled dealers anticipate continued growth this calendar year when combining the 56% expecting a “somewhat better” year with the 28% who think they’ll experience a “much better” year in 2017.
“These, at the end of the day, are stunning indicators as the industry continues to operate at a pace that most of us have never seen before,” stated Sherm Goldenberg, publisher of RVBusiness magazine, which partnered with Wells Fargo on the annual RV retailer survey. “They tend to parallel the latest Recreation Vehicle Industry Association (RVIA) shipment reports as well as the impressive financial performances of the industry’s larger public companies.
“Although everyone is well aware of the obstacles the industry faces with potential cyclicality, a tight labor pool and the ever-present need to improve product quality and service at the manufacturer, supplier and dealer levels,” he added, “the fact of the matter is that a clear majority of the industry’s companies are still doing well and are excited about their prospects for the foreseeable future.”
Consistent with national shipment reports, the survey confirms that travel trailers outsold all other RV types by a long shot in 2016. As a matter of fact, fully 90% of the respondents (who could check off more than one category) benefited most from the sales of relatively affordable towables followed by fifth-wheels (41.1%) and Class C motorhomes (28.8%).
Looking at the responses, however, affordability wasn’t the only impetus behind those precedent-setting travel trailer sales numbers as 64.9% of the surveyed dealers said “mid-range” products generated the most revenues for them last year while 32.4% catered to “ultra-affordable” product buyers and only 2.7% favored “high-end” product offerings.
Among the other survey results:
- While the most substantial 2016 growth for most dealers was in new RV sales followed by F&I, service and used unit sales, dealers — able to choose more than one category – are continuing in 2017 to look toward new unit sales as their best revenue generators (77.6%) followed by service (56.6%) and F&I (48.7%).
- Internet sales contributed “significantly” in 2016 to the revenues of 56% of the dealers surveyed, while 36% said the World Wide Web played “not much” of a sales role for them and another 8% felt the Internet contributed “not at all” to their annual revenues.
- Mirroring national trends, a solid majority of 87.8% of the retailers surveyed are seeing an appreciable number of first-time buyers in the marketplace right now.
- Nearly a fifth of the respondents (18.40%) plan to add locations in 2017, either organically or by acquisition, while another fifth (19.7%) said “maybe” they would buy or build new facilities and another 61.8% have no such plans.
- The availability of financing, both retail and wholesale, is “better” in 2017 versus a year or two ago in the opinions of 30.7% of the respondents. At the same time, 61.3% feel it’s pretty much the same and only 8% see less available financing.
- Nearly half (48.7%) of the surveyed dealers favor combining the RV arena’s two key trade shows, RVIA’s Louisville Show and RVDA’s Con/Expo, for the sake of expediency. A total of 26.3% aren’t sure and 25% don’t like or care about the idea.
- Asked to rate the industry’s performance on service and parts on a one to five scale, a five being the best possible rating, 42.1% issued a 3 grade, 26.3% a 2, 22.4% a 1, 9.2% a 4 and none of the survey subjects gave the RV industry a 5.
- A resounding 92% of those completing the survey, by the same token, said they would initially support measures now under consideration by the RV arena’s chief trade associations and key corporations streamlining parts availability systems across the board.
Reflecting recent public debate around the industry, surveyed dealers feel the chief challenge facing their stores and the industry right now is “product quality at all levels.” That was the top pick by a majority (73.7%) of the respondents, who were again free to select more than one challenging factor. Second (60.5%) was “the labor pool,” third (39.5%) was “keeping up with demand,” fourth (34.2%) was a concern about “potential interest rate hikes” and fifth (30.3%) was “increased consolidation.”